DIRECTOR GENERAL (INVESTIGATION AND REGISTRATION) vs VIDEOCON INTERNATIONAL LIMITED

THIS enquiry originated from the advertisement released by Videocon International Limited (the respondent) on 29.6.1992 in the ''Hindustan Times'', New Delhi. Through this advertisement, the respondent announced a special scheme of gifts and prizes called ''Golden Videocontest'' for the buyers of Videocon Colour Television. The scheme was open to the buyers from the date of advertisement i.e. 29.6.1992 to 26.8.1992. Under the scheme, for every Videocon Colour T.V. purchased during the given period, the respondent offered a "Videocon Walky" free of charge and over 4000 other prizes worth more than Rs. 1 crore to the winners of the contest. THIS scheme seemed to attract the provisions of the Monopolies and Restrictive Trade Practices Act, 1969 (the MRTP Act in brief) relating to unfair trade practices. Therefore, in exercise of the powers conferred by the Regulations 17 and 18 of the MRTP Commission Regulations, 1991, the MRTP Commission ordered the Director General (Investigation & Registration) [the DG] to conduct a preliminary investigation into the matter and submit a Preliminary Investigation Report (PIR). The PIR submitted by the DG is a little unfocussed. All the same, it concludes that the ''Golden Videocontest'' launched by the respondent amounts to unfair trade practices as contemplated in Section 36-A(3)(b) of the MRTP Act. The DG, therefore, suggested that a Notice of Enquiry (NOE) may be issued to the respondent to further enquire into the alleged unfair trade practices.

IN the NOE issued on 26.10.1992 it has been alleged that since the contest was organised by the respondent with the object of promoting sale of its television sets, it was prima facie a case of unfair trade practices within the meaning of Section 36-A(3)(b) of the MRTP Act. The respondent filed its reply to the NOE and the DG filed a rejoinder thereto. After the completion of pleadings, the following issues were framed, "(1) Whether the respondent has indulged in the unfair trade practice attracting the provisions of Clause 3(b) of Sub- section (1) of Section 36A of the MRTP Act, 1969 ? (2) If answer to Issue No. 1 is in the affirmative, whether the said practice is prejudicial to public INterest ? (3) Relief."

Learned Counsel for the DG Mr. R.D. Makheeja urged that the special scheme of gifts and prizes launched by the respondent constitutes unfair trade practices and that it is violative not only of the provisions contained in Sub-clause (3)(b) but also of the provisions contained in Sub-clause (3)(a) of Section 36-A of the MRTP Act. It was violative of Section 36- A(3)(a) because the Videocon Walky announced to be given as a free gift was not given free. Its price was already included in the scheme. The contest falls foul of Section 36-A(3)(b) because it was organised for the purpose of promoting the sale of the Videocon T.V. sets. In support of his arguments, he cited two rulings of the MRTP Commission, namely, (1993) 1 CTJ 53 (MRTPC) and UTPE 41/1984 dated 19.6.1991.

Learned Counsel for the respondent Mr. B.S. Nagar contended that the alleged trade practices do not amount to unfair trade practices because there is no evidence on record to prove that the respondent had adopted any unfair method or unfair or deceptive practice for promoting the sale of television sets which is an essential requirement of an unfair trade practice as defined in Section 36A of the MRTP Act. He further contended that the DG has not produced any evidence to prove that the price of free gift, namely, Videocon Walky was included in the scheme. He submitted that the free'' gift of Videocon Walky was given entirely at the expense of the respondent and that in any case it was not the subject-matter of the present enquiry, he added. He further argued that no loss or injury was caused to the consumers on account of the Golden Videocontest, nor was any such complaint received from the consumers. This contention of the Advocate is irrelevant in view of the amendment made in Section 36-A of the MRTP Act in 1991.

WE have carefully considered the submissions urged on behalf of the parties and have also perused the material on record. In view of the provisions contained in Order XIV, Rule 2 of the Code of Civil Procedure, 1908, the Commission has to pronounce judgment on all issues framed under Rule 1 of the said order. The issues framed in this case have been reproduced in the earlier part of the order. While making his submissions, the learned Counsel for the DG Mr. R.D. Makheeja roped in the provisions of Section 36-A(3)(a) of the MRTP Act as well but interestingly, the aforesaid clause neither forms part of the issues nor does it figure in the NOE issue to the respondent. Therefore, the submissions urged in respect of Section 36-A(3)(a) of the MRTP Act cannot be considered unless an additional issue is framed for which the parties did not press. If an additional issue is framed, it may mean turning the clock backwards as the whole case will then be reconsidered for framing an additional issue and once an additional issue is framed, a fresh chance will have to be given to the parties to lead evidence in respect thereof.

THERE is some merit in the contention of the respondent that there is no evidence on record to prove that the respondent had adopted unfair methods or unfair or deceptive practices in furtherance of its objective to promote the sale of its television sets. At this stage, it may be worthwhile to have a close look at the definition of unfair trade practice contained in Section 36A of the MRTP Act which is reproduced below : "Section 36-A. In this Part, unless the context otherwise requires, unfair trade practice means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any services, adopts one or more of the following practices and thereby causes loss or injury to the consumers of such goods or services, whether by eliminating or restricting competition or otherwise, namely : xxx xxx xxx xxx xxx xxx"

In terms of the above definition, a trade practice can be called an unfair trade practice only if some unfair method or unfair or deceptive practice including any of those mentioned in Section 36-A(1) is adopted for the purpose of promoting sale, use or supply of goods, etc. In the cases relating to unfair trade practices, the onus is on the complainant or the petitioner which in the instant case is the DG. The DG has, however, failed to establish that the purpose of the Golden Videocontest launched by the respondent was the promotion of sale of its products. The respondent has emphatically denied this charge and it has further clarified that the contest was organised to commemorate the completion of 100 months of the respondent Company in the business of Television sets. We find that in the advertisement as it appeared in the Hindustan Times on 29.6.1992 also the celebration or the commemorative aspect of the event has been effectively brought out. We are far from convinced about the DG''s contention that the purpose of the scheme was the promotion of sale of respondent''s products. Had it been so, this could as well be established by showing that after the launching of Golden Videocontest by the respondent, there was a sudden spurt or a substantial increase in the sale of television sets which could be rationally attributed to the aforesaid scheme. But the DG has failed to produce any such proof on record to substantiate the claim. Nor has it been established that by launching the impugned scheme, the respondent adopted any unfair method or unfair or deceptive practice for furtherance of its objective to promote sales. Where then is the question of the impugned scheme falling within the mischief of Section 36- A(3)(b) of the MRTP Act ? Our answer to this is ''No'' for the simple reason that if the purpose of the contest organised by the respondent is not the promotion of sale directly or indirectly, it cannot fall within the ambit of Section 36-A(3)(b) of the Act. Further, the observation made by the DG in his PIR that "It is not clear from the advertisement whether the lucky winners of the prizes will be decided by draw of lots or by a decision of a panel of Judges" is not based on facts. The respondent has enclosed a photocopy of the ''Entry Form'' prescribed for joining the contest. In Clause 6 of the aforesaid Form it is clearly mentioned that the prize winners will be decided by an eminent panel of Judges and their decision in this matter will be final and unchallengeable. In the light of the aforesaid discussion, we find no pith or substance left in the DG''s case. In sum, no case of unfair trade practices is made out against the respondent. The NOE stands discharged with no order as to costs. NOE discharged.