Delhi High Court
Oriental Rubber Industries ... vs Competition Commission Of India & ... on 22 April, 2016
Author: Rajiv Sahai Endlaw
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 22nd April, 2016
+ W.P.(C) 11411/2015 & CM No.30075/2015 (for stay)
ORIENTAL RUBBER INDUSTRIES
PRIVATE LIMITED ..... Petitioner
Through: Mr. Sandeep Sethi, Sr. Adv. with Mr.
Amitabh Kumar, Mr. Gautam Sahai &
Ms. Ella Bali, Advs.
Versus
COMPETITION COMMISSION OF INDIA
& ANR .... Respondents
Through: Mr. Prashanto Chandra Sen & Mr.
Prasenjit Singh, Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1. This petition under Article 226 of the Constitution of India was filed
pleading-
a. that the petitioner is a manufacturer of several rubber products
including manufacturing of fabric re-enforced rubber conveyor
belts and ancillary products;
b. that on 2nd June, 2015 the petitioner received a notice dated 27th
May, 2015 from the respondent No.2 Director General,
Competition Commissioner of India (DG) in suo motu case no.
06/2013 in pursuance of the order of the Competition
Commission of India (CCI) under Section 26(1) of the
WP(C) No11411/2015 Page 1 of 28
Competition Act, 2002 wherein the petitioner was one of the
opposite parties in the case related to a cartel/bid-rigging;
c. that though the notice aforesaid sought detailed information and
documents from the petitioner but the petitioner was not
provided with any documents/evidence which formed the basis
of investigation;
d. that the petitioner on 4th June, 2015 requested for inspection of
records with the respondent no.1 CCI in order to understand the
context in which notice aforesaid was issued;
e. that on 18th June, 2015 DG issued another notice to the
petitioner to show cause why its acts and conduct should not be
treated to be in contravention of Section 3 of the Competition
Act;
f. that though the DG supplied a copy of the unreasoned order of
the CCI under Section 26(1) of the Act but neither the CCI nor
the DG explained which particular conduct of the petitioner had
contravened the provisions of the Competition Act; no other
documents/evidence on the basis of which impugned inquiry
had been initiated and notices issued were also disclosed.
g. that the application of the petitioner seeking information was
rejected by the CCI on 23rd June, 2015 stating that the matter
was ‗confidential'.
WP(C) No11411/2015 Page 2 of 28
h. that further attempts of the petitioner to gather information also
did not meet with any success.
i. that on 24th November, 2010 the petitioner was served with
summons dated 23rd November, 2015 of the DG under Section
41(2) r/w Section 36(2) of the Companies Act addressed to Mr.
Vishal Makar and Mr. Prem Kumar Madali, officers of the
petitioner, to appear before DG on 14th December, 2015 in
respect of the inquiry / investigation.
j. that the CCI/DG were thus conducting inquiry/investigation
against the petitioner, asking the petitioner to join in the same,
without giving access to the petitioner the evidence/documents
based on which such inquiry/investigation was being conducted.
k. that as per Section 36(1) of the Competition Act, the CCI, in
discharge of its functions, is to be guided by principles of
natural justice and the CCI/DG by failing to provide an
opportunity to the petitioner to inspect the file and by failing to
provide certified copies of documents sought for, not complying
with the principles of natural justice.
l. that the DG was conducting inquiry/investigation unfairly and
unreasonably without following due process of law.
m. that the DG also does not permit the parties being examined to
be assisted by their counsel.
WP(C) No11411/2015 Page 3 of 28
n. that under Regulations 37 and 50 of the Competition
Commission of India (General) Regulations 2009, the petitioner
is entitled to inspection of records but which was being denied
to the petitioner.
o. that the petitioner cannot present its case to the CCI/DG in a fair
and reasonable manner in the absence of documents/evidence.
p. that once the DG furnishes its inspection report, CCI does not
generally accept new evidence.
