Rule 2 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 2 defines the terms the Packaged Commodities Rules depend on: who is a manufacturer, packer or dealer, what counts as a retail or wholesale package, what "net quantity" and "retail sale price" mean, and how e-commerce is defined. These definitions decide which rules bind whom. Rule 2 has been amended several times, and the printed text in our source shows old and substituted wording side by side; this article uses the wording that the footnotes show as current. Our source is as amended up to G.S.R. 226(E) of 28 March 2022; check later amendments.
Rule 2 has clauses (a) to (s), including later inserted clauses (aa), (bb), (bc), (bd), (be) and (bf). Key points: a manufacturer includes anyone who puts their mark on a product as if they made it; a packer pre-packs in units suitable for sale; a retail package is for sale to the ultimate consumer, excluding industrial or institutional consumers; a wholesale package includes a pack of ten or more retail packages; retail sale price is the maximum price inclusive of all taxes (current wording); and "consumer" now takes its meaning from the Consumer Protection Act, 2019 (from 1 October 2022). Words not defined in the rules have their Act meaning (rule 2(s)).
The definitions at a glance
| Clause | Term | Gist (current wording) |
|---|---|---|
| (a) | Act | The Legal Metrology Act, 2009 (1 of 2010) |
| (aa) | Consumer | As in clause (7) of section 2 of the Consumer Protection Act, 2019; substituted for the 1986 Act reference, with effect from 1 October 2022 |
| (b) | Dealer | Buys, sells, supplies or distributes packaged commodities, for cash, deferred payment, commission or other consideration; includes a commission agent; excludes a manufacturer, except where the manufacturer sells to a person other than a dealer |
| (bb) | Industrial consumer | Buys packaged commodities directly from the manufacturer, importer or wholesale dealer for use by that industry; package carries "not for retail sale" |
| (bc) | Institutional consumer | An institution that buys packages bearing "not for retail sale" directly from the manufacturer, importer or wholesale dealer, for its own use and not for commercial or trade purposes |
| (bd) | E-commerce | Buying and selling of goods and services including digital products over a digital and electronic network |
| (be) | E-commerce entity | A company under the Companies Act, 1956 or 2013, or a foreign company under clause (42) of section 2 of the Companies Act, 2013, or an office, branch or agency in India as described in the rule, owned or controlled by a person resident outside India, conducting e-commerce business |
| (bf) | Marketplace based model of e-commerce | An information technology platform provided by an e-commerce entity acting as a facilitator between buyer and seller |
| (c) | Lot | For stored packages, the total number stored; for packages on or at the end of a packing line, the maximum hourly output |
| (d) | Manufacturer | Produces, makes or manufactures the commodity, and includes a person who puts a mark on a package not made by him claiming it to be his |
| (e) | Maximum permissible error | An error in deficiency not exceeding the limits in the First Schedule |
| (f) | Net quantity | Quantity by weight, measure or number, excluding the packaging or wrapper |
| (g) | Packer | Pre-packs any commodity, in bottle, tin, wrapper or otherwise, in units suitable for wholesale or retail sale |
| (h) | Principal display panel | The total surface area of the package where the required information is given, either grouped together in one place, or pre-printed information in one place and on-line information in another |
| (i) | Quantity | By weight, measure or number of the commodity in the package |
| (j) | Retail dealer | A dealer who directly sells packages to the consumer; includes a wholesale dealer making direct sale to the consumer |
| (k) | Retail package | Intended for retail sale to the ultimate consumer for consumption; includes imported packages |
| (l) | Retail sale | Sale, distribution or delivery through retail shops, agencies or other instrumentalities for consumption by an individual or a group or any other consumer |
| (m) | Retail sale price | The maximum price at which the packaged commodity may be sold to the consumer, inclusive of all taxes (substituted version) |
| (n), (o) | Section; Schedule | A section of the Act; a Schedule to these rules |
| (p) | Standard package | A package containing the specified quantity of a commodity |
| (q) | Wholesale dealer | A dealer who does not sell directly to any consumer, but distributes or sells through one or more intermediaries |
| (r) | Wholesale package | (i) a pack of a number of retail packages meant for an intermediary and not for sale to a single consumer; (ii) a commodity sold to an intermediary in bulk for resale in smaller quantities; or (iii) ten or more retail packages, provided they are labelled as the rules require |
| (s) | Other words | Words used but not defined in the rules, but defined in the Act, have the Act's meaning |
Pay attention to the roles. A business can be a manufacturer, packer, importer and dealer for different packs, and the declaration duties differ. Our guide on who must comply sets out the roles under the Act; here we stay with the rule text. The entries on e-commerce and declarations feed into the e-commerce rule; see our note on e-commerce labelling. For a food business checking which label duties follow from these terms, see our FSSAI label compliance page.
