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TMI Blog2016 (5) TMI 882X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of correcting or contradicting what is said against the person. In my opinion the aforesaid is true of the role of the DG also and as a part of the duty to act fairly, DG ought to allow the officials of the petitioner summoned, if so desire, to be accompanied by Advocates. The fear of the DG of the Advocates is also not understandable. DG has full discretion to regulate its proceedings and ensure and control that the presence of the advocates does not delay its proceedings, as was the apprehension expressed. Sachs L.J., in his opinion in the aforesaid judgment observed that there must be “fairplay in action” though it may be “flexible” depending upon the situation so that the same does not result in “unsuitable procedures”. It was also noted that many men have deep rooted fear of becoming involved as defendants in actions arising out of their depositions and that it is difficult to even persuade a citizen to give evidence in road accident cases and that the Inspectors must in public interest take into account the fears of potential witnesses. Buckley L.J. in his opinion in the said judgment held that fair treatment required the Inspectors to give to persons being investigated t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther attempts of the petitioner to gather information also did not meet with any success. i. that on 24th November, 2010 the petitioner was served with summons dated 23rd November, 2015 of the DG under Section 41(2) r/w Section 36(2) of the Companies Act addressed to Mr. Vishal Makar and Mr. Prem Kumar Madali, officers of the petitioner, to appear before DG on 14th December, 2015 in respect of the inquiry / investigation. j. that the CCI/DG were thus conducting inquiry/investigation against the petitioner, asking the petitioner to join in the same, without giving access to the petitioner the evidence/documents based on which such inquiry/investigation was being conducted. k. that as per Section 36(1) of the Competition Act, the CCI, in discharge of its functions, is to be guided by principles of natural justice and the CCI/DG by failing to provide an opportunity to the petitioner to inspect the file and by failing to provide certified copies of documents sought for, not complying with the principles of natural justice. l. that the DG was conducting inquiry/investigation unfairly and unreasonably without following due process of law. m. that the DG also does not permit the par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the senior counsel for the petitioner, as to how the challenge to the order dated 26(1) which is more than two years old i.e. of 6th November, 2013, is maintainable now, the senior counsel for the petitioner states that the petitioner for the first time learnt of the said order only on receipt of first notice dated 27th May, 2015 from DG, CCI. It is clarified that prior thereto, the petitioner was not investigated at all. 3. The order under Section 26(1) directs the DG, CCI to complete the investigation and submit a report within sixty days. It has as such been enquired from the counsel for the respondents appearing on advance notice, as to how the investigation is continuing till now. The senior counsel for the petitioner in this regard also draws attention to Regulation 20(2) of the Competition Commission of India (General) Regulation, 2009 which provides for the CCI, while directing the DG, CCI, to investigate, to submit a report within such time as may be specified by the CCI which ordinarily shall not exceed sixty days from the date of receipt of the directions. 4. The counsel for the respondents on oral instructions states that the period was extended from time to time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sires to cross-examine any witness recorded, would also be given an opportunity to cross-examine. 13. The senior counsel for the petitioner states that the material should be made available before the statement of the representatives of the petitioner is recorded and for which purpose they have been summoned tomorrow i.e. 1st December, 2015 and on 3rd December, 2015. 14. The counsel for the respondents seeks time to obtain instructions. 15. List tomorrow i.e. 1st December, 2015", on 1st December, 2015 - "1. The counsel for the respondents states that complete instructions have not been received as yet. 2. List on 2nd December, 2015. 3. In the meanwhile, the hearing listed before the Director General, Competition Commission of India (CCI) for today be deferred to 3rd December, 2015." and on 2nd December, 2015- "1. This order is in continuation of the previous orders dated 30th November, 2015 and 1st December, 2015. 2. The counsel for the respondents states that without prejudice to the rights and contentions of the respondents and without constituting a precedent, the respondents are ready to furnish all the documents of investigation available with the respondents, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce In the advocates before authorities competent to take evidence and DG, CCI under the provisions of the Competition Act, 2002 is empowered to take evidence. 3. The counsel for the respondents seeks time to consider. 4. List on 14th December, 2015. 5. The date given of 14th December, 2015 for the summoned persons of the petitioner to appear before the DG, CCI be deferred." 5. Thereafter on 14th December, 2015, the following order was passed. "1. This order is in continuation of the order dated 11th December, 2015. 2. Though the counsel for the respondents initially stated that the insistence if any for being accompanied by the Advocate should be of the officials of the petitioner summoned by the respondents and cannot be of the petitioner but upon the counsel for the petitioner stating that he would implead the said officials also as petitioners, the counsel for the respondents has not pressed the said objection. 3. Arguments on the right of the said officials to be accompanied by advocates have been heard. 4. Order reserved. 