Accordingly, reliefs of (i) seeking a direction to the CCI/DG to allow
the petitioner to inspect of documents/evidence that were being relied upon
while making allegations against the petitioner; (ii) seeking a direction to the
CCI/DG to grant opportunity to the petitioner to cross-examine the witnesses
whose statements may have been recorded by the CCI/DG in the matter,
were claimed in the petition.
2. The petition came up first before this Court on 9 th December, 2015
when the following order was passed.
―3. The petitioner in the petition itself has stated that the
controversy in the present petition is factually as well as legally
the same as W.P.(C) No.11072/2015 titled Forech India Ltd. Vs.
Competition Commission of India & Anr. disposed of vide order
dated 2nd December, 2015 and sought disposal of this petition in
the same manner.
WP(C) No11411/2015 Page 4 of 28
4. The counsel for the respondents appearing on advance
notice does not controvert and states that the petition be disposed
of in the same manner as order dated 2nd December, 2015 supra
save that it be clarified that the petitioner shall be entitled to only
those documents which are relevant to and pertain to the
petitioner and that the petitioner will have an opportunity to cross
examine only those witnesses whose oral statement pertains to
the petitioner.
5. The counsel for the petitioner is agreeable.
6. At this stage, on request of the counsels, list on 11th
December, 2015.‖
3. In Forech India Ltd supra, the following orders were passed on 30th
November, 2015-
―1. The petition impugns the order dated 6th November, 2013 of
the respondent No.1 Competition Commission of India (CCI)
under Section 26(1) of the Competition Act, 2002 as well as
denial by the respondent No.2 Director General (DG), CCI of
information in the form of inspection of documents and evidence
against the petitioner sought by the petitioner from the DG, CCI.
2. On enquiry from the senior counsel for the petitioner, as to
how the challenge to the order dated 26(1) which is more than
two years old i.e. of 6th November, 2013, is maintainable now,
the senior counsel for the petitioner states that the petitioner for
the first time learnt of the said order only on receipt of first notice
dated 27th May, 2015 from DG, CCI. It is clarified that prior
thereto, the petitioner was not investigated at all.
3. The order under Section 26(1) directs the DG, CCI to
complete the investigation and submit a report within sixty days.
It has as such been enquired from the counsel for the respondents
appearing on advance notice, as to how the investigation is
continuing till now. The senior counsel for the petitioner in this
WP(C) No11411/2015 Page 5 of 28
regard also draws attention to Regulation 20(2) of the
Competition Commission of India (General) Regulation, 2009
which provides for the CCI, while directing the DG, CCI, to
investigate, to submit a report within such time as may be
specified by the CCI which ordinarily shall not exceed sixty days
from the date of receipt of the directions.
4. The counsel for the respondents on oral instructions states
that the period was extended from time to time but is unable to
state, till what time it is valid now. It is stated that extension was
often on the request of the opposite parties.
5. Prima facie, it appears that when there are several parties
against whom an order of investigation has been made, extension
of time at the behest of one or several parties without hearing the
others, may not be appropriate.
6. The information pursuant to which the order under Section
26(1) has been made in the present case is of cartelisation of as
many as seventeen opposite parties to determine the tender price
of conveyor belt. A question arises that when the allegation of
cartelisation is against several persons, why investigation against
one should be initiated after a long gap of one and a half years.
7. It is also the contention of the senior counsel for the
petitioner that the petitioner has also been denied the material if
any against it and the right to cross-examine the witnesses, if any
whose statement has been recorded and which is found to be
against the petitioner. The senior counsel for the petitioner has in
this regard drawn attention to Regulation 41(5) of the
Regulations supra and contended that the same provides for a
right of cross-examination.
8. The counsel for the respondents states that there is no right
of cross-examination and it is in the discretion of the DG, CCI,
whether to give an opportunity to cross-examine the witnesses or
not.
