Whether town planning department can recover development charges from builders if they fail to carry out development work?

  Apart from that, it has been brought to the notice of the Commission during the hearing that the developers have to get their license renewed every five years commencing from the date of grant of license and pay renewal fee on each occasion. Such fee has to be paid even if the reason for which the project is pending is non-completion of external development work by the OPs. This means that the developers who have been granted license in 2014 would have to pay the renewal fee in 2019 mandatorily if the External Development Works remain pending owing to the complacency of the OPs. {Para 21}

22. The Commission is of the view that the interest of the developers in this regard can be protected through appropriate directions; whereas, in the absence of intervention by the Commission at this stage, neither can the extant position be restored at a later stage nor the likely damages to the developers and the consumers be compensated. Thus, in the given facts and circumstances, the Commission finds that the balance of convenience lies in granting the interim relief as sought by the Informant. It has been observed by the Hon’ble Supreme Court in Zenit Mataplast P.Ltd vs State Of Maharashtra & Ors (2009) 10 SCC 388:

“Interim order is passed on the basis of prima facie findings, which are tentative. Such order is passed as a temporary arrangement to preserve the status quo till the matter is decided finally, to ensure that the matter does not become either infructuous or a fait accompli before the final hearing. The object of the interlocutory injunction is, to protect the plaintiff against injury by violation of his right for which he could not be adequately compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial.”

23. In light of the factual situation as discussed in the preceding paras, the case in hand appears to be exceptional in nature, which merits intervention by the Commission. The Commission notes that the investigation in the present matter is likely to take some time. In the meanwhile, the members of the Informant could suffer irreparable harm by way of cancellation of licenses and levying of penal interest despite the OPs being at fault. The Informant has placed on record the fact that the OPs are not discharging their obligation under the agreement and yet have issued several notices to the developers for want of payment of due EDC amount, wherein it is stated that default by the developers would render their license null and void. Thus, the Commission finds it appropriate and necessary to intervene at this stage to safeguard the members of the Informant against the irreparable and irretrievable losses that may be caused to them.

COMPETITION COMMISSION OF INDIA

Case No. 40 of 2017

In re:

Confederation of Real Estate Developers

Association of India-NCR (CREDAI-NCR) Vs  Department of Town and Country Planning, Government of Haryana …OP-1

Haryana Urban Development Authority …OP-2

CORAM

Mr. Sudhir Mital

Chairperson

Mr. U. C. Nahta

Member

Justice G. P. Mittal

Member

Dated:  01.08.2018

Order under Section 33 of the Competition Act, 2002

Print Page

How to determine relevant market for purpose of competition Act?

 The word 'market' used therein has reference to 'relevant market'.
As per sub-section (5) of Section 19, such relevant market can be
relevant geographic market or relevant product market. The
factors which are to be kept in mind while determining the
relevant geographic market are stipulated in sub-section (6) of
Section 19 and the factors which need to be considered while
determining the relevant product market are prescribed in
sub-section (7) of Section 19. These two sub-sections read as
under:
“(6) The Commission shall, while determining the
“relevant geographic market', have due regard to
all or any of the following factors, namely:-
(a) regulatory trade barriers;
(b) local specification requirements;
(c) national procurement policies;
(d) adequate distribution facilities;
(e) transport costs;
(f) language;
(g) consumer preferences;
(h) need for secure or regular supplies or
rapid after-sales services.

(7) The Commission shall, while determining the
“relevant product market”, have due regard to all or
any of the following factors, namely:-
(a) physical characteristics or end-use of
goods;
(b) price of goods or service;
(c) consumer preferences;
(d) exclusion of in-house production;
(e) existence of specialised producers;
(f) classification of industrial products.”
It is for this reason, the first and foremost aspect that needs
determination is: 'What is the relevant market in which
competition is effected?”
31) Market definition is a tool to identify and define the boundaries of
competition between firms. It serves to establish the framework
within which competition policy is applied by the Commission.
The main purpose of market definition is to identify in a
systematic way the competitive constraints that the undertakings
involved face. The objective of defining a market in both its
product and geographic dimension is to identify those actual
competitors of the undertakings involved that are capable of
constraining those undertakings behaviour and of preventing

