Monopolies and Restrictive Trade Practices Commission
Voluntary Organisation In The Interest ... vs Delhi Bottling Co. (P.) Ltd. on 16 January, 1989
Equivalent citations: [1990]68COMPCAS532(NULL)
ORDER
G.R. Luthra, J. (Chairman)
1. The point for determination at present is as to what are the rights of a complainant, whether an individual consumer or a registered consumer association or a trade association, which files a complaint under Section 10(a)(i) or 36B(a) of the Monopolies and Restrictive Trade Practices Act, 1969, and as to whether such complainant is entitled to pursue the complaint, fully participate in the proceedings by way of producing evidence, cross-examining the witnesses of the respondent, administering of interrogatories, making application for discovery of documents, etc., or he has merely to watch and has only a right of addressing arguments if so permitted by the Commission and it is the Director-General of Investigation and Registration who has to have full charge of the proceedings and pursue the same.
2. The aforesaid point arose in the present enquiry (UTPE No. 151 of 198'6) as well as in similar enquiries bearing UTPE Nos. 152 and 153 of 1986 on account of an objection of counsel for the respondents to the effect that according to the provisions of the Monopolies and Restrictive Trade Practices Act and Regulation 73(5) of the Monopolies and Restrictive Trade Practices Commission Regulations read with Rule 13A of the Monopolies and Restrictive Trade Practices Rules. It is only the Director-General who is entitled to pursue the entire enquiry and the complainant does not have any right to participate, unless the enquiry, instead of being a public interest one, is to resolve an inter se dispute between an individual or a group of individuals on the one hand and another person as respondent on the other hand. In this respect, the following order was passed by Shri D.C. Aggarwal who singly constituted the Commission on July 23, 1987 :
"The case today is fixed for filing of the reply to the notice of enquiry. Learned counsel for the respondent has informed me that in terms of the order of the last date some copies of documents have been made available only this morning. In the circumstances, full reply to the notice of enquiry on merits has not been prepared and only a reply containing preliminary objections has been filed. As now, copies of the documents have been supplied to the respondent's learned counsel, it is directed that a full reply on the merits as well shall be filed before the next date of hearing with advance copy to each of the complainants and to the Director-General. I have made it clear that since it is a complaint case, it has to be decided as to who will have the primary responsibility, whether the Director-General or the complainant, to pursue this enquiry before the Commission. Either the complainant itself or the Director-General on behalf of the complainant will be allowed to take responsibility for the due conduct of the case. Once one of them takes charge of the case, whether the Director-General or the complainant, then the responsibility can be shifted to the other only, when he is not taking due interest in the conduct of the proceedings. The case now will be called on September 24, 1987, for further proceedings in the light of the reply to the notice of enquiry to be filed by the respondent."
3. On September 24, 1987, Dr. S. R. Khanna, who is the convener of the consumer organisation "VOICE" and also representing other complainants in UTPE Nos. 151 to 153 of 1986, stated that the complainant had every right to fully participate in the proceedings and to be heard in that respect. Then, learned counsel for the respondent, Shri C. L. Sareen, submitted that the complainant had no such right. The case was then adjourned to December 3, 1987, and, thereafter, to January 6, 1988. On January 6, 1988, the following order was passed :
"Learned counsel for the respondent and Shri S. S. Kumar, advocate, who are in a similar capacity in other cases, rely upon some judgments of the Commission on the point fixed for arguments today. It is first of all necessary that those judgments should be before us, so that we may be in a position to appreciate the same. Hence, a list of those judgments be given by Shri Sareen and Shri S. S. Kumar, advocates, within two weeks and then copies of the list shall be given to the complainant as well as counsel for the Director-General and the date of arguments will be fixed. The case will be taken up on January 28, 1988.
Prima facie, as it appears to us, a complainant who comes with a complaint as of right under Section 10 or Section 36B of the Monopolies and Restrictive Trade Practices Act, has every right not only to file the complaint but to prosecute and do everything in his power for proving his case. Therefore, the respondent shall file objections in writing showing as to how and why the complainant is debarred from taking full part in the proceedings. Those objections should be filed along with the list of the judgments mentioned above.
Rejoinder by the Director-General be filed on January 28, 1988."
