# M/S. HARIDAS EXPORTS v. ALL INDIA FLOAT GLASS MFRS. ASSOCIATION AND ORS

- **Citation:** [2002] Supp. 1 S.C.R. 229
- **Court:** Supreme Court of India
- **Decided:** 2002-07-22
- **Case number:** Civil Appeal Nos. 2330 and 3572 of 2000
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/m-s-haridas-exports-v-all-india-float-glass-mfrs-association-and-ors-18601
- **Pages:** 40

## Headnote

j
M/S. HARIDAS EXPORTS
A
v.
ALL INDIA FLOAT GLASS MFRS. ASSOCIATION AND ORS.
JULY 22, 2002
,, " ' '
[B.N. KIRPAL, CJ. Y.K:·SABHARWAL'AND
't '' ,
B
,.,. . ;
.,.
· K.G. BALAKRISHNAN, JJ.] ... ·1
"I ,; ,, ·'"'''''
' "
"
.,
, "
I• 11 ', I' l11 ..
, 1' : I• l.
iK·
L,
}I
Monopolies and Restrictive Trade Practices.Act, 1969-Sections fl2),, r
2(c), 2(o), 2(u), 33(1)(1) and (ja), 36-A and. 37-Foreign Manufactwers ''C
exporting goods into India and selling at predatory pric~omplaint. under.,;
the Act .restrictive trade practice-Jurisdiction of MRTP. Commission--Plea ,
that Commission has no jurisdiction since sections 33(J)(j)and (fa) impliedly_,
repealed by anti-dumping provisions-Held, anti-dumping provisions do not,
per se oust the jurisdiction of Commission--/! can take action in respect of ,
imported goods or otherwise-However it cannot stop import and cannot D
decide validity of the action of Government in permitting import of goods at
predatory price---Customs Tariff Act, 1975-Sections 9-A. to 9-C- Customs
Tariff (Identification, Assessment and Collection of Anti-dumping Duty on '
Dumped Articles and/or Determination of Injury) Rules, 1995.
· · .. ,, ·
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1
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I•
rl
,I I;
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•.
•1
,. I
Sec::on 12-A(l)-Temporary injunction--Grant of-Jurisdiction of., E .
Commission-Held, could be granted on the basis of proof that restrictive
trade practices likely to affect prejudicially the public interest, or interest of
any trader, class of traders or traders generally or bf customers, and i:ot on :
me;e allegation--Merely because an industry will find itself unable to compeie
with imports from outside India can be no ground for exercising jurisdiction F
under the Section. ·
,.
- ' •
'.
' ... '~
II.
Section 12-A Explanation II-Temporary Injunction-Grant a/-
Procedure for-Commission should normally give notice and hear the
respondents before passing an order ofinjunction---Code o/Civil.Procedure,1 ·
1908-0rder XXXIX Rule 211.
•
'' ,,
,
• G
.,.
"
a
·11.
Section 37.,-Cartel formation outside India-Export by the cartel _into
India-Jurisdiction of MRTP Commission to interfere. wjt~ .cartel formatio~
Held, is outside the territorial jurisdiction of Commission--But if the cartel
carries out restrictive trade practice in -India then Commission will get
jurisdiction. ' '
229
,,. , .•
H
230
SUPREME COURT REPORTS [2002] SUPP. I S.C.R.
A
· Docthne-"Effect Doctrine "-Applicability of
Words and Phrases- "goods "-Meaning of in the context of Section
2(e) of Monopolies and Restrictive Trade Practices Act, 1969.
The facts in Civil Appeal Nos. 2330 and 3572 of 2000; 76 of 2002
B and SLP (c) No. 22549 of 2001 are that Respondent No.I, an association
of domestic float glass manufacturers filed a complaint under Section
33(1)(j), Ga) and Section 36-A read with Section 2(o) of Monopolies and
Restrictive Trade Practices Act, 1969 before of Monopolies and Restrictive
Trade· Practices Commission (MRTP Commission) against Indonesian
C companies alleging that they were selling float glass at prices much lower
than their cost of production and thereby were indulging in selling at
predatory prices with an intent to eliminate competition and causing
material injury to the interest of domestic float glass industry; and that
the MRTP Commission passed injunction against the Indonesian
companies restraining them from exporting float glass to India at allegedly
D predatory prices.
C.A. No., 3562 of 2000 is against th'e MRTP Commission's interim
injunction which was subsequently confirmed, directing the appellant, an
export cartel which used to produce natu~al soda and export it in India,
not to indulge in the practice of cartelization by exporting soda ash to India
E in the form of cartel directly or indirectly.
F
The questions for considerations before this Court were whether
MRTP Act has extra territorial jurisdictions; whether the principle of
"effect doctrine" has any application in India i.e. where action takes place
and agreements are entered into outside India but th

## Text

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j
M/S. HARIDAS EXPORTS
A
v.
ALL INDIA FLOAT GLASS MFRS. ASSOCIATION AND ORS.
JULY 22, 2002
,, " ' '
[B.N. KIRPAL, CJ. Y.K:·SABHARWAL'AND
't '' ,
B
,.,. . ;
.,.
· K.G. BALAKRISHNAN, JJ.] ... ·1
"I ,; ,, ·'"'''''
' "
"
.,
, "
I• 11 ', I' l11 ..
