Supreme Court Sets Aside Rs 5 Lakh Compensation Order Against Maharashtra FDA in Pune’s Gurunanak Dairy Case

The Supreme Court has set aside the Bombay High Court’s ₹5 lakh compensation order against Maharashtra FDA in the Gurunanak Dairy and Sweets case in Pune.

Pune: The Supreme Court has set aside the Bombay High Court’s direction requiring the Maharashtra Food and Drug Administration (FDA) to pay ₹5 lakh in compensation to Pune-based Gurunanak Dairy and Sweets.

The apex court’s order, passed on October 5, came after the Maharashtra government challenged the High Court’s compensation direction in the case involving the suspension of the dairy and sweets outlet’s food licence.

Case began after food poisoning complaint

The matter dates back to June 12, 2026, when FDA officials inspected Gurunanak Dairy and Sweets following a complaint related to food poisoning.

During the inspection, officials reported deficiencies concerning sanitation, record maintenance, food labelling and the personal hygiene of employees. The FDA also collected a sample of malai peda for laboratory analysis, which was subsequently declared unsafe, according to the state’s submissions before the Supreme Court.

Based on the inspection findings and the unsafe food sample, the FDA suspended the establishment’s food licence under the Food Safety and Standards Act, 2006.

Business challenged licence suspension

The establishment challenged the suspension before the FDA Commissioner on June 15.

It subsequently submitted a comprehensive compliance report on July 9, following which FDA officials conducted a re-inspection on July 13.

The re-inspection recorded 35 out of 36 marks, translating into 98% compliance with the assessed requirements.

Despite the improved compliance report, the dispute continued and eventually reached the Bombay High Court.

Bombay High Court ordered ₹5 lakh compensation

On August 17, the Bombay High Court revoked the suspension of the establishment’s food licence and permitted Gurunanak Dairy and Sweets to resume its retail business.

The High Court also directed the FDA to deposit ₹5 lakh as compensation, citing the financial loss suffered by the business during the period of closure.

According to the High Court proceedings, the establishment claimed that it earned around ₹25,000 per day and had remained closed for approximately 35 days, resulting in substantial revenue loss.

Maharashtra government challenged compensation order

The Maharashtra government subsequently approached the Supreme Court against the compensation direction.

The state argued that the FDA had acted in response to a food-poisoning complaint and had identified deficiencies during its inspection. It also maintained that the unsafe malai peda sample justified the suspension of the food licence in the interest of public health.

The government further argued that the FDA had acted promptly, including conducting the re-inspection within four days of receiving the establishment’s compliance report.

It contended that the statutory appeal filed by the establishment was pending before the FDA Commissioner and that there was no deliberate delay, arbitrariness or mala fide action on the part of the authorities.

Supreme Court quashes ₹5 lakh direction

After considering the submissions, the Supreme Court set aside the Bombay High Court’s direction requiring the Maharashtra FDA to pay ₹5 lakh compensation to Gurunanak Dairy and Sweets.

The ruling provides relief to the Maharashtra FDA in the compensation dispute and recognises the regulatory action as having been taken in the context of food safety and public health concerns.

The case highlights the balance between enforcement of food safety regulations and the rights of businesses affected by regulatory action.

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