9. It has however been enquired from the counsel for the
respondents, as to how a person being investigated against would
know, whether to apply for cross-examination or not, unless the
WP(C) No11411/2015 Page 6 of 28
evidences, if any, recorded against such person are made
available / known to him.
10. The counsel for the respondents states that even if the right
of cross-examination is not given by the DG, CCI, the same can
be sought before the CCI, after the DG, CCI has submitted the
report.
11. The senior counsel for the petitioner in this regard has
drawn attention to Regulation 43 which bars a party from
producing any additional evidence before the CCI and which was
not produced before the DG, CCI.
12. At this stage, the counsel for the respondents states that he
has received instructions that as of now, the time for submitting
the report is till 30th December, 2015 and before the report is
submitted, all materials available will be furnished to the
petitioner and if the petitioner desires to cross-examine any
witness recorded, would also be given an opportunity to cross-
examine.
13. The senior counsel for the petitioner states that the material
should be made available before the statement of the
representatives of the petitioner is recorded and for which
purpose they have been summoned tomorrow i.e. 1 st December,
2015 and on 3rd December, 2015.
14. The counsel for the respondents seeks time to obtain
instructions.
15. List tomorrow i.e. 1st December, 2015‖,
on 1st December, 2015 -
―1. The counsel for the respondents states that
complete instructions have not been received as
yet.
2. List on 2nd December, 2015.
WP(C) No11411/2015 Page 7 of 28
3. In the meanwhile, the hearing listed before the
Director General, Competition Commission of India (CCI)
for today be deferred to 3rd December, 2015.‖
and on 2nd December, 2015-
―1. This order is in continuation of the previous orders
dated 30th November, 2015 and 1st December, 2015.
2. The counsel for the respondents states that without
prejudice to the rights and contentions of the respondents
and without constituting a precedent, the respondents are
ready to furnish all the documents of investigation
available with the respondents, save those with respect to
which any party has claimed confidentiality, to the
petitioner on the date when the statement of the official of
the petitioner who has been summoned to appear is
recorded and after confronting the said official with some
of the documents with which it is deemed expedient to
confront him.
3. It is further stated that the respondents will similarly
give an opportunity to the petitioner to cross examine any
witness whose oral statement pertaining to the petitioner
has been recorded. It is yet further stated that the
petitioner shall be given an opportunity to make a further
statement after copies of the documents have been given to
the petitioner and after the official of the petitioner has
been confronted with some of the documents.
4. The senior counsel for the petitioner has expressed
apprehension that the respondents, in the guise of
confidentiality, may deny all documents to the petitioner.
5. The counsel for the respondents states that the
orders passed on the application of any other person
claiming confidentiality with respect to any document /
material shall also be supplied to the petitioner.
WP(C) No11411/2015 Page 8 of 28
6. In this view of the matter, the petition is disposed of
keeping all contentions of both the parties open and giving
liberty to the parties to apply if any difficulty arise.‖
4. When this petition was listed next on 11th December, 2015, the
following order was passed:
―1. This order is in continuation of the previous order
th
dated 9 December, 2015.
2. The counsel for the respondents states that the respondents
are willing to provide copies of the documents to be used
against the petitioner to the petitioner and to allow the
petitioner the right to cross examine the witnesses whose
evidence is intended to be used against the petitioner but
object to the additional relief claimed in the petition of
allowing the summoned officials of the petitioner to be
accompanied by advocates. It is contended that the advocates
would be permitted to cross examine the witnesses whose
evidence is intended to be used against the petitioner but
would not be allowed to accompany the officials of the
petitioner whose statement is to be recorded by the Director
General (DG), Competition Commission of India (CCI).
2. Attention of the counsel for the respondents has been drawn
to Section 30 of the Advocates Act, 1961 which confers a right
of practice In the advocates before authorities competent to
take evidence and DG, CCI under the provisions of the
Competition Act, 2002 is empowered to take evidence.