4. Before we proceed further, it is necessary to give some facts as to how the enquiries were started.
5. The aforesaid complaint, subject-matter of the said enquiry and some other complaints were filed against different manufacturers of aerated waters on the basis of which the matter was referred to the Director-General for investigation and making a report. He submitted a report with which the Commission was not fully satisfied and hence the matter was sent back for filing a supplementary report. The Director-General filed a supplementary report and recommended that no action need be taken. The complainants were called upon to argue as to why the complaints be not dismissed and further proceedings dropped. After hearing the complainants, notices of enquiry were directed to be issued separately to different manufacturers of soft drinks. The notice of enquiry in every case is on the same lines. The relevant words of the notice of enquiry issued in the present case, i.e., UTPE No. 151 of 1986, which are being reproduced as a specimen, read as under :
"On the basis of the complaints and the preliminary investigation reports submitted by the Director-General (Investigation and Registration), it appears to the Commission that the respondent above mentioned has indulged in the trade practices stated as under :
(a) The provisions of the Food Products Order, 1955, enjoins on the parties that they should conspicuously mention that the drink in the container does not contain fruit juice or pulp where the container does not contain them. The respondent did not mention these words conspicuously on the containers, but mentioned the same in an inconspicuous manner on the cork, which is generally removed by a retail shopkeeper while handing over the drink to the customer thereby making the customer unaware of what is written on the cork in small print.
The respondent did not strictly comply with the requirements of Clause 11(3) of the Food Products Order, 1955, and thereby attracted the provisions contained in Clause (4) of Section 36A of the said Act.
(b) The respondent organised a contest/lottery after August 1, 1984, for the purpose of promoting, directly or indirectly, the sale of its product or its business interest, and thus indulged in unfair trade practice within the meaning of Section 36A(3)(b) of the Act. (A copy of complaints and the preliminary investigation report enclosed)."
6. Before we advert to the objections of learned counsel for the respondent, we have first to see as to what rights are conferred on the complainant by the provisions of the Monopolies and Restrictive Trade Practices Act Both Sections 10(a)(i) and 36B give a right to the complainant to file a complaint. It is a well-settled principle of law that whenever a certain right is given to a person to approach any authority by way of a complaint or an application, that the complainant or the applicant has full rights to pursue his complaint or application, which means that he has a right to produce evidence, give applications in reply to the interrogatories and for discovery and production of documents in accordance with law, cross-examination of witnesses of the opposite party and also address arguments. That right subsists until and unless it is taken away by any of the provisions of law which gives a right to file a complaint or an application. There is no provision in the Monopolies and Restrictive Trade Practices Act which takes away such right.
7. Rather, there are indications that not only the Legislature did not want to take away the inherent right of a complainant to pursue his complaint but also encouraged that such right should be exercised by the complainant. That is why Parliament has been amending the Monopolies and Restrictive Trade Practices Act from time to time. First of all, the right of filing complaints for the commencement of enquiries relating to restrictive and unfair trade practices was given to the consumer associations or trade associations or to a group of at least twenty-five consumers. An individual could not approach the Commission for getting any relief, even for getting compensation. From August 1, 1984, by way of amendment of the Monopolies and Restrictive Trade Practices Act, a right was given, under Section 12B of the Monopolies and Restrictive Trade Practices Act, to individuals (whether trader or consumer), besides the Central Government, State Governments and class of traders to file applications for compensation for damage suffered on account of any unfair, restrictive or monopolistic trade practice. Further encouragement was given to individual consumers to file complaints on the basis of which enquiries could be commenced by the Commission. That encouragement took the shape of amendment of the Monopolies and Restrictive Trade Practices Act brought about in 1986. That amendment was enforced with effect from June 1, 1987. All this shows that by a gradual process Parliament wanted to associate complainants whether individual consumers, registered consumer associations or trade associations with the proceedings of the enquiry. This is indicative of the fact that Parliament wanted and still desires that every complainant should have a full right to participate in the proceedings of the enquiries.
8. The aforesaid view finds further support from the provisions of Section 55 of the Monopolies and Restrictive Trade Practices Act, which reads as under :
"Appeal. -- Any person aggrieved by any decision on any question referred to in Clause (a), Clause (b) or Clause (c) of Section 2A, or any order made by the Central Government under Chapter III or Chapter IV or, as the case may be, the Commission under Section 13 or Section 36D or Section 37, may, within sixty days from the date of the order, prefer an appeal to the Supreme Court on one or more of the grounds specified in Section 100 of the Code of Civil Procedure, 1908 (5 of 1908)."
9. It is apparent from the aforesaid provision that the right to appeal has been given to every aggrieved person. There can be no manner of doubt that the complainant is and will be an aggrieved person if there is an adverse decision by way of dismissal of the complaint or not taking any action on the same. The right to file an appeal will be totally illusory and without any use until and unless the complainant is allowed to fully participate in the proceedings before the Commission. In fact, the complainant will be automatically an aggrieved person if he is not allowed to participate fully in the proceedings and that itself will be a good ground for even acceptance of the appeal.