, 1' : I• l.
iK·
L,
}I
Monopolies and Restrictive Trade Practices.Act, 1969-Sections fl2),, r
2(c), 2(o), 2(u), 33(1)(1) and (ja), 36-A and. 37-Foreign Manufactwers ''C
exporting goods into India and selling at predatory pric~omplaint. under.,;
the Act .restrictive trade practice-Jurisdiction of MRTP. Commission--Plea ,
that Commission has no jurisdiction since sections 33(J)(j)and (fa) impliedly_,
repealed by anti-dumping provisions-Held, anti-dumping provisions do not,
per se oust the jurisdiction of Commission--/! can take action in respect of ,
imported goods or otherwise-However it cannot stop import and cannot D
decide validity of the action of Government in permitting import of goods at
predatory price---Customs Tariff Act, 1975-Sections 9-A. to 9-C- Customs
Tariff (Identification, Assessment and Collection of Anti-dumping Duty on '
Dumped Articles and/or Determination of Injury) Rules, 1995.
· · .. ,, ·
Ju
1
•
I•
rl
,I I;
I -r I
•.
•1
,. I
Sec::on 12-A(l)-Temporary injunction--Grant of-Jurisdiction of., E .
Commission-Held, could be granted on the basis of proof that restrictive
trade practices likely to affect prejudicially the public interest, or interest of
any trader, class of traders or traders generally or bf customers, and i:ot on :
me;e allegation--Merely because an industry will find itself unable to compeie
with imports from outside India can be no ground for exercising jurisdiction F
under the Section. ·
,.
- ' •
'.
' ... '~
II.
Section 12-A Explanation II-Temporary Injunction-Grant a/-
Procedure for-Commission should normally give notice and hear the
respondents before passing an order ofinjunction---Code o/Civil.Procedure,1 ·
1908-0rder XXXIX Rule 211.
•
'' ,,
,
• G
.,.
"
a
·11.
Section 37.,-Cartel formation outside India-Export by the cartel _into
India-Jurisdiction of MRTP Commission to interfere. wjt~ .cartel formatio~
Held, is outside the territorial jurisdiction of Commission--But if the cartel
carries out restrictive trade practice in -India then Commission will get
jurisdiction. ' '
229
,,. , .•
H
230
SUPREME COURT REPORTS [2002] SUPP. I S.C.R.
A
· Docthne-"Effect Doctrine "-Applicability of
Words and Phrases- "goods "-Meaning of in the context of Section
2(e) of Monopolies and Restrictive Trade Practices Act, 1969.
The facts in Civil Appeal Nos. 2330 and 3572 of 2000; 76 of 2002
B and SLP (c) No. 22549 of 2001 are that Respondent No.I, an association
of domestic float glass manufacturers filed a complaint under Section
33(1)(j), Ga) and Section 36-A read with Section 2(o) of Monopolies and
Restrictive Trade Practices Act, 1969 before of Monopolies and Restrictive
Trade· Practices Commission (MRTP Commission) against Indonesian
C companies alleging that they were selling float glass at prices much lower
than their cost of production and thereby were indulging in selling at
predatory prices with an intent to eliminate competition and causing
material injury to the interest of domestic float glass industry; and that
the MRTP Commission passed injunction against the Indonesian
companies restraining them from exporting float glass to India at allegedly
D predatory prices.
C.A. No., 3562 of 2000 is against th'e MRTP Commission's interim
injunction which was subsequently confirmed, directing the appellant, an
export cartel which used to produce natu~al soda and export it in India,
not to indulge in the practice of cartelization by exporting soda ash to India
E in the form of cartel directly or indirectly.
F
The questions for considerations before this Court were whether
MRTP Act has extra territorial jurisdictions; whether the principle of
"effect doctrine" has any application in India i.e. where action takes place
and agreements are entered into outside India but the resultant adverse
effect is experienced in India then can the MRTP Commission have any
jurisdiction; whether anti-dumping provisions as provided in Customs
Tariff Act, 1975 and Customs Tariff (Identification, Assessment and
Collection of Anti-dumping Duty on Dumped Articles and for
Determination of Injury) Rules, 1995 would oust the jurisdiction of MRTP
G Commission; and whether import by Indian party from foreign country
at predatory prices required the agreement for import to be registered as
per Section 33(1)(.j) of the MRTP Act; and whether under the facts and
circumstances of the case passing of injunction order was called for.
In Civil Appeal No. 3562 of 2000, additional question for
H consideration was whether the Commission had jurisdiction to interfere
HARIDAS EXPORTS 1'. ALL INDIA FLOAT GLASS MFRS. ASSOCIATION
231
with cartel formation; and whether the Commissi.on had jurisdiction to A
grant injunction.
