Delhi High Court High Court

Hindustan Lever Ltd. & Anr. vs Monopolies & Restrictive Trade … on 24 March, 1999

Delhi High Court
Hindustan Lever Ltd. & Anr. vs Monopolies & Restrictive Trade … on 24 March, 1999
Equivalent citations: 1999 IIIAD Delhi 515, 1999 97 CompCas 382 Delhi, 79 (1999) DLT 234, 1999 (49) DRJ 329
Author: A Kumar
Bench: A Kumar, M Sarin


ORDER

Arun Kumar, J.

1. Colgate Palmolive (India) Limited complainant No.1 (hereinafter referred to as ‘Colgate’) filed a complaint along with complainant No. 2, claiming to be a consumer, before the Monopolies and Restrictive Trade Practices Commission (hereinafter referred to as the “Commission”) against M/s. Hindustan Lever Limited complaining that the advertisement campaign of the letter regarding its dental cream New pepsodent disparages the leading toothpaste namely Colgate Dental Cream manufactured by complainant No.1. It was further alleged that M/s. Hindustan Lever Limited was indulging in unfair trade practices. The product ‘New pepsodent’ was recently introduced in the market. The advertisement campaign of this product through the print, visual media and otherwise, was being carried out in a manner which misleads the public at large while at the same time it is disparaging to the product of complainant No.1, namely, Colgate Dental Cream. In its various advertisements Hindustan Lever claimed that the New pepsodent toothpaste had 102% anti-bacterial superiority over the leading toothpaste. Along with the complaint, an application under section 12A of the Monopo- lies and Restrictive Trade Practices Act, 1969 (hereinafter referred to as the ‘Act’) was filed for interim relief. By an order dated 5th/6th Novem- ber, 1997, the Commission passed certain interim directions by way of interim relief in favour of the complainants. The Commission also felt that in view of the claim of Hindustan Lever that New pepsodent had 102% anti- bacterial superiority over the leading
toothpaste (which prima facie was found to be the Colgate Dental Cream) opinion of independent experts would be helpful in deciding the matter. The Commission felt that examination of truthfulness of such claim involves a highly scientific approach. It was also felt that the issue was technical in nature and both the parties had relied upon expert opinion filed by them on record. In these circumstances, the Commission felt that it would be better to be guided by independent expert opinion on the subject. Both the parties i.e. Colgate and Hindustan Lever were required to furnish the name of one expert on each side. In addition, Commission was to nominate an expert from its side. The opinion of the experts was to be utilised for purposed of final decision as also for passing final orders on the interim relief application. Thus the order passed on 5th/6th November, 1997 was treated to be a purely temporary interim order subject to modification, variation or vacation after perusing the report of panel of experts and after hearing both the sides. Certain directions were also issued regarding the conduct of the advertisement campaign by M/s. Hindustan Lever. This temporary interim order of the Commission was challenged by the Hindustan Lever before the Supreme Court, as per provisions of Section 55 of the Act. The Supreme Court vide its order dated 17th December, 1997 rejected the challenge. It was observed:-

“On a consideration of the above contentions and on a careful appraisal of the reasons given by Commission we are of the view that the order passed by the Commission was purely discretionary order and was also an interim order pending the passing of a
final order of temporary injunction and is not liable to be interfered with in this appeal. As stated earlier, a reading the Commission’s order shows that it noticed that the Appellant was relying upon opinions of experts to substantiate its claim of 102% superiority in anti-becterial action while the respondent, first complainant was also relying upon the opinion of its ex- perts to contradict the Appellant’s claim. The matter being technical in nature, if the Commission felt, as suggested by the Appellant in its reply, that a panel of experts could go into the correctness of rivals claims and give its opinion and
if the Commission further said that after the opinion was given, parties could make their final submissions in the injunction application and if the Commission felt that till then, an order of an interim nature should operate, we do not think that it is a fit case for interference with such a discretionary order.”

2. This was followed by an order dated 13th February, 1998 passed by the Commission by which the expert panel of three experts was constituted. The Commission observed:-

“The Expert Panel will go into the question whether or not the claim of 102% superiority of New pepsodent Toothpaste over Colgate Dental Cream Toothpaste is correct. For this purpose the panel of experts will be free to carry out any appropriate tests as deemed necessary and would adopt such protocol for the purpose as is found appropriate by them.”

3. Mr. Michael Cole, the Chairman of the expert panel vide his letter dated 27th July, 1998 addressed to the Chairman of the Commission raised certain queries. Copies of the said letter was given by the Commission to the rival parties, inviting their comments. Both the sides filed their comments. The arguments were also heard on behalf of both the parties. Thereafter the Commission passed the impugned order dated 18th November, 1998, the operative part whereof is reproduced as under:-

“It is true that the aforesaid order passed by the Commission on 5th/6th November, 1997 was an interim order passed on some prima facie case in favour of the applicants/complainant. It has been observed therein that it was necessary to examine by experts the claim of 102% anti-bacterial superiority of New pepsodent over Colgate Dental Cream. It however, transpires from the material on record that 102% superiority claimed by the respondent with respect to its New pepsodent over Colgate Dental Cream is not confined only to anti-bacterial superiority. What is challenged before this Commission in the main matter is
misleading adver- tisement about such claim. The validity of that claim has to be examined by the expert panel. We think that the claim is as to more effectiveness of New pepsodent qua fighting germs that that of the leading toothpaste. So far as the consumer is concerned, this effectiveness has to be tested qua his oral health case. We think that mere laboratory test or study may not be sufficient for the purpose. It would be quite proper that the test is car- ried out in the light of some clinical study in that context of long-term plaque and gingivitis. We think that the claim of 102% superiority made by the respondent qua New pepsodent over Colgate Dental Cream can best be examined if such tests are carried out.”