10. The learned counsel for the respondents, Shri S. S. Kumar and Shri C. L. Sareen first of all relied on Section 18(2) of the Monopolies and Restrictive Trade Practices Act, which reads as under :
"Subject to the provisions of this Act, the Commission shall have power to regulate-- ......
(2) In particular, and without prejudice to the generallity of the foregoing provisions, the powers of the Commission shall include the power to determine the extent to which persons interested or claiming to be interested in the subject-matter of any proceeding before it are allowed to be present or to be heard, either by themselves or by their representatives or to cross-examine witnesses or otherwise to take part in the proceeding."
11. Learned counsel contended that, that provision clearly gave power to the Commission to determine the extent to which persons interested or claiming to be interested in the subject-matter of any proceeding before it should be allowed to be present or to be heard, which meant that the Commission had full power to exclude the complainant, being an interested person, from taking any part in the proceedings. They stated that the answer to the questions as to what would happen and who would pursue the complaint, if the complaint was debarred from participating, was furnished by Rule 13A of the Monopolies and Restrictive Trade Practices Rules framed by the Central Government. That rule reads as under :
"Duties and functions of the Director-General.-- (1)(a) The Director-General shall, in addition to the duties and functions entrusted to him under the Act and these rules, be entitled to appear in any proceeding in the course of any inquiry before the Commission ;
(b) Where the Director-General is entitled to appear before the Commission, he may appear either in person or be represented by a counsel duly authorised in this behalf.
(2) It shall be the duty of the Director-General to conduct such investigations as may be directed by the Commission for any of the purposes under the Act."
12. Learned counsel contended that it clearly showed that the Director-General could take part and have full charge of the proceedings in the event of exclusion of the complainant.
13. They also relied upon Sub-regulation (5) of regulation 73 of the Monopolies and Restrictive Trade Practices Commission Regulations, 1974, which reads as under :
"Any complainant, applicant, informant and Government authority who makes reference under Clause (a) of Section 10 shall, if he or it is not a party to the proceedings, be deemed to be a party and shall be entitled to be heard in the proceedings. The Secretary may, and if so directed by the Commission shall, furnish to him or it a copy of the documents filed with him under regulations 53, 54, 55, 65, 67, 69 and 72."
14. It was urged by learned counsel for the respondent that the complainant was merely a "deemed party" in the proceedings and was entitled to be heard only and, consequently, did not have full rights of participation in the proceedings which commenced on the basis of the complaint. In support of their contention about the interpretation of regulation 73(5), learned counsel for the respondent (Shri C. L. Sareen and Shri S. S. Kumar) relied upon some judgments of this Commission in the following cases :
Sarabhai M. Chemicals P. Ltd., In re (RTPE No. 45 of 1975 --May 27, 1975), Sivakasi Chamber of Match Industries v. Western India Match Co. Ltd. (RTPE No. 3 of 1973), Voice v. Bharat T. V. Ltd. (RTPE No. 138 of 1984 -- October 11, 1985), Siliguri Tea Auction Committee, In re, (RTPE No. 5 of 1984 -- February 25, 1986), Pieco Electronics and Electricals Ltd. (UTPE No. 63 of 1985 -- May 22, 1986), Association of State Road Transport Undertakings v. Premier Tyres (RTPE No. 78 of 1984 -- November 7, 1986), Jindal Aluminium Ltd., In re (UTPE No. 148 of 1986--January 11, 1988), Raymond Woollen Mills Ltd., In re [1976] 46 Comp Cas 395 (MRTPC), India Paper Pulp Co. Ltd., In re (reported at page 491 of S. M. Dugar's Law of Restrictive Trade Practices), All India Motor Transport Congress v. Goodyear India Ltd. [1976] 46 Comp Cas 315 (MRTPC) and Ballarpur Industries Ltd. (RTPE No. 89 of 1984 --November 14, 1985).
15. Learned counsel also relied upon a judgment of the Delhi High Court delivered on September 16, 1988, in Civil Writ Petition No. 707 of 1986 having the title Ballarpur Industries Ltd. v. Director-General of Investigation and Registration [1988] 64 Comp Cas 884; [1988] 1 MTR 312 (Delhi). The aforesaid judgment has also been reported in September, 1988, part of Company Law Digest at page 33. In that judgment, inter alia, it was held that Sub-regulation (5) of regulation 73 was intra vires the Monopolies and Restrictive Trade Practices Act and that the Commission had the power to frame the same under Sections 18 and 66 of the said Act. Learned counsel for the respondent contended that, according to Sub-regulation (5) of regulation 73, as already mentioned, the complainants did not have full right of participation. They added that the Delhi High Court recognised the said provisions as perfectly legal and valid and hence that deprived the complainant of full rights of participation.
