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Premier Tyres Ltd. and ors. Vs. the Monopolies and Restrictive Trade Practices Commission, New Delhi and ors. - Court Judgment

LegalCrystal Citation
SubjectMRTP
CourtDelhi High Court
Decided On
Case NumberCivil Writ Appeal No. 1523 of 1974
Judge
Reported inAIR1975Delhi204; [1976]46CompCas297(Delhi); ILR1975Delhi777
ActsMonopolies and Restrictive Trade Practices Act, 1969 - Sections 10
AppellantPremier Tyres Ltd. and ors.
RespondentThe Monopolies and Restrictive Trade Practices Commission, New Delhi and ors.
Advocates: A.H. Desai,; Ravnder Narain,; J.N. Aggarwal,;
Cases ReferredSmt. Abnash Kaur v. Dr. Avinash Nayyar
Excerpt:
monopolies and restrictive trade practices act (1969) - sections 10(a) (iii), 18(1) (a) and 37 read with regulations of 1970 and 1974 made under section 66--jurisdiction of the commission to allow amendment.; on a complaint made by the register under section 10(a)(iii) the commission may, with or without investigation by the director of the commission, issue notice of hearing as to why an inquiry under section 37 should not be held into the alleged restrictive trade practices. in the present case an application for the amendment of the said complaint was made by the registrar seeking to add more alleged restrictive trade practices into which inquiry was sought. the amendment was allowed by the commission. the order allowing the amendment was challenged on the ground that the complaint..........are raised by the writ petition for decision at the threshold, namely:- (1)whether the restrictive trade practices (enquiry) regulations, 1970 (hereinafter called 'regulations of 1970') which applied to the proceeding titled application no. 1 of 1971 pending before the monopolies and restrictive trade practices commission would also apply to a subsequent application filed on october 26, 1974 for the amendment of application no. 1 of 1971 though in the meanwhile the monopolies and restrictive trade practices commission regulations, 1974 (hereinaller called 'regulations of 1974') came into force on june 29, 1974, clause 87 of which repeated the regulations of 1970 without affecting the operation of the repealed regulations or any investigations, legal proceeding or remedy in respect of any.....
Judgment:

V.S. Deshpande, J.

(1) Two questions are raised by the writ petition for decision at the threshold, namely:-

(1)Whether the Restrictive Trade Practices (Enquiry) Regulations, 1970 (hereinafter called 'Regulations of 1970') which applied to the proceeding titled Application No. 1 of 1971 pending before the Monopolies and Restrictive Trade Practices Commission would also apply to a subsequent application filed on October 26, 1974 for the amendment of Application No. 1 of 1971 though in the meanwhile the Monopolies and Restrictive Trade Practices Commission Regulations, 1974 (hereinaller called 'Regulations of 1974') came into force on June 29, 1974, clause 87 of which repeated the Regulations of 1970 without affecting the operation of the repealed Regulations or any investigations, legal proceeding or remedy in respect of any right, privilege, obligation or liability acquired, accrued or incurred under the repealed Regulations so that all investigations and legal proceedings shall be continued as if the Regulations of 1974 had not been made.

And

(2)Whether the Commission had the power to entertain and allow the application for amendment dated October 26,1974.

