DIRECTOR GENERAL OF INVESTIGATION AND REGISTRATION Vs. EXIM INDIA OIL CO

JUDGEMENT

(1.) Exim India Oil Company (respondent hereafter) is facing this enquiry on an application preferred by the Director General, Investigation and Registration (DC for short) alleging that it has indulged in certain restrictive trade practices attracting Clauses (a), (b), (c) and (f) of Sec.33 (1) of the MRTP Act, 1969. The respondent is a proprietary concern engaged in the business of sale and distribution of superior kerosene oil (SKO), lubricants and greases. For the purpose of sale and distribution of the aforesaid products, the respondent appointed dealers on certain standard terms and conditions, in respect of which it entered into an agreement with them. The DC on a perusal of the standard agreement has pointed out that Clauses 5, 16, 17, 18, 19, 20 and 28 attract the various clauses of Sec.33 (1) of the Act. He has, therefore, prayed in his application that an enquiry may be instituted against the respondent. Based on the DG's application a Notice of Enquiry (NOE) was issued on 20th October, 1994. In brief, the clauses in the standard agreement constituting restrictive trade practices are as under : clause 5 : The clause requires the dealers to lift certain minimum quantity of the products as specified by the respondent. As the dealers are required to purchase even goods for which there may not be adequate demand, the charge is that Clause 5 attracts Sec.33 (1) (b) of the Act. Clauses 16, 17 and 28 : Under these clauses, the dealers cannot sell or buy the products of other oil companies without the previous consent of the respondent. They are restrained from dealing in competitors' products and from purchasing goods from any party or person other than the respondent. These restrictions attract Sec.33 (1) (c) of the Act. Clauses 18 and 19 : In terms of these clauses, the dealers are prohibited from selling the petroleum products purchased from the respondent to such parties to whom supplies have been stopped by the respondent. The dealers are also restrained from selling the petroleum products to any dealer, agent or distributor appointed by any other oil company. These restrictions attract Sec.33 (1) (a) of the Act. Clause 20 : The dealers are prohibited under this clause from selling the respondent's products at higher prices or rates than those which the respondent fixed from time to time. This attracts Sec.33 (1) (f) of the Act.

(2.) In its reply the respondent has made the following averments : 1. The respondent is a proprietary concern which has ceased to exist with effect from 31st March, 1995 and the dealership agreement executed by it with its dealers also ceased to exist from the same date.2. The NOE does not disclose any ground or cause of action and is "bald, vague and ambiguous".

(3.) In view of Sec.33 (3) of the Act as the trade practices alleged are expressly authorised by or under law for the time being in force or have the approval of the Central Government, and the Government is a party to the standard agreement, the enquiry is not maintainable.