16. Never before, this Commission ever took into consideration the effect of the Monopolies and Restrictive Trade Practices Act and its amendments, from time to time, in respect of the rights of the complainant, It was never taken into consideration in any of the judgments of the Commission that when a complainant was given a right to file a complaint, he had every right to pursue the same till its decision which meant that he had full rights of participation. There cannot be any two opinions on the fact that the Monopolies and Restrictive Trade Practices Act has precedence over the rules and regulations framed thereunder. Hence, even if Rule 13A and regulation 73(5) are interpreted to be depriving a complainant of his full rights of participation, although, we are holding that they do not, yet the provisions of the Monopolies and Restrictive Trade Practices Act, on account of having precedence must be followed and the complainant is not debarred from full rights of participation. Under these circumstances, we are constrained to differ from the view taken by the Commission previously.
17. The judgment of the Delhi High Court does not, in any way, support the respondents. It was never held that the complainant had no rights to take part in the proceedings except to the extent of being heard. In fact, that question was never before the High Court. The said High Court, as is clear from the last two paragraphs of the judgment, was dealing merely with the question whether the provisions of Regulation 73(5) were in any way illegal and beyond the rule-making power of the Commission vis-a-vis the rights of the respondent, who, as was held by the High Court, had a full right to defend and was not debarred from doing so.
18. Sub-section (2) of Section 18, which has been reproduced already, does not, in any way, prohibit full participation of the complainant in the proceedings commenced on his complaint. Learned counsel for the complainant, Dr. L. M. Singhvi, submitted that the aforesaid provision had no relevance as far as rights of the complainant were concerned, because the same enabled the Commission to regulate or control the rights of "interested persons" who could be persons other than the complainant. That argument is based on a sound reasoning. The said provision does not deal with parties to a proceeding who are the complainants as well as respondents. There can be no manner of doubt and no two opinions that as far as the respondent is concerned, he can neither be excluded from the enquiry proceedings nor can the extent to which he is allowed to be present or to be heard be determined by the Commission. He has to get full rights of participation including production of evidence, administering of interrogatories, seeking discovery of documents, cross-examining the witnesses produced by the complainant and/or the Director-General address arguments and do everything which is necessary for pursuing his case. When the respondent, as a party, has full rights of participation, how can it be said that the rights of the complainant can be curtailed. In our opinion, the power and discretion conferred under Sub-section (2) of Section 18 is with a view to regulate and control the extent to which "interested persons" other than the complainant and the respondent, can participate in proceedings pending before the Commission.
19. In our opinion, Sub-regulation (5) of regulation 73 does not, in any way, limit the rights of the complainant to have full participation in the proceedings commenced on its complaint. It says that if the complainant is not a party to any proceedings, he shall be deemed to be a party. A party, which includes the respondent, has full rights of participation whether he is or is deemed to be a party. The word entitled to be heard does not merely mean entitlement to address arguments and a person who is entitled to be heard must produce evidence and material on record before the arguments to be addressed by him have any meaning.
20. Rule 13A merely enables the Director-General to take part in the proceedings. This is clear from the use of the words "entitled to appear". That does not mean that he will be entitled to take full charge of the proceedings to the exclusion of the complainant for otherwise there was no difficulty in so expressing while framing the rule. Hence, this rule does not debar the complainant from exercising an inherent and normal right of pursuing his or its complaints to its logical conclusion by taking full part in the proceedings. Rule 13A was framed with a view to enable the Director-General to look after the proceedings and also in the event of the complainant ceasing, for any reason, to pursue the enquiry at any stage, to take full charge of the proceedings.
21. In respect of the order of Shri D. C. Aggarwal dated July 23, 1987, it was urged by learned counsel for the respondent that the said order allowed either the Director-General or the complainant to pursue the proceedings, that both could not do that, that the said order was binding and that, therefore, this Bench could not allow both the complainant and the Director-General to handle the proceedings. They added that if that order was to be varied, the same could be done only by Shri D. C. Aggarwal himself on a proper review petition.
22. Obviously, the aforesaid contention is wrong. That order did not determine anything. It is clear from a plain reading of the said order that it was merely a proposition or posing a question to the parties to be argued upon and the final order has to be made after hearing the parties.
