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        Companies Law

        2008 (9) TMI 555 - SC - Companies Law

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        Unfair trade practice under section 36A requires a sale context; no actual sale means the provision does not apply. Section 36A of the Monopolies and Restrictive Trade Practices Act, 1969 is directed at deceptive representations connected with the sale or supply of ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                        Provisions expressly mentioned in the judgment/order text.

                            Unfair trade practice under section 36A requires a sale context; no actual sale means the provision does not apply.

                            Section 36A of the Monopolies and Restrictive Trade Practices Act, 1969 is directed at deceptive representations connected with the sale or supply of goods or services, and the text confines it to situations where goods are actually sold. Applying ejusdem generis and noscitur a sociis, the inclusive wording added by the 1991 amendment did not expand the provision beyond that statutory purpose. On the stated facts, no goods were sold, so the unfair trade practice finding could not stand. A concurring note added that a broader case might arise where a supplier promises goods known to be unavailable.




                            Issues: Whether section 36A of the Monopolies and Restrictive Trade Practices Act, 1969 applies where no goods are actually sold and, on that basis, a party can be held guilty of unfair trade practice.

                            Analysis: Section 36A, introduced by the 1984 amendment and expanded by the 1991 amendment, was enacted to prevent consumers from being misled by false or deceptive representations about goods or services that are in fact sold. Applying the object of the provision, together with the principles of ejusdem generis and noscitur a sociis, the provision was held to be directed to cases where goods are sold and are represented in a misleading manner, rather than to a situation where no sale at all takes place. The inclusive form of the definition after the 1991 amendment did not enlarge the provision beyond its statutory purpose.

                            Conclusion: Section 36A was not attracted on the facts, since no goods were sold by the appellant to the respondent; the finding of unfair trade practice could not stand and the appeal succeeded.

                            Concurring Opinion: Altamas Kabir, J. agreed with the result and the setting aside of the order, but observed that a wider concept of unfair trade practice could in an appropriate case extend to a promise to supply goods known to be unavailable, even without an actual sale.

                            Ratio Decidendi: Section 36A of the Monopolies and Restrictive Trade Practices Act, 1969 is aimed at deceptive practices connected with the sale or supply of goods or services and cannot be applied where no goods are actually sold.


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                            ActsIncome Tax
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