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1986 DIGILAW 42 (KAR)

MOTOR INDUSTRIES CO. LTD. v. MONOPOLIES AND RESTRICTIVE TRADE PRACTICES COMMISSION

1986-01-20

K.A.SWAMI

body1986
K. A. SWAMI, J. ( 1 ) IN this Petition under Articles 226 and 227 of the Constitution, the petitioner has sought for the following reliefs: ( i) To issue a writ of certiorari, quashing the order of the Respondent in Restrictive Trade practice Enquiry No. 8/1982 on the petitioner's application dated 20-9-1982 made under regulation 66 of the MRTP Commission Regulation, 1974, (ii) To issue a writ of certiorari, quashing the notice bearing No. 20 (226)-RTF/82 dated 19-8-1982 issued by the respondent, produced as Annexure-Q in so far as it relates to : (a) alleged discrimination in supplies of fuel injection equipment etc. as para (i) of Annexure-Q. (b) para (ii) (a), (b) and para (iv) of Annexure-Q (iii) To issue a writ of mandamus, restraining the respondents from proceeding further with the enquiry in the Enquiry No. 8/82 relating to the Petitioner-Company in so far as the same relates to paras (i), (ii) (a) and (b) and (iv) of the said notice dated 19-8-1982 (Annexure-Q ). (iv) To grant such other writ, order, direction, reliefs, including allowing this Writ Petition with costs. ( 2 ) THERE is also an application filed by Sr. L. D. Sabharwal for being impleaded as Additional respondent. That application has not been allowed. However, it has been directed to be brought up along with the main matter. Learned Counsel appearing for Sr. Sabharwal is also heard in the proceeding. ( 3 ) BEFORE proceeding to consider the Petition on merits, it is also necessary to dispose of this application. No doubt, Sr. Sabharwal is a complainant and on the basis of his complaint, the first respondent has initiated the proceeding by issuing the impugned "notice of enquiry"-Annexure-Q but the scheme of the Act does not provide for any relief to the complainant nor does it confer any right of hearing on him. No doubt, Sr. Sabharwal is a complainant and on the basis of his complaint, the first respondent has initiated the proceeding by issuing the impugned "notice of enquiry"-Annexure-Q but the scheme of the Act does not provide for any relief to the complainant nor does it confer any right of hearing on him. As per Section 10 (a) of the monopolies and Restrictive Trade Practices Act, 1969 (hereinafter referred to as the M. R. T. P. Act) it is open to the first respondent to enquire into any restrictive trade practice : (i) upon receiving a complaint of facts which constitute such practice from any trade or consumers' association having a membership of not less than twenty-five persons or from twenty-five or more consumers, or (ii) upon a reference made to it by the Central Government or State Government, or (iii) upon an application-made to it by the Registrar, or (iv) upon its own knowledge or information sri L. D. Sabharwal does not fall in any one of the aforesaid class of complainants. The first respondent appears to have treated the complaint of Sri L. D. Sabharwal as an information received by it and has initiated the enquiry. Of course, even in the absence of the complaint by sri L. D. Sabharwal, it was and is open to the first respondent to gather information on its own and enquire into the matter. Therefore, it is not possible to hold that a person or an authority not falling in any one of the classes of complainants mentioned in Section 10 (a) (i) to (iii) of the Act, becomes entitled to participate in the proceeding as of right, and as if he or it, is a accessary party to the proceeding. Merely because he or it has supplied information to the first respondent to enable it to initiate an enquiry into the matter, does not become a party to the proceeding. The act enumerates the complainants. An individual trader is not recognised for this purpose; therefore, he can at the most become an informant or his complaint may be treated as an information under Section 10 (a) (iv) of the Act. Therefore, it is not possible to allow Sri sabharwal to come on record as a party to the proceeding. The act enumerates the complainants. An individual trader is not recognised for this purpose; therefore, he can at the most become an informant or his complaint may be treated as an information under Section 10 (a) (iv) of the Act. Therefore, it is not possible to allow Sri sabharwal to come on record as a party to the proceeding. Irrespective of this, as it is already pointed out, Learned Counsel appearing for Sri L. D. Sabharwal has been heard on merits of the proceeding. With these observations, the application filed by Sri L. D. Sabharwal is rejected. ( 4 ) ON receipt of the impugned notice-Annexure-Q, dated 10th August, 1982, the petitioner has filed an application before the first respondent under Regulation 66 of the Monopolies and restrictive Trade Practices Commission Regulations, 1972 (hereinafter referred, to as, the 'regulation') for separating the allegations