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TMI Blog2023 (4) TMI 1387X X X X Extracts X X X X X X X X Extracts X X X X ..... ssembly (Phase Breaks). The petitioner firm again participated in the said global tender and it s bid was accepted for supply of 176 sets, out of total tender quantity of 238 sets - Admittedly, in response of the purchase order dated 27.2.2018, the petitioner supplied the entire articles through various Challan-cum-Tax Invoices dated 26.6.2018 but instead of clearing the outstanding amount to the petitioner firm, the second respondent sent a letter dated 17.05.2018 stating that they have invoked Book Examination Clause for the present order as well as the previous order of 2013. The price trend does not support the allegation of abuse of dominant position made by the informant by artificially determining the sale price in terms of the provisions contained in Section 4(2)(a)(ii) of the Act, 2002. In view of the above assessment, the Commission was of the view that the petitioner does not appear to have abused its dominant position in terms of the provisions of Section 4 of the Act, 2002 and no case of contravention of the provisions of Section 4 of the Act, 2002 was made out against the petitioner, accordingly the matter was ordered to be closed in terms of the provisions contained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvocate Navin Sinha For the Respondent : Rajnish Kumar Rai (Delivered by Hon'ble Mahesh Chandra Tripathi, J.) 1. Heard Sri Fuzail Ahmad Ansari, learned counsel for the petitioner and Sri Sudarshan Singh, learned counsel for the respondents. 2. Pleadings have been exchanged and with consent of learned counsel for the parties, this writ petition is being finally disposed of under the Rules of the Court. 3. Present Writ Petition under Article 226 of the Constitution of India is preferred seeking following reliefs:- "A. issue a writ, order or direction in the nature of certiorari to quash the impugned Modification Advice/Orders dated 12/13.09.2018 in respect of Purchase Order No.CORE/S/1271/5530/20478 dated 27.02.2018, Purchase Order No.CORE/S/1271/5226/20473 dated 12.01.2018 and Purchase Order No.CORE/S/1271/4054/20177 dated 13.09.2013 as well as quash the Demand Notice dated 26.09.2018 in respect of purchase order dated 13.09.2013. B. issue a writ, order or direction in the nature of mandamus directing the respondent authorities to make the entire payments of the petitioner forthwith alongwith 18% interest from the actual date of dues of the petitioner. C. issue a wr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voice from AF Switzerland, which is claimed to be same price on which the CORE bought the material directly from AF Switzerland some years back. It is also claimed that Arthur Flury Switzerland - AF prices remained same from the years 2011 till 2018 in foreign currency as it had a policy of fixed prices for final customer and re-seller gets the discount on these prices. The bid was opened on 18.10.2017 and the petitioner's offer was accepted by the Competent Authority. Consequently, legally bounded purchase order was given to the petitioner for supply of 28 sets of SNS Assembly (Phase Breaks) vide their purchase order dated 12.1.2018 with detailed terms and conditions for total value of Rs. 2.31 crores. It is undisputed that full material was supplied by the petitioner firm. The copy of the challan-cum-tax invoice showing receipt of articles on 15.3.2018 has also been brought on record as Annexure No.7 to the writ petition. 6. Meanwhile, another global tender was advertised by the CORE on their official website and solicited online global bids, which were opened on 29.11.2017 for supply of 238 sets of SNS Assembly (Phase Breaks). The petitioner firm had again participated in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ected to challenge by the CORE and the same has attained finality. Meanwhile, the respondents issued a notice to the petitioner on 17.5.2018 for producing books and records in tender under "Book Examination Clause-IRS 3300" qua the articles supplied by the petitioner in view of purchase order dated 13.09.2013 as well as purchase order dated 12.01.2018. Even though against the purchase order dated 13.09.2013 the respondents had already paid the amount and it was a closed contract. Said notice was responded by the petitioner through its response dated 30.05.2018. Thereafter, the respondents issued a letter to the petitioner on 14.06.2018 and reiterated the earlier demand of supplying the documents. In the notice dated 17.05.2018 the respondent had alleged that the petitioner is taking unreasonable higher profits. Consequently, the second respondent had preferred a complaint dated 12.06.2018 under Section 19(1)(b) of the Competition Act, 2002 Act, 2002 before the Secretary, Competition Commission of India CORE alleging that the petitioner flouted the provisions of Sections 3 and 4 of the Act, 2002. The said complaint was treated as a Reference Case No.05 of 2018 (Central Organisation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovided under the Competition