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TMI Blog2014 (4) TMI 806X X X X Extracts X X X X X X X X Extracts X X X X ..... out fundamental rights given to the citizens to practice any profession or carrying on any occupation, trade or business so long as it is not prevented or is within the frame work of the regulation, if any - The restrictions permitted to be imposed by sub-clauses (2) to (6) of Article 19 must be read as a whole, each throwing light on the scope of the other and that the common thread running through these several provisions was the ground of public policy understood in a comprehensive sense - Every public statute was enacted in the public interest and, therefore, both public policy and public interest demanded its enforcement - The public interest justifying the restrictions might, therefore, arise from the very provisions of the enactment and might be grounded on the necessity to prevent its evasion. The restrictions permitted by sub-clauses (2) to (6) of Article 19 follow a pattern i.e. they are imposed by the legislature for the reasons of public policy - The aspect of public policy involved in the facts of each of the several fundamental rights conferred by the several sub-clauses of Article 19(1) might defer but one underlined principle, requirement of public policy, runs t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business activities of selling the aforesaid branded products in Indian market at a competitive price by purchasing the same in bulk from other countries where they are available at a very cheap price. 2.4 According to the petitioner, even the consumers are being benefited as they get the products at a lesser price than that offered by the manufacturers. The petitioner is aggrieved by issue of the Electronics and Information Technology Goods (Requirement for Compulsory Registration) Order, 2012 and the notifications issued by the respondent authorities in purported exercise of powers conferred under Section 10 (1) (p) of the Bureau of Indian Standards Act, 1986 (for short, the Act 1986 ) read with Rule 13 (fa) of the Bureau of Indian Standards Rules, 1987 (for short, the Rules 1987 ) which has an effect of destroying the parallel imports and hampering the business of such importers including the petitioner as the same mandates compulsory registration of the aforesaid products by getting them tested in BIS (Bureau of Indian Standard) recognized laboratory through a manufacturer or by a person duly authorized by such manufacturer by providing such technical specifications which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g a positive image internationally as a country with quality production of the Electronic IT goods. Department of Electronics Information Technology (DeitY) has on 03 Oct. 2012 notified Electronics and Information Technology Goods (Requirement for Compulsory Registration) Order, 2012 mandating fifteen categories of electronics items under the Compulsory Registration Scheme of Department of Consumer Affairs based on their compliance to Indian safety standards. 3.4 The order under consideration, Electronics and Information Technology Goods (Requirement for Compulsory Registration) Order, 2012 , was not sudden and due notice was given to all concerned. The order was notified on 07 Sept. 2012, published in Gazette of India on 03-10-2012 and came into effect on 03 July 2013. The order neither has any effect of prohibiting parallel imports nor does it encourage the monopoly of MNCs. The order is equally applicable to imported as well as domestically manufactured electronic goods. The petitioner has alleged that the said Order has an effect of destroying the parallel imports and shutting down of the business of such importers. The petitioner's allegation is baseless as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er due consultations with stakeholders which include industry associations, Department of Consumer Affairs (DoCA), Ministry of Commerce, Bureau of Indian Standards (BIS), Representatives of Conformity Assessment Bodies, Consumer Organizations etc. Rather, this order has come into effect as a strategic initiative of National Policy on Electronics (NPE), 2012 of the Govt. of India which has led to this order that has been approved by the Union Cabinet. 4 . . A. The order is neither ultra vires, nor unjust, nor unreasonable, nor in violation of provisions of law, nor arbitrary, nor discriminatory, nor contrary to settled legal position, nor in breach of principles of natural justice and nor in gross violation of Art. 14 19 (1) (g) of the Constitution of India since it has been issued after due consultations with the stakeholders in the electronics sector including industry associations, Department of Consumer Affairs (DoCA), Ministry of Commerce, Bureau of Indian Standards (BIS), Representatives of Conformity Assessment Bodies, Consumer Organizations etc. B .. C. The BIS Act has been in place since 1986. Many Govt. Ministries/Departments have been using BIS Licensin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Technology (IT) goods are made available to the consumers. It is pertinent to note that the said Order is not only applicable to indigenous manufacturers but also to the foreign manufacturers of the covered electronics and IT goods. It is categorically denied that the impugned Order will be having an overriding effect over the Section 107A(b) of the Patent Act, 1970 because the impugned Order does not deal with the import of the electronics and IT goods, however, the same has been issued to provide safeguard to the consumer against the sub-standard or defective goods which do not conform to the specified standards. (d) With regard to para no.3.5 of the petition, I state that the contents thereof are distinct and irrelevant so far as the facts and circumstances of the current proceedings are concerned. Even for the sake of repetition, I reiterate that the impugned Order and the adopted mechanism pursuant thereto do not interfere with the export and import of electronics and IT goods but the same provides certain mechanism to maintain certain quality standards in the interest of consumer at large. (e) With regard to para no.3.6 of the petition, I state that the alleged discrimi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction on the part of the authorities could be termed as violative of the principles of natural justice as no opportunity of hearing was given to the petitioner and other similarly situated persons before introducing such a policy. 