contained in paragraphs 2 (a),and (b) and first part of para-1 of the Notice of Enquiry dated 18-2-1982 and dropping paragraph 4 of the said notice. The first respondent after hearing the petitioner has rejected the application holding that para-4 cannot be dropped because it will have a bearing on the other allegations contained in the notice. As far as separating of the allegations contained in first part of para-1 and paragraphs 2 (a) and (b) of the Notice of Enquiry are Concerned, it is held that the same cannot at all be separated because they are closely connected with the other parts of the notice ; and further that the prayer does not fall within the purview of Regulation 66 (1) (a) and (b) of the Regulations. Accordingly, the Commission has rejected the application. ( 5 ) NO doubt, in this Writ Petition, as per the prayers made, the petitioner has sought for quashing para-4 of the Notice of Enquiry, in addition to 1st part of para-1, and paras 2 (a) and (b) thereof. However, during the course of arguments, Sri Rangarajan, Learned Counsel for the petitioner, has made it clear that the petitioner is not urging for quashing para-4 of the Notice of Enquiry and it may be treated as given up. In view of this submission, the prayer relating to quashing of para-4 of the Notice of Enquiry is not considered and it is treated as abandoned. ( 6 ) 6. In view of this submission, the prayer relating to quashing of para-4 of the Notice of Enquiry is not considered and it is treated as abandoned. ( 6 ) 6. 1) It is contended on behalf of the petitioner that first part of para-1 and paras 2 (a) and (b) of the notice of enquiry do not at all contain necessary ingredients of "restrictive trade-practice"; therefore, the Commission has no jurisdiction to enquire into the allegations contained in first part of para-1 and paras 2 (a) and (b) of the Notice of Enquiry. It is submitted that as far as the acceptance of resignation of Sri L. D. Sabharwal, proprietor of Modern Engineering Corporation, lucknow, to the dealership of the petitioner, the same is in accordance with the terms of the agreement entered into by him with the petitioner-company and that agreement is approved by the 1st Respondent under Section 37 of the Act ; therefore, the question of there being any restrictive trade practice does not arise. As far as Faizabad Diesels, of which Sri L. D. Sabharwal is a proprietor, is concerned, the dealership has been terminated in terms of the contract, which is also approved by the 1st Respondent. Thus it is submitted that when an act is done in terms of the agreement, it cannot provide a ground for initiating a proceeding to enquire into the same under the camouflage of Restrictive Trade Practice. It is also further submitted that if the necessary allegations are not contained in the Notice of Enquiry, the 1st respondent cannot go into the matter and hold an enquiry and decide the same ; that there is a threshold bar for the 1st respondent to go into it because the necessary allegations to exercise jurisdiction under the Act, are neither before it nor it has collected any such material. Therefore, it is submitted that inspite of the fact that in the ultimate analysis of the matter or in the ultimate order passed in the proceeding, there is a right of appeal provided it does not come in the way of this Court to exercise jurisdiction under Article 226 of the Constitution since the matter is one of jurisdiction. In support of these submissions, Learned Counsel has placed reliance on the decisions of the supreme Court in Tata Engineering and Locomotive Co. In support of these submissions, Learned Counsel has placed reliance on the decisions of the supreme Court in Tata Engineering and Locomotive Co. , Ltd. , Bombay v. The Registrar of the restrictive Trade Agreement, New Delhi, AIR1977 SC 973 , [1977 ]47 compcas520 (SC ), (1977 )2 SCC55 , [1977 ]2 SCR685 ; Mahindra and Mahindra Ltd, v. the union of India and Anr. , AIR 1979 SC 798 ; 1969 (2) Appeal Cases, 147, Anisminic Ltd. v. Foreign Compensation Commission and Anr. ; 1918 Supreme Court of the United States, 299, usa -v.- Colgate and Co. and also AIR1961 SC 272 , [1961 ]1 SCR591 , calcutta Discount Co. , Ltd, v. Income Tax Officer, Calcatta. It is also further submitted that if the 1st respondent is permitted to go into the allegations made in paras 1 and 2 of the Notice of Enquiry, the two suits filed by the petitioner against Sri L. D. Sabharwal will be affected inasmuch as the subject-matter of the two suits relates to the question as to whether Sr. L D. Sabharwal can still be considered to be an authorised dealer of the petitioner-Company inspite of the fact that in one case his resignation has been accepted arid in another case the contract of dealership itself has been terminated. Therefore, it is submitted that the first respondent ought to have separated the allegations contained in paras 1 and 2 of the notice of Enquiry from the other portions of the notice. 6. 