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1996 (2) TMI 362

Service - Deficiency of - COMPENSATION APPLICATION NO. 198 OF 1994 - Dated:- 1-2-1996 - SARDAR ALI, ACTING CHAIRMAN AND U.P. SINGH, MEMBER K.K. Marwah for the Complainant. B.S. Nagar for the Respondent. ORDER Sardar Ali, Acting Chairman - This order shall dispose of a preliminary issue framed by the Commission on 29-11-1995 regarding maintainability of the compensation application on the grounds stated by the Respondent in its reply dated 1-3-1995. The issue is whether this application is not maintainable for the objections taken by the Respondent in its reply . 2. This issue was treated as preliminary issue and was directed to place before us for adjudication on the basis of the pleadings of both the parties. 3. In the instant case a notic .....

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ong with relevant Serial Nos. of the Punjab National Bank and other particulars were furnished to Respondent No. 2. The applicant sent three letters under registered covers (A.D.) but no reply in response to the letter dated 8-11-1993 of the applicant has been received. 5. It has been alleged by the applicant that the failure of the Respondent No. 1 in allotting right shares as per his entitlement amounts to deficiency of service on the part of the Respondent No. 1 and as such, the Respondent is indulging in restrictive trade practices and as a result of these practices the applicant has suffered grievous monetary loss and mental anguish and prayed to direct the Respondent to pay him jointly or severally the compensation amount of Rs. 1,75, .....

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ng to the carrying of any trade, therefore, the same is also not trade practice as defined under section 2(u) of the MRTP Act. 5. That the issuing of Right Issue or raising the capital through the Right Issue is not a trade and also further not a trade practice, therefore, the same can never be unfair trade practice as defined under section (36A) of the MRTP Act. Therefore, this Hon ble Commission has no jurisdiction to try this complaint. 7. The applicant filed the rejoinder to the reply filed by the Respondent and has reaffirmed the allegations. It has also been urged by the applicant that the Supreme Court Judgment in Morgan Stanley Mutual Fund v. Kartick Das [1994] 1 SCL 19 (SC) is not applicable since the Respondents have failed to pro .....

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ompany merely offers the issue for subscription to the public by way of raising capital for its trade or business. It is further held that no service within the meaning of section 2( r) is provided or made available to the prospective investors for consideration where the com- pany simply issues the debentures for subscription. This view was also fortified by the principle laid down by the Full Bench of this Commission in TTK Pharma that raising of capital by way of equity does not amount to carrying on of a trade. 9. In the light of the above observations made by the Hon ble Supreme Court of India, in Morgan Stanley s case (supra) and the Commission s orders in Deepak Fertilizers and TTK Pharma, we hold that the compen-sation application i .....

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