5.1 Mr. Mehta submitted that the impugned order has resulted into a total closure of a lawful occupation, trade and business of the petitioner and is in derogation of the Article 19, Clause (6) of the Constitution of India because the restrictions which have been imposed are not covered by Clause (6) of Article 19. 5.2 Mr. Mehta submitted that the policy decision of the respondents has resulted into discrimination amongst the citizens of India engaged in the business activities as preference has been given to the multi national companies over the parallel importers. According to Mr. Mehta, the impugned order and the notifications are not only unconstitutional but the same are also ultra vires the provisions of Section 107 A (b) of the Patents Act, 1970 [as amended by the Patents (Amendment) Act, 2005]. It is submitted that Section 107 A (b) of the Patents Act ensures the parallel import of the electronics and information technology goods without aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the notifications issued pursuant thereto are in any manner ultra vires Article 19 (1) (g) of the Constitution of India or violative of any other provisions of law. 8. Before adverting to the rival submissions canvassed on either side, it will be profitable to look into the Order 2012 published in the official gazette dated 7th September, 2012, which reads as under: 'S.O. 2357(E). In exercise of the powers conferred by section 10(1)(p) of the Bureau of Indian Standards Act, 1986 (63 of 1986) and in pursuance of clause (fa) of rule 13 of the Bureau of Indian Standards Rules, 1987, the Central Government, after consulting the Bureau of Indian Standards, hereby makes the following Order, namely:- 1. Short title and commencement: (1) This Order may be called the Electronics and Information Technology Goods (Requirements for Compulsory Registration) Order, 2012. (2) It shall come into force on the expiry of six months from the date of its publication in the Official Gazette. 2. Definitions: (1) In this Order, unless the context otherwise requires, (a) Act means the Bureau of Indian Standards Act, 1986 (63 of 1986); (b) Appropriate Authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Information Technology, the Appropriate Authority or person authorized by him, with a view to secure compliance with this Order may also- (a) inspect or cause to be inspected any books or other document and other Goods or the components or materials of any Goods kept by or belonging to or in the possession or under the control of any person engaged in the manufacture, storage for sale, import, sale or distribution of Goods; (b) enter and search any premises and seize Goods in respect of which it has reason to believe that a contravention of this Order has been committed or the said Goods are not complying with the Specified Standards; (3) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) relating to search and seizure shall so far as may be, applied to searches and seizures under this clause.' 9. It will also be profitable to look into the Electronics and Information Technology Goods (Requirement for Compulsory Registration) Amendment Order 2013, which reads as under: '2. In the Electronics and Information Technology Goods (Requirements for Compulsory Registration) Order, 2012, (a) for paragraph 3, the following paragraph shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stitution, i.e. right to carry on business. 11. It appears from the materials on record that the laboratories authorized by the respondent no.2-Bureau of Indian Standards demand for the purpose of testing and certifying certain information which would be available only with the manufacturer and such manufacturer, according to the petitioner, would never provide with such details to the parallel importers. Therefore, according to the petitioner the parallel importers are indirectly restrained from carrying on their business which is otherwise permissible under the Indian laws. However, it appears that the requirements of the respondent no.2-Bureau for testing the sample would include certification of raw materials like HDD, mother boards, PCB layout, schematic, circuit diagram of mother board, which would be available only with the manufacturer. The system assemblers import these finished products which are raw materials for laptops, namely, HDD, MB, ODD, RAM and are unable to provide certification, schematic, circuit diagram etc. to the BIS lab for testing the sample of their assembled laptop. This, in our opinion, is not a valid ground for challenging the validity of the impugn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision which no reasonable person would have reached or (v) abused its powers. 17. Article 19(1)(g) read with Article 19(6) of the Constitution of India spells out fundamental rights given to the citizens to practice any profession or carrying on any occupation, trade or business so long as it is not prevented or is within the frame work of the regulation, if any. There cannot be any dispute that certain professions, occupations, trade or business which are not in the interest of general public may be completely prohibited while other may be permitted with reasonable restrictions. The restrictions permitted to be imposed by sub-clauses (2) to (6) of Article 19 must be read as a whole, each throwing light on the scope of the other and that the common thread running through these several provisions was the ground of public policy understood in a comprehensive sense. The public policy thus enforced might be founded on the principles of the common law; vide for instance Egerton v. Earl Brownlow [1853] 4 HLC 1 at p.256 (G), where the House of Lords said: No subject can lawfully do that which has a tendency to be injurious to the public, or against the public good. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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