Definitions that change the answer
Manufacturer (clause (d))
The definition is wider than "who makes". It includes a person or firm that "puts, or causes to be put, any mark on any packaged commodity, not produced, made or manufactured by him or it", where the mark claims the commodity is his. A brand owner who has goods made by a contract maker and puts its own mark, as if it were the producer, is a manufacturer for these rules. The rule does not say what happens where the label plainly names a different maker; the test in the text is the mark that claims the commodity as the brand's own. Take advice on private-label facts.
Dealer versus manufacturer (clause (b))
A dealer "does not include a manufacturer who manufactures any commodity which is sold or distributed in a packaged form except where such commodity is sold by such manufacturer to any other person other than a dealer". The consequence is that a manufacturer selling directly to a consumer (a person other than a dealer) is treated as a dealer for that sale. The clause does not say more than that.
Retail package and retail food package (clause (k))
A retail package is intended for retail sale to the ultimate consumer for consumption, and includes imported packages. The original first proviso, excluding industrial or institutional consumers from "ultimate consumer", was omitted by G.S.R. 359(E) of 6 June 2013. The current proviso, substituted by G.S.R. 385(E) of 14 May 2015, says that for a "retail food package" the definition in the rules or regulations under the Food Safety and Standards Act, 2006 applies. So for food, the definition of the retail food package is taken from the food law, not from the Rules. The text does not reproduce that definition; check the food regulations, and see FSSAI label compliance.
Wholesale package (clause (r))
Limb (iii), ten or more retail packages, matters in practice: a carton of ten or more labelled retail packs is a wholesale package even if sold to someone who is not an intermediary, provided the retail packs are labelled as the rules require. Wholesale packages are dealt with by rule 24; see rules 1 and 3 for where they sit.
Retail sale price (clause (m))
Two versions appear in our source:
| Version | Wording |
|---|---|
| Original | The maximum price at which the commodity may be sold to the consumer, printed in the form "Maximum or Max. retail price Rs... inclusive of all taxes" or "MRP Rs... incl. of all taxes", with rounding of fractions (less than 50 paise to the preceding rupee; above 50 paise up to 95 paise to 50 paise) |
| Substituted by G.S.R. 629(E) of 23 June 2017, effective 1 January 2018 | "The maximum price at which the commodity in packaged form may be sold to the consumer inclusive of all taxes" |
The current definition states the price concept only. How the MRP is shown on the package is dealt with elsewhere in the rules; see our article on the MRP declaration and the later rule articles in this series.
Consumer (clause (aa))
Inserted by G.S.R. 629(E) (2017, effective 1 January 2018) by reference to the Consumer Protection Act, 1986, then substituted to point to clause (7) of section 2 of the Consumer Protection Act, 2019. The footnote says the 2021 substitution was to apply from 1 April 2022 and was "now w.e.f. 01.10.2022" by G.S.R. 226(E) of 28 March 2022.
Industrial and institutional consumer (clauses (bb), (bc))
Our source prints (bc) in two versions: the 2015 version (an institution that hires or avails of transport, hotel, hospital or other facilities and buys packages from the manufacturer, importer or wholesale dealer) and a later version (an institution that buys packages bearing "not for retail sale" for its own use and not for commercial or trade purposes) marked as substituted by the 2017 amendment. We describe the later wording. The footnote layout for (bb) is less clear, so for that clause check the gazette text. Both terms feed into rule 3, which lifts Chapter II from packs meant for such consumers; see rule 3.