Act, 2002. The said act has been enacted to provide, keeping in view of the economic development of the county, for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom to trade carried on by other participants in markets, in India, and for matters connected therewith. The Competition Commission rejected the claim of the Railway by passing an order that no inflated rates have been presented by the petitioner for the Railway to revise the same. It is to be noted that against the order of Competition Commission, the Railway had the freedom to approach the Tribunal constituted under the Act, which they chose not to and unilaterally revised the rates by passing an order dated 12/13.9.2018 and consequently, has issued a demand notice on 26.9.2018 for a sum of Rs. 5,19,47,553.80/-. It is to be further noted that once the Competition Commission already decided the claim of the Railway, prima facie, we are of the view that without filing an appeal, unilaterally rates could not have been revised. The matter re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the petitioner. The same is also in violation of principle of natural justice. 12. Sri F.A. Ansari further submitted that in the notice dated 17.05.2018 the respondent had alleged that the petitioner is taking unreasonable higher profits without there being any basis for the same. It is factually incorrect as the rates were finalized through proper negotiation between the parties and after due deliberations the price offered by the petitioner firm was duly accepted by the respondent authorities. Accordingly, the purchase order was issued in favour of the petitioner firm. Moreover, the second respondent had filed detailed complaint dated 12.06.2018 before the CCI, registered as Reference Case No.05/2018 under Section 19(1)(b) of the Act, 2002, against the petitioner alleging contravention of provisions of Sections 3 and 4 of the Act, 2002. On the said complaint/reference the enquiry was made by the CCI on the basis of material filed by the respondent and passed an order on 27.8.2018 and rejected the complaint/reference. He submitted that while preferring the reference against the petitioner the CORE has alleged before the CCI, on the basis of purchase orders, to the effect that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also dismissed by the NCLAT on 13.4.2022. While dismissing the review application the NCLAT observed that it is open to the aggrieved party to prefer Civil Appeal before Hon'ble Supreme Court against the judgment dated 23.1.2020. He submitted that till date no appeal is filed and therefore, the order dated 27.1.2018 passed by the CCI has attained finality and findings therein are not amenable to scrutiny of this Court which has been upheld by the NCLAT vide order dated 23.1.2020 and 13.4.2022 (review order) which is not subjected to challenge before the Apex Court under Section 53-T of the Act, 2002. He submitted with utmost respect that once the remedy has not been availed by the CORE even at this belated stage then this Court does not inhere the power to sit in appeal or to interfere or upset the findings recorded by the CCI in its order dated 27.1.2018. 14. In support of his submission, learned counsel for the petitioner has placed reliance upon the judgment of Apex Court in Union of India vs. Tantia Construction Pvt. Ltd. 2011 (5) SCC 697 and ABL International Ltd. vs. Export Credit Guarantee Corporation of India Limited 2004 (3) SCC 553. He has also relied upon a Division ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted from M/s Arthur Flury, Switzerland was found to be on much lower side as CHF 6400, CHF 7200 & CHF 7200 against the order rate CHF 8600, CHF 8580 & CHF 8580. The said recovery was done by invoking "Book Examination Clause" as mentioned in Para 3300 of IRS conditions of contract. He has placed reliance on Para-42 of the counter affidavit filed by the CORE, wherein it has been stated that in case of any dispute there is a provision of arbitration clause - 2900 IRS conditions as mentioned in the contract. After the amendment in Arbitration and Conciliation Act, 1996 the condition clause 2900 was accordingly amended by the Railway Board and the same is applicable being statutory amendment. 17. It has been further submitted that while submitting the offer on behalf of M/s Arthur Flury, Switzerland, the petitioner has given proforma invoice in which higher CHF rate was quoted by the petitioner but at the time of supplying the material they have paid only CHF 6400, CHF 7200, CHF 7200 per unit respectively in purchase orders dated 13.9.2013, 12.1.2018 and 27.2.2018. Further the petitioner has declared in their calculation sheet submitted during the negotiation that they were claiming ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of enterprises or person or association of persons shall enter into any agreement in respect of production, supply, distribution, storage, acquisition or control of goods or provision of services, which causes or is likely to cause an appreciable adverse effect on competition within India. 