- (1.) This is an appeal under Section 55 of the Monopolies and Restrictive Trade Practices Act, 1969 (for brevity hereinafter referred to as 'the Act'). The appellant is a company engaged in manufacture and sale of automobiles. It is aggrieved by the impugned order dated 28.2.2006 passed by the Monopolies and Restrictive Trade Practices Commission (for brevity 'the Commission') in U.T.P. Enquiry nos. 86/99, 87/99 and 90/99 whereby the Commission has directed the appellant to cease and desist from continuing with the practices complained of and not to repeat the same in future.
(2.) Since there is no dispute on facts, the case of the parties on facts is common and to the following effect: The practice under scrutiny is of the year 1999 when the appellant was to begin the manufacture and delivery of newly introduced Tata Indica cars into the market with effect from February 1999, with the installed capacity of approximately 60,000 cars in a year. The appellant invited the prospective customers to book the car through dealers. The booking amount demanded by the appellant was quite high and close to the estimated price finally payable which would include excise duty, sales tax and transportation charges. The terms and conditions for booking of order for purchase of Tata Indica cars were mentioned in detail indicating the model wise price depending upon the city of booking. It was indicated that the price of vehicle as well as taxes, duties and cess will be as applicable on the date of delivery. Those making valid booking were to be supplied the vehicle as per priority numbers generated and allocated by a computerized technique, for the first 10,000 bookings only. The terms also provided that the payments against the remaining bookings will be refunded to the customers, without interest, at the earliest but in any case within a month from the closing of the booking. For refunds after a month, interest will be paid at the rate of 10% per annum. The order booking form mentioned in Clause 7 that the person concerned had carefully read the terms and conditions of the bookings and agreed to the same. Although the initial allotment was confined only to 10,000 cars, the appellant received as many as 1,13,768 booking applications along with stipulated amount which aggregated to Rs.3,216.44 crores. 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. 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 sent them to the Director (Research) for investigation. The Director submitted Preliminary Investigation Reports (PIR) in all the three matters and three cases were registered as per numbers noted earlier. The Notices of Enquiry under Sections 36-B (d), 37, 36-D of the Act and under Regulation 51 were issued to the appellant who contested the complaints. The appellant filed its reply to the Notice of Enquiry in which it also raised a preliminary objection that the allegations of the restrictive trade practice were vague and not permissible by law. Their further defence was that there are no facts and material to show that the alleged practice is prejudicial to the public interest requiring an enquiry under Section 37 of the Act and that no facts were disclosed in the Notice of Enquiry to show prejudice to the public interest. On merits some of the allegations were denied as incorrect. It was pointed out that none of the complainants had applied for the booking of Tata Indica vehicle and hence they lacked locus standi to file the complaints in the capacity of consumers. On merits the appellant also took the defence that there was no false and misleading statement made by the appellant for inviting booking of Tata Indica cars, the applicants made the bookings with open eyes being aware about the stipulation for payment of interest. According to appellant by letter dated 6.2.1999 the successful applicants were intimated of the priority number allotted to them and the unsuccessful applicants were also informed that they had an option to be considered for the second phase of 50,000 cars and such optees would be entitled to receive interest at the rate of 11% per annum with effect from 1.2.1999 till the date of delivery. Those who did not opt for the second phase deliveries were refunded their booking amounts along with 10% interest.;