(2) The legal and the factual beckground in which the above questions arise is as follows :-The Monopolies and Restrictive Trade Practices Commission has been established by the Monopolies and Restrictive Trade Practices Att, 1969. Under section 10(a) the Commission I may inquire into any restrictive trade practices while under section 10(b) it may inquire into any monopolistic trade practices. In this case we are concerned with an inquiry by the Commission into restrictive trade practices. Such an inquiry may be made by the Commission (i) upon receiving a complaint from any trade or consumers' association; (ii) upon a reference made to it by the Government; ('iii) upon an application made to it by the Registrar of the Commission; or (iv) upon its own knowledge. The first method of inquiry is initiated by non-officials while the other methods are initiated offically, thereforee, an investigation by the Director of the Commission has to The Monopolies And Restrictive Trade Practices Commission New Delhi And Others be made in the complaint by the non-officials under section 10(a)(i). But such an investigation may or may not be made if the initiation is by the officials under the other methods. Under section 12, the Commission is deemed to be a civil court for certain purposes and has been conferred with certain powers of the civil court. Section 18 empowers the Commission to regulate the procedure and conduct of its business. Section 66 gives the Commission powers to make regulations for the efficient performance of its functions under the Act. In particular and without prejudice to the generality of the provisions, such regulations may provide for various specified matters. In exercise of the above powers, the Regulations of 1970 and the Regulations of 1974 were made by the Commission. Application No. 1 of 1971 was made by the Registrar of the Commission on December 23, 1971 under section 10(a)(iii) of the Mrtp Act praying that the Commission may inquire into certain restrictive trade practices practiced by the various tyre manufacturers in India who had entered into an Agreement called a code of conduct. The restrictive trade practices referred to in that application were terms and Conditions l(h), Ii, 12 of the Agreement and provisions for credit policy and trade prices. On October 26, 1974 an application for amendment of Application No. 1 of 1971 was filed by the Registrar by which some other restrictive trade practices resorted to by the said tyre manufacturers were sought to be added to the original complaint made in Application No. 1 of 1971. The tyre manufacturers opposed the application. But the Commission allowed ttie amendment prayed for by the impugned order dated November 22, 1974. In the present writ petition the said order of the Commission is challenged as being without jurisdiction whether it is taken to have been passed under the Regulations of 1970 or the Regulations of 1974. Let us, thereforee, first consider which of the two sets of Regulations, namely, those of 1970 and those of 1974 were applicable to the consideration of the application for amendment filed on October 26, 1974. The Regulations are mainly procedural. The normal rule is that a party has no vested right in procedure and, thereforee, the procedure which is applicable at the relevant time will govern unless the application of the previous procedure is expressly saved. Clause 87(1) of Regulations of 1974 repeals the Regulations of 1970 and thereby brings into force the Regulations of 1974 from June 29, 1974 when they were promulgated. Clause 87(2) saves the previous operation of the Regulations of 1970 up to the date of appeal. It also ;D/75- 4 saves anything duly done or suffered under the Regulations of 1970 and states that the repeal will not affect any right, privilege, obligation or liability acquired, accrued or incurred under the Regulations of 1970. We are not concerned here with any previous operation of the Regulations of 1970 nor are we concerned with any right, privilege, obligation or liability which was acquired, accrued or incurred under the Regulations of 1970. The latter part of clause87(2) goes on to state that the repeal shall not affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation or liability. Since there is no right, privilege, obligation or liability under consideration, the question of any investigation, legal proceeding or remedy in respect of them also does not arise. The last words of clause 87(2) are 'and all investigations and legal proceedings shall be continued or enforced as if the present Regulations had not been made.' The contention of Shri Ashok Desai learned counsel for the petitioner is that these last words mean that the investigations and legal proceedings which were pending on June 29, 1974 were to be governed by the Regulations of 1970 as if the Regulations of 1974 were not made. Had regulation 87(2) not been made by the Commission, the principle of section 6(e) of the General Clauses Act, 1897 would have governed the effect of the repeal of the Regulations of 1970. In drafting regulation 87(2) the Commission seems to have in mind the following scheme. The first part of regulation 87(2) repeats the language of clauses (b) to (d) of section 6 of the General Clauses Act. But the second part of regulation 87(2) makes a departure from the second part of clause (e) of section 6 of the said Act. For, while the second part of clause (e) of section 6 of the General Clauses Act saves only 'any such investigation, legal proceeding or remedy' meaning thereby the investigation, legal proceeding or remedy referred to in the first patt of clause (e), namely, which are in respect of any sucR right, privilege, obligation, liability, etc., which are acquired, accured or incurred under the repealed enactment, the last part of regulation 87(2) uses the words 'all investigations and legal proceedings'. These words are not restricted to the immediately preceding words which refer to investigation, legal proceeding or remedy in respect of a right, privilege, obligation or liability which was acquired, accured or incurred under the repealed Regulations. It would appear, thereforee, that the substitution of the word 'all' in place of the words ''any such' by regulation 87(2) has varied the meaning which could have been attributed to the said regulation had it been phrased similarly to section 6(e) of the General Clauses Act. Since the last words of regulation 87(2) are wider them the last words A of section 6(e) of the General Clauses Act it would appear that all pending investigations and legal proceedings would be governed by Regulations of 1970 and that Regulations of 1974 would apply only to those proceedings or investigations which are instituted on or after 29th June 1974.

