Monopolies and Restrictive Trade Practices Commission
M. Balasundram vs Jyothi Laboratories And Anr. on 10 October, 1994
ORDER
A.N. Varma, Chairman
1. A complaint was received from one Shri Balasundram, partner of Southern India Trading Agency, Coimbatore, against Jyothi Laboratories of Bombay as well as the Director (Commercial Services) Doordarshan Kendra, Madras. The complaint purported to be under Section 36A(1)(x), read with Section 36B(a) and (d), of the Monopolies and Restrictive Trade Practices Act. It stated that the complainant was engaged in the business of ultramarine blue since 1982 and gained substantial experience in the said line of trade. The brand name of its product (liquid ultramarine blue) "Regaul" was alleged to be very popular in India, specially in the South. Subsequently, the respondent also entered the said field and started manufacturing and selling liquid blue under the brand name "Ujala". As part of a sales promotion drive, the respondent launched a publicity campaign for boosting the sales of its product, advertising it in the newspapers as well as through Doordarshan, Madras. It was further alleged that the advertisement released by the first respondent through the Doordarshan is highly misleading and calculated to disparage the product of the complainant.
2. The Commission examined the complaint and on consideration of the same issued a notice of enquiry against the respondents under Sections 36A, 36B(d) and 36D of the Monopolies and Restrictive Trade Practices Act. The notice of enquiry in so far as relevant for our purpose runs thus :
"The Commission has information that the first respondent is engaged in the manufacture of liquid blue in the trade name "Ujala". For the purpose of promoting the sale of "Ujala" the first respondent has released advertisements through the second respondent on Doordarshan, Madras, It has come to the knowledge of the Commission through the information given by Shri M. Balasundram, partner of Southern India Trading Agency, Coimbatore, that the informant is also engaged in the manufacture and sale of ultramarine blue which is sold in the trade name of "Regaul" and which product is also known as "Regaul Liquid Ultramarine Blue." It appears from the information that respondent No. 1 has in its publicity campaign released on Doordarshan given wrong or misleading visual description of the informant's product. The misleading advertisement on Doordarshan shows a blue colour container strikingly similar to the one in which the informant's product is being marketed. Moreover, in the press media also the informant's product is disparaged.
From the above facts it appears to the Commission that the respondents have indulged in the unfair trade practice of "disparaging the goods, services or trade of another person" attracting Section 36A(1)(x) of the Monopolies and Restrictive Trade Practices Act. A copy of the information received by the Commission is enclosed for ready reference.'
3. In response to the notice of enquiry the first respondent submitted its reply, denying the charge that it has in any way attempted to disparage the complainant's product, or that it has otherwise indulged in any unfair trade practice falling within Section 36A(1)(x) of the Monopolies and Restrictive Trade Practices Act. The plea of the respondent further was that the container shown in the advertisement was markedly different from the container in which the complainant was marketing its product. There was no similarity whatever between the complainant's bottles and those shown on the Doordarshan. At any rate, in the impugned advertisement shown over the Doordarshan all that the respondent attempted to highlight was that only three to four drops of Ujala were sufficient to achieve the desired whitening effect on the clothes washed with that product as against the quantity which is required to be added in the case of other products in circulation in the market. In short, the respondent's case was that no particular manufacturers were intended to be targeted by the respondent in that advertisement. It was further added that as soon as the Commission issued an injunction order in this case under Section 12A on December 12, 1991, the respondent got a letter addressed by its advertisement agency to the Doordarshan Kendra at Madras requesting the latter to stop the telecast of the advertisement until further notice.
4. On the pleas raised by the respondent and the rejoinder filed by the Director-General (Investigation and Registration), the Commission framed the following issues for its consideration by its order dated July 21, 1992 :
1. Whether the notice of enquiry is not maintainable for the reasons stated in the written reply ?
2. Whether the respondents or any of them have indulged in unfair trade practices within the meaning of Section 36A(1)(x) of the Monopolies and Restrictive Trade Practices Act, 1969, as alleged ?
3. If the answer to issue No. 2 is in the affirmative, whether the unfair trade practice as alleged is prejudicial to public interest, the interest of the consumer or consumers generally ?
4. Relief.
5. In support of the charge only one witness was examined by the Director-General, namely, Shri Balasundram, the complainant himself. Earlier his affidavit had been filed by way of examination-in-chief which is marked exhibit A-1. Shri Balasundram was cross-examined extensively by the respondent's counsel. On behalf of the respondent Shri Anjan Chatterjee was examined. Shri Chatterjee was a script writer and advertising executive and who was approached by the first respondent for preparing a commercial on the product in question in the month of April, 1991, and the same was released in the month of June, 1991. He corroborated the respondent's version that the bottles shown in the two photographs forming part of the commercial do not resemble the Regaul bottles, and that there was nothing false and misleading or disparaging in the impugned advertisement. He was cross-examined at length by learned counsel for the Director-General. In addition to the affidavit and statements of the witnesses of the parties, certain documents were also filed to substantiate the statements of the witnesses of the two parties.
