Appeal No. 36 of 2014. Case: India Trade Promotion Organisation Vs Competition Commission of India and Ors.. COMPAT (Competition Appellate Tribunal)
| Case Number | Appeal No. 36 of 2014 |
| Counsel | For Appellant: Krishnan Venugopal, Senior Advocate and Sidhartha, Advocate and For Respondents: Mayank Bansal, Advocate |
| Judges | G.S. Singhvi, J. (Chairman) |
| Issue | Competition Act, 2002 - Sections 17, 18, 19, 19 (6), 19(1), 19(1)(a), 19(4), 19(5)(6), 19(6), 2(h), 2(i), 2(j), 2(l), 2(r), 2(t), 2(u), 26, 26(1), 26(8), 27, 27(b), 3, 3(1), 3(3)(b), 3(3)(d), 3(4), 34, 35, 36, 36(1), 36(2), 4, 4(1), 4(2(c), 4(2) (e), 4(2)(a(i), 4(2)(a)(i), 4(2)(a)(ii), 4(2)(b)(i), 4(2)(b)(ii), 4(2)(c), 4(2)(d), 4(2)(e), 41(2), ... |
| Judgement Date | July 01, 2016 |
| Court | COMPAT (Competition Appellate Tribunal) |
Order:
G.S. Singhvi, J. (Chairman)
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Whether an entity (appellant herein) created by the Government of India, which is incorporated under Section 25 of the Companies Act, 1956 (for short 'the 1956 Act'), is under an obligation to temporarily part with the assets placed at its disposal by the Central Government and whether the time-gap policy, which has also been described as 'time gap restriction' in the record of this appeal, framed/implemented by the appellant for holding exhibitions/fairs and other events at Pragati Maidan, New Delhi and the alleged discrimination practiced in the allotment of spaces to the private organisers are contrary to Sections 4(2)(a)(i), 4(2)(b)(i), 4(2(c) and 4(2)(e) read with Section 4(1) of the Competition Act, 2002 (for short 'the Act'), are the questions which arise for consideration in this appeal filed against order dated 03.04.2014 passed by the Competition Commission of India (for short, 'the Commission') in Case No. 74 of 2012 titled 'Indian Exhibition Industry Association and Ministry of Commerce and Industry and another'.
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The appellant is a 100% Government-owned non-profit making company and functions under the administrative control of the Department of Commerce, Ministry of Commerce and Industry, Government of India. It was incorporated in 1976 under Section 25 of the Companies Act, 1956 (for short 'the 1956 Act') as 'Trade Fair Authority of India', which was merged in 1992 with Trade Development Authority of India and was re-named as 'India Trade Promotion Organisation'. The initial subscribers of the company were (1) the President of India; (2) the Prime Minister's Special Envoy, Ministry of External Affairs; (3) Joint Secretary, respondent Ministry; and (4) Chief Executive Director, Fair Organisation, respondent Ministry.
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The main objects of the appellant, as set out in its Memorandum of Association are:
1. To promote, organize and participate in industrial trade and other fairs and exhibitions show-rooms and depots in India and abroad and to take all measures incidental thereto for boosting up country's trade.
2. To publicize in India and abroad international Trade Fairs and Exhibitions to be held in India and invite the foreign participants to participate in them.
3. To organize and undertake trade in commodities connected with or relating to such fairs, exhibitions showrooms and depots in India and abroad and to undertake the purchase, sale, storing and transport of such commodities in India or anywhere else in the world.
4. To undertake promotion of exports and to explore new markets for traditional items of export and develop exports of new items with a view to maintaining, diversifying and expanding the export trade.
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Before the incorporation of the Trade Fair Authority of India under Section 25 of the 1956 Act, India International Trade Fair Organisation (a wing of Ministry of Commerce) and Indian Council of Trade Fairs and Exhibitions (a registered Society operating under the control of Ministry of Commerce, Government of India) were engaged in the organisation of trade fairs and exhibitions at Pragati Maidan. The task of formulating the policy, direction and supervision of exhibitions and commercial publicity was performed by the Directorate of Exhibition and Commercial Publicity (another wing of Ministry of Commerce). These entities were merged and a unified autonomous agency with the name 'Trade Fair Authority of India' was created and incorporated under the 1956 Act. The main task of Trade Fair Authority of India was to facilitate organisation of National/International trade fairs and exhibitions at Pragati Maidan, which was given to it on nominal rent.
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The appellant, which was created with the merger of Trade Fair Authority of India with Trade Development Authority of India provides services to trade and industry and acts as a catalyst for the growth of India's trade and policy and regulates holding of various exhibitions in India. It also approves holding of International Exhibition Fair Trade and India Trade Exhibitions abroad. The appellant also manages and rents out spaces at Pragati Maidan. It has regional offices in Bangalore, Chennai, Kolkata and Mumbai. The appellant has two subsidiary companies, namely, KTPO and TNTPO, which manage venues at Bangalore and Chennai, respectively.