3. The counsel for the respondents seeks time to consider.
4. List on 14th December, 2015.
5. The date given of 14th December, 2015 for the summoned
persons of the petitioner to appear before the DG, CCI be
deferred.‖
5. Thereafter on 14th December, 2015, the following order was passed.
WP(C) No11411/2015 Page 9 of 28
―1. This order is in continuation of the order dated 11th
December, 2015.
2. Though the counsel for the respondents initially
stated that the insistence if any for being accompanied by the
Advocate should be of the officials of the petitioner
summoned by the respondents and cannot be of the petitioner
but upon the counsel for the petitioner stating that he would
implead the said officials also as petitioners, the counsel for
the respondents has not pressed the said objection.
3. Arguments on the right of the said officials to be
accompanied by advocates have been heard.
4. Order reserved.
5. Since the question is of some significance and since
the respondents have not filed any counter affidavit, it is
deemed appropriate that an opportunity to file the written
submissions be given to the respondents.
6. Written submissions be filed by first week of January,
2016 with advance copy to the counsel for the petitioner.
The petitioner may also file its written submission within the
said time with advance copy to the respondents.
7. Appearance by the officials of the petitioner before
the DG, CCI is deferred till the pronouncement of the
judgment.
8. At this stage, the counsel for the respondents states
that the respondents at this stage are not insisting upon the
personal appearance of the said officials; the respondents will
give a questionnaire to be answered by the said officials and
to which replies may be submitted by the said officials.
9. The senior counsel for petitioner, under instructions,
is agreeable thereto.‖
6. The counsel for the petitioner in his written submissions has addressed
the entire controversy but which, as recorded in the orders reproduced above,
WP(C) No11411/2015 Page 10 of 28
stands conclusively resolved. With respect to the aspect of right of the
officials of the petitioner to be accompanied by advocates at the time of
recording of their statement before the DG, reliance is placed on the Google
Inc. vs. Competition Commission of India MANU/DE/1271/2015 where a
Division Bench of this Court held that the investigation by DG tantamounts
to commencement of trial/inquiry on the basis of an ex party prima facie
opinion and it is contended that the Competition Appellate Tribunal also in
its order dated 11th December, 2015 in Appeal No.105/2012 titled Lafarge
India Limited Vs. Competition Commission of India and other connected
appeals has held that the procedure required to be followed by the DG as a
prelude to the passing of an order under Section 27 of the Act is akin to the
provisions to be followed by a Civil Court in deciding a civil suit except that
the DG is not bound by the technicalities of the procedure contained in the
Code of Civil Procedure.
7. The respondents CCI/DG in their written submissions handed over on
28th January, 2016 have contended -
a. The Competition Act belongs to the family of legislation which
deals with economic offences such as Foreign Exchange
WP(C) No11411/2015 Page 11 of 28
Regulation Act, 1973 (FERA), Customs Act 1962 and Foreign
Exchange Management Act, 1999 (FEMA).
b. Section 40 of the FERA gives power to a gazetted officer to
summon persons to give evidence and produce documents and
the said proceedings are deemed to be judicial proceedings under
Section 193 and Section 228 of the Indian Penal Code, 1860;
under the Customs Act also a gazetted officer is empowered to
summon persons and to take evidence under the Act and to ask
persons for production of documents.
c. While interpreting the provisions of the aforesaid laws, the
Courts have consistently held that a person who is called to give
his / her statement by way of evidence cannot insist as a matter of
right that he be accompanied by a lawyer; reliance in this regard
is placed on Poolpandi Vs. Supdt., Central Excise (1992) 3 SCC
259 and Satyanarayan Nandlal Nuwal Vs. Chief Enforcement
Officer 1998 (1) Mh L.J. 548 and Paradip Port Trust Vs.
Workmen (1977) 2 SC 339.
WP(C) No11411/2015 Page 12 of 28
d. The rationale for not permitting an advocate at this stage is that
the person who is called to give in his statement is not an accused
and the proceeding is merely an ongoing investigation process.
e. At the stage of investigation, when the person being questioned is
not an accused, the question to self-incrimination would not arise;
reliance in this regard is placed on Percy Rustomji Basta Vs.
