Supreme Court quashes Bombay HC order directing Maharashtra FDA to pay ₹5 lakh compensation
The Supreme Court on Monday, October 5, 2026, set aside a Bombay High Court direction that had ordered the Maharashtra Food and Drug Administration (FDA) to pay ₹5 lakh as compensation to a Pune-based dairy and sweets establishment whose food licence was suspended following a food poisoning complaint. The order was passed in State of Maharashtra & Ors. v. M/s Gurunanak Dairy & Sweets, according to a press note issued by the Maharashtra FDA.
Background: Inspection and suspension after complaint
The case stems from an inspection conducted by Pune food safety officers on June 12, after the FDA received a complaint of food poisoning linked to the establishment. The inspection reportedly revealed multiple deficiencies, including lapses in hygiene, maintenance of records, labelling, and the personal hygiene of employees. Based on these findings, the establishment’s food licence was suspended under the Food Safety and Standards Act, 2006.
According to the FDA, a sample of “Malai Pedha” collected during the inspection was subsequently declared unsafe. The State maintained before the Supreme Court that the suspension was a necessary public health measure, carried out in accordance with the statutory framework under the Food Safety and Standards Act.
Appeals process and compliance steps
Following the suspension, the proprietor filed a statutory appeal before the FDA Commissioner on June 15. The establishment later submitted a compliance report on July 9, detailing steps it said were taken to address the deficiencies noted during the June inspection. The FDA conducted a reinspection on July 13, four days after receiving the compliance report, the department said.
High Court proceedings and compensation order
Subsequently, the establishment approached the Bombay High Court by filing Writ Petition No. 9905 of 2026. On August 17, the High Court revoked the suspension of the food licence and directed the FDA to deposit ₹5 lakh as compensation for business losses claimed by the establishment.
State’s challenge before Supreme Court
The Maharashtra government contested only the compensation directive before the Supreme Court. It argued that FDA authorities had acted promptly at every stage—from the initial inspection and suspension to the reinspection following the compliance report—and that the statutory appeal filed by the establishment before the FDA Commissioner had been heard and reserved for orders.
The State further submitted that the FDA’s actions were neither malicious nor arbitrary, and that there was no deliberate delay attributable to the authorities. It contended that time spent in good faith during the discharge of statutory duties and processes cannot be the basis for imposing a financial penalty or compensation on the government.
Supreme Court decision
Accepting the State’s submissions, the Supreme Court set aside the Bombay High Court’s direction requiring the FDA to pay ₹5 lakh and quashed the compensation order, the FDA press note said. The press note did not indicate any further directions beyond quashing the compensation component of the High Court’s order.
What’s next
According to the State’s submissions, the establishment’s statutory appeal before the FDA Commissioner had been reserved for a decision when the matter reached the Supreme Court. No further details were immediately available on the status of that appeal.
The case underscores the balance courts are often called upon to strike between safeguarding public health under the Food Safety and Standards Act, 2006 and addressing claims of business losses allegedly arising from regulatory action. In this instance, the Supreme Court concluded that the compensation imposed by the High Court was not warranted.