2. Any agreement entered into in contravention of the provisions contained in sub-section (1) shall be void. 3. Any agreement entered into between enterprises or associations of enterprises or persons or associations of persons or between any person and enterprise or practice carried on, or decision taken by, any association of enterprises or association of persons, including cartels, engaged in identical or similar trade of goods or provision of services, which- a. directly or indirectly determines purchase or sale prices; b. limits or controls production, supply, markets, technical development, investment or provision of services; c. shares the market or source of production or provision of services by way of allocation of geographical area of market, or type of goods or services, or number of customers in the market or any other similar way; d. directly or indirectly results i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... local authority or enterprise or any person referred to in that sub-section and it shall be in such form and be accompanied by such fee as may be prescribed: Provided that the Appellate Tribunal may entertain an appeal after the expiry of the said period of sixty days if it is satisfied that there was sufficient cause for not filing it within that period. (3) On receipt of an appeal under sub-section (1), the Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the direction, decision or order appealed against. (4) The Appellate Tribunal shall send a copy of every order made by it to the Commission and the parties to the appeal. (5) The appeal filed before the Appellate Tribunal under sub-section (1) shall be dealt with by it as expeditiously as possible and endeavour shall be made by it to dispose of the appeal within six months from the date of receipt of the appeal. 53T. Appeal to Supreme Court.- The Central Government or any State Government or the Commission or any statutory authority or any local authority or any enterprise or any person aggri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h examination, it is established that the contract price is in excess of the actual cost plus reasonable margin of profit, the purchaser shall have the right to reduce the price and determine the amount to a reasonable level. (iv) Whether a contract provided for book examination clause the Contractor or its agency bound to allow examination of its books within a period of 60 days from the date the notice is received by the Contractor, or its agencies calling for the production of documents as under clause (i) above. In the event of Contractor's or his agencies failure to do so, the contract price would be reduced and determined according to the best judgment of the purchase which would be final and binding on the Contractor and his agencies." (emphasis supplied) 21. We have proceeded to examine the record in question and find that the CORE is an organization under the Ministry of Railways and is entrusted with the responsibility to carry out railway electrification over the entire network of the Indian Railways. The CORE inter alia procures SNS Assembly also called 'Phase Break' for various Railways Zones from M/s Arthur Flury AG Switzerland, which sells this produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondents had already paid the amount and it was a closed contract. The petitioner submitted reply to the said notice on 30.05.2018. Thereafter, the second respondent preferred complaint dated 12.06.2018 under Section 19(1)(b) of the Act, 2002 before the Secretary, CCI against the petitioner for flouting provisions of Sections 3 and 4 of the Act, 2002, registered as a Reference Case No.05 of 2018. Finally, the Commission has decided the reference on 27.8.2018. The operative portion of the judgment dated 27.8.2018 is reproduced hereinafter:- "8. The Commission has perused the reference and the documents filed therewith and also considered the material available in public domain. 9. At the outset, the Commission notes that though the Informant has alleged contravention of the provisions of both Sections 3 and 4 of the Act, yet looking at the nature of allegations and the relationship of the OP with the OEM, the provisions of Section 3(3)(a) of the Act are not applicable to the present case as the OP (distributor) and OEM (manufacturer) are operating at different levels of the production chain in different markets. Thus, prima facie the provisions of Section 3(3)(a) of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a situation of high dependence of the Indian Railways for the SNS Assembly on the OP. Thus, the Commission observes that the OP can be said to be dominant in the above defined relevant market. 