State of Maharashtra (1971) 1 SCC 847; Surjeet Singh Chabra
Vs. Union of India (1997) 1 SCC 508; and K.T.M.S. Mohd. Vs.
Union of India (1992) 3 SCC 178.
f. The legislature can carve out a different procedure and the
principles of natural justice can be moulded while carving out
such procedures; reliance is placed on Swadeshi Cotton Mills Vs.
Union of India (1981) 1 SCC 664; Union of India Vs. W.N.
Chadha 1993 Supp (4) SCC 260; Union of India Vs. Tulsiram
Patel (1985) 3 SCC 398 and Sahara India (Firm) Vs. CIT
(2008) 14 SCC 151.
g. That principles of natural justice can be sub-served to larger
public interest; reliance is placed on Satyanarayan Nandlal
Nuwal Vs. Chief Enforcement Officer supra.
WP(C) No11411/2015 Page 13 of 28
h. Larger public interest calls for expeditious investigation in order
to investigate economic offences which have serious implications
and sufficient opportunity is there to ensure that there is
compliance of principles of natural justice.
i. That CCI/DG is not barring advocates from practicing before it
but a person being investigated has no right to be represented by
an advocate during investigation when there is only a fact
finding.
8. I have considered the rival contentions on the aspect of officials of the
petitioner if summoned by DG to be accompanied by advocates.
9. I have, speaking for the Division Bench of this Court, in Google Inc.
supra, with respect to the proceedings before the DG held as under-
―18. We, for the following reasons conclude that order of the
CCI/direction to the DG, CCI in exercise of power under Section
26(1) of the Act, to cause investigation, is capable of
review/recall:
..............
(C) The DG, during the course of such investigation, by virtue
of Section 41(2) read with Section 36(2) of the Act has the
same powers as are vested in a Civil Court under the Code
of Civil Procedure, 1908, while trying a suit in respect of, (i)
summoning and enforcing the attendance of any person and
examining him on oath, (ii) requiring the discovery and
production of documents, (iii) receiving evidence on
affidavit, (iv) issuing commissions for the examination of
witnesses and documents, and (v) requisitioning public
records or documents from any public office. The DG is
further empowered by Section 41(3) read with Sections 240
and 240A of the Companies Act, 1956 to keep in its custody
any books and papers of the person/enterprise investigated
against/into for a period of six months and to examine any
person on oath relating to the affairs of the person/enterprise
being investigated against/into and all officers, employees
and agents of such person/enterprise are also obliged to
preserve all books and papers which are in their custody and
power.
(D) Failure to comply, without reasonable cause, with any
direction of the DG, under Section 43 of the Act has been
made punishable with fine extending to rupees one lakh for
each day of failure, subject to a maximum of rupees one
crore.
(E) It would thus be seen that the powers of the DG during such
investigation are far more sweeping and wider than the
power of investigation conferred on the Police under the
Code of Criminal Procedure. While the Police has no power
to record evidence on oath, DG has been vested with such a
power. Our experience of dealing with the matters under the
Competition Act has shown that not only statement on oath
of witnesses summoned during the course of investigation is
being recorded but the said witnesses are being also
permitted to be cross-examined including by the
informant/claimant and which evidence as part of the report
of the DG forms the basis of further proceedings before the
CCI. Thus while in investigation by Police under the
Cr.P.C., the rule of audi alteram partem does not apply,
there is no such embargo on the DG, CCI.
