MRTP can take action regarding imported goods: SC

NEW DELHI: Giving teeth to the MRTP Commission to deal with imported goods, the Supreme Court, in an important order, has held that the Commission could take action in cases of restrictive trade practices in India involving imported goods.
"The MRTP Commission can take action whenever a restrictive trade practice is carried out in India in respect of imported goods or otherwise," a three-judge Bench comprising Chief Justice BN Kirpal, Justice YK Sabharwal and Justice KG Balalkrishnan said on Monday.
However, the Bench held that the Commission could not restrain a party from importing items from foreign countries.
This ruling was given by the Court while allowing Haridas Exports to import float glass from Indonesia.
The importer was restrained from doing so on the complaint filed by All India Float Glass Manufacturers Association alleging that the imported glass was being sold at predatory prices in India.
The Chief Justice, writing the 50-page judgement for the Bench, said that the Commission can order investigation into the restrictive trade practices or grant an injunction "only in respect of the restrictive trade practices" under Section 37 or Section 12A of the MRTP Act.
On agreements being signed outside India for import of goods to India, the apex court said, "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" would empower the MRTPC to pass appropriate orders under Section 37 of the Act regarding the restrictive trade practices, the Chief Justice said.
"The MRTPC, in such a case, may not be able to stop import but there can be an 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 practice under Section 37," Justice Kripal explained.
He said import of material at prices lower than prevailing in India could not per se be regarded as being prejudicial to the public interest.
"If the normal or export price of any goods outside India is lower than the selling price of an indigenously produced item than to say that the import is prejudicial to the public interest would not be correct," the Bench said.
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 as was sought to be submitted by the Association.
Justice Kirpal said the injunction order passed against the foreign manufacturers of float glass, who do not carry on business in India was clearly contrary to the provisions of the Act and set aside the same.