Disposing of the appeals, the Court
HELD: I.I. On the facts of the instant case, impugned order passed
by the MRTP Commission against the Indonesian exporters cannot be B
sustained and is set aside. Anti-dumping provisions do not per se oust the
jurisdiction of the MRTP Commission. MRTP Commission can, inter a/ia
take action· whenever a restrictive trade practice is carried out in India
in respect of imported goods or otherwise. It is only in respect of the Indian
leg of the restrictive trade practice, can an order under Section 12A and/
or Section 37 be passed. Under Section 33 of the Act what can be registered C
is only an agreement in regard to which any party to an agreement carries
on business in India [Section 35 Explanation l J. But this does not mean
that if an agreement is entered into outside India and which results in a
Restrictive Trade Practice in India, the MRTP Commission has no
jurisdiction. The "effect doctrine" apply and Section 2(u) and Section 37 D
gives jurisdiction to the MRTP Commission to pass appropriate orders
qua the Restrictive Trade Practice in India. The MRTP Commission, in
such a case, may not be able to stop import but there can be order
imposing post import restrictions such as, for example, not to sell imported
goods in India in such a manner which will be regarded as a restrictive
trade pracrice under Section 37. [261-F, G, H; 262-A, BJ
E
1.2. In Explanation I to Section 35 the use of the words "shall be
deemed to be an agreement within the meaning of this section ........... "and
the time-frame for registration clearly indicates that Section 33 and Section
35 apply only to the Indian agreements or agreements in India and,
therefore, it became necessary to imcorporate Explanation I so as to F
enlarge the ambit and give extra territorial jurisdiction in relation to those
agreements which relate to performance of services in India and any party
to that agreement carries on business in India. [262-C, DJ
1.3. Reading Sections 1(2), 2(c), 14 and Explanation I to Section 35 G
of Monopolies and Restrictive Trade Practices Act, 1969 together can leave
no manner of doubt that the Act has no extra territorial operation. The
present case is concerned with float glass, which was sought to be imported
into India. For the purpose of the Act, it is only the goods imported into
India which will fall within the definition of the word "goods" in Section
2(e). As such for the Commission to exercise any jurisdiction goods must H
,,.,, 11 • 1 " 1, 1 • ~UP.RE~.E. COURT, REPORTS. {2002] SUPP. I S.C.R.
A'\ bM~R~.':·~.IJl~hi~i:~J.'!'P.Pr,t~.~.}~tq ~n~!~··.~~ .l~~g as. the import has not_ taken,
place and the goods are merely intended for export to Indi_a the same .will
not fall within the definition of the word "goods" in Section 2(e).
•, ·
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·(249-H; 250-B, CJ
.
h'Jtttf4/Jfhe lrestficti~e~tfade 'practi~e
1 'may -<u"rtiay not be directly
Ba connectttd"with 'of1>e'.'tlie ies·u1t of any ·agreement between the parties in'·
India!'A'.fiy·act wiiicli 1falls 1Uffder the 'Category ot restrictive trade practice
can'· be irivestigatea into 'and'orders passed under Section 27(1). Sections'.
2(o}'and i(u)'ao riot speCificiillfiridicate thatttie·practice should be carried
on•o'nly1bya1pefscirf (){'person's in India. if the ttade practice is such that
C'J itbe~o~~~-~r~~~~!~ted t~~~e.:~~a,ct!c,e ~n In~~a.a_s c~n~~mplated by Section '
2(o);' then-i acbon·<:an be talien under Section 37(1)'m respect of such a
trade"practice?l253-'A, ·n11 J1 !J:''l 1 "
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OB'Jm lu!t ~·Job 1idt Jul!.: I no-.::
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G ni1~s:1Under Sedion :33(·1)(j) 1of the Aet;·any'agreemenf to sell goods' 1
atisuch ·prices its would iliave'-the 'effect of eliminating competition or a•·
DJ coml)etitor is'-regardedas·an'a'greement relating to ·an ·agreement relating·
to•restrictive·.trade,practice and shall be subject to registration. The Act -
nowhere states1't-hatithis agreement should be' only iri India or between
Indfan'·parties.·11n effect;·this Section recognize's 'effeet doctrine', nameiy;- •
where·.an·agreement r-Csults 'in sale of goods at ·such prices which would
E _ havelthe ·effect of. eliminating !Competition or a competifor. In the very
· l nature of things, die -safo l()f, goods keeping ·in mind the definition of the·
word "goods" in Section 2(e) must be of goods imported into lndia,.in the
'lcf
1_,1•.rft~'"' 1.h"ll~/I ~Hf~ h) ~~., ~111 ~~.
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case hke the' present. Thus, the agreement requmng registration must be
in°fespecn>f·g86ai~it~/. thei~
1
illl'po·rfint<nridia:'(253-G, u; 254-A, 8] ,!,
noib'.lfl bns c..1. nniJJ'Jt'. h:rl1 ~·ii.r: ,. , , 1 1.:.
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:~_.6~~~h(''.~!rf~f.:~oft~!?.~'.'.,,wo?1~,~~"ap~licabie o?ly in 'reiation to ;
those gooils 'Yhicli are ~ithin 'the territory of India before its sale referred
~..,,... .. 11 ., ,~• nn~· ~1.·- ,., ,~ •• q.l~
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tom Section 33(1)(j) oftlkAct. An agreement, which results in' sale outside
India a'ntfih~'expb';i'~rthe.gol)iJ's to Intlia, e~en iftha
1t sale is at predatory
prices, would not ,..fall}~thi
1
n the' ambit of Section 33(1j(j) of the Act. It is
a subsequent agreement of sale of the imported goods, if it has the effect
Guor'"eli~in~tln~
1
'c~. ~p~titi"o~.·~~ ~ 'co~p~tltor, which would .be .registrable
5-'f'A~l llb-J 1--
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uq,~H ~.~SH~rr,~~,q~9).,~f1t~~ 1-f~: ~ve.n)f1:ii;i_agre.ement is exe~ute~ outside
India or the parties to the agreement are not in India and agreement may
U:.J..1'lutluu .._,,~.T \.'f i11~uO.-: r....i+1·.