23. Shri S. S. Kumar, learned counsel for some of the respondents, relied upon judgments of the Supreme Court in S.P. Gupta v. President of India (commonly known as "judges case"), AIR 1982 SC 149, and Sachidanand Pandey v. State of West Bengal, AIR 1987 SC 1109. In the former case, some advocates had filed a number of writ petitions challenging the action of the Government in respect of transfer of High Court judges. The Union of India pleaded that they had no locus standi to file writ petitions and that the same could only be filed by judges who were aggrieved. It was held that the advocates had a locus standi because they were partners in the task of administration of justice undertaken by the judges and were vitally interested in the maintenance of a fearless and an independent judiciary to ensure fair and fearless justice to the litigants. It was further held that the traditional rule in regard to locus standi was that judicial redress was available only to a person who had suffered a legal injury, but that the public interest litigation could be started by others also, provided the same was bona fide and with a view to vindicating the cause of justice and not for obtaining some personal gain or private profit or out of political motivation or other oblique consideration. In the latter case, Sachidanand Pandey v. State of West Bengal, AIR 1987 SC 1109, it was held that any litigation started by a public-spirited person must inspire confidence in the courts and also among the public and that the same must be above suspicion, Learned counsel for the respondents (Shri S. S. Kumar) urged that complaints filed by the registered consumer associations or trade associations were obviously public interest litigations and that, therefore, the courts could have a check on the same with a view to find out if the said litigation was bona fide and the above suspicion and that, therefore, in such cases, it was necessary to exclude complainants from full participation so that such litigations could be pursued unhampered by the Director-General. He submitted that in a public interest litigation, the complainant is merely a source of information and not a party to the enquiry, while it is the Director-General who has to take full charge of the proceedings.
24. The authorities cited by learned counsel for the respondent have no relevance. The Supreme Court did not lay down that any person who files a writ petition in public interest should be excluded from pursuing the same. In fact, in both the litigations, the persons who started the proceedings themselves pursued the same. The only thing to be seen is that such litigation is a bona fide one and not for the purpose of harassing or for obtaining some personal gains directly or indirectly. That can always be ensured under the provisions of relevant laws like the Civil Procedure Code, etc.
25. It is wrong on the part of learned counsel for the respondent to urge that in a public interest litigation, the complaint is merely a source of information and the complainant is not a party to the enquiry. Accepting such a view will be against an express intention of Parliament. Parliament had provided long ago that the Commission could act on its information or on its own knowledge and the Commission had been so acting since its very creation. If the complaint was thought to be merely an information, there was hardly any necessity for Parliament to have amended the Monopolies and Restrictive Trade Practices Act, in the year 1986 so as to give the right to an individual consumer also to file a complaint. That clearly means that the right to file a complaint clearly meant a right to pursue the same fully and not merely be a spectator after filing the same.
26. Learned counsel for the respondent also relied upon a judgment of the Supreme Court in Udit Narain Singh Malpaharia v. Addl. Member Board of Revenue, AIR 1963 SC 786, and a judgment of the Madras High Court in Mahadeva Rice and Oil Mills v. Chennimalai Goundar, AIR 1968 Mad 287. It was held that a necessary party was one without whom no order could be made effectively. Learned counsel submitted that in a public interest litigation, a registered consumer association or a trade association was not a necessary party because the enquiry before the Commission could be decided without its presence and that, therefore, there was hardly any justification for allowing such a complainant to participate fully in the proceedings.
27. The aforesaid argument suffers from a fallacy. When a particular association has been allowed to file a complaint, even in respect of public interest litigation, it is obviously a necessary party and without giving opportunity of pursuing, to it, there cannot be any complete or effective adjudication of the matter. When a right to file a complaint has been given, it can neither be debarred from pursuing the same nor can its right to participate in the proceeding on the basis of the said complaint be curtailed.
28. Hence, having regard to all the relevant provisions of the Monopolies and Restrictive Trade Practices Act, rules and regulations framed thereunder and the manifestation of the legislative intent from time to time by way of amending the Monopolies and Restrictive Trade Practices Act, we are of the view that a complainant, whether an individual consumer or a registered consumer association or a trade association, who files a complaint under Section 10(a)(i) or 36B(a) of the Monopolies and Restrictive Trade Practices Act, is entitled to pursue the complaint, fully participate in the proceedings by way of producing evidence, cross-examining the witnesses of the respondent, administering interrogatories and making an application for discovery of documents, etc. The Director-General is entitled to take part in the said proceedings also but not to the exclusion of the complainant until and unless the complainant, for any reason whatsoever, ceases to pursue the enquiry at any stage in which case, the Director-General is entitled to take full charge of the proceedings. It is made clear that in case the complainant pursues the enquiry himself, he will have to bear the expenses of the same and the Director-General cannot be called upon to do so.
29. Announced in the open court today January 16, 1989.