15. In view of the above assessment, the Commission is of the view that the OP appears to be dominant in terms of the provisions of Section 4 of the Act. 16. To examine the alleged abuse of dominant position by the OP in the relevant market delineated supra, it is noted that the Informant has not specified any specific condition which can be examined within the framework of Section 4(2)(a)(i) of the Act. 17. However, on a closer scrutiny of the information, it appears that the Informant is essentially aggrieved by the allegedly high prices charged by the OP for supply of SNS Assembly to CORE. The informant has claimed that the OP has increased the prices in last 12 years without any significant inflation in Switzerland. Thus, the informant has essentially raised the issue of excessive pricing. To support the allegations, it has been pointed out that in purchase order dated 13.09.2013, the OP had supplied 282 sets of SNS Assembly on behalf of M/s Arthur Flury AG on the basic rice (exclud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2019 was filed by the CORE before the NCLAT and the same was dismissed by the NCLAT on 23.1.2020 with following observations:- "After hearing learned counsel for the appellant, we find that there is no plausible explanation offered for inordinate delay of 330 days (wrongly described as 350 days) in preferring the appeal. Admittedly, the impugned order was passed by the Competition Commission of India based at New Delhi and it is inconceivable that the appellant was not aware of the appellate mechanism and the forum empowered to entertain the appeal. The ground sought to be projected for condonation of delay does not constitute a "sufficient cause" so as to warrant condonation as sought. Viewed in that context, we find that the huge delay of 330 days has not been explained satisfactorily and no sufficient cause has been assigned for such delay. The application for condonation of delay is accordingly dismissed. That apart, on merit we find that the Commission has noticed the trend in decrease of price of the relevant product in 2016 and 2018 and in view of the same, no prima facie case for directing investigation by Director General was made out. We find no reason to disagree wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CCI was challenged before the NCLAT in Appeal (AT) No.79 of 2019 and finally, the Appellate Tribunal had also dismissed the appeal on the ground that there was no plausible explanation offered for inordinate delay of 330 days in preferring the appeal and no sufficient reason or cause has been assigned for such delay. Consequently, the application for condonation of delay was accordingly dismissed. Further, on merit the NCLAT found that the Commission has noticed the trend in decrease of price of the relevant product in 2016 and 2018 and in view of the same, no prima facie case for directing investigation by Director General was made out. The NCLAT found no reason to disagree with the view taken by the Commission and declined to intervene. The review application was also dismissed by the NCLAT on 13.4.2022 as not maintainable, leaving it open to the aggrieved party to prefer Civil Appeal before the Hon'ble Supreme Court of India against the judgment dated 23.01.2020 passed by the Tribunal in Competition Appeal (AT) No.79 of 2019. 26. It is admitted that the observations and findings returned by the CCI in its order dated 27.8.2018 stood upheld by the NCLAT in its orders dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h they exclude the jurisdiction of their respective High Courts. This aspect can be illustrated by briefly adverting to the broad facts of two of the matters before us. C.A. No. 1532-33 of 1993 arises as a result of conflicting orders issued by the West Bengal Taxation Tribunal and the Calcutta High Court. Certain petitioners had challenged the constitutional validity of some provisions in three legislations enacted by the West Bengal Legislature before the west Bengal Taxation Tribunal. After examining the matter and hearing the arguments advanced in response by the State of West Bengal, the West Bengal Taxation Tribunal, by this order dated 9.10.1991, upheld the constitutional validity of the impugned provisions. Thereafter, the constitutional validity of the same provisions was challenged in a Writ Petition before the Calcutta High Court. During the proceedings, the State of West Bengal raised the preliminary objection that by virtue of Section 14 of the West Bengal Taxation Tribunal Act, 1987, which excluded the jurisdiction of the High Court in all matters within the jurisdiction of the Taxation Tribunal, the Calcutta High Court had no jurisdiction to entertain the writ petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Central Tax Courts. Similarly, other Reports of the LCI have suggested the setting up of 'Gram Nyayalayas' (1986) LCI, 114th Report , Industrial/Labour Tribunals 1987 LCI, 122nd Report and Education Tribunals (1987) [LCI, 123rd Report . 