TMI Blog1995 (11) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... eleased a brochure with the caption 'Invest on nature for a brightful future' in which it had represented as follows : ( a )On an investment of just Rs. 1,000 towards the cost of teak sapling, the sale value of teak per tree will work out to Rs. 76,800 after 20 years; ( b )The amount of Rs. 76,800 from the scheme will be income-tax free; ( c )After the completion of five years, if any investor desires to opt out of the scheme, he/she will get back his/her investment of Rs. 1,000 per tree with 15 per cent interest from the company within a month of making such a claim; (4)The DG was informed by the respondent in response to a probe letter that the promoters of the company had purchased two acres of land required for the first two years of the scheme with the intention to acquire more land depending upon the demand; (5)No guarantee is provided to the investors except that they are protected to the extent of insurance of the input costs; (6)The respondent is a newly incorporated company without any solid financial background but has embarked upon an ambitious project (the scheme) involving purchase of land and plantation of teak trees; (7)The claim of the respondent is b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unfair trade practices alleged in the NOE. 6. The DG filed an application for interrogatories and discovery of documents. The respondent furnished its reply to the same which is a part of record. After the hearing on 6-12-1994 the respondent chose to absent itself at the subsequent hearings of this Commission and proceedings continued ex parte against the respondent. The DG furnished the affidavit of Dr. K.S. Yadav, the Assistant Director General along with the supporting documents. 7. We have a hearing to Shri S. Gupta, attorney for the DG. 8. The main issue is whether the respondent has misled the investors by making tall and unrealistic claims. 9.The respondent's reply in respect of the allegations in the NOE have already been summed up above. There are only two areas of concern, which may attract section 3 6A. One relates to the insurance coverage and the other to the area acquired for plantation by the respondent. In respect of the first area of concern, namely, the insurance coverage, there is practically no categorical or comprehensive insurance by the respondent of the teak plantations. All that it has said in its reply is that after completion of one year o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lantations Ltd. IA No. 78 of 1993] read with CW 83 of 1993]. In these two rulings some of the said contentions have been dealt with in detail. It is useful to reproduce certain observations in the above cited cases. 13. In the Sterling Tree Magnum India Ltd.'s. case ( supra ) , the Commission observed as follows: "Having given the matter our careful and anxious consideration and having perused the assertions made by the respondent in its reply and additional reply as well as the data furnished by it, we are clearly of the view that the impugned projections made by the respondent are neither false nor deceptive so as to attract section 36A of the Act. We do think that a claim or representation can be regarded as false or deceptive within the meaning of section 36A of the MRTP Act when it is found that the claim is false when it was made or when there is a reasonable certainty that it will be proved to be false when the fulfilment of the obligation or the promise undertaken is to take place. Section 36A will also be attracted if the publicity material or representation in any other form made by the trader is on the face of it, and, without more is found to be so misleading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cient to exclude the possibility of any mischief being caused to the innocent prospective investors. Any observations made herein, therefore, should not be taken as an expression of opinion on the issues arising in those cases. The observations made in this case are confined to the facts placed on record in the present case both by the Director General as well as the respondent. No rule of general application has been laid down by us in this case." 17. On the income-tax exemption, the Commission in the Anubhav Plantations Ltd. 's case ( supra ) observed as follows : "Shri Dua, learned counsel for the Director General argued that it may be wrong to claim on behalf of the respondent that the return is income-tax free. According to him, agricultural income is being covered by amended definitions periodically, and it is not correct to predict what the position will be in the next 20 years. In the same breath, he questioned Shri Joneja's claim that the land will not be brought under any urban agglomeration, as in future point of time, any urban area could be created by the Government and the plantation land in question could fall within such an area. This is too specious an argu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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