Rule 18 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rule 18 is the dealer's rule. It bars anyone in the supply chain from selling above the retail sale price, from altering the price, and from selling a package that does not comply. It sets how prices move when a tax changes, and it requires certain retailers and LPG distributors to keep weighing equipment.
No wholesale dealer, retail dealer or importer may sell, distribute, deliver, display or store for sale a non-compliant package. No one in the chain may sell above the retail sale price. Dealers may not obliterate, smudge or alter the price, and manufacturers, packers and importers may not alter the price on a printed wrapper. After a tax revision, the price rise is limited to the tax increase. Covered retailers keep an electronic weighing machine for consumers to check purchases; LPG distributors keep a check weigher.
Sub-rule (1) and (1A): compliant packages only
Rule 18(1): "No wholesale dealer or retail dealer or importer shall sell, distribute, deliver, display or store for sale any commodity in the packaged form unless the package complies with in all respects, the provisions of the Act and these rules."
The duty is that of the dealer, separately from the manufacturer's. A retailer cannot rely on the supplier's label. Section 18 of the Act covers "offer, expose or possess for sale" (see section 18), and rule 18(1) is the rule-level twin. "Dealer", "wholesale dealer" and "retail dealer" are defined in rule 2.
Sub-rule (1A) (substituted by G.S.R. 629(E) of 23 June 2017) says the wholesale dealer shall be allowed to sell pre-packaged commodities directly to industrial and institutional consumers. The printed sentence ends without a full stop. Such sales sit outside Chapter II under rule 3(c), and the packs carry the declaration "not for retail sale" under rule 2(bb) and (bc). Dealers in packaged goods often ask how this rule sits with their licensing; for a broader view, see our legal consultation service.
The text used here is the Packaged Commodities Rules as amended up to G.S.R. 226(E) of 28 March 2022.
Sub-rule (2) and (2A): the price ceiling and identical goods
(2) "No retail dealer or other person including manufacturer, packer, importer and wholesale dealer shall make any sale of any commodity in packed form at a price exceeding the retail sale price thereof."
(2A) (2017): "Unless otherwise specifically provided under any other law, no manufacturer or packer or importer shall declare different maximum retail prices on an identical pre-packaged commodity by adopting restrictive trade practices or unfair trade practices" as defined in the Consumer Protection Act. The printed text cites the 1986 Act's clauses and then, by G.S.R. 779(E) of 2 November 2021 (w.e.f. 1 April 2022, now 1 October 2022), "clause (41) and (47) of section 2 of the Consumer Protection Act, 2019".
So sub-rule (2A) does not ban different MRPs as such. It bars them where they result from restrictive or unfair trade practices, and applies only "unless otherwise specifically provided under any other law". The text does not say when two products are "identical".
Sub-rule (3) and (4): tax revision
If, after a commodity has been pre-packed, any tax payable on it is revised:
- the retail dealer or other person shall not sell at a price above the revised retail sale price communicated by the manufacturer (or the packer where different);
- the manufacturer or packer must publish the revised prices by not less than two advertisements in one or more newspapers, and by circulating notices to dealers and to the Director in the Central Government and the Controllers of Legal Metrology in the States and Union Territories;
- the difference between the price marked and the revised price shall not exceed the extent of the tax increase, or, for a fresh tax, the fresh tax.
| Proviso | Effect |
|---|---|
| First | Newspaper publication is not necessary where the revision is due to a tax under a State law |
| Second | The revised price may be charged only on packages marked as pre-packed in the month of the revision or the month immediately following |
| Third | Where the revised price is lower than the marked price, no price above the revised price may be charged, whatever month the commodity was pre-packed |
Sub-rule (4): sub-rule (3) does not apply to a package that need not show the month and year of pre-packing. The rule speaks of tax "revised", and the source does not refer to a particular tax; the text does not refer to GST by name in this sub-rule.
Sub-rule (5) and (6): no altering of price
(5) "No wholesale dealer or retail dealer or other person shall obliterate, smudge or alter the retail sale price, indicated by the manufacturer or the packer or the importer... on the package or on the label affixed thereto."