6. The first issue need not detain us as no arguments were addressed by learned counsel for the respondents on the same. The issue is accordingly answered in the negative as the respondent has failed to substantiate its stand with regard to the jurisdiction of the Commission to deal with the matter, The complaint is that respondent No. 1 has indulged in unfair trade practices by launching a campaign of denigration against the complainant's product Regaul by making false and misleading representations projected on the Doordarshan Kendra, Madras. These allegations clearly bring the matter within the purview of the Commission attracting the provisions of Clause (x) of Section 36A(1).
7. We next turn to the second and the main issue debated at the Bar. The issue is whether the respondents or either of them have indulged in unfair trade practices within the meaning of Section 36A(1)(x) of the Monopolies and Restrictive Trade Practices Act. The contents of the notice of enquiry have already been reproduced hereinabove. A glance at the same would show that the impugned advertisement screened by the Doordarshan Kendra, Madras, was directed specifically and solely against ultramarine blue marketed by the complainant's concern under the brand name "Regaul". The notice expressly states that the advertisement released by the first respondent was designed to convey a wrong and misleading visual description of the complainant's product in view of the blue colour of the container which was stated to be strikingly similar to the one in which the informant's product was being marketed.
8. A plain reading of the enquiry leads us to the irresistible conclusion that the only charge which respondent No. 1, was called upon to meet was that it is Regaul which was sought to be disparaged and not that the advertisement was aimed or targeted generally against the manufacturers of marine blue operating in the matter. In order to bring home a charge under Clause (x) of Section 36A(1) it must be established that the disparagement is of the goods, services or trade of another. Of course, the impugned representation which is said to disparage the goods of another must be proved to be false or misleading. In the present case, even the first of these two conditions is not present. Admittedly the bottle shown in the impugned advertisement displayed on the TV does not bear any label at all so as to identify the product of the informant. Significantly the bottle filed with the complaint did not have any label affixed on it.
9. Secondly, we saw the video cassette on the TV times out of number with a view to make sure whether the product which is stated to have been sought to be disparaged could, in the remotest sense, be identified with the bottle in which the complainant's product is being marketed, the bottle in which Regaul is being marketed, In fact the bottle shown on the TV could not be identified with the bottle of any other known manufacturer for that matter.
10. We do think that the words "goods of another person" have a definite connotation. It implies disparagement of the product of an identifiable manufacturer. In the present case, the bottle shown on the TV is not relatable to the product of either the informant or the bottle in which he is marketing the product or even of any other manufacturer, for that matter. Indeed, the whole of the impugned advertisement takes but a few fleeting seconds within which it is impossible to identify the product or its manufacturer or the brand which is said to have been disparaged. The basic requirement of Clause (x) of Section 36A has thus remained unsubstantiated in the present case. All that could be said after viewing the impugned advertisement on the Doordarshan several times over is that whereas only a few drops of the liquid blue manufactured and marketed by respondent No. 1 is shown to be sufficient for achieving the desired result, namely, the whiteness in the clothes washed or rinsed with the same, in the case of the other product shown on the TV, several spoons are required to be used, on seeing which the lady holding the bottle of "Ujala" exclaims the words "chhi, chhi, chhi !" These words no doubt do seem to run down the other product shown on the TV. But that by itself is not sufficient to bring home the charge of unfair trade practice compre-hended under Clause (x) of Section 36A as the identity of the product or the manufacturer is not capable of being fixed.
11. As this Commission has ruled in the case of Reckitt and Coleman v. Zee Telefilms and Procter and Gamble (I. A. No. 82 of 1992 in UTPE No. 170 of 1992) a charge under Section 10 cannot be sustained unless the representation is first shown to be false or misleading and second that it is disparaging to the goods of another. The Commission has also ruled that a mere claim to superiority in the quality of one's product or the technology used in the manufacture thereof compared to other products in circulation is not by itself sufficient to attract Clause (x). (See order dated May 3, 1993, I. A. No. 85 of 1993, in UTPE No. ... of 1993 in the matter of Core Parenterals). Equally well settled is the proposition that publicity and advertisement of one's product with a view to boosting sales is a legitimate market strategy, provided, of course, the undertaking or the individual keeps within the bounds of the provisions of the Monopolies and Restrictive Trade Practices Act. In this connection, another principle which has been recognised by the Commission time and again is that a certain degree of puffing up of one's product is permissible. The impugned advertisement, at worst, is in our opinion simply an instance of puffing up, but certainly not disparagement of the goods of any identifiable manufacturer.
12. The second issue must, therefore, be answered in the negative in favour of the respondent. The second issue having been answered in the negative the remaining issues do not arise for consideration and are disposed of accordingly. In the premise the notice of enquiry is discharged but there will be no orders as to costs.