(3) Though ordinarly an amendment or repeal of procedural regulations would have a retrospective effect, such amendment or repeal may not affect the pending proceedings which may continue to be governed by the repealed regulations. It would, thereforee, depend upon the language of the repealing statute or regulation as to whether the pending proceedings are to be affected by it. It is in this context that we have to construe the last words of regulation 87(2) differing from the language of section 6(e) of the General Clauses Act. Since in their natural sense the last words of regulation 87(2) would appear to include all the pending proceedings to be governed by the repealed regulations, there is no need to give any other meaning to these words. The view that pending proceedings are not affected by the repeal is not an unusual one and would, thereforee, appear to accord with the intention of the framers of regulation 87(2) of the Regulation 87(2) of the Regulations of 1974.

(4) We may, however, observe that the expression of this opinion by us would not make any difference to our finding on the next question inasmuch as, as we shall show later, the power of the Commission to allow the impunged amendment would be the same under the Regulations of 1970 as also the Regulations of 1974.

(5) The Monopolies and Restrictive Trade Practices Commission is a statutory body established by the Mrtp Act, 1969 for the purpose of certain functions. Section 18(1)(a) of the Act expressly states that 'subject to the provisions of this Act, the Commission shall have the power to regulate the procedure and conduct of its business'. The satute thus gives effect to the general principle that a statutory body or authority created to discharge certain functions would have the implied power to follow such procedure as is necessary or essential for the discharge of its statutory functions. This rule of statutory construction is stated in Craies on Satute Law, 7th Edition, page 111. as follows:-

'IF a statute is passed for the purpose of enabling something to be done, but omits to mention in terms some detail which is of great importance (if not actually essential) to the proper and effectual performance of the work which the statute has in contemplation, the courts are at liberty to infer that the statute by implication empowers that detail to be carried out.'

In Assistant Collector of Central Excise, Calcutta v. National Tobacco Co. of India, Ltd. : 1978(2)ELT416(SC) , the Supreme Court referred to Craies on Statute Law (Fifth Edition) page 105 and observed as foHows:-

'IT is well established rule of construction that a power to do something essential for the proper and effectual performance of the work which the statute has in contemplation may be implied.'

It would appear, thereforee, that even in the absence of section 18, the Commission would have the power to devise and apply the necessary rules of procedure for holding an inquiry under section 37 of the Act into any restrictive trade practices on a complaint received under section 10(a) of the Act.

(6) The Regulations of 1970 (or of 1974) may now be considered in the above background in relation to the power which is conferred on the Commission to allow an amendment of the application of complaint made under section 10(a)(iii). The title of regulation 22 of the Regulations of 1970 is 'Amendment of notice of reference, etc.' The opening part of regulation 22 says:-'A notice of hearing, statement of case, answar or reply may be amended at any time by leave of the Commission'.