(F) Thus, investigation by DG, CCI tantamount to
commencement of trial/inquiry on the basis of an ex parte
prima facie opinion. Though the Supreme Court in Para 116
of SAIL (supra) [(2010) 10 SCC 744] has held that inquiry by
CCI commences after the DG, CCI has submitted report of
investigation but, in the facts of that case, had no occasion to
consider that the DG, CCI in the course of investigation has
powers far wider than of the Police of investigation. Para 29
of the judgment also notices that the counsels had addressed
arguments on issues not strictly arising for adjudication in
the facts of that case; however since it was felt that the said
questions were bound to arise in future, the Supreme Court
proceeded to deal with the said contentions also.
(G) The investigation by the DG ordered by the CCI thus stands
on a different pedestal from a show cause notice, the scope
of judicial review whereof, though lies, is very limited and
from investigation/inquiry pursuant to an FIR by the Police
which in some cases has been held to be not causing any
prejudice and thus furnishing no cause of action for a
challenge thereto.
(H) Before registration of an FIR the concerned Police Officer is
not to embark upon an inquiry and is statutorily obliged
(under Section 154(1) of the Cr.P.C.) to register a case and
then, if has reason to suspect (within the meaning of Section
157(1) Cr.P.C.) to proceed with the investigation against
such person. Per contra, as noticed above, investigation by
the DG under the Competition Act commences not merely
on the receipt of reference/information but only after CCI
has formed a prima facie opinion of violation of the
provisions of the Act having been committed.
(M) Just like an investigation by the Police has been held in
Bhajan Lal (supra) [1992 Supp (1) SCC 335] to be affecting the
rights of the person being investigated against and not
immune from interference, similarly an investigation by the
DG, CCI, if falling in any of the aforesaid categories, cannot
be permitted and it is no answer that no prejudice would be
caused to the person/enterprise being investigated
into/against or that such person/enterprise, in the event of
the report of investigation being against him/it, will have an
opportunity to defend.
(N) The Supreme Court, in Rohtas Industries (supra) 1969 (1)
SCC 325 and the Calcutta High Court in New Central Jute
Mills Co. Ltd. (supra) [AIR 1966 Calcutta 151], cited by the
counsel for the respondent No. 2/complainant, also has held
that an investigation against a public company tends to
shake its credit and adversely affects its competitive position
in the business world even though in the end it may be
completely exonerated and given a character certificate and
that the very appointment of Inspector (in that case under
Section 237(b) of the Companies Act to investigate the
Company's affairs) is likely to receive much press publicity
as a result of which the reputation and prospects of the
Company may be adversely affected.
(O) When the effect of, an order of investigation under Section
26(1) of the Competition Act can be so drastic, in our view,
availability of an opportunity during the course of
proceedings before the CCI after the report of the DG, to
defend itself cannot always be a ground to deny the remedy
under Article 226 of the Constitution of India against the
order of investigation. Though we do not intend to delve
deep into it but are reminded of the principle that in cases of
violation of fundamental rights, the argument of the same
causing no prejudice is not available (see A.R. Antulay Vs.
R.S. Nayak (MANU/SC/0002/1988 : 1988) 2 SCC 602).‖
10. A Division Bench of this Court of which the undersigned was a
member, in Punjab National Bank vs. Kingfisher Airlines Limited
MANU/DE/4118/2015 was concerned with the question whether a person
who is proposed to be a classified as a willful defaulter by the banks or
financial institutions and who in accordance with the Reserve Bank of
India's Circular has been conferred with an opportunity of being heard by
the Grievance Redressal Committee of bank/financial institutions to oppose
such a proposal has a right to be represented by an advocate in the said
hearing. It was noticed that Section 30 of the Advocates Act 1961 as under-
―30. Right of advocates to practise-Subject to provisions of this Act,
every advocate whose name is entered in the [State roll] shall be
entitled as of right to practise throughout the territories to which
this Act extends,-
(i) in all courts including the Supreme Court;
(ii) before any tribunal or person legally authorised to take
evidence; and
(iii) before any other authority or person before whom such
advocate is by or under any law for the time being in force
entitled to practise.‖
which though earlier had not been notified and was thus not in
operation, had been notified on 19th June, 2011.