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no~ 1 ~ptff.~'~;~~!}N~>t~Jl~d~f. 1S~SMo!1 ~3.,_ peing an outside India agreement
nevertheless, ,if any, restrictive trade practice, as a consequence of any such
UiJU)~t:...Hl euu ....... .:4
US\JTf'iiHIUl"f Jl .. ll. ,.,
H an outside agreement, is carried out in India then the Commission shall
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HARIDAS EXPORTS 1•. ALL INDIA FLOAT GLASS MFRS. ASSOCIATION
233
have jurisdiction under Section 37(1) in respect of that restrictive trade A
practice if it comes to the conclusion that the same is prejudicial to the
public interest. (254-C, D, E, F]
I. 7. ,It is possible that persons outside India indulge in such trade
practices, not necessarily restricted to the effectuation of prices within
India, which have the effect of preventing distorting or restricting B
competition in India or gives rise to a restrictive trade practice within India
then in respect of that restrictive trade practice, MRTP Commission will ·
have jurisdiction. If the effect of restrictive trade practices came to be felt
in India because of a part of the trade practice being implemented here
the MRTP Commission would have jurisdiction. This "effects doctrine" C
will clothe the MRTP Commission with jurisdiction to pass an appropriate
order even though a transaction, for example, which results in exporting
goods to India at predatory price, which was in effect a restrictive trade
practice, had been carried out outside the territory of India if the effect
of that had resulted in a restrictive trade practice in India. If power is
not given to the MRTP Commission to have jurisdiction with regard to D
that part of trade practice in India which is restri~tive in nature then it
will mean that persons outside India can continu~ to indulge in such
practices whose adverse effect is felt in India with impugnity. A
competition law like the MRTP Act is a mechanism to counter cross border
economic terrorism. Therefore, even though such an a~reement may enter . E,
into outside the territorial jurisdiction of the Commission but if it results
in a restrictive trade practice in India then the Commission will have
jurisdiction under Section 37 to pass appropriate orders in respect of such
restrictive trade practice. (254-G, H; 255-A-C]
·
F
1.8. In the instant case no challenge to the import policy allowing
import of float glass and even if such a challenge was to be there it would
hardly succeed. The grievance of the respondents is that import is being
made at predatory prices. The challenge is to the actual import. But
allowing such a challenge will amount 'fo giving the MRTP Commission
jurisdiction to adjudicate upon the legal validity of the provisions relating G
to import, which jurisdiction the Co'!lmission does not have. It is not a
court with power of judicial review over legislative action. Therefore, it
would have no jurisdiction to decide whether the action of the G?vern~ent
in permitting import of float glass even at predatory prices is valid or not.
The Commission cannot prohibit import, its jurisdiction commences after
I
.
,.
I
import is completed and any restrictive trade practice takes place. The H
234
SUPREME COURT REPORTS [2002] SUPP. 1 S.C.R.
A rate of import duty which is imposed is a legislative act and is thus not
amenable to the jurisdiction of the MRTP Commission. (255-F, G, H; 256-BJ
B
2.1. The jurisdiction of the MRTP Commission, is not outsted by the
Anti-dumping provisions in the Customs Act. The two operate in different
fields and have different purpose. (255-D) ·
2.2. The levy or non-levy of anti-dumping or other duty being a
legislative act pursuant to the exercise of powers under the Customs Tariff
•
Act can also not be a subject-matter of judicial review by the MRTP
<Eommission. The two statutes and regimes op·erate in different and distinct
C spheres and there is no conflict between the two regimes/statutes. Hence
t.Jie question of implied repeal of the provisions of Section 33(1)(j) of the
iftRTP Act, 1969 on account of the provisions of Section 9A of the Customs
Tariff Act, 1975 does not arise. (256-E; 258-B)
2.3. On the facts of this case, it cannot be said that import by the
D Indian party from Indonesia at predatory prices required the agreement
for import to be registered as per Section 33(1)(j) of the Act. Under this
provision, there must be an agreement between the foreign seller and the
Indian importer to sell goods at such prices as would have the effect of
eliminating competition of a competitor, i.e., here the Indian industry. It
is only if there is an agreement between the Indian importer and the
E foreign seller which has such an effect that the production in India of float
glass by efficient Indian industry would have to stop and such stoppage is
considered prejudicial to the public interest, can an order under.Section
12-A or Section 37 be passed. [258-F, G, H; 259-A)
F
G
2.4. Import of material at prices lower than prevailing in India
cannot per se be regarded as being prejudicial to the public interest. The
availability of goods outside India at prices lower than those which are
indigenously produced would encourage competition amongst the Indian
industry and would not per se result in eliminating the competitor.
