Friday, 13 November 2009

Apple FMCG business model is illegal: Madras High Court

The Madras High Court in its wonderful judgement wayback in 2005 has given a blow to the business of Apple FMCG Marketing (Pvt) Ltd. This is introduction. Another judgement of the same High Court on V-Can Network would appear later.
Apple FMCG Marketing (Pvt) Ltd filed writ petitions No. 22674 and 27411 of 2004 in the Madras High Court in the State of Tamil Nadu. And the Madras High Court delivered its judgement on January 7, 2005 giving a blow to its business model. Judge A K Rajan delivering his judgment held that "It is true that several companies including multinational companies carry on the business of the 'Multilevel Marketing' and it is also true that the Executive and the law enforcing authorities keep a blind eye on such activities. This also does not make an illegal act legal. It is alwlays a fact that the law enforcing authroitiey would try to close the table only after the horse had escaped." (Para 22).
In this part of India, people are gullible and fall an easy prey to the tall promises made through the media. That was the reason why the lottery tickets were sold in large numbers in the State. Many companies want to exploit this attitude of people and float many schemes and lure the people to join the schemes. The petitioner (Apple FMCG) is not entitled for direction for prohibiting the authorities from ;keeping surveillance over any meeting. Sec 7 of the Prize Chits and Money Circulation Schemes (Banning) Act confers the right on the police officer to enter any premises, where has got a reason to suspect that the premises are being used for purposes connected with the promotion of conduct of any prize chit or money circulation scheme in contravention of the provision of the Act. (Para 33).


dtytrivedi said...

hey david i have question for you?

if these guys are more confident than distributors saying that amway distributors compels the new recruited to purchase and/or retail products worth 100 pv or Rs 5000?

if it is so then any damn person can get the idea of around what is amway india's turnover?

according my information there are currently 500,000 distributors

it would be like 500,000 distributors buying products worthed Rs 5000 monthly.

which means Rs60,000* 500,000.

the anwser it Rs 30,000,000,000. Rs 30 billion

ok lets put that distributors do 80 pv or RS 4000 monthly.

which means 48000*500,000 = Rs 24,000,000,000. Rs 24 billion.

and the reality is that the actual figure of amway (Rs 11.28 billion) is 2.12 times lesser than the above figure and 2.65 times when compared to Rs 30 billion

so simple as that!!!

what u say david???

Tex said...

I say many IBOs don't buy anything, so your logic sucks.