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Although, the appellant was created as an autonomous entity, the Ministry of Commerce issued guidelines/instructions generally for achieving the objects set out in its Memorandum of Association and in particular, the holding of fairs/exhibitions in India and abroad. The appellant acted in consonance with those guidelines/instructions and also issued circulars from time to time to apprise the public about the guidelines/instructions issued by the Government of India. In July, 2006, the appellant framed policy for licencing of exhibitions and space and facilities at Pragati Maidan. The particulars of the guidelines/instructions/circulars issued from time to time for holding trade fairs and exhibitions, to which reference has been made in the investigation report prepared by the Director General (DG) and which are relevant to the issue involved in this appeal are given below:
(i) Vide Memorandum No. 10(7)/95-TP(Vol-II) dated 21.09.1999, Government of India approved the guidelines for holding International Fairs/Exhibitions in India and Indian Trade Exhibitions abroad by the organizers other than the appellant. Paragraphs 1, 2, 3.2 to 3.4 of those guidelines read as under:
"1. GENERAL
1.1. The instrumentally through which International Exhibitions in India and Indian Exhibitions abroad is currently regulated is through the provisions of Handbook of Procedures of the Export and Import Policy of the Government of India.
1.2. The approval or grant of permission for holding exhibition abroad does not amount to any endorsement or support of Government of India or ITPO for the event. The approval is only to facilitate trans/border movement of exhibits through the customs authorities for the approved events."
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THE NEED FOR A FRAMEWORK
2.1. It has been observed that a large number of organizers are coming forward to organise events in India and abroad and at time frequent exhibition convey confusing signals to the participants and to business visitors from India and abroad when events also lead to poor business response causing loss of opportunity on the organizer and the nation.
2.2. Further, there exists the need to have transparency in granting approvals by the Designated Authority. Thus the need was felt to review the existing framework and a Committee was constituted by the Ministry of Commerce (MOC) for the same.
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INTERNATIONAL TRADE EXHIBITION/FAIRS IN INDIA
3.1. General
Any Indian entity wishing to organize any International Trade Fairs/Exhibitions in India or abroad, would be required to obtain a certificate from an officer of Government of India through the Ministry of Commerce not below the rank of Under Secretary or an officer of the India Trade Promotion Organisation duly authorized by its Chairman on this behalf to the effect that such exhibition, fairs or as the case may be similar show or display, has been approved or sponsored by the Government of India in the Ministry of Commerce or the India Trade Promotion Organisation and the same is being held in the public interest (Export. Import Policy 1997-2002, handbook of Procedure Chapter II para 11.71).
Import is allowed without a license, of exhibits including construction and decorative materials required for the temporary stands of the foreign exhibitors at the approved exhibitions for a period of six months on re-export basis (Export-Import Policy 1997-2002, Handbook of procedures, Chapter 5, para 5.41 sub paras (ix)]
3.2. APPLICATION FOR GRANT OF APPROVAL
(i) Application is to be submitted to the General Manager (Domestic Fair Divisions) India Trade Promotion Organization (An undertaking of Ministry of Commerce), Pragati Bhavan, Pragati Maidan, New Delhi.
(ii) The information to be provided in the application would include:-
(a) The details of the legal status and financial status of the applicant/firm/company.
(b) Past experience in organizing trade exhibition and whether such events were supported by Apex/State Chambers of Commerce and Industry, Export Promotion Council etc.
(c) Whether the proposed events have the support of Chambers of Commerce and Industry, Export Promotion Councils, Commodity Boards etc. (Proof of Support to be attached).
3.3. CONSIDERATION OF THE APPLICATION
While considering the application, it has to be ensured that the slots of well-established trade fairs/exhibitions that are being held regularly with certain product profile are not granted to new applicants without ascertaining the requirements of such established exhibition organizers. This is to prevent pre-empting of established events.
3.4. The time gap required between two exhibitions/fairs on the same theme and similar product profile within the same city would be three months and if held in another city, it would be one month."
(Emphasis supplied)
(ii) After two years, the Ministry of Commerce and Industry issued D.O. No. 11 (14)/99-TP dated 02.01.2001 and amended the guidelines relating to time gap required between two International Exhibitions/Fairs to be held in India on the same theme and similar product profile within the same city and directed that the time gap would be 45 days instead of 3 months. For similar exhibitions/fairs held in different cities in India, the time gap was prescribed as one month. However, an exception was made in the case of IT, Telecom and Broadcasting Sectors and it was provided that there will be no time gap between the fairs/exhibitions organised by the industries in these sectors.
(iii) In response to letter dated 19.12.2002 sent by the appellant, the Ministry of Commerce and Industry, Department of Commerce, Government of India decided to lift the time gap...
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