[259-C, DJ
3.1. It is while dealing with a complaint relating to restrictive trade
practice that the MRTP Commission has the jurisdiction to grant
temporary injunction under Section 12-A(I). It is only on the basis of
proof; and not mere allegation, and on the basis of an inquiry before the
Commission that any trader or class of traders is carrying on a restrictive
H trade practice which is likely to affect prejudicially the public interest or
HARIDAS EXPORTS 1•. ALL INDIA FLOAT GLASS MFRS. ASSOCIATION
235
the interest of any trader, class of traders or traders generally or of A
consumers that the Commission would have jurisdiction to grant a
temporary injunction restraining any undertaking a person from carrying
on any restrictive trade practice. While the Commission has power to grant
ex-parte temporary injunction, but in view of Explanation II to Section
12-A, whereby the provisions of Rule 2-A of Order XXXIX CPC made B
applicable, for grant of temporary injunction the Commission normally
ought to give notice and hear the respondents before passing an order of
injunction. Merely. because an industry will find itself unable to be able
to complete with imports from outside can be of no ground for exercising
jurisdiction under Section 12-A. It is only if the trade practice which is
being impugned is such that would fall within the four corners of Section C
2(o), which defines restrictive trade practice, can the Commission grant
an injunction. [259-D, E, F, G]
3.2. The facts on record do not indicate any justification for any
interim order being passed in the present case. Furthermore, the order
passed against the foreign manufacturers of float glass, who do not carry D
on business in India is clearly contrary to the provisions of Section 14 of
the Act and, as such, cannot be sustained. [260-A, BJ
4.1. The competition law in the form of MRTP as it stands today
does not contain any provision, which can give it jurisdiction to interfere
merely with cartel formation. Formation of cartel which takes place E
outside India is outside the territorial jurisdiction of the MRTP. The Indian
importer obtaining goods at a low price does not contravene any law. He
has obtained a good bargain. [267-E]
4.2. If the cartel carries out restrictive trade practice in India or it's F
actions have the effect of a restrictive trade practice being carried out in
India, then the MRTP Commission will get jurisdiction to act under
Section 37(1) of the MRTP Act. [267-FJ
5. In the instant case, no case had been made out by the respondents
for the grant of injunction against the appellant. The injunction issued G
against the appellant was not only against the provisions of Section 14 of
the Act but even on facts as alleged no case had really been made out for
any order under Section 12-A or Section 37 of the Act. [267-H; 268-A]
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2330 of
2002.
H
236'.:.
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1iP'Pe~iirig'p~?Heg~·" ·
~ ·: "i!:
! .) ,'i .~ .t.-l·<::-..1 .• ulJ'.)OUllll nu
Th~ Judgment of the Court was deliven;d by
.
. . .
_ ~
[illl iol r::oil1n1l1L'.b• ·1.0. #I· 1i!J11t Jo!l n!J lno·.;~n .1n tJ:JGl -Jd l .-.l
-.:ifrKIRPAL; C.J:;'Civil Appeal· Nos!'~2330·or:iooo;13572"6r 2000, 76:0( 11
D:12002 and•S.l.J.·P/(C) No; 22549•of200l:»lrn .. m ngi·~1nl ;ii! ''l'i11!i" :n·"~l1
'•o ,.1 uoth?l lo 1,ior•i ·, "' 'Hfl .•! 111ntuu'l
:·\i;'J!'.: d 1>1bnl ni n·Jfll•Uti 11•1
Leave granted. I(; . / -•M'
1 .lt .. ni .t•,,·1~ "<1 11rn riwi ,1bt.1 t!i .briu l"JJ.. #1t
( 8 u
Th~se"appeals are; :against , orders1 passed by. itherMonopolies :.and
Re.strictive .Trade Practices Commission·(hereinafter referred.to as the ;'MRTPJb
E · J Corpmjssjon'.'.) whereby 1 Indones·i~nrmanufacturers. of1 fl~at1glass; had been r.,
re~tr:;;ii_ned)from 1 exporting 1the, same.to J~ndia,at allegedly1predatory .prices.- 1uo
'.IH .'tllli (ti~ ~wt 14"\l!H"I Jor,
1uli ·r•iiq rrn! h 1& ~boo~ :-niniiiJrlo ~'J1,oqmt
Respondent No. l is an associa~iC?n- 19[
1 ~.9f~bg}.~~s.>lill~n!!f~~Wr_~~~)n.,11
India. During March-April, 1998, complaints were made by the said respondent
F . to ,the -.Customs ,Departmenti) alleging that-the tlndonesiammanufactufors of
1 flo_a~ .gl(ls_s.,,jn1ass!:>ciation;with· ~ndian 1importers .were .allegedly.lindulging• in·, :i
hel!YYi:l!nder:-invoicing.0lhe 1respondentsJ were, rhowever~l inforified1 by, then l
Customs Department in Calcutta that: iftheY. had·.ahy genuine grievance;1the1?
same could be made before the Designated Authority, Ministry of Commerce
dealingi with -anti!dun'iping Jcomplainis: On J26th I May;' "1998/llie' resp'on~ent
G i _No~ l presenteg'a 'complaint before.the Designated Authority~ This coriipl~fof
111
appears toihave' been fiied before 'the...,Ariti~D-tiriipirig AutlioritY aiid tli~ safi:ie~i"
was possibly{noe.pursuea by the complainant: j • i '" • ''lll l n11 ;n ri • ud f'I/.. " : 1
j.\-:~.)!: :H--,;:.[ .1·1-' .1011. "f. 11;.i;,·,~1" f.r;,· 110in,~ ,.,b:at 1-JL~" zn1;
On l 0th September, 1998, the respondent No. l filed a complaint before
the MRTP Commission under Section 33(l)G), · Qa) and .Seetion 36A' read
H ~with Section 2(o) of the Monopolies and Restrictive Trade Practices Ac{ri'.:
HARIPAS EXPORTS '" ALL INDIA FLOAT GLASS MFRS. ASSOCIATION [B.N. KIRPAL CJ.]
23 7
1969 (hereinafter referred to as the. 'MRTP Act') against three Indonesian, A
companies alleging that they were manufacturing float glass and were. selling
the same at predatory prices in.· India, and were hence resorting·to restrictive
and unfair trade practices. In the complaint, it was stated that the float glass
of Indonesian origin was being exported into India at the CIF price of US$
155. to 180 PMT. At this price, some float glass had be~n .shipped into India !B
during the penod December, 1997, to June, 1998. It was alleged that these
sale prices were predatory prices as they were ·1ess than not only the· cost of
production for the product in Indonesia but also the variable cost of production
of the product. The complainant gave figure indicating the estimated cost of
float glass internationally as well as the cost of production· of float glass in
India with a view to demonstrate that the Indian manufacturers of float glass C
would not be able to compete with the price at which the' Indonesian
manufacturers were presently selling or intending to seil to Indian consumers.
