LexM/S KLM ROYAL DUTCH AIRLINES versus DIRECTOR GENERAL OF INVESTIGATION & REGISTRATION
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[2008) 14 S.C.R. 245 - --\ M/S. KLM ROYAL DUTCH AIRLINES A v. DIRECTOR GENERAL OF INVESTIGATION & REGISTRATION (Civil Appeal Nos. 815-816 of 2002) OCTOBER 3, 2008 B ~, [TARUN CHATTERJEE AND DR. MUKUNDAKAM SHARMA, JJ.] Monopolies and Restrictive Trade Practices Act, 1969 - c s. 36A (1)(ii), (iv) and (vi) - Deficiency in service - Held by MRTP Commission to be unfair trade practice - On appeal, held: In order to term an act amounting to unfair trade practice under the sub-clauses of the provision, it is necessary to prove that the service provider makes false and misleading repre- D sentation regarding the service - Deficiency in service does ,_, not amount to unfair trade practice - Element of unfair trade practice stands on higher and onerous platform than the defi- cient service - In the facts of the case, the service provider cannot be said to have committed unfair trade practice, as E false and misleading representation has not been alleged. A complaint was filed before the respondent-Author- ity, against the appellant-Airlines alleging that the com- plainant had booked a consignment which was required > to be delivered to the customer by a particular date, that F -I appellant was not able to deliver the consignment to the customer, before or on the required date as the consign- ment was misplaced by the appellant; and the same amounted to deficiency in service. Complainant also filed separate petition before Consumer Forum claiming com- G pensation for the loss. -~ Respondent-Authority concluded that the trade prac- ' ., tice by the appellant constituted unfair trade practice un- der Clauses (ii), (iv) and (vi) of Section 36A(1) of Monopo- 245 H 246 SUPREME COURT REPORTS [2008] 14 S.C.R. A lies and Restrictive Trade Practices Act, 1969. The respon- f '- dent filed a complaint/application for registration and in- vestigation, before MRTP Commission. The Commission found the appellant guilty of adoption and indulgence in unfair trade practices to the extent that there was defi- B ciency in service. Hence the appeals. Allowing the appeals, the Court HELD: 1.1 For making out a case of unfair trade prac- f--- tice an element is involved to the extent of making false c and misleading statement and representation and in or- der to make a case of unfair trade practice such ingredi- ents, which are part and parcel of the concept of unfair trade practice have to be alleged and must be proved and established. Before it can be said that an act amounts to D an unfair trade practice the complainant is required to show that the trade practice was employed for the pur- pose of promoting the sale, use or supply of any goods \ _.. or the provision of any services and also that the state- }---' mentor advertisement is a false representation of the kind E specified in Sub-clauses of clause. (1) of Section 36-A of Monopolies and Restrictive Trade Practices Act, 1969. [Paras 14 and 16] [259,D-E; 257,C-D] Man Roland Druckimachinen Ag v. Multicolour Offset Ltd. 2004 (7) sec 447 - referred to. F 1.2 Whether a statement constitutes a false or mis- :, ~ leading representation will depend upon the facts and cir- .._ cumstances of each case. It is not possible to provide an exclusive list of the statements which may constitute false or misleading representation, nor can there be any strait- G jacket formula evolved thereof for the said purpose. How- .ever the statements of the nature, which are willfully made knowingly false, or made recklessly without honest be- 1--r-·~ lief in its truth, and made with the purpose to mislead or ·~ deceive, will definitely constitute a false or misleading rep- H resentation. In addition, a failure to disclose a material fact M/S. KLM ROYAL DUTCH AIRLINES v. DIR GEN. OF 247 INVESTITN. & REGISTRATION ' --, when a duty to disclose that fact has arisen will also con- A stitute a false or misleading representation. [Para 14] [257,H; 258,A-C] 1.3 There could be no finding by the MRTP Commis- sion that the appellant is guilty of unfair trade practice. B. What is sought to be done by the MRTP Commission is ~ -..j. to hold that the appellant is guilty of unfair trade practice which is not equal to holding a person guilty of providing deficient service. Element of unfair trade practice definitely stands at a higher and onerous platform than the defi- cient service. The deficiency in service, as in the present c case, cannot be said t
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