Amendments at a glance
| Clause | Amendment noted in the source |
|---|---|
| (aa) | G.S.R. 629(E), 2017; 2019 Act reference by G.S.R. 779(E) of 2 November 2021, from 1 October 2022 (G.S.R. 226(E), 28 March 2022) |
| (bb), (bc) | G.S.R. 385(E), 14 May 2015; (bc) substituted by G.S.R. 629(E), 2017 |
| (bd), (be), (bf) | G.S.R. 629(E), 23 June 2017, effective 1 January 2018 |
| (k) | First proviso omitted by G.S.R. 359(E), 6 June 2013; second proviso substituted by G.S.R. 385(E), 14 May 2015 |
| (m) | Substituted by G.S.R. 629(E), 2017, effective 1 January 2018 |
The Jan Vishwas Acts of 2023 and 2026 amend the Act, not these Rules. Where an amending Act or rule after March 2022 changes a definition, our source will not show it.
Who is exposed in practice
| Business | Which definitions matter |
|---|---|
| Brand owner with contract manufacturing | "Manufacturer" (clause (d)): own mark claiming the goods |
| Wholesaler selling cartons of ten labelled packs | "Wholesale package" (clause (r)(iii)) |
| Online marketplace | "E-commerce entity" and "marketplace based model" (clauses (be), (bf)) |
| Manufacturer selling a pack directly to a shopper | "Dealer" exception (clause (b)) |
| Hotel buying bulk packs marked "not for retail sale" | "Institutional consumer" (clause (bc)) |
Example 1. A company sells biscuits under its own brand, made by a contract factory, with its mark claiming the goods. Under clause (d) the company is a "manufacturer" for these rules.
Example 2. A distributor sells a carton of twelve labelled one-litre packs to a shop. Under clause (r)(iii), the carton is a wholesale package provided the retail packs are labelled as the rules require.
Need help reading the definitions for your product?
Which definition applies decides which label duties you carry. Our FSSAI label compliance team can help map your product, your role in the supply chain and your sales channel to the definitions, for both the Packaged Commodities Rules and the food rules. Bring a sample label and your supply-chain contracts.
Key takeaways
- Rule 2(a) to (s) defines the roles and package types the Rules turn on; (aa), (bb), (bc), (bd), (be) and (bf) were inserted later.
- A "manufacturer" includes a brand that puts its own mark on goods it did not make.
- A "wholesale package" includes ten or more labelled retail packages.
- "Retail sale price" now means the maximum price inclusive of all taxes; "consumer" follows the Consumer Protection Act, 2019 from 1 October 2022.
- For "retail food package" the Food Safety and Standards Act, 2006 definition applies.
- Our source is as amended up to March 2022; check later amendments.
Read next
- Rules 1 and 3 of the Legal Metrology (Packaged Commodities) Rules, 2011: Commencement and applicability
- Rule 4 of the Legal Metrology (Packaged Commodities) Rules, 2011: Regulation of pre-packing and sale
- Section 18 of the Legal Metrology Act, 2009: Declarations on pre-packaged commodities
- Key Definitions Under Legal Metrology Act -- Section 2
Disclaimer: Based on the Legal Metrology (Packaged Commodities) Rules, 2011 (as amended up to G.S.R. 226(E) of 28 March 2022; later amendments are not reflected) read with the Legal Metrology Act, 2009 (Act 1 of 2010), as amended by the Jan Vishwas (Amendment of Provisions) Act, 2023 (in force) and subject to the Jan Vishwas (Amendment of Provisions) Act, 2026 (in force only from the date the Central Government notifies); neither Jan Vishwas Act amends rule 2, as on 30 September 2026. State Legal Metrology rules, later amendments and notifications change; verify the current position before acting.