DIRECTOR GENERAL (INVESTIGATION AND REGISTRATION) vs EICHER MOTORS LTD.

A complaint was made by Shri V.S. Kalmath stating that Eicher Motors Ltd., New Delhi had issued an advertisement, in the newspapers, to promote the sale of its light commercial vehicle, by the brand name ''Canter'', as Japan''s No. 1 six tonner. It was further complained that the advertisement was misleading as the vehicle, in question, had a payload capacity of 3.5 tonnes as shown in the pamphlet. The complaint was sent to the DG for investigation. The DG after investigation, submitted the PIR mentioning therein, that the complainee, Eicher Motors Ltd. had stated in reply to the probe letter that it had since discontinued the impugned advertisement, and had also undertaken not to release such an advertisement in future. However, it was concluded in the PIR that as the advertisement was misleading in respect of its payload capacity which was only 3.5 tonnes, a Notice of Enquiry may be issued so that such misleading representations are not made in future. It may also be mentioned here that in the meantime another complaint containing similar allegations was received by the DG directly from one Shri Asha Ram of Noida, U.P.

ACCORDINGLY, on the basis of the PIR, a Notice of Enquiry, dated 13.12.1989, was issued to the respondent. In response thereto, the respondent filed an application under Section 36(D)(2) of the MRTP Act, 1969 (the Act for brief) stating therein that it had already informed the DG, during the course of his investigation, that the impugned advertisement had since been discontinued and would not be issued in future. The application was considered by the Commission on 10.5.1990 but was rejected and the respondent was directed instead, to file a reply to the Notice of Enquiry. The respondent, thereafter, filed its reply and clarified therein that it had entered into a foreign collaboration agreement with Mitsubishi Motor Company of Japan for the manufacture of light commercial vehicles with the brand name ''Canter''. It was further stated in the reply that the impugned advertisement was issued on or about 29.4.1986 whereas the production of the vehicles commenced from 16.6.1986. It was also submitted that reference to six tonner in the impugned advertisement was to the gross vehicle weight of ''Canter'' and not to its payload capacity. It was further clarified that the payload of the vehicle in question was 3.5 tonnes only and it was nowhere stated in the advertisement, that reference to six tonner was in respect of its payload. As a preliminary objection, it was also stated that the enquiry was not maintainable as no allegation with regard to loss or injury having been caused to the consumer had been made and further that there was no allegation also that the alleged trade practice was prejudicial to the public interest or to the interest of the consumers, generally.

On completion of pleadings, the following issues were framed : 1. Whether the Notice of Enquiry is liable to be quashed for the reasons stated in the preliminary objections ? 2. Whether the respondent is or has been indulging in the unfair trade practices as stated in the notice of enquiry ? 3. If reply to issue No. 2 is in affirmative, as to whether the aforesaid unfair trade practices are prejudicial to public interest or to the interest of the consumer in general ? 4. Relief.

DG relied only on documents for proving its case of unfair trade practices by the respondent. These documents are copies of the brochure and the impugned advertisement and the letters dated 21.8.1986 and 3.8.1987 addressed to the DG by the respondent. On behalf of the respondent, Shri S.N. Sehgal, its Senior Manager (Engine Development), appeared as a witness. The respondent''s letter of 21.8.1986 is to the effect that the description of ''Canter'' as six tonner is based on its gross weight which is 5,950 kgs. and is approximately six tonnes and its load carrying capacity is 3.5 tonnes and that too, has been shown separately in the impugned advertisement. In its letter of 3.8.1987, it has given market share of ''Canter'', by way of justification, for claiming it to be Japan''s No. 1 light commercial vehicle. It has also been intimated therein that the impugned advertisement has since been discontinued and would not be published again. The respondent has, on the other hand, relied on the testimony of its Senior Manager. It has been stated by him in his affidavit that light commercial vehicle is defined to mean a vehicle, the gross weight of which does not exceed 6 tonnes and the gross vehicle weight of ''Canter'' is 5,950 kgs. and, therefore, ithas been appropriately described as a six tonner. It has been further mentioned by him that gross vehicle weight consists of total weight of the vehicle including the payload and while the weight of ''Canter'' is 2.5 tonnes, its rated payload capacity is 3.5 tonnes. It has also been stated by him that although its gross weight is 6 tonnes, it can carry much higher load and its load carrying capacity has been tested upto about 9 tonnes.

WE have heard the learned Advocates for the DG as well as the respondent. Earlier also, arguments were heard by a Division Bench of the Commission, but the order could not be pronounced as one of the Members constituting the Division Bench, demitted office. Written submissions were also filed both on behalf of the DG as well as the respondent. The respondent is relying on the order of the Hon''ble Supreme Court, passed in the case of Nirma Industries Ltd. v. Director General of Investigation and Registration, (1997) 5 CTJ 161 (Supreme Court) (MRTP). It has been held therein that each of the clauses employed in Section 36A of the Act is interwoven by use of a conjunction which would indicate that in order to determine a trade practice to be an unfair trade practice, the Commission has to be satisfied as to whether the necessary ingredients contained therein are satisfied or not and it would have to be established that the alleged trade practice had caused not only actual loss or injury suffered by the consumer but also include likelihood of consumers suffering loss or injury in any form and for that purpose there has to be some cogent material to support a finding of an unfair trade practice. It may be mentioned here that before the amendment in 1991, loss or injury to the consumer was an essential ingredient of Section 36A of the Act and it had to be proved in order to sustain a finding of unfair trade practice. It transpires that the present enquiry was instituted before the amendment to the Act. In other words, actual loss or injury or probable loss or injury likely to be suffered by the consumer has to be proved on the basis of cogent material before a finding of adoption of and indulgence in unfair trade practices by the respondent can be given. In this case, no such loss or injury to the consumers either actual or probable has been proved by the DG. In fact, it transpires from record that the impugned advertisement describing ''Canter'' as a six tonner was issued in April, 1986 and was discontinued shortly thereafter, when the complaint was under investigation and was not published again. It appears that it would not have been necessary to proceed with the present enquiry if the respondent''s application under Section 36-D(2) of the Act had been accepted. Be that as it may, on merits also although on the face of it the impugned advertisement appears to be misleading, there is no cogent material before us to hold that actual or probable loss or injury has been or is likely to be caused to the consumers as a consequence of the alleged unfair trade practice. In view of the above, there is no escape from the conclusion that the charge of adoption of and indulgence in unfair trade practices by and on behalf of the respondent cannot be said to have been established particularly in view of the binding ruling of the Hon''ble Supreme Court referred to above and, accordingly, the Notice of Enquiry deserves to be and is hereby discharged with no order as to costs on the facts and in the circumstances of the case. NOE discharged.