(7) Under regulation 6 an application made under section 10(a)(iii) by the Registrar shall contain the facts which constitute the restrictive trade practices and shall set out the relevant portions of the agreement if any. Further it shall be signed and verified by the Registrar. In our view, the complaint under section 10(a) brings to the notice of the Commission the restrictive trade practices complained of. The proceeding before the Commission is a quasi-judicial one. The complaint made under section 10(a) is analogous, in its nature, to a plaint filed before a civil court or a criminal complaint filed before a criminal court. Just as a plaint may be rejected by a civil court for want of cause of action, a complaint under section 10(a) may not be acted upon by the Commission if, with or without the investigation by the Director, the Commission comes to the conclusion that it does not disclose a sufficient cause for the Commission to proceed further. Similarly, a criminal court on the examination of a complaint, may not find a prima fade case to proceed aglinst the accused. But just as a plaint which is not rejected for want of a cause of action and a complaint which is registered as disclosing a prima fade case become the starting point of a civil or a criminal proceeding, the complaint under section 10(a) becomes the starting point of the proceeding for the investigation into restrictive trade practices under section 37. Regulation 7 states that proceedings under section 37(1) shall be instituted by a notice by the Commission io the person against whom allegations of restrictive trade practices arc made slating that the Commission proposed to hold an inquiry into the said practices. The reason seems to be that until and unless the Commission has made up its mind to bring the opposite party before it in an inquiry under section 37, the proceedings to which the complainant and the respondent would be parties cannot be said to be intia-ted by the Commission. Till the issue of the notice only the complaintis before the Commission and the only party before the Commissionis the complainant. Once the notice is issued, however, the substanceof the complaint on which the notice is issued has to be communicated to the respondents. This is made clear by the last words of regulation 7 which required that the notice shaH state 'that the Commission proposed to hold an inquiry into the practice'. 'The practice' is the one which is complained of as being restrictive in the complaint. In the notice, thereforee, the complained of practice will necessarily have to be set out. A notice which does not set out: the practice will be unintelligible. In our view, thereforee, the notice necessarily conveys to the respondents the allegations of restrictive trade practice or practices made against them. It is only then that the respondents can file a statement of case under regulation 16 to which an answer may be filed by the Registrar under regulation 18. We have, thereforee, the complaint which after consideration or investigation is embodied in the notice followed by a statement of case by the respondents and answer by the Registrar. Regulation 22 allows the amendment of a notice of hearing, statement of case and answer.

(8) The question is as to/what is meant by 'a notice of hearing' in relation to its amendment? In the present case, the notices served on the respondents referred to the complaint made by the Registrar copies of which are annexed to the notices. It is only because of the annexures that the respondents could know from the notices as to what the allegations against them were. It is to meet these allegations that the statement of case is filed by the resp ondents. In construing regulation 22, learned counsel for the petitioner submitted that the amendment authorized by it is only the amendment of the notice but not of the amendment of the annexures to the notice. Learned counsel visualized some technical or minor errors in a notice which could be amended under regulation 22. He contended that there is no provision in regulation 22 for the amendment of the complaint made by the Registrar and, thereforee, the impugned order of the Commission allowing the amendment is without jurisdiction. We put to the learned counsel whether the additional restrictive trade practices alleged in the application for amendment could have been joined to the original restrictive trade practices complained of in Application No. 1 of 1971 when it was filed. Learned counsel could not deny that the allegations now sought to be introduced by way of amendment in Application No. 1 of 1971 could have been made in the original application when the same was filed. We also put to the learned counsel if an additional application as an additional complaint under section 10(a)(iii) containing these very additional allegations can be filed by the Registrar. The learned counsel could not deny that such an additional application could be filed subject to limitation and estoppel. We are of the view that the original application and the additional application could be considered together by the Commission inasmuch as these are restrictive trade practices arising out of the same Code of Conduct alleged against the same set of respondents. If this be so, we do not see why the subsequent application should not be ragarded as an application for the amendment of the original application. Instead of lumping the two together and hearing the parties on both of them together, the supplementary allegations made in the second application may be more conveniently incorporated in the original application by way of amendment. This power is conferred on the Commission both by section 18(l)(a) which enables the Commission to regulate its own procedure and the conduct of its business as also by regulation 22 which empowers the Commission to amend a notice of hearing.

(9) What is a notice of hearing? Regulation 6 states that an application made tinder section 10(a)(iii) by the Registrar shall contain the facts which constitute the restrictive trade practices. Regulation 7 requires a notice to be given to the person against whom allegations of restrictive trade practices are made staling that the Commission proposed to hold an inquiry into the practices. It follows, thereforee, that a notice must specify the allegations constituting the restrictive trade practices. Unless the notice states the allegations of restrictive trade practices, it will be meaningless. The party on whom it is served will not know the very reason for the issue of the notice and will not be able to draft a statement of case to meet the allegations which were to be conveyed by the notice. The power to amend the notice thus includes the power to amend the allegations conveyed by the notice. Regulation 27 also gives the Commission the power to give a direction that the notice of hearing be amended.