11. It was inter alia held -
―17. Having given our thoughtful consideration to the matter, we,
with respect are unable to concur with the view taken by the
High Courts of Calcutta and Bombay and for the reasons
hereafter appearing hold that a proposed wilful defaulter, in
the hearing before the GRC, would have a right of
representation though an advocate.
............
(Q) That takes us to Section 30 of the Advocates Act supra
conferring in the advocates a right to practice. Chief Justice of
India Justice T.S. Thakur speaking for the High Court of
Karnataka in M/s. Kothari Industrial Corporation Limited v.
The Coffee Board MANU/KA/0414/1999 held that the right
of an advocate to practice before any Court or Tribunal,
contained in Section 30 of the Advocates Act, necessarily
means that a litigant before any such Court, Tribunal,
Authority or person will have a right to engage and avail the
services of an advocate.
(R) Supreme Court in N.K. Bajpai supra [(2012) 4 SCC 653] after
noticing Section 30 of the Advocates Act held that the right to
practice is not only a statutory right but would also be a
fundamental right under Article 19(1)(g) of the Constitution.
(S) Supreme Court in Dr. D.C. Saxena, Contemnor v. Hon'ble
the Chief Justice of India MANU/SC/0627/1996 : (1996) 5
SCC 216 held that advocacy touches and asserts the primary
value of freedom of expression so dear in a democracy. It was
further held that freedom of expression produces the benefit of
the truth to emerge and assists stability by tempered
articulation of grievances and plays its part in securing the
protection of fundamental human rights.
(X) Though the counsel for the respondents, from Clause 3(ii) of
the Master Circular requiring the decision taken on
classification as a wilful defaulter to be well documented and
supported by requisite evidence contended that the GRC is
authorized to take evidence but we find the words 'legally
authorized to take evidence' meaning, authorized to compel
presence of any person as a witness and which we do not find
the GRC to be authorized to. It thus cannot be said that the
GRC is legally authorized to take evidence.
(NN) A Division Bench of the High Court of Punjab and Haryana
in Paramjit Kumar Saroya v. Union of India
MANU/PH/0765/2014, in the context of the provision in the
Maintenance and Welfare of Parents and Senior Citizens Act,
2007 debarring representation through an advocate before the
Tribunals constituted under the said Act, held that after the
coming in to force of Section 30 of the Advocates Act, there
cannot be an absolute bar to the assistance by legal practitioner
to before a Tribunal.‖
12. Section 30 of the Advocates Act confers on an advocate a right to
practice inter alia before any person legally authorized to take evidence. The
DG, by the Competition Act, has been legally authorized to take evidence.
Once that is so, in the light of dicta aforesaid of the Division Bench in
Kingfisher Airlines Limited supra, has but to be held that an advocate has a
right to practice before DG and which right to practice would include
accompanying a person who has been summoned before the DG for
investigation.
13. As far as the judgments cited by the counsel for the respondent are
concerned,
i. Poolpandi supra is of an era before Section 30 of the Advocates
Act had come into force and hence would not be applicable hereto.
Moreover, what was for consideration therein and adjudicated was,
whether a person summoned during investigation under the Customs
Act is entitled to protection of Article 20(3) of the Constitution of
India and suffers mental torture by being called away from the
comfort of his house and office and being questioned. Both were
answered in the negative. It was held that since the person so
summoned is not an accused, Article 20(3) has no application and
that there is no constitutional right to claim comforts to which the
person is used to, during investigation.
It is settled principle that a judgment is a precedent on what was
for decision and decided therein and not for what may be logically
deduced therefrom. Supreme Court, in the said judgment, was not
concerned with the question, as in this petition i.e. whether a person
has been called for giving statement before a person who is
authorized to take evidence has a right to avail services of an
advocate and whether an advocate under Section 30 has a right to
practice before such person.
ii. the judgment of the Division Bench of the Bombay high Court
in Satyanarayan Nandlal Nuwal supra merely follows Poolpandi
supra
iii. Paradip Port Trust supra was concerned with the Industrial
Dispute Act which contained a specific provision debarring the
advocates from appearing before the Industrial Tribunal. However
there is no such corresponding provision in the Competition Act
debarring the advocates from practicing before the DG. Thus the same
would be of no relevance.
iv. Percy Rustomji Basta, Surjeet Singh Chabra and K.T.M.S.