2) On the contrary, Sri K. Shivashankar Bhat, Learned Senior Standing Counsel for Central government, appearing for respondents 1 and 2, submits that whether the petitioner is guilty of restrictive trade practices or not, has yet to be enquired into and it is the 1st respondent and 1st respondent alone which has got jurisdiction to decide. Therefore, it is not the stage at which the interference is called for. It is also further submitted that the petitioner cannot expect entire gamut of evidence to be put in the Notice of Enquiry, that the allegations contained in paras 1 and 2 of the Notice of Enquiry are sufficient to give jurisdiction to the 1st respondent and are sufficient to enable the petitioner to meet the same. It is also further submitted that the petitioner cannot expect entire gamut of evidence to be put in the Notice of Enquiry, that the allegations contained in paras 1 and 2 of the Notice of Enquiry are sufficient to give jurisdiction to the 1st respondent and are sufficient to enable the petitioner to meet the same. After all, it is submitted, the 1st respondent is discharging the public function in the interest of trade and commerce in order to maintain the standard, of trade and commerce and to see that the monopolistic and restrictive trade practices are not practices so that the trade and commerce can flourish without any hamper. It is also further submitted that even if the 1st respondent holds against the petitioner, the right of appeal is provided, and an appeal lies to the Supreme Court; hence it is not a matter for interference at this stage. Shri Shivashankar Bhat, Learned Senior Standing Counsel for Central Government, further submits that the scope of enquiry under the Act, is quite different from the subject-matter of the suit, that the 1st respondent is required to go into whether there is any restrictive trade practice committed by the petitioner; whereas the subject-matter of the suits is as to whether Sri l. D. Sabharwal continues to be the authorised dealer of the petitioner-Company. Therefore, it is submitted that pendency of the suits has nothing to do with the present proceeding because neither the present proceeding is affected by the suits nor the suits are affected by the present proceeding; therefore, the 1st respondent is right in negativing this contention. 6. 3) I may also mention here that Learned Counsel appearing for Sri L. D. Sabarwal has only adopted the arguments of Learned Senior Standing Counsel for Central Government ; and has further submitted that he has only brought to the notice of the Commission certain facts and it is for the Commission to enquire into the same. ( 7 ) HAVING regard to the aforesaid contentions, the points that arise for consideration are : (i) Whether paras 1 and 2 of the Notice of the Enquiry dated 19th August, 1982 (Annexure-Q) contain essential ingredients of restrictive trade practice ? (ii) Whether it is a case for interference under Article 226 or 227 of the Constitution ? (iii) Whether the impugned order requires to be quashed ? ( 8 ) 8. (ii) Whether it is a case for interference under Article 226 or 227 of the Constitution ? (iii) Whether the impugned order requires to be quashed ? ( 8 ) 8. 1) POINT NO. (i) : In order to appreciate the contentions bearing on this point, it is necessary to reproduce paras 1 and 2 of the Notice of Enquiry (Annexure-Q) which are as follows :" (i) Discrimination in supplies ; This Respondent has discriminated in supplies of fuel injection equipment, its spares and replacements to Modern Engineering Corporation and Faizabad diesels, the Authorised distributors of respondents at Lucknow and Faizabad respectively, with other Authorised Distributors of Gorakhpur and Kanpur Divisions, without having regard to the engine population in these areas, Respondent-Company has instead been making increased supplies to its favourite distributors. The distribution policy of respondent has created artificial scarcity and caused rise in prices in the market : (ii) Refusal to supply/deal : (a) Modern Engineering Corporation, Lucknow has been the oldest authorised Distributor of the Respondent and has been making repeated complaints to the respondent regarding mal-distribution and malpractices in making the supplies by it, with no effect. The said distributor made a conditional offer of resignation on or about 8th August, 1980 according to which it was pointed out to the respondent "that if things cannot be done as requested by us, we cannot continue any longer to associate with MICO under such degrading and humiliating conditions, we shall discontinue our association with effect from 12th november, 1980. . . . . . . . . . . . " the Respondent accepted the resignation, without any reasonable cause on or about 11th february, 1981 and in fact supplies were stopped in November, 1980. The said distributor placed an indent on 20th March, 1982, but no supplies were made by the Respondent. (b) Faizabad Diesels, Faizabad were appointed