them from behaving independently of effective competitive
pressure.
Therefore, the purpose of defining the 'relevant market' is to
assess with identifying in a systematic way the competitive
constraints that undertakings face when operating in a market.
This is the case in particular for determining if undertakings are
competitors or potential competitors and when assessing the
anti-competitive effects of conduct in a market. The concept of
relevant market implies that there could be an effective
competition between the products which form part of it and this
presupposes that there is a sufficient degree of interchangeability
between all the products forming part of the same market insofar
as specific use of such product is concerned.
32) While identifying the relevant market in a given case, the CCI is
required to look at evidence that is available and relevant to the
case at hand. The CCI has to define the boundaries of the
relevant market as precisely as required by the circumstances of
the case. Where appropriate, it may conduct its competition
assessment on the basis of alternative market definitions. Where
it is apparent that the investigated conduct is unlikely to have an
adverse effect on competition or that the undertaking under

investigation does not possess a substantial degree of market
power on the basis of any reasonable market definition, the
question of the most appropriate market definition can even be
left open.
33) The relevant market within which to analyse market power or
assess a given competition concern has both a product
dimension and a geographic dimension. In this context, the
relevant product market comprises all those products which are
considered interchangeable or substitutable by buyers because of
the products' characteristics, prices and intended use. The
relevant geographic market comprises all those regions or areas
where buyers would be able or willing to find substitutes for the
products in question. The relevant product and geographic
market for a particular product may vary depending on the nature
of the buyers and suppliers concerned by the conduct under
examination and their position in the supply chain. For example,
if the questionable conduct is concerned at the wholesale level,
the relevant market has to be defined from the perspective of the
wholesale buyers. On the other hand, if the concern is to
examine the conduct at the retail level, the relevant market needs
to be defined from the perspective of buyers of retail products.

34) It is to be borne in mind that the process of defining the relevant
market starts by looking into a relatively narrow potential product
market definition. The potential product market is then expanded
to include those substituted products to which buyers would turn
in the face of a price increase above the competitive price.
Likewise, the relevant geographic market can be defined using
the same general process as that used to define the relevant
product market.
35) Bearing in mind the aforesaid considerations, we concur with the
conclusion of the Tribunal. It is the notion of 'power over the
market' which is the key to analysing many competitive issues.
Therefore, it becomes necessary to understand what is meant by
the relevant market. This concept is an economic one.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6691 OF 2014
COMPETITION COMMISSION OF INDIA 
V
CO-ORDINATION COMMITTEE OF
ARTISTS AND TECHNICIANS OF W.B.
FILM AND TELEVISION AND ORS.
Dated:MARCH 07, 2017.
Citation:AIR 2017 SC 1449

Print Page

Whether comparative advertisements are permissible in India?

In the opinion of this Court, it is open to an advertiser to highlight a special feature/characteristic of his product which sets it apart from its competitors and to make a comparison as long as it is true. For instance, if a chocolate biscuit manufacturer issues a comparative advertising highlighting that his product has the highest chocolate content and the lowest price, then in the opinion of this Court the rival manufacturer cannot seek an injunction on the ground that fibre content or calorific value or protein content had not been compared.

49. In other words, it is open to an advertiser to objectively compare one or more material, relevant, verifiable and representative feature of the goods and services in question which may include price. There is no requirement in law to disclose each and every factor/characteristic in comparative advertisement. No reasonable observer would expect one trader to point to all the advantages of its competitor‟s business and failure to do so does not per se take the advertising outside what reasonable people would regard as „honest‟.

50. It is also pertinent to mention that it is the defendants‟ case that the impugned adverting campaign compared all the common features mentioned in all competitors packaging.

51. Further, tomorrow, if plaintiffs in response to defendant‟s advertising campaign, launch a comparative advertising highlighting its alleged salient features like power factor, life of bulb, it cannot be injuncted on the ground that the factor of brightness/lumens has not been mentioned.

52. In fact, mere trade puffery, even if uncomfortable to the registered proprietor, does not bring the advertising within the scope of trade mark infringement. Much advertising copy is recognised by the public as hyperbole. The Act, 1999 does not impose on the courts an obligation to try to enforce, through the back door of trade mark legislation, a more puritanical standard.

53. From the aforesaid discussion, it is apparent that the impugned advertising campaign is not misleading and there is no denigration or disparagement of plaintiffs‟ mark. Further, the factors compared are material, relevant, verifiable and representative features. Consequently, present application is dismissed, but with no order as to costs.