91. We may first address the issue of exclusion of the power of judicial review of the High Courts. We have already held that in respect of the power of judicial review, the jurisdiction of the High Courts under Article 226/227 cannot wholly be excluded. It has been contended before us that the Tribunals should not be allowed to adjudicate upon matters where the vires of legislations is questioned, and that they should restrict themselves to handling matters where constitutional issues are not raised. We cannot bring ourselves to agree to this proposition as that may result in splitting up proceedings and may cause avoidable delay. If such a view were to be adopted, it would be open for litigants to raise constitutional issues, many of which may be quite frivolous, to directly approach the High Courts and thus subvert the jurisdiction of the Tribunals. Moreover, even in these special branches of law, some areas do involve the considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court's writ jurisdiction under Articles 226/227 of the Constitution, before a Division Bench of the High Court within whose territorial jurisdiction the particular Tribunal falls. 93. We may add here that under the existing system, direct appeals have been provided from the decisions of all Tribunals to the Supreme Court under Article 136 of the Constitution. In view of our above-mentioned observations, this situation will also stand modified. In the view that we have taken, no appeal from the decision of a Tribunal will directly lie before the Supreme Court under Article 136of the Constitution; but instead, the aggrieved party will be entitled to move the High Court under Articles 226/227 of the Constitution and from the decision of the Division Bench of the High Court the aggrieved party could move this Court under Article 136 of the Constitution." (emphasis supplied) 28. In L. Chandra Kumar's case (supra) once a Constitution Bench of the Apex Court declared the law that "all decisions of Tribunals created under Article 323A and Article 323B of the Constitution will be subject to the scrutiny before a Division Bench of the High Court within whose jurisdicti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficacious alternative remedy by way of appeal under Section 53-T of the Act, 2002 before the Hon'ble Supreme Court of India to challenge the order. Relevant paragraphs of the judgment are reproduced hereinafter:- "6. Having due regard to this incontrovertible legal position, in the absence of any explanation from the Petitioner for not having availed the efficacious alternative remedy by way of appeal under Section 53-T of the Competition Act, 2002, before the Hon'ble Supreme Court of India to challenge the impugned order, we do not find any justification to entertain the present Writ Petition and accordingly, the same is dismissed. No costs." 31. In Union of India vs. Tantia Construction Pvt. Ltd. (supra) Hon'ble Supreme Court has dismissed the SLP on the ground that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. Relevant portion of the judgment is reproduced herein below:- "27. Apart from the above, even on the question of maintainability of the writ petition on account of the Arbitration C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xercise of this power [See: Whirlpool Corporation vs. Registrar of Trade Marks, Mumbai & Ors. [1998 (8) SCC 1]. And this plenary right of the High Court to issue a prerogative writ will not normally be exercised by the Court to the exclusion of other available remedies unless such action of the State or its instrumentality is arbitrary and unreasonable so as to violate the constitutional mandate of Article 14 or for other valid and legitimate reasons, for which the court thinks it necessary to exercise the said jurisdiction. 53. On the basis of the above conclusion of ours, the question still remains why should we grant the reliefs sought for by the appellant in a writ petition when a suitable efficacious alternate remedy is available by way of a suit. The answer to this question in our opinion, lies squarely in the decision of this Court in the case of ShriLekha Vidyarthi (supra) wherein this court held : "The requirement of Article 14 should extend even in the sphere of contractual matters for regulating the conduct of the State activity. Applicability of Article 14 to all executive actions of the State being settled and for the same reason its applicability at the thres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctual obligations may be more limited and in doubtful cases the parties may be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes. However, to the extent, challenge is made on the ground of violation of Article 14 by alleging that the impugned act is arbitrary, unfair or unreasonable, the fact that the dispute also falls within the domain of contractual obligations would not relieve the State of its obligation to comply with the basic requirements of Article 14. To this extent, the obligation is of a public character invariably in every case irrespective of there being any other right or obligation in addition thereto. An additional contractual obligation cannot divest the claimant of the guarantee under Article 14 of non-arbitrariness at the hands of the State in any of its actions. x x x " 54. From the above, it is clear that when an instrumentality of the State acts contrary to public good and public interest, unfairly, unjustly and unreasonably, in its contractual, constitutional or statutory obligations, it really acts contrary to the constitutional guarantee found in Article 14 of the Constitution. T ..... 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