as Authorised Distributors of the Respondent at faizabad (U. P.) on or about 1st July, 1979 and the said distributorship was terminated with effect from 15th December, 1981 by the respondent, in terms of Clause 3 of the agreement dated 1st june, 1979, without reasonable cause. (b) Faizabad Diesels, Faizabad were appointed as Authorised Distributors of the Respondent at faizabad (U. P.) on or about 1st July, 1979 and the said distributorship was terminated with effect from 15th December, 1981 by the respondent, in terms of Clause 3 of the agreement dated 1st june, 1979, without reasonable cause. "it is also necessary to notice the definition of "restrictive trade practice" as provided in Section 2 (0) of the Act, which leads thus : " (O) "restrictive trade practice" means a trade practice which has, or may have, the effect of preventing, distorting or restricting competition in any manner and in particular,- (i) which tends to obstruct the flow of capital or resources into the stream of production, or (ii) which tends to bring about manipulation of prices, or conditions of delivery or to affect the flow of supplies in the market relating to goods or services in such manner as to impose on the consumers unjustified costs or restrictions. " from the aforesaid definition of 'restrictive trade practice', it is clear that it is only such trade practice which has the effect actual or probable of preventing, distorting or restricting competition in any manner and in particular - which tends to obstruct the flow of capital or resources into the stream of production or which tends to bring about manipulation of prices, or conditions of delivery or to affect the flow of supplies in the market relating to goods or services in such manner as to impose on the consumers unjustified costs or restrictions. 8. 2) The Notice of Enquiry issued under Section 10 (a) (iv) and Section 37 of the Act, read with regulation 58 of the Regulations must contain the necessary facts which constitute restrictive trade practice. Bald allegations cannot be held to furnish ground for the Commission to enquire into the matter. The Notice of. Enquiry must set out all the facts relating to alleged trade practice and also state as to how, having regard to the nature and history of the trade, it constitutes restrictive trade practice in the context of the facts stated in the Notice. The absence of all the necessary facts and circumstances, in the Notice of Enquiry, constituting restrictive trade practice is a" serious legal infirmity and it vitiates the Notice of Enquiry. The absence of all the necessary facts and circumstances, in the Notice of Enquiry, constituting restrictive trade practice is a" serious legal infirmity and it vitiates the Notice of Enquiry. Regulation 58 also specifically states that "the proceedings under Sub-section (1) of Section 37 of the Act shall be initiated by a notice to the person or persons against whom allegations of restrictive trade practices are made stating that the Commission proposes to hold an inquiry into the alleged trade practices. " Thus the Notice of Enquiry must contain all the facts constituting the alleged trade practice. The Notice of Enquiry is in the nature of complaint. As it is condition precedent for the commencement of the investigation that the complaint must disclose prima facia that a cognizable offence has been committed, so also for the Commission to enquire into the alleged restrictive trade practice on the information received by it. It must state in the Notice of Enquiry all the necessary facts constituting the restrictive trade practice alleged against a person or party to whom such Notice of Enquiry is issued. The rule laid down by the Supreme Court in State of west Bengal -v.- Swapan Kumar, AIR1982 SC 949 , (1982 )1 complj217 (SC ), 1982 Crilj819 , 1982 (1 )SCALE38 , (1982 )1 SCC561 , [1982 ] 3 SCR121 in relation to commencement of investigation under Section 157 of the Code of Criminal procedure, on receipt of the First Information Report must be made applicable to the proceeding initiated by the Commission for the alleged restrictive trade practice on the information received by it under Section 10 (a) (iv) of the Act, by issuing Notice of Enquiry. The rule laid down by the supreme Court in the aforesaid decision is as follows : "21. The position which emerges from these decisions and the other decisions which are discussed by Brother A. N. Sen is that the condition precedent to the commencement of investigation under Section 157 of the Code is that the F.. R. must disclose, prima facie, that a cognizable offence has been committed. It is wrong to suppose that the police have an unfettered discretion to commence investigation under Section 157 of the Code. Their right of inquiry is conditioned by the existence of reason to suspect the commission of a cognizable offence and they cannot reasonably, have reason so to suspect unless the F.. It is wrong to suppose that the police have an unfettered