M/S VOLTAS LTD. BOMBAY versus UNION OF INDIA AND ORS.

Citation: [1995] 1 S.C.R. 947 · Decided: 07-02-1995 · Supreme Court of India · Bench: A.M. AHMADI · Disposal: Appeal(s) allowed

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Judgment (excerpt)

MIS VOLTAS LTD. BOMBAY 
A 
v. 
UNION OF INDIA AND ORS. 
FEBRUARY 7, 1995 
[AM. AHMADI, CJ, S. MOHAN AND N.P. SINGH, JJ.} 
B 
Monopolies and Restrictive Trade Practices Act, 1969-Section 33 (i) 
as substituted w.e.f. 1.8.84-Deeming clause-Limitation of Court to ignore 
mandate of legislature-Trade practices enumerated in clauses (a) to (1) of 
sub-section (1) of Section 33-Shal/ be deemed to have been statutorily deter-
C 
mined and specified as restrictive trade practices-Neither Commission nor 
Court can question the wisdom of Parliament-Such agreement has to be 
registered. 
Sections 37 and 38-Scope of inquiry by Monopolies and Restrictive 
Trade Practices Commission--// commission satisfied that any practice held D 
to be restrictive trade practice does not restrict or discourage competition in 
any trade or industry-No order u/s 37 to be passed to desist or discontinue 
such practice or declare agreement void. 
, 
The appellant had entered into agreements with large number of E 
companies in respect of distribution of different machineries and equip-
ments within different territories of India. Under the terms of the agree-
ments different types of machines and instruments were to be distributed 
by the appellant as the Marketing Company. The appellant had been 
appointed as Buyer (Sole Importer) on the terms and conditions men-
tioned in different agreements. 
F 
In the year 1986, notices were issued u/s lO(a) (iii) r/w s. 37 of the 
Monopolies and Restrictive Trade Practices Act, 1969, informing the ap-
pellant that the agreements between the appellant and the different com-
panies contained conditions which amounted to restrictive trade practices 
under clauses (a) and (c) of Section 33(1) of the Act. The Monopolies and G 
Restrictive Trade Practices Commission directed the appellant to discon-
tinue the restrictive trade practices as mentioned in the Notice of Enquiry, . 
and not to repeat the same in future and further that the objectionable 
clauses, as mentioned in the Notices be deleted from the respective agree-
ments, within 8 weeks of the receipt of the said order. 
H · 
947 
948 
SUPREME COURT REPORTS 
[1995J 1 S.C.R. 
A 
The appellant urged that inspite of the amendment in sub-sectiJn 1 
of section 33 w.e.f. 1.8.1984, the power of the Commission or of this Court 
has in no way been curtailed or abridged and the Commission or this 
Court, can examine an agreement for recording a finding as to whether 
any of the clauses of such agreement relates to restrictive trade practices; 
that for passing an order u/s 37, first it has to be examined as to whether 
B the agreement relates to any of the restrictive trade practices and if the 
Commission is satisfied that it relates to one or more restrictive trade 
practices within tl1e meaning of Section 2(0) of the Act, then the Commis-
sion has to examine as to whether such agreement is prejudicial to the 
public interest; that Section 37 contemplates and conceives inquiry in 
C respect of any restrictive trade practice relating to an agreement which has 
been registered u/s 35 as well as an agreement which has not been so 
registered; that while amending sub-section 1 of Section 33, Section 2(0) 
was not deleted or substituted and that has left an apparent conflict 
between Section 2(0) and Section 33(1) of the Act, that after the amend-
D ment of sub-section 1 of Section 33, there is no forum where a person can 
show that although it may appear that any of the clauses of the agreement, 
relate to a restrictive trade practice specified in clauses (a) to (I) of . 
sub-sec. 1 of Section 33, but such clauses cannot be held to be covered by 
any of the clauses. 
E 
Allowing the appeals, this Court 
HELD : 1.1.The Legislature by the statute may create a legal fiction 
saying that something shall be deemed to have been done which in fact and 
truth has not been done, but even then Court has to give full effect to such 
F statutory fiction after examining and ascertaining as ~o for what purpose 
and between what parties such statutory fiction has been resorted to. In 
the substituted sub-section (1) of Section 33 of the Monopolies and 
Restrictive Trade Practices Act, 1969, a deeming clause has been intro-
duced by the Parliament specifying that agreements falling within one or 
more of the categories mentioned in clauses (a) to (I) to sub-section (1) of 
G Section 33, shall be deemed for the· purposes of the Act, to be the agree-
ments relating to restrictive trade 

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