On this basis, it was contended that the sale of float glass by the Indonesian
manufacturers at the said price of US$ · l 55 to I 80 PMT will restrict, distort
and prevent competition by pricing out Indian producers from the market.
· This would result in lowering the production of the Indian industry and the · D
consequent idle capacity and losses would force the industry to become sick
which would lead to its closure whkh would have a direct impact on ihe
employment in the industry.
·
"
In response to the notice issued to the Indonesian companies, Mis. P.T. E
Mulia Industries (respondent No. 2 in this appeal) wrote a letter to the MRTP
Commission stating that it had never in the past exported float glass to India.
The other two respondents did not send any reply to the Commission. The
appellant, however, which is the Indian importer of the float glass from
Indonesia had filed a caveat before the Commission. It also filed a reply
refuting the allegations of the respondent and it was the contention of the F
appellant that respondent No. I was a cartel of Indian manufacturers of float
glass which was, in fact, exporting out of India at prices ·far lower than the
0
ir
own cost of production in India. It was also contended by the appellant
herein that the cost of production of float glass was lower in Indonesia than
in India and float glass was not being exported to India at predatory prices. G
The application under Section 12-A for interim injunction was heard by
the Chairman of the Commission and a second Member. There was a difference
of opinion amongst them. While the Chairman vide order dated 18th January,
1999, allowed the application and restrained the Indonesian companies from
exporting to India their float glass production at 'predatory prices, Dr. S. H
23.8
SUPREME COURT REPORTS [2002] SUPP. I S.C.R.
'A. Chakravarthy, the second Member dismissed the application, inter alia, holding
that there was no evidence to substantiate the plea of predatory pricing at this
stage. By order dated 9th February, 2000, the third Member who heard the
case concurred with the view taken by the Chairman and passed an order of
injunction against the Indonesian companies.
B
While Civil Appeal No. 2330 of 2000 is filed by the Indian importer
who was the caveator before the Commission, Civil Appeal No. 3572 of
2000 has been filed by P.T. Muliaglass which is the subsidiary of P.T. Mulia ·
Industrindo. It is the case of P.T. Muliaglass that the holding company does
not carry out any manufacturing operations and that is why it had informed
C the MRTP Commission that it was not engaged in the export of float glass
to India and, therefore, it did not appear before the MRTP Commission. P.T.
Mulia Glass which, in fact, manufacturers the float glass being aggrieved by
the order of the MRTP Commission has filed the appeal, inter alia, contending
that it is not exporting float glass to India at predatory prices.
D
On behalf of the appellant, it was submitted that the MRTP Commission
had no jurisdiction to entertain and adjudicate upon the complaint which was
made by the respondents. It was submitted that the essence of the complaint
of the respondents before the MRTP Commission was of injury to the domestic
industry on account of low prices by the Indonesian manufacturers which is
a dispute under Anti-Dumping law and does not fall within the jurisdiction
E of MRTP Commission. It was submitted that the complaint which was made
against the Indonesian exporters was one essentially of dumping as it had
been contended that the Indonesian exporters were exporting float glass at
very low prices which were predatory in nature and the intention was to
cause injury to the domestic industry.
F
It was submitted that Article 18.1 of the WTO Agreement on
Implementation of Article VI of GA TT, 1994, provides that "no specific
action against dumping of exports from another Member can be taken except
in accordance with the provisions of GATT, 1994 as interpreted by this
Agreement". The remedy against the practice of"dumping"/export of goods
G at "predatory prices" has been expressly agreed upon internationally under
the General Agreement on Tariffs and Trade (Gatt) to which India is a
signatory. The Agreement deals with anti-dumping duties and provides
mechanism to implement it.
In pursuance of the GA TT, 1994, the Parliament for the first time
H inserted provisions 9A to 9C in the Customs Tariff Act vide the Customs
HARIDAS EXPORTS i•. ALL INDIA FLOAT GLASS MFRS. ASSOCIATION {B.N. KIRPALCJ.J 239
Tariff (Amendment) Act, 1995, No. 6 of 1995 which replaced the provisions A
of sections 9, 9A and 9B earlier inserted in the Customs Tariff Act under Act
No. 52 of 1982. The Statement of Objects and Reasons to the Bill clearly
states that the Bill seeks to amend the Custom Tariff Act to bring the provisions
of the Custom Tariff Act in conformity with the provisions of Article VI of
the Gatt 1994, and the agreements on subsidies and countervailing measures. B
Even the preamble of the Customs Tariff (Amendment) Act, 1995, No. 6 of
1995 also provides that the provisions of sections 9, 9A and 9B of the
Customs Tariff Act, I 975, have been replaced by the new sections 9, 9A and
9B to reflect the changes in the domestic law, consequent upon coming into
effect the Agreement on Anti-dumping (i.e. an Agreement on implementation
of Article VI of the GA TT 1994) ..... under the Uruguay Round on 1st January, C
1995.