discretion to commence investigation under Section 157 of the Code. Their right of inquiry is conditioned by the existence of reason to suspect the commission of a cognizable offence and they cannot reasonably, have reason so to suspect unless the F.. R. prima facie, discloses the commission of such offence. If that condition is satisfied, the investigation must go on and the rule in Khwaja Nazir Ahmed will apply. The Court has then DO power to stop the investigation, for to do so would be to trench upon the lawful power of the police to investigate into cognizable offences. On the other hand, if the F.. R. does not disclose the commission of a cognizable offence, the Court would be justified in quashing the investigation on the basis of the information as laid or received. " in Mahindra and Mahindra Ltd. , -v.- Union of India, AIR 1979 SC 798 in relation to the application made by the Registrar under Section 10 (a) (iii) of the Act, it has been laid down that the application must contain facts which in the opinion of the Registrar constitute restrictive trade practice and it is not sufficient to make mere reference to clauses of the agreement and bald allegations that the clauses constitute restrictive trade practice. It has been further held that the application must set out facts or features to show or establish as to how the alleged clauses constitute restrictive trade practice in the context of facts. In this background, let me now consider the allegations contained in para-1 of the Notice of Enquiry in question. The allegations are to the effect that the Petitioner has discriminated in supplying fuel injection equipment its spares and replacements to Modern Engineering Corporation and Faizabad Diesels, authorised distributors of the Petitioner at Lucknow and Faizabad respectively on the one hand and the other authorised distributors of the Petitioner at Gorakhpur and Kanpur Divisons on the other, without having regard to the engine population in these areas; inasmuch as it has been making increased supplies to its favourite distributors and this distribution policy of the Petitioner has created artificial scarcity and caused rise in prices in the market. There is no allegation that having regard to the nature of the trade, in what manner it has actually resulted or likely to result in preventing, distorting or restricting competition in any manner or how it tends to obstruct the flow of capital or resources into the stream of production or tends to bring about manipulation of prices or conditions of delivery or to affect the flow of supplies in the market relating to supply of fuel injection equipment, its spares and replacements or has caused imposition on customers unjustified costs or of restrictions. In the absence of necessary allegation, it it highly hazardous for the Commission to start an enquiry and at the same time, it places the Petitioner at a great disadvantage. The very basis of fair and proper enquiry consistent with the principles of natural justice is denied inasmuch as the necessary facts constituting the alleged restrictive trade practice are not disclosed to the Petitioner, nevertheless it is required to meet the charge of alleged restrictive trade practice. Thus I am of the view that para-1 of the Notice of Enquiry is very bald one. The Commission cannot be permitted to proceed with the enquiry without disclosing the necessary facts constituting the restrictive trade practice. 8. 3) As far as the allegations contained in paras (ii) (a) and (b) are concerned, they relate to the resignation submitted by Sri L. D. Sabharwal as Proprietor of Modern Engineering Corporation, lucknow, from the authorised dealership of the petitioner-company. The said resignation has been accepted. Thereafter, the authorised dealership of Sri L. D. Sabharwal of the petitioner-company in relation to Faizabad Diesels has been terminated by the petitioner-Company with effect from 15th December, 1981. Both these acts are done in terms of the agreement. It is not disputed that the terms of the two agreements are approved by the commission under the provisions of the Act. Therefore, there is no question of examining them as to whether the same contain a clause which is likely to result in 'restrictive trade practice'. It is an established position of law that it is open to a trader to select his own dealer (See : USA -v.-Colgate and Co. Therefore, there is no question of examining them as to whether the same contain a clause which is likely to result in 'restrictive trade practice'. It is an established position of law that it is open to a trader to select his own dealer (See : USA -v.