A random test carried out on two batches of Johnson & Johnson's baby shampoo samples in Rajasthan has found traces of the chemical formaldehyde, a known carcinogen.
The discovery comes just a few months after the authorities launched an investigation into J&J's Baby Powder to see if it contains cancer-causing asbestos. J&J said in late February it had resumed production of baby talc after government tests found no asbestos in the product.
Twenty-four bottles of J&J baby shampoo were tested randomly from the two batches, officials said.
"There is a presence of formaldehyde, a chemical used as a preservative. Johnson & Johnson is now claiming they have not used formaldehyde in the product, but it's showing up in the test," said Raja Ram Sharma, Drug Controller of Rajasthan.
"We cannot tell how much percentage of formaldehyde has shown up in the test, but now since the company has challenged it, the samples will be sent for further test to a central drug laboratory," Mr Sharma said.
The Rajasthan Drugs Controller has kept the two batches of J&J baby shampoo till a final decision on the product is taken after the second test by the central lab.
J&J rejected the findings of the report, saying it hasn't used formaldehyde at all in the product. "We do not accept the interim results given to us, which mentioned samples to 'contain harmful ingredients - identification positive for formaldehyde,'" a J&J spokesperson said, according to news agency Reuters.
The drug control authority said it randomly tests medicines and cosmetic samples twice a month. Seven samples failed the test last month.