Mohd.supra are on the evidentiary value of the statements which were
factually found to have been voluntarily made before the officers
under the FERA and also did not consider the question aforesaid under
consideration herein.
v). Swadeshi Cotton Mills supra is on the applicability of the
principle of audi alteram partem in emergent situations and under the
provisions of Industries (Development and Registration) Act, 1951
and the extent of judicial review against such decisions.
vi). Similarly, W.N. Chadha supra also is on the aspect of affording
opportunity of being heard to an accused before issuing a letter
rogatory at the stage of investigation.
vii). Tulsiram Patel supra again is with respect to the circumstances
under which a departmental enquiry is dispensed with under the
second proviso to Article 311(2) of Constitution of India and the
exclusion of principles of natural justice thereunder.
viii). Similarly, Sahara India (Firm) supra is with respect to
applicability of principles of natural justice, in that case, before
passing an order requiring special audit under Section 142(2A) of the
Income Tax Act, 1961.
I do not find any of the aforesaid judgments requiring me to take a
different view from that emerging from a combined reading of Google Inc.
and Kingfisher Airlines Limited surpa.
14. Lord Denning M.R. in In Re: Pergamon Press Ltd. (1971) 1 Ch. 388,
after noting that the Inspectors of an investigation under Section 165(b) of
the (U.K.) Companies Act, 1948 were not a Court of law, their proceedings
not judicial or even quasi-judicial for they decided and determined nothing
and only reported, observed that the same would however not minimise the
significance of their task because the report which they prepared had wide
repercussions owing to containing findings of facts accusing, condemning
and leading to judicial proceedings and exposing those against whom they
are directed to criminal prosecution or to civil action and may bring winding
up of a company or may be used as basis to wind up the company and held
that for the reason of the consequences flowing from their report, the
Inspectors ―must act fairly‖ owing to the duty--even though only
administrative, which they performed. It was further observed that before
the Inspectors condemned or criticised, they must give the person a fair
opportunity of correcting or contradicting what is said against the person. In
my opinion the aforesaid is true of the role of the DG also and as a part of
the duty to act fairly, DG ought to allow the officials of the petitioner
summoned, if so desire, to be accompanied by Advocates. The fear of the
DG of the Advocates is also not understandable. DG has full discretion to
regulate its proceedings and ensure and control that the presence of the
advocates does not delay its proceedings, as was the apprehension expressed.
Sachs L.J., in his opinion in the aforesaid judgment observed that there must
be ―fairplay in action‖ though it may be ―flexible‖ depending upon the
situation so that the same does not result in ―unsuitable procedures‖. It was
also noted that many men have deep rooted fear of becoming involved as
defendants in actions arising out of their depositions and that it is difficult to
even persuade a citizen to give evidence in road accident cases and that the
Inspectors must in public interest take into account the fears of potential
witnesses. Buckley L.J. in his opinion in the said judgment held that fair
treatment required the Inspectors to give to persons being investigated the
material against him and must put to him their proposed conclusions
therefrom to give him fair opportunity to explain.
15. The objection of the respondent CCI/DG, to the officials of the
petitioners summoned by the DG being accompanied with an advocate is
thus overruled and it is declared that the officials of the petitioner summoned
by the respondent shall be entitled to be accompanied by the advocate(s).
16. Else, the petition is disposed of in terms of the orders dated 9 th
December, 2015 and 11th December 2015.
RAJIV SAHAI ENDLAW, J.
APRIL 22, 2016.
M..
