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TMI Blog2015 (9) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... within a short time or else it was to carry interest at the rate of 10% per annum. The order of the Commission appears to be largely influenced by a conclusion that the appellant should not have asked for deposit of an amount above the basic price because in the opinion of the Commission it was unfair for the appellants to keep excise and sales tax with itself for any period of time. Such conclusion of the Commission is based only upon subjective considerations of fairness and do not pass the objective test of law as per precise definitions under Section 36A of the Act. Even after stretching the allegations and facts to a considerable extent in favour of respondent Commission, we are unable to sustain the Commission’s conclusions that the allegations and materials against the appellant make out a case of unfair trade practice against the appellant. Nor there is any scope to pass order under Section 36-D(1) of the Act when no case of any unfair trade practice is made out. - Decided in favor of appellant. - CIVIL APPEAL NO. 2069 OF 2006 - - - Dated:- 7-9-2015 - VIKRAMAJIT SEN AND SHIVA KIRTI SINGH, JJ. For Appellant : Mr. Rajan Narain,Adv. For Respondent : Mr. P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rores. The appellant gave an option to prospective customers to opt for a second phase of 50,000 vehicles likely to be delivered from April-May 1999 to March 2000. It refunded the balance amounts to those who desired for refund, along with interest as represented. No complaint was made to the Commission by any of the persons who made the booking and thereafter either purchased the car or withdrew the deposits with or without interest, as the case may be. (iii) However three complaints were made before the Commission by persons who claimed that they had intentions to make the booking but were dissuaded by the high quantum of deposit required for the purpose. Their specific objection was that the demanded amount exceeded the basic price of the car if cess, taxes and transportation cost were left out. According to the complainants the appellant had indulged in Unfair Trade Practice (UTP) by demanding an excessive amount for bookings of Indica cars and by including the likely taxes, cess and transportation cost. 3. Since the defence taken by the appellant was also not disputed on facts, it would be relevant to note the same. When the Commission received the three complaints, it s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the customer would be required to pay. According to submissions, such practice could not have promoted the sale of their vehicle rather it was discouraging. The large response shows peoples faith in the products of the appellant and also that the interest rate offered by the appellants was appreciable and fair. 5. Learned Senior Counsel Mr. Ashok H. Desai highlighted the definition of Unfair Trade Practice as indicated in Section 36A of the Act. Since the Notice of Enquiry alleged that the appellant had indulged in unfair trade practices falling under Section 36A (1) (i), (ii), (iv) and (vi) of the Act, the aforesaid provisions need to be noticed. They read as follows: 36A. Definition of unfair trade practice In this Part, unless the context otherwise requires unfair trade practice means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provisions of any services, adopts any unfair method or unfair or deceptive practice including any of the following practices, namely :- (1) the practice of making any statement, whether orally or in writing or by visible representation which, (i) falsely represents that the good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to consider whether the Board has adopted unfair method or deceptive practice for the purpose of promoting the sale, use or supply of any goods or for the provisions of any services. Unless there is a finding on this issue, the appellant Board cannot be penalised for unfair trade practice. 8. On behalf of appellant reliance was also placed upon judgment of this Court in the case of M/s Lakhanpal National Limited vs. M.R.T.P. Commission and Another (1989) 3 SCC 251, particularly paragraph 7 and 9 thereof. In paragraph 7 it was held that the definition of Unfair Trade Practice in Section 36A is not inclusive or flexible, but specific and limited in its contents. The Court also considered the object of this provision with a view to resolve the issue as to whether particular acts can be condemned as unfair practice or not. We are in full agreement with the view expressed by L. M. Sharma, J., as he then was and hence it would be more appropriate to extract para 7 which runs thus: 7. However, the question in controversy has to be answered by construing the relevant provisions of the Act. The definition of unfair trade practice in Section 36-A mentioned above is not inclusiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o him the Commission acted fairly in entertaining the complaints from three persons who found the booking amount very high and therefore did not deposit the same. According to him once a Preliminary Investigation Report dated 15.2.2000 was available with conclusion and recommendation to the effect that only the basic price of the car ought to have been collected from the public and not further amount which can cover only excise duties and sales tax that goes to the Government and that such amount should not have been retained by manufacturing units for a long period of time, the Commission although did not find the appellant guilty of any of the four specific provisions of Section 36-A (1) but still it felt compelled to conclude against the appellant and resultantly pass a cease and desist order under powers conferred upon the Commission by Section 36-D (1) (a) of the Act. 10. Mr. Sanghi also sought to support the finding of the Commission on issue number one that the appellant has indulged in unfair trade practice by referring to certain narratives in the Preliminary Investigation Report (PIR). As per his submission the Commission had not only communicated the precise allegatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king amount although this fact was obvious from the terms and conditions of the booking and was reportedly relied upon by the appellant in its reply even at the stage of preliminary investigation. The Commission noticed the relevant facts including provision for interest while narrating the facts, but failed to take note of this crucial aspect while discussing the relevant materials for the purpose of arriving at its conclusions. Such consideration and discussion begins from paragraph 32 onwards but without ever indicating that the booking amounts had to be refunded within a short time or else it was to carry interest at the rate of 10% per annum. 13. The order of the Commission appears to be largely influenced by a conclusion that the appellant should not have asked for deposit of an amount above the basic price because in the opinion of the Commission it was unfair for the appellants to keep excise and sales tax with itself for any period of time. Such conclusion of the Commission is based only upon subjective considerations of fairness and do not pass the objective test of law as per precise definitions under Section 36A of the Act. The submissions and contentions of Mr. Desa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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