Hyderabad Consumer Commission orders Rs 2 lakh payout after fungus found in Rs 230 organic butter pack, refers case to FSSAI

Complaint and discovery

A Hyderabad district consumer commission has ruled that a retailer and the manufacturer of Akshaya Kalpa Organic Cooking Butter violated consumer‑protection laws after a customer discovered visible fungal growth in a packet bought for Rs 230. The complainant, Sandya Chavula, purchased the butter on 28 January 2025 from a store in Sainikpuri, Secunderabad. The pack, manufactured on 21 December 2024 with a 19 April 2025 expiry, showed clear signs of contamination when opened at home, prompting her to return to the outlet and lodge a complaint.

Retailer and manufacturer defenses

Both parties argued that the product was sold in the sealed condition received from the supplier. The retailer claimed no responsibility for manufacturing, packaging, or marketing, and denied any fault. The manufacturer, in a reply dated 17 March 2025, attributed the problem to improper storage at the retail outlet, noting that the store’s open‑chiller operated 3‑4 °C above the recommended temperature and could not maintain the required below 4 °C environment for the butter.

Commission’s findings and order

A three‑member bench (President Vakkanti Narasimha Rao, members P.V.T.R. Jawahar Babu and Suma Vala) examined the evidence, including the manufacturer’s own admission that the retailer’s cold‑chain was inadequate. The commission concluded that:

• Both retailer and manufacturer failed to ensure proper storage conditions.
• The product was contaminated and adulterated, posing a health risk.
• Selling the butter constituted an unfair trade practice under Section 39(1)(g) of the Consumer Protection Act, 2019.

The final order, dated 9 October 2026, directed the parties to:

• Jointly refund Rs 230 to the complainant.
• Pay Rs 1 lakh (Rs 50,000 each) as compensation for mental agony and inconvenience.
• Cover Rs 10,000 in litigation costs.
• Deposit Rs 1 lakh (Rs 50,000 each) as punitive damages into the consumer‑welfare fund.
• Discontinue the unfair trade practice.
• Refer the matter to the Food Safety and Standards Authority of India (FSSAI), Hyderabad, for action under Section 90 of the Consumer Protection Act.

All directives must be complied with within 45 days of receipt of the order.

Practical implications for consumers and retailers

• Cold‑chain vigilance: The case underscores the legal responsibility of both manufacturers and retailers to maintain temperature‑controlled storage for perishable foods. Retailers using open chillers for products that require closed‑chiller conditions may face liability.
• Consumer recourse: Consumers who encounter visible spoilage can seek redress under the Consumer Protection Act, including refunds, compensation, and punitive damages.
• Regulatory oversight: The referral to FSSAI means the agency may conduct its own inspection, potentially leading to product recalls, fines, or mandatory corrective actions for the manufacturer.
• Industry precedent: While food‑safety violations are not new in India, this is one of the few consumer‑commission rulings that combines monetary penalties with a direct referral to FSSAI, signalling tighter enforcement of cold‑chain standards.

What remains uncertain

• FSSAI’s final action: The commission’s order triggers a review, but the specific outcome—such as a recall, suspension of the product’s license, or additional penalties—has not yet been disclosed.
• Scope of contamination: The commission relied on the complainant’s visual observation and the manufacturer’s storage‑temperature admission. No laboratory test results confirming the type of fungus were released publicly.
• Impact on other batches: It is unclear whether other batches of the same product line share the same storage issues, or if this was an isolated incident.

How to verify the decision

The full judgment and related documents are available on the Times of India legal news portal. Readers can review the original article at: [https://timesofindia.indiatimes.com/legal/news/woman-found-fungus-and-visible-contamination-in-a-rs-230-butter-pack-bought-from-a-retail-store-hyderabad-consumer-commission-has-now-ordered-rs-2-lakh-in-damages-and-compensation-and-referred-the-matter-to-fssai-for-action/articleshow/135352385.cms](https://timesofindia.indiatimes.com/legal/news/woman-found-fungus-and-visible-contamination-in-a-rs-230-butter-pack-bought-from-a-retail-store-hyderabad-consumer-commission-has-now-ordered-rs-2-lakh-in-damages-and-compensation-and-referred-the-matter-to-fssai-for-action/articleshow/135352385.cms) The Consumer Protection Act, 2019, and FSSAI guidelines on cold‑chain management are publicly accessible on the respective government websites for further reference.

--- This report follows the verified facts released by the Hyderabad district consumer commission and the Times of India legal news article. No additional sources were used.