(6) "The manufacturer or packer or the importer shall not alter the price on the wrapper once printed and used for packing."
Read with rule 6(3), the only permitted change is a lower-MRP sticker that does not cover the printed MRP (see the MRP article).
Sub-rule (7): retailers' weighing machine
The sub-rule applies to "all retailers who are covered under the Value Added Tax VAT or Turn Over Tax (TOT) Goods and Service Tax and dealing in packaged commodities whose net content declaration is by weight or volume or a combination thereof". The words "Goods and Service Tax" are marked as substituted by G.S.R. 779(E). Such retailers "shall maintain an electronic weighing machine of at least accuracy class III, with smallest division of at least 1 g, with facility to issue a printed receipt indicating among other things the gross quantity, price and the like at a prominent place in their retail premises, at no charge to consumers, for the benefit of consumers", who may check the weight of their purchases on it.
The consumer is not charged for using the machine. The sub-rule does not say whether a retailer below the tax registration threshold is covered; it says "covered under" the tax laws named, so whether a particular shop falls in depends on its tax position, which the sources do not settle.
Sub-rule (8): LPG cylinders
All marketing companies, manufacturers, packers, importers or distributors of Liquefied Petroleum Gas cylinders shall maintain a check weigher or non-automatic weighing instrument, digital or analogue, of Accuracy class III (Max. 50 kg, e = 10 g) to check the weight of the cylinder, and shall provide to the delivery man the means to measure or weigh the correct quantity. The footnote shows this as substituted by G.S.R. 359(E) of 6 June 2013.
Consequences
A breach of rule 18 is a breach of the Rules. Section 36 of the Act punishes dealing in packages that do not conform to the declarations, and rule 32 provides a fine for contravention of the Rules that has no separate punishment; see section 36 and our article on rule 32. Section 30 of the Act concerns short delivery and excess receipt of quantity, not price, so do not treat it as the penalty for selling above MRP; the sources do not name a separate Act section for that. The 2026 Jan Vishwas Act is in force only from the date the Central Government notifies it.
Practical examples
Example 1. A grocer sells a 500 g pack printed "MRP Rs 100" at Rs 105 "for delivery". Rule 18(2) bars any sale above the retail sale price.
Example 2. A tax on a product rises by Rs 3 after packing. The manufacturer may revise the price but the difference from the marked price may not exceed Rs 3, and it must notify through two newspaper advertisements unless the change is under a State law.
Example 3. A wholesaler finds that a lot has a wrong price and rubs it out with a marker. Rule 18(5) bars obliterating, smudging or altering the price.
Need help with dealer compliance?
Stock that comes in with a wrong label becomes the dealer's problem at the counter. If you run a wholesale or retail business and want to set up a receiving check, a price-change routine or a response to an inspection, our legal consultation service can help plan it.
Key takeaways
- Dealers may not sell, display or store a non-compliant package; the duty is separate from the manufacturer's.
- No one may sell above the retail sale price, and price alteration is barred.
- After a tax revision, the price rise is capped at the tax increase, with advertisement and notice duties on the manufacturer or packer.
- Covered retailers keep an electronic weighing machine for consumers; LPG distributors keep a check weigher.
- The text is as amended up to March 2022.
Read next
- Rules 14 to 17 of the Packaged Commodities Rules, 2011: Dimensions, sheets and container declarations
- Rule 19 of the Packaged Commodities Rules, 2011: Inspection at manufacturer or packer premises
- Rule 6 of the Packaged Commodities Rules, 2011: Maximum retail price and unit sale price
- Legal Metrology for FMCG and retail industry
Disclaimer: Based on the Legal Metrology (Packaged Commodities) Rules, 2011 (as amended up to March 2022; check later amendments), read with the Legal Metrology Act, 2009 (Act 1 of 2010), the Jan Vishwas (Amendment of Provisions) Act, 2023 (in force) and the Jan Vishwas (Amendment of Provisions) Act, 2026 (in force only from the date the Central Government notifies), as on 30 September 2026. State Legal Metrology rules, later amendments and notifications change; verify the current position before acting.