MONOPOLIES AND RESTRICTIVE TRADE PRACTICES COMMISSION, NEW DELHI 

V. T. KORDE, Advocate, for Director (Research). 

DINESH MATHUR, Advocate, for the respondent. 

ORDER 

SMT. MOKSH MAHAJAN, J. - An application under regulation 65(i)(j) read with regulation 71 of the Monopolies and Restrictive Trade Practices Commission Regulations, 1991 (hereinafter referred to as MRTPC Regulations) has been filed on behalf of the Central Bank of India. Subhash Marg, Lucknow - the respondent for discharging the notice of enquiry (NoE for short), dated 24.9.1998 issued under the orders of the Commission. 

2. This enquiry has arisen from the complaint of one Shri Jagdish Narain Suri and Laxmi Narain Suri, 100 Bhiwana Singh Shivala Road, Raja Bazar, Lucknow made to the Commission. The Commission thereto ordered preliminary investigation to the Director of Research. On the basis of the Preliminary Investigation Report, (PIR for short) a notice of enquiry came to be issued under section 10(a)(iv) and section 37 of the MRTP Act, 1969 (the Act for short). In the PIR, it is alleged that the respondent is demanding caution money deposits in the form of fixed deposits, increasing lease rent of deposits arbitrarily, is not maintaining waiting list of the applicants and giving lockers not on 'first come first serve basis'. 

3. No reply was filed in response to the notice of enquiry as issued. Instead an application under regulation 65(i)(j) as brought out above has been filed. It is stated on behalf of the respondent that the enquiry is barred by section 4(2) of the MRTP Act inasmuch as a specific MR provision exists in the Banking Regulation Act, 1949, for the impugned banking business carried on by the respondent. The enquiry is also barred by the principles of res judicata inasmuch as the subject matter of the present enquiry has already been considered by this Commission in, inter alia, the respondent's own case as well others in RTPE 198/96, 46/94, 142/92, 59/94 and 335/96 as disposed of by a common order, dated 13.1.1999. 

4. Drawing distinction on facts in the cited cases, the Director (Research) in its reply has stated that in the present case, the respondent has acted under the instructions issued in C.O. Circular No. CO : 95-96 : 236, dated 2.12.1995 issued by the Operations Department of the respondent's Central Office in Mumbai. Under the heading 'Caution Money Deposit', the respondent is to obtain 'caution money deposit' in the form of a fixed deposit for one year and the interest is to be credited towards the adjustment of the locker rent due, etc. As against this, the circular referred to in the consolidated order rendered in RTPE No. 198/96, 46/94, 142/92, 59/94, 59/94 and 335/96 in DBOD No. GC.BC.27-C.408C(L)-84, dated 27.3.1984. The reliance on the aforesaid cases is, therefore, stated to be misplaced. 

5. Shri Dinesh Mathur, advocate for the respondent, and Shri V. T. Korde, advocate for Director (Research), have been heard. Both the advocates reiterated their stand as taken in their respective application and replies. 

6. We have considered the submissions as made on both sides. Undeniably, the respondent is a banking company within the meaning and scope of the Banking Regulation Act, 1949 (BR Act for short). Section 6 of the BR Act enumerates various forms of business which include renting of lockers and taking deposits, etc. Section 4(2) of the MRTP Act MR excludes the applicability thereto the matters in respect of which specific provisions exist inter alia in the BR Act. Providing of lockers is thus one of the forms of business for which specific provisions exists in the BR Act. 

7. In case of order rendered in RTPE 244/97, dated 1.9.1998, the Division Bench of the Commission have held as follows : 

"Section 4(2) of the MRTP Act excludes applicability MR thereof inter alia to a banking company with respect to matters in respect of which specific provisions exist inter alia in the BR Act. Section 6 of the BR Act enumerates forms of business in which banking companies may engage themselves. They include lending or financing of money either upon or without security. Provision for giving loan by way of purchase of a vehicle popularly known as Auto Finance against hypothecation of the vehicle in question would certainly be included in the forms of business enumerated in section 6 of the BR Act. Our attention has been invited by learned advocate Shri Suri for respondent No. 2 to section 35A thereof providing for power of the Reserve Bank to give directions. Thereunder, the Reserve Bank is empowered to issue directions to banking companies generally or to any banking company in particular from time to time, if it is satisfied inter alia that in the public interest or in the interest of banking policy, it is necessary to do so. It has further been provided therein that the banking company to which such directions are issued shall be bound to comply with such directions. It thus becomes clear from the aforesaid provisions contained in the BR Act that the Reserve Bank enjoys supervisory power over conducting affairs of banking business by any and every banking company. As aforesaid, it can issue directions if it is necessary to do so in public interest or in the interest of banking policy." 

"As pointed out hereinabove, the Reserve Bank under the BR Act is constituted as a custodian inter alia of public interest and conducting of banking affairs by the banking company qua any banking policy. This Commission can also pass a cease and desist order against any party found guilty inter alia of adoption of or indulgence in restrictive and/or unfair trade practices in public interest and not de hors thereto. In that view of the matter, it is difficult to conceive that the Reserve Bank will not issue directions in public interest if it finds inter alia adoption of or indulgence in any restrictive and/or unfair trade practice by any banking company." 

8. In the cited case of RTPE No. 198/96,46/94,142/92,59/94 and 335/94, we find that the allegations against five banks including Central Bank of India are exactly the same as in the present case. It has not been shown as to how the internal instructions issued by the Head Office would take out the respondent bank from the purview of the BR Regulations. In the circumstances, the distinction made on the basis of circulars is neither vital nor material to the determination of the issue which stands concluded in the cited cases. 

9. In the premises, as the NoE issued in the cases of RTPE No. 198/96, 46/94, 142/92, 59/94 and 335/96 stand discharged, in the absence of any contrary decision cited, we direct that NoE issued against the respondent in this case shall stand discharged. No order as to cost. 

10. Pronounced in open court on this 20 August, 1999.