5. Since the question is of some significance and since the respondents have not filed any counter affidavit, it is deemed appropriate that an opport ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d proceedings are deemed to be judicial proceedings under Section 193 and Section 228 of the Indian Penal Code, 1860; under the Customs Act also a gazetted officer is empowered to summon persons and to take evidence under the Act and to ask persons for production of documents. c. While interpreting the provisions of the aforesaid laws, the Courts have consistently held that a person who is called to give his / her statement by way of evidence cannot insist as a matter of right that he be accompanied by a lawyer; reliance in this regard is placed on Poolpandi Vs. Supdt., Central Excise (1992) 3 SCC 259 and Satyanarayan Nandlal Nuwal Vs. Chief Enforcement Officer 1998 (1) Mh L.J. 548 and Paradip Port Trust Vs. Workmen (1977) 2 SC 339. d. The rationale for not permitting an advocate at this stage is that the person who is called to give in his statement is not an accused and the proceeding is merely an ongoing investigation process. e. At the stage of investigation, when the person being questioned is not an accused, the question to self-incrimination would not arise; reliance in this regard is placed on Percy Rustomji Basta Vs. State of Maharashtra (1971) 1 SCC 847; Surjeet Singh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... months and to examine any person on oath relating to the affairs of the person/enterprise being investigated against/into and all officers, employees and agents of such person/enterprise are also obliged to preserve all books and papers which are in their custody and power. (D) Failure to comply, without reasonable cause, with any direction of the DG, under Section 43 of the Act has been made punishable with fine extending to rupees one lakh for each day of failure, subject to a maximum of rupees one crore. (E) It would thus be seen that the powers of the DG during such investigation are far more sweeping and wider than the power of investigation conferred on the Police under the Code of Criminal Procedure. While the Police has no power to record evidence on oath, DG has been vested with such a power. Our experience of dealing with the matters under the Competition Act has shown that not only statement on oath of witnesses summoned during the course of investigation is being recorded but the said witnesses are being also permitted to be cross-examined including by the informant/claimant and which evidence as part of the report of the DG forms the basis of further proceedings befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , will have an opportunity to defend. (N) The Supreme Court, in Rohtas Industries (supra) 1969 (1) SCC 325 and the Calcutta High Court in New Central Jute Mills Co. Ltd. (supra) [AIR 1966 Calcutta 151], cited by the counsel for the respondent No. 2/complainant, also has held that an investigation against a public company tends to shake its credit and adversely affects its competitive position in the business world even though in the end it may be completely exonerated and given a character certificate and that the very appointment of Inspector (in that case under Section 237(b) of the Companies Act to investigate the Company's affairs) is likely to receive much press publicity as a result of which the reputation and prospects of the Company may be adversely affected. (O) When the effect of, an order of investigation under Section 26(1) of the Competition Act can be so drastic, in our view, availability of an opportunity during the course of proceedings before the CCI after the report of the DG, to defend itself cannot always be a ground to deny the remedy under Article 226 of the Constitution of India against the order of investigation. Though we do not intend to delve deep i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e services of an advocate. (R) Supreme Court in N.K. Bajpai supra [(2012) 4 SCC 653] after noticing Section 30 of the Advocates Act held that the right to practice is not only a statutory right but would also be a fundamental right under Article 19(1)(g) of the Constitution. (S) Supreme Court in Dr. D.C. Saxena, Contemnor v. Hon'ble the Chief Justice of India MANU/SC/0627/1996 : (1996) 5 SCC 216 held that advocacy touches and asserts the primary value of freedom of expression so dear in a democracy. It was further held that freedom of expression produces the benefit of the truth to emerge and assists stability by tempered articulation of grievances and plays its part in securing the protection of fundamental human rights. (X) Though the counsel for the respondents, from Clause 3(ii) of the Master Circular requiring the decision taken on classification as a wilful defaulter to be well documented and supported by requisite evidence contended that the GRC is authorized to take evidence but we find the words 'legally authorized to take evidence' meaning, authorized to compel presence of any person as a witness and which we do not find the GRC to be authorized to. It thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Bombay high Court in Satyanarayan Nandlal Nuwal supra merely follows Poolpandi supra iii. Paradip Port Trust supra was concerned with the Industrial Dispute Act which contained a specific provision debarring the advocates from appearing before the Industrial Tribunal. However there is no such corresponding provision in the Competition Act debarring the advocates from practicing before the DG. Thus the same would be of no relevance. iv. Percy Rustomji Basta, Surjeet Singh Chabra and K.T.M.S. Mohd.supra are on the evidentiary value of the statements which were factually found to have been voluntarily made before the officers under the FERA and also did not consider the question aforesaid under consideration herein. v). Swadeshi Cotton Mills supra is on the applicability of the principle of audi alteram partem in emergent situations and under the provisions of Industries (Development and Registration) Act, 1951 and the extent of judicial review against such decisions. vi). Similarly, W.N. Chadha supra also is on the aspect of affording opportunity of being heard to an accused before issuing a letter rogatory at the stage of investigation. vii). Tulsiram Patel supra again i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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