Se::ti:n 9A, inter alia, provides that where any article is exported from
any country or territory to India at less that its normal value, then, upon the
importation of such article into India, the Central Government may, by
notification in the Official Gazette, impose an anti-dumping duty not exceeding D
the margin of dumping in relation to such article. The said section indicates
how the normal value and the margin of dumping is to be ascertained. Section
9B contains provisions which provide for exemption from levy under Section
9 or Section 9A in certain cases while Section 9C gives the right of appeal
against the order of determination or review thereof regarding the existence, E
degree and effect of any subsidy or dumping in relation to import of any
article. The Act contemplates the Designated Authority, which is appointed
under it's provisions, to conduct a detailed investigation into the allegation
of dumping of articles before it determines the normal value, export price and
the margin of dumping. It is important to note that in undertaking this exercise,
the Government or the foreign country exporting the article is required to be F
informed. By notification dated lst January, 1995, Anti-Dumping Duty Rules
were framed. Rule 14 sets out circumstances under which the designated
authority may terminate an investigation. In Rule 14( d), there is a de-minimus
requirement that is to say the volume of the dumped imports, actual or
potential, should account for not less than 3% of the imports of the like G
product. If the imports are below this level, the authority shall terminate the
investigation immediately. It is the case of the appellant that the float glass
which was imported from Indonesia was much less than 3%.
The learned counsel for the appellants contended that the respondents
have in the complaint filed by them with the MRTP Commission under the H
l'240
::·"'
. I 'l· SUPREME'COURT'REPORTS [2002] SUPP. rs:c.R.
'A ... MRTP'Act'soughnedressal·oftheir alleged grievance tliat'cerfain Indonesian
I companies a~e selling· float glass at-~prices ".ffiuch lower tnan'',theif• cost' of
. productio'n and are thereby allegedly' indulging in predator/p'ricing with/an
, alleged ·intent to ·eliminate competition· arid causinglmaterial· iitjufy to' the
I ·interest.of domestic float·glass industrY. For redressaf of the 'alleged grievance
.of the respondents; a specific remedy has'been providecl'linder seetioris 9A
;B
J to ·9erof the Customs :fariff Act 'and the'1Anti-duinping 'Ducy- Rules·.· The
.provisions ofsectioris 9Ato 9C introduced•undei"the'Customs TariffA~t'artd
I. the Anti-dumping Duty Rules provide for a complete anCl exhaustive niadiiiiety
•. to 1prevcnt dumping .of goods into Iridia'including export:of goods 1into India
'at 'predatory' price: causing "injury'.' to T domestic industry' 'caU'sing ~threat; of
· C injuryAo domestic industry by-waylofjimpositiori 'of anti-dumping duty 'on
import of such goods. The expression "injury" has been defined under Article
3 of the Agreement on Anti-Dumping as under: _
11.o·n 1 ~...,nnr; ' ....
- · ... d,,. ·.
N J• .'! <.· ... lr1 /fJ1fl ·. ~
'1 1 -l .·\· - "ll. ~. ,;
,1L i". 1.i"Injury shall ,unless otherwise .specified, •be taken to •mean ·material
rl
' ,jnjury to.a.domestic industry; threat of material injury to·a 'domestic
(D ::r·' _ ,; industryfor material retardati~n of1.the 1establishment of such'•an
·, ., · L -,.industry,:and shall be interpreted•in accordance With the provisions'bf
this Article.';... , , . •
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~(I fl·~'J ~.
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I 'r· ·, J' ,rjt N
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11i; :/_,/ ·r·.~L••J.I 1 , _.1 ,..,T,1 ·t •..
~!~; ,r.~ ~L' 1v1r. (tJ, 1 '' ""·
h,
L11r· ( · 1.r~.'iJ HP
Ir;,.",. T~u?, i~ :w,~~' su,bmitted, t~e ~e!ll~dy, for.~l'l!P.o.sition _ofm.1ti-4umping duty
h,~~. ,~e.~It ~~~viq7~ .. ~9 ,~s.,t~ pr~v~nt ,qi,st,9.J1iC!!1;,,,impaiin.i:ept ~pd restrictiOI1:.,0f
E competition in domestic industry. A specific. authority, i.e., the .Designated
I 'T _
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l~p!~9ri,ty ~!}. :.~nti-?u!1.1P.l~g h_~s 18e_i;p. .~?~S~!tP!~4. un9~r th.t; ,AJ]thdumping
Duty Rules framed under the Customs Tariff Act which has .the powers to
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~?.?~~cUnvestigat!op ,ul?~n,.~e.ceipt, of a cqp]pl~int from ~he d<?mest_ic ~ndustry
~~ suo f!10f~ ~el~ting1~p,,d,u_mP,~ng ~f g??'1~,p~ a foreig~ cpmpany ,to identify
p
!h~,rxis~enc;~, ~egr:~ ,anc:f
1 e£.f~ct 0~31~y all~g~d.dumping.il). rela~ionto _import
p~ ~.1.1~ .a.i:t~cle ~H4 1inj.~ry to 40m~~~s, 1ind,i,i~try:,~hr~a~·<?f: !njμry ,to d9mestic
i~qu~try~,~~rnri~~. r~!ar~I,~ti~n t9,~~~~Rqs9~e~!(of d_om~sti~ i!J..d1:1.st_ry,.etc .. a.nd
to recommend to the Central Government the amount of anti- dumping duty
i.,J I
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to remove the injury to the domestic industry, based on which the Central
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~9;ve,r;n!11,e?t. ~mp9.~es _p~ovisional ?.!. :?~<!l .~ti7 d~rnP,ii:tg .41!ty .up,on importa~_io~
G
?f,th~ c~n.~e~~~ go~ds into I~dia as H re~pl,t .o,f,whi~h the 1c9st ,for:the Jn_diat?-
i~~ort.e,r .fo~.~~7. i~P9f1f?,goods ~nd the. aff\cl~s becowe_s the sa!'tle .a.s that.of
fair value of such go~ds .~i;td articles in th~
1 d'!rne~_~ic m~r~e.t. The obje<;:~ of
the provisions of the Customs Tariff Act and the Anti- dumping Duty rules
~s th~s to p~event distortion; impairment and restriction·of competition caused
H byexport of goods to India at dumped/predatory price. In view of the aforesaid;
HARIDAS EXPORTS i'. ALL INDIA FLOAT GLASS MFRS. ASSOCIATION [B.N. KIRPAL C J.J
241
the finding of the MR TP Commission that as the provisions of the Customs A
Tariff Act only provide for imposition of custom duties, they have had no
relevance for overriding the provisions of the MRTP Act, is erroneous, was
the submission. It is also submitted that the object of the MRTP Act on the
other hand generally is to check concentration of economic power to the
common detriment, to control monopolies and to prohibit monopolistic and B
restrictive trade practices and for matters connected therewith or incidental
thereto. In view of the MRTP Act and the provisions of the Customs Tariff
Act cover the.same subject- matter as the scope and object of both the Acts
is same although the MR TP Act is a general Act and the Customs Tariff Act
is a special Act for the redressal of grievance of the respondents.