-Colgate and Co. In the absence of any purpose to create or maintain a monopoly, the Act does not restrict the long recognised right of trader or manufacturer to engage in an entirely private business freely to exercise his own independent discretion as to the parties with whom he will deal and to announce in advance, circumstances under which he will refuse to ; sell. In one case, the authorised dealership is terminated and in another the resignation to the authorised dealership tendered by L. D. Sabharwal is accepted in exercise of the power vested in the petitioner under the terms of the contract. Therefore, it is not possible to hold that such exercise of power attracts the charge of 'restrictive trade practice'. Therefore, paras (ii) (a) and (b) of the Notice of Enquiry cannot also be held to contain the necessary ingredients of restrictive trade practice. 8. 4) In view of the conclusions reached by me, it is not possible to accept the submissions made by learned Senior Standing Counsel for Central Government appearing for respondents 1 and 2 that the Commission is entitled to go into the allegations contained in paras 1 and 2 of the Notice of Enquiry, Accordingly, Point No. 1 is answered in the negative. ( 9 ) 9. 1) POINT NO. 2 : The next question is as to whether it is a case for exercising jurisdiction under Article 226 or 227 of the Constitution. This has to be examined in the background that the case is at the initial stage before the Commission and as against the ultimate decision in the case, an aggrieved person or party has a right of appeal to the Supreme Court. No doubt, normally interference is not called for at this stage as the Commission is empowered to enquire into the allegations of restrictive trade practice. No doubt, normally interference is not called for at this stage as the Commission is empowered to enquire into the allegations of restrictive trade practice. But, in a case like this where the condition precedent for exercise of jurisdiction, in other words, for holding an enquiry by the Commission into the alleged restrictive trade practices is not Satisfied inasmuch as necessary allegations are not contained in the Notice of Enquiry regarding the alleged restrictive trade practice, to enable the petitioner to know the case alleged against if, is not just and proper to allow the Commission to make a roving enquiry. In a case like this, if the Commission is allowed to go ahead with (he enquiry which will necessarily subject the petitioner to a lengthy proceeding and unnecessary harassment, it will be nothing but allowing the Commission to clutch at the jurisdiction. The commission does not enjoy unlimited jurisdiction. It is a Tribunal of limited jurisdiction. It has no right or jurisdiction to enquire into the allegations of restrictive trade practice upon its own knowledge or information (Section 10 (a) (iv) of the Act.) unless it is possessed of all the necessary facts and circumstances which go to establish the alleged restrictive trade practices and states the same in the Notice of Enquiry. It is condition precedent for exercise of jurisdiction to start the proceeding. In the instant case as pointed above, it cannot be held to exist. It is necessary to state in the Notice of Enquiry all the facts and circumstances resulting in the alleged restrictive trade practice to enable the person or party to whom such Notice of Enquiry is issued, to know the nature and the scope of the proceeding initiated against him or it ; as otherwise, it will be nothing but an arbitrary exercise of power to make a roving enquiry which our jurisprudence does not permit. No authority, whether it be administrative or executive, much less an authority clothed with judicial power, can exercise its power or jurisdiction arbitrarily. It is more so in the case of Tribunals with limited jurisdiction. In Calcutta Discount Co. , Ltd. , -v. Income tax Officer, Companies District I, Calcutta and anr. No authority, whether it be administrative or executive, much less an authority clothed with judicial power, can exercise its power or jurisdiction arbitrarily. It is more so in the case of Tribunals with limited jurisdiction. In Calcutta Discount Co. , Ltd. , -v. Income tax Officer, Companies District I, Calcutta and anr. , page 372, with reference to Section 34 of the Income-tax Act, it is held that before the Income-tax Officer has jurisdiction to start proceeding under Section 34 of the Income-tax -Act after the expiry of four years, he must have reason to believe that there has been under-assessment and further reason to believe that such under-assessment has resulted from undisclosure of material facts. It is further held that in the proceedings under Article 226 of the Constitution, the High Court can investigate the existence of one of those two conditions and if it is found that conditions precedent do not exist, the High court, in exercise of jurisdiction under Article 226 of the Constitution, can issue high prerogative writs prohibiting the action under the notice issued under Section 34 of the income-tax Act. It is also further held that the High Court has power to issue, in a fit case, a writ of prohibition or certiorari where an action of an executive authority acting without jurisdiction subjects or is likely to subject a person to lengthy proceedings and unnecessary harassments to prevent such consequences. It is more so in the case of Tribunal exercising quasi-judicial power. 9. 2) In Rex -v.- Shoreditch Assessment Committee, Ex Parte Morgan, (1910) 2 KB 859 the court of Appeal while issuing mandamus to the Committee, held thus : ". . . . . . . . . . . . It is a contradiction in terms to create a tribunal with limited jurisdiction and unlimited power to determine such limit as its own will and pleasure -- such a tribunal would be autocratic, not limited -- and it is immaterial whether the decision of the inferior tribunal on the question of the existence or non-existence of its own jurisdiction is founded on law or fact. " In Anisminic Ltd.-v.- Foreign Compensation Commission and Anr. , Lord Pearce observed thus : "such tribunals must, however, confine themselves within the powers specifically committed to them on a true construction of the relevant Acts of Parliament. " In Anisminic Ltd.-v.- Foreign Compensation Commission and Anr. , Lord Pearce observed thus : "such tribunals must, however, confine themselves within the powers specifically committed to them on a true construction of the relevant Acts of Parliament. It would lead to an absurd situation if a tribunal, having been given a circumscribed area of inquiry, carved out from a general jurisdiction of the Courts, were entitled of its own motion to extend that area by misconstruing the limits of its mandate to inquire and decide as set out in the Act of Parliament. Lack of jurisdiction may arise in various ways. There may be an absence of those formalities or things which are condition precedent to the tribunal having any jurisdiction to embark on an inquiry. Or the tribunal may at the end make an order that it has no jurisdiction to make. Or in the intervening stage, while engaged on a proper inquiry, the tribunal may depart from the rules of natural justice ; or it may ask itself the wrong questions ; or it may take into account 'matters which it was not directed to take into account. Thereby it would step outside its jurisdiction. . . . . . . . . . . the Courts' supervisory duty is to see that it makes the authorised inquiry according to natural justice and arrives at a decision whether right or wrong. They will intervene if the tribunal asks itself the wrong questions (that is, questions other than those which parliament directed it to ask itself ). But, if it directs itself to the right inquiry, asking the right questions, they will not intervene merely because it has or may have to the wrong answer, provided that this is an answer that lies within its jurisdiction. " 9. 4) In the instant case also, as it is already pointed out, the conditions precedent for initiating a proceeding by issuing Notice of Enquiry under Section 10 (a) (iv) and Section 37 of the Act read with Regulation 58 of the Regulations, are not satisfied. In other words, the same do not exist. Therefore, the Commission cannot be permitted to act in excess of its jurisdiction. In addition to this, it is the case of the petitioner that the roving enquiry embarked upon by the Commission subjects itto lengthy proceeding and unnecessary harassment. In other words, the same do not exist. Therefore, the Commission cannot be permitted to act in excess of its jurisdiction. In addition to this, it is the case of the petitioner that the roving enquiry embarked upon by the Commission subjects itto lengthy proceeding and unnecessary harassment. The Act does not contemplate any such roving enquiry. The Tribunal of limited jurisdiction can exercise its suo motu jurisdiction only on satisfying the conditions precedent, as mentioned earlier. Hence, I am of the view that it is a fit and proper case for exercise of jurisdiction under Article 226 or 227 of the Constitution, to prevent the arbitrary exercise of jurisdiction which is nothing but negation of rule of law. Accordingly, Point No. 2 is answered in the affirmative. ( 10 ) POINT NO. 3 : In view of the conclusions reached on Point Nos. 1 and 2, it follows that the impugned order (Annexure-S) in so far it relates to paras 1 and 2 of the Notice of Enquiry dated 19th August, 1982 (Annexure-Q) and paras 1 and 2 of the said Notice of Enquiry, are liable to be quashed. Point No. 3 is answered accordingly. ( 11 ) FOR the reasons stated above, this Writ Petition is allowed in the following terms : "the allegations contained in paras 1 and 2 of the Notice of Enquiry, dated 19-8-1982 issued by the first Respondent, produced as Annexure-Q ; and the impugned Order dated 12-10-1982 passed by the first Respondent in Restrictive Trade Practices Enquiry No, 8/32, produced as annexure-S, in so far it relates to paras 1 and 2 of the Notice of Enquiry referred above, are hereby quashed. It is made clear that the first Respondent is at liberty to proceed to enquire into the allegations contained in paras 3 and 4 of the Notice of Enquiry dated 19-8-1982 issued by the 1st respondent, produced as Annexure-Q.