TMI Blog2017 (10) TMI 1639X X X X Extracts X X X X X X X X Extracts X X X X ..... ve rights or monopoly rights, conducts trade or business, per se such activity cannot fall within the description of or cannot be characterized as sovereign functions. It is only when activities, such as printing of notes, minting, production of other national security related services, articles or goods etc. are involved and are sought to be regulated, would it be an issue as to whether such trade or business are sovereign functions of the Government or State entity. In the present case, the State of Uttarakhand, like all other States in the country, have created monopolies by canalizing liquor procurement. Therefore, the Government departments or other public agencies or entities that may be quasi public, cannot be described as engaged in sovereign functions. Assertion with respect to the policy having been upheld by the Uttrakhand High Court - HELD THAT:- This Court is of the opinion that the upholding of the policy was on an application of the parameters of judicial review. The wisdom of the policy or its impact with respect to position of domination or abuse thereof, could not have been the subject matter of Court's jurisdiction under Article 226 of the Constitut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the CCI, in the context of arguments that the policy impugned before the Commissioner was upheld by the Uttarakhand High Court with the following observations :- 17. Before I consider the submissions of the learned ASG in relation to the meaning of the expression 'enterprise' contained in Section 2(h) of the Act, I may note that by referring to the various reliefs sought by respondent No. 2 before the Commission; the clauses of the agreement between the parties and by reference to the statutory Rules aforesaid, the petitioner is confusing the issue arising for determination, i.e., whether the petitioner is an 'enterprise' under Section 2(h) of the Act. These submissions of Mr. Parasaran, really, touch upon the merit of the complaint and proceedings before the Commission. They do not have a bearing on the issue of jurisdiction of the Commission to conduct an investigation and deal with the information furnished by respondent No. 2. These are all defences that the petitioner may raise before the Commission in support of its defence that it is not abusing its position of dominance or that its agreement with respondent No. 2 is not in contravention of the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity, including an activity relatable to the sovereign function of the Government, the Central Government may grant exemption only in respect of activity relatable to sovereign functions. Therefore, an enterprise may perform some sovereign functions, while other functions performed by it, and the activities undertaken by it, may not refer to sovereign functions. The exemption under Section 54 could be granted in relation to the activities relatable to sovereign functions of the Government, and not in relation to all the activities of such an enterprise. Pertinently; there is no notification issued under Section 54 either under Clause (c), or under the proviso. This clearly shows that the Central Government does not consider any of the activities of the petitioner as relatable to sovereign functions. 21. Dr. Singhvi has pointed out and, in my view, rightly so that the Supreme Court has clearly held in Sri Ladulal Jain (supra) that when the Government runs the Railways for providing quick and cheap transport for people and goods and for strategic reasons, it cannot be said that it is engaged in an activity of the State as a sovereign body. Paragraphs 10 11 from this decision re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no infirmity in the observations and findings returned by the learned Single Judge. The judgment in Competition Commission of India v. Steel Authority (Supra) states that an order under Section 26(1) of the Act is an administrative one and does not in any manner result in adverse consequences or determine the rights and obligations of the parties. The State of Uttarakhand formulated a policy and it is fashioned in such a manner that State officials, vested with exclusive powers of taking decisions to dictate as to what brands of liquor are to be procured and distributed to retailers and sold to the consumers. These functions cannot per se be called a sovereign function. The observations of the learned Single Judge with respect to what constituted a sovereign function by relying upon the judgment in Bangalore Water Supply and Sewerage Board v. A. Rajappa ors. 1978 AIR 548 and Ashok Harikuni (Supra) , are apt. When the State or its agency, who are vested with exclusive rights or monopoly rights, conducts trade or business, per se such activity cannot fall within the description of or cannot be characterized as sovereign functions. It is only when activities, such a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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