It was urged that where a particular subject has received special treatment
under specific provisions/statute, it will exclude the applicability of the general
provision (s) which might otherwise cover the said topic. Therefore, applying
this well-settled law, the general provisions of the MR TP Act will be excluded
in relation to any grievance and complaint pertaining to dumping/exporting
c
of goods at predatory price from foreign country in to India, with an intent D
to cause injury to the domestic industry which is specifically covered under
the provisions of Sections 9A, 9 B and 9C of the Customs Tariff Act and the
Anti-dumping Duty Rules framed thereunder. Therefore, Sections 9 A to 9C
of the Customs Tariff Act exclude the jurisdiction of the MRTP Commission
in such matters. The appellants rely on the following decisions of the Hon'ble E
Supreme Court which unequivocally lays down and reiterates the above
mentioned principle:
(i)
Belsund Sugar Co. Ltd. v. State of Bihar and Ors., [1999] 9 SCC
620, at 639, 641, 648, 649 and 650.
(ii) Jogendra Lal Saha v. State of Bihar and Ors., (1991] Supp. 2 F
sec 624, at 657.
(iii) life Insurance Corporation of India v. D.J Bahadur and Ors.,
(1981] 1 sec 315, at 349, 350-354
(iv) Damji Valji Shah and Anr. v. Life Insurance Corporation of G
India and Ors., (1965] 3 SCR 665, at 673.
(v) Gobind Sugar Mills ltd. v. State of Bihar and Ors., [1999] 7
sec 76, at 80-82.
(vi) Shriram Mandir Sansthan v. Vatsa/abai and Ors., (1999] l SCC
657, at 661 and 662.
H
242
SUPREME COURT REPORTS [2002) SUPP. l S.C.R.
A
On behalf of the respondents, it was submitted that the provisions of
the Customs Tariff Act, 1975 relation to imposition of anti-dumping duties
do not in any way oust the jurisdiction of the MRTP Commission over the
restrictive trade practice of predatory pricing.· 1t was contended that the two
statutes occupied different fields and were distinct in their scope and
applicability. There was no overlap or conflict between the statutes and hence
B the question of repeal, whether implied or express, did not arise. The Customs
Tariff Act is concerned with the imposition of duties of custom. 'Imposition
of customs duty is the policy decision of the Government in the realm of
taxation. Section 9A read with the Rules provide for the determination of
certain objective criteria on the basis of which the decision of the Central
C Government to levy anti damping duty can be based. The Customs Tariff Act
does not confer any right . on any individual or Association and does not
provide for any remedy to them. Only the domestic industry can approach
the Designated Authority.
It was . further contended that whereas predatory pricing enquiries are
D concerned with sales below the cost of production of the predator with the
intention to eliminate competition, anti- dumping investigations are triggered
when an exporter sells his products in the export market at a price below that
of the price at which he sells his product in the country of origin. In antidumping investigations, therefore the focus is on sale price in the country of
E origin as opposed to. the cost of production.
According to the respondents, the MRTP Act provides for a judicial
remedy for specified practices done individuanylor collectively. An individual
consumer or a trade association or a competitor can approach the MRTP
Commission. There is a right of appeal to the Supreme Court against the
F orders passed by the ·MR TP Commission. Only domestic industry has the
right to initiate antidumping proceeding. Thus the scope and operation of the
Acts mentioned above was different. In particular, the ingredients of
transactions which attract operation of the MRTP Act and the Customs Tariff
Act are different and the question of the superseding the other as a special
G law does not arise. They operate in different fields and are subject to different
considerations. Hence, in the absence of any conflict or overlap between the
two statutes, the question of the Customs Tariff Act provisions impliedly
repealing the provisions of Section 33 (l)G) of the MRTP Act do not arise,
was the submission.
H
While adopting the arguments of the other counsel, Shri Anil B. Divan,
HARIDAS EXPORTS i·. ALL INDIA FLOAT GLASS MFRS.ASSOCIATION(B.N. KIRPALCJ.]
243
Senior Advocate on behalf of the respondent No.