Thursday, June 04, 2009

Competition Act_Practical Problems_4

The Association of Truck Operators of India by agreement insisted that members of the association shall not deal with the non-members in transportation of goods. The Association claims that this agreement is entered for the welfare of trade and not for anyother purpose. In your opinion whether the agreement would be under the purview of the Competition Act, 2002. Whether your answer would be different if the association attempts to control the provisioning of services rendered by its members.

"Cartel" includes an association of producers, sellers, distributors, traders or service providers who, by agreement amongst themselves, limit, control or attempt to control the production, distribution, sale or price of, or, trade in goods or provision of services; The term cartel like agreement has been given an inclusive meaning. Thus an association for the welfare of the trade or formed for any other purpose not mentioned in the aforesaid definition will not be a cartel. It is only when an association, by agreement amongst themselves, limits control or attempts to control the production, distribution, sale or price of, or, trade in goods or provision of services, that it will be a cartel.

Companies Act_Practical Problems_84

The Board of Directors of ABC Private Limited having a paid-up share capital of Rs. 1 Crore consists of two directors, one of them, viz, Mr. S possesses membership of the Institute of Company Secretaries of India. The company desires to appoint him as a company secretary also. State the legal position.

Under Section 383A of the Companies Act, 1956, in case of a company having only two directors, none of them can be appointed company secretary in spite of possessing the requisite qualification. In view of the overriding effect of Section 383A, consideration of section 314 is unnecessary