(10) The provisions for the amendment of notice contained in the Regulations of 1974 are even more explicit. Regulation 72(3) empowers the Commission to allow an amendment even before a notice of inquiry is served on the respondent. The Commission, however, must give a notice of the application for amendment to the respondents before allowing the amendment. Before the issue of the notice, the only document which would be before the Commission in a proceeding pending before it under section 37 of the Act would be the complaint or the reference or the information received by it under section 10(a). Each of these documents could be amended after notice to respond ents and after the respondents are heard even before the notice of the filing of the complaint or the report or the information is issued to the respondents. The complaint under section 10(a)(iii) is thus capable of being amended by the Commission on the application of the complainant.

(11) Regulation 72(1) enables the Commission to amend any defect or error in any proceeding including the notice of inquiry. As already observed above, the notice has to contain the allegations of restrictive trade practices made against the respondents. The amendment of the notice would thus include the amendment of these allegations.

(12) Since clauses (3) and (1) of regulation 72 cover the amendment of the notice, clause (2) thereof does not cover it. Learned counsel for the petitioner argued that the amendment could be made only under clause (2) and since it does not include the complaint under section 10(a)(iii) the said complaint cannot be amended at all. He further argued that only a pleading could be amended under regulations 72(2) read with regulation 70. This argument ignores regulations 72(1) and 72(3). Even if, thereforee, this argument were correct by itself, it is answered by pointing out that the power of amendment of the complaint is given to the Commission by regulations 72(1) and 72(3).

(13) Another argument put forward by the learned counsel for the petitioner against the impugned order was that at one stage the Registrar had stated that the additional allegations would be only to support the allegations made in the original complaint. But the application for amendment seeks to add new allegations to the allegations made in the original complaint. But there is no estoppel against the Registrar in making additional allegations even if he had thought at one stage that the additional allegations would support only the original allegations and would not make out new restrictive trade practices.

(14) It was then argued that having once filed a complaint on specific allegations and having asserted that the additional material will be only to strengthen these allegations, the Commission cannot allow the amendment of the original complaint by the introduction of totally new allegations. This would amount to making out a new case. We are unable to appreciate this argument. The complaint is that the respondents are resorting to restrictive trade practices. Whether the restrictive trade practice is only one or they are numerous, the object of the complaint is to invite inquiry by the Commission under section 37. Each restrictive trade practice may be connected with another or may be quite different from the others. The disparate nature of restrictive trade practices is like separate causes of action. Just as separate causes of action can be joined in one civil suit similarly different allegations of restrictive trade practices can also be made in one complaint. They can be introduced by an amendment of the original complaint just as they can be introduced by an amendment of the plaint or an application. This question has been decided by a Full Bench of this Court in Smt. Abnash Kaur v. Dr. Avinash Nayyar, 2nd (1974) Ii Delhi 133. (2).

(15) The acceptance of the argument that once a notice of hearing is given in respect of certain restrictive trade practices only, other restrictive trade practices cannot be introduced by way of amendment in the said notice of hearing would allow technicality to defeat justice. For, if such an amendment is not allowed and a decision is given as to the allegations made in the unamended notice of hearing, a subsequent complaint by the Registrar praying the Commission to inquire into additional restrictive trade practices would be resisted on the ground that it is barred by the principle of constructive rest judicata. It would be arguable that these additional restrictive trade practices might and ought to have been alleged in the first complaint itself and that the failure of the Registrar to do so operated against him as constructive rest judicata. It appears from the order of the Commission that the Registrar was now and not very experienced. He, thereforee, omitted to allege certain restrictive trade practices in the first complaint made by him. To prevent him from moving the Commission by amending the notice of inquiry, that is. the complaint annexed to the notice of inquiry, would give to the petitioners before us an undeserved advantage. Such a consequence would not haw been contemplated by the framers of the Regulations. For the above reasons, the writ petition is dismissed after heari ng both the parties but before it was admitted with no order as to costs.


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