I.A. 1893/2015 [U/o. 39 Rule 2A CPC] On 22nd January, 2015 it was orally agreed by the counsel for the defendants that the defendants would not extend the impugned comparative advertising campaign to the electronic media.

During the course of hearing, the advertising campaign launched by the defendants on the television channels was shown to this Court. The advertising campaign launched by the defendants on the television is not comparative advertising inasmuch as it does not mention the name of any of the rivals in the trade, including that of the plaintiffs.

The Judge relied on one of the codes of the ASCI (Advertising Standards Council of India) wherein it states that comparative advertisements are permissible in the interest of vigorous competition and public enlightenment as long as these conditions are fulfilled.

Delhi High Court

Havells India Ltd & Anr vs Amritanshu Khaitan & Ors on 17 March, 2015

Author: Manmohan
CS (OS) 107/2015

Print Page

When employer can not restrain employee from taking job in rival company?

These principles have been clearly stated in the case of (Shree Gopal Paper Mills Ltd. v. Surendra K. Ganeshdas Malhotro Y, , Justice A.N. Ray has observed as follows:

"21. In contracts of service it is the proprietary interest owned by the master that requires protection. As Lord Parkar said in 1961-1 AC 688.

"The reason, and the only reason for upholding such a restraint on the part of an employee is that the employer has some proprietary right whether in the nature of trade connection or in the nature of trade secrets, for the protection of which such a restraint is - having regard to the duties of the employee - reasonably necessary. Such a restraint has, so far as I know, never been upheld if directed only to the prevention of competition or against the use of a personal skill and knowledge acquired by the employee in his employer's business."

In master and servant contracts restraint can be imposed upon a servant in respect of trade secrets and business connection of the master. In the case of Forster and Sons Ltd. v. Suggett, 1918 35 T.L.R. 87 the works manager of the plaintiff who were chiefly engaged in making glass and glass bottles was instructed in certain confidential methods concerning inter alia the correct mixture of gas and air in the furnaces. He agreed that during the five years following the determination of his employment he would not carry on in the United Kingdom or be interested in glass bottle manufacture or in any other business connected with glass making as conducted by the plaintiffs. The restraint for protection of trade secrets was held to be reasonable. It is indispensable that the employer must prove definitely that the servant has acquired substantial knowledge of some secret process or mode of manufacture used in the course of his business. In our country the restriction beyond the period of employment would not however be valid. Similarly, an employer is entitled to protect his trade connection. The nature of the business and the nature of the employment are important considerations justifying a restraint. It may appear that the servant had no access to the trade secrets of his master or to his customers. If that is so, the covenant is in gross and unenforceable. As Farwell, J., said in Town End v. Jaran, 1900 2Ch 698 at P. 703:

"Now, if one man apart from any business takes a covenant in gross from another man, that he will not trade at all, that is simply oppressive. He does not require it to protect his own interest, because he has no interest to protect."

In the Herbert Morris case, 1916-1-688 Lord Atkinson said that an oppressive agreement meant that it would, if enforced, deprive a person for lengthened period of the power of employing that mechanical and technical skill and knowledge which his own industry, observation and intelligence have enabled him to acquire in the very specialised manufacturing business, thus forcing him to begin life afresh as it were, depriving him of the means of supporting himself and his family. Lord Atkinson further said that the general public suffer with him for it is in the public interest that a man should be free to exercise his skill and experience to the best advantage for the benefit of himself and of all those who desire to employ him. See 1961-1 688 at pp. 698 per Lord Atkinson.

21. In all cases of covenants of restraint between master and servant the two questions are first what are the interest of the employer that are to be protected and secondly, against what is he entitled to have them protected. The master is entitled to be protected in regard to his interests in trade secrets and secret process of manufacture. That protection is secured by restraining the employee from divulging those trade secrets or putting them to the use of the servant, the master is also entitled to be protected against invasion of his customers or clientele but the master is not entitled to be protected against competition..."

Bombay High Court

Jet Airways (I) Ltd. vs Mr. Jan Peter Ravi Karnik on 17 April, 2000

Equivalent citations: 2000 (4) BomCR 487

S. S. Nijjar, J.

Print Page