4. M/s. Hindustan Lever Limited, the petitioner in the present petition, has challenged aforesaid directions contained in the order dated 18th November, 1998 of the Commission. Mainly the challenge is that the peti- tioner only claimed 102% anti-bacterial superiority over the leading tooth- paste. The petitioner is prepared for any test with respect to the 102% anti-bacterial superiority. However, according to the learned counsel for the petitioner the scope of enquiry cannot be widened to include other things like better overall dental care of cure of dental diseases, like Gingivitis. In other words, the counsel submits that the petitioner can be tested for its claim and nothing more. Any test has to be confined to what the petitioner had claimed. By virtue of the impugned order dated 18th November, 1998, the scope of enquiry has been widened so as to include matters for which the petitioner never laid any claim.

5. The learned counsel appearing for the respondents first contended that this petition is not maintainable. It is submitted that the impugned order was passed in the course of proceedings for interim relief under Section 12A of the Act. All orders under Section 12A can be challenged only in the Supreme Court under the provisions of Section 55 of the Act. Therefore, this court has no jurisdiction to entertain this petition. On merits it is submitted that the contentions raised on behalf of the petitioner are ill- founded. Firstly, even for the purposes of the claim of the petitioner for 102% anti-bacterial
superiority, the enquiry has to be conducted as per the need felt by the experts themselves as expressed in the letter of the Chairman dated 27th July, 1998 referred to hereinbefore. Secondly, it is submitted that it is not correct to say that the scope of enquiry has been widened by virtue of the impugned order. Thirdly, according to the respond- ents the claim of the petitioner in its advertisements is not confined to 102% anti-bacterial superiority over the leading toothpaste. The advertise- ments in the media and TV coverage show that the petitioner was really trying to convey to the consumers superiority of its product over that of the complainant in the matter of overall dental care. The learned counsel appearing for the consumers, complainant No. 2 submitted that a consumer as a common man understands from the advertisements of the petitioner that by using its toothpaste, it will have a better dental and oral health care. The consumer is not aware of the niceties or intricacies of the claims made by the petitioner. It is only interested in better dental care and the claim of the petitioner that its product is 120% more effective in combating becteria conveys a message to the consumer that it will give better dental care and protection. Therefore, the enquiry cannot be restricted as suggested by the petitioner. When one of the questions before the Commis- sion is about the impact of the advertisement campaign of the petitioner on the onsumers, the enquiry cannot be confined to a particular aspect alone.

6. Our attention has been drawn to the next of some of the advertisements published by the petitioner. We find on a prima facie view of the matter that it cannot be said that the advertisements are confined to petitioner’s claim of 102% anti-bacterial superiority of the ‘pepsodent’ tooth paste over the leading tooth paste. The advertisements appear to go beyond in projecting that the germs could cause tooth ache (pg. 28 of the paper book); and “these germs could attack your teeth and could cause tooth decay” (page 171 of the paper book). In these circumstances, it cannot be said that the advertisements in question only project the claim of 102% anti-bacterial superiority.

7. In these facts, it would appear that the Commission and the expert body cannot be faulted with for requiring clinical tests.

8. We have heard the learned counsel for the parties on the rival contentions. So far as the question of maintainability of the writ petition is concerned, the learned counsel for the petitioner submits that the orders regarding scope of enquiry by the experts panel cannot be said to be an order under Section 12A of the Act and therefore, it will not be correct to contend that only Section 55 of the Act is the remedy. Section 55 is the remedy so far as the orders under Section 12A are concerned. For other orders a petition
under Article 226 of the Constitution of India would be the remedy available to the aggrieved party.

9. We are unable to accept this submission of the learned counsel for the petitioner. It is to be noted that the interim directions were passed by the Commission in proceedings on an application under Section 12A of the Act which was for interim relief. The application has not yet been finally disposal of. The Commission itself observed that further arguments on the application can be heard after the report of the experts panel is avail- able. We have already noted the fact that the Commission felt the need of the report of the experts to decide the issue in view of the rival claims of both the parties. Thus the
enquiry is still on. It is in the course of the said enquiry that the Commission ordered appointment of an expert panel. The petitioner challenged the interim order of the Commission before the Supreme Court. At that time, no grievance was made about the proposal of appointment of an expert panel. The Supreme Court observed that the application under Section 12A of the Act for interim relief will be dis- posed of after further hearing and after the report of the expert panel is available. It refused to interfere in the matter. The order
which has been challenged in these proceedings was passed in the course of Section 12A proceedings and, therefore, if the petitioner has any grievance against the same, it should have approached the Supreme Court as before under Section 55 of the Act. In view of the provision of Section 55 of the Act, the parties are debarred from approaching the High Court in relation to orders under Section 12A of the Act. This petition is accordingly liable to be dismissed as not maintainable. Ordered accordingly.