2010 (3) TMI 678 - HC - Companies Law

Interpretation of section 12B of the Monopolies and Restrictive Trade Practices Act, 1969 Held that - No doubt the respondents would have to defend legal proceedings in more than one forum, but then that is what has been specifically permitted by section 12B of the said Act and the principle of election of remedies cannot be imported to deny parallel proceedings it such parallel proceedings have been specifically permitted even if in the past the Commission has taken a view to the contrary. As per the clear mandate of section 12B(4) of the said Act, an application for compensation is maintainable even if a civil suit is pending and the application must proceed in accordance with law. We thus set aside the impugned order dated 13-11-2000 and direct the Commission (now the succeeding authority being Competition Commission of India under the Competition Act, 2002) to proceed in accordance with law. The petition is accordingly allowed

Issues Involved:
1. Interpretation of Section 12B of the Monopolies and Restrictive Trade Practices Act, 1969.
2. Maintainability of an application under Section 12B of the Act when other legal proceedings are pending.
3. Doctrine of election of remedies and its applicability to Section 12B.
4. Historical and legislative intent behind Section 12B.
5. Consistency with previous judicial and Commission decisions.

Detailed Analysis:

1. Interpretation of Section 12B of the Monopolies and Restrictive Trade Practices Act, 1969:
The judgment primarily revolves around the interpretation of Section 12B, which empowers the Commission to award compensation for losses caused by monopolistic, restrictive, or unfair trade practices. Section 12B(1) allows for compensation claims without prejudice to other legal remedies. Section 12B(4) ensures that any compensation awarded by the Commission is set off against amounts recovered through other legal proceedings.

2. Maintainability of an application under Section 12B of the Act when other legal proceedings are pending:
The petitioner argued that Section 12B permits parallel proceedings, supported by Regulation 77 and the format of the affidavit required under the Act. The respondents contended that parallel proceedings should not be allowed and that the petitioner must choose between remedies. The court found that Section 12B(4) explicitly allows for parallel proceedings by providing a mechanism for setting off compensation awarded by the Commission against amounts recovered through other legal proceedings.

3. Doctrine of election of remedies and its applicability to Section 12B:
The doctrine of election of remedies requires the existence of two or more remedies, inconsistency between them, and a choice of one. The court concluded that this doctrine does not apply to Section 12B as the remedies under the Act are concurrent and cumulative, not inconsistent. The court cited American jurisprudence and Indian case law to support this view, emphasizing that Section 12B allows for additional remedies without precluding other legal actions.

4. Historical and legislative intent behind Section 12B:
The respondents referred to the Sachar Committee's recommendations, which led to the introduction of Section 12B, arguing that the Committee did not suggest parallel proceedings. However, the court held that the enacted law must be given full effect, and the clear language of Section 12B permits parallel proceedings. The court emphasized that the legislative intent, as reflected in the statute, allows for additional remedies and does not restrict the filing of an application under Section 12B even if other legal proceedings are pending.

5. Consistency with previous judicial and Commission decisions:
The court referred to various judgments, including Pennwalt (I.) Ltd. v. Monopolies and Restrictive Trade Practices Commission, Man Roland Druckimachinen AG. v. Multicolour Offset Ltd., and Reckitt Benckiser (India) Ltd. v. Hindustan Lever Ltd., which supported the view that remedies under the Act are in addition to other legal remedies. The court also noted that previous Commission decisions, which discouraged parallel proceedings, were not binding and that the clear mandate of Section 12B should prevail.

Conclusion:
The court set aside the impugned order dated 13-11-2000, holding that an application for compensation under Section 12B is maintainable even if other legal proceedings are pending. The Commission (now the Competition Commission of India) was directed to proceed in accordance with the law. The petition was allowed, and the parties were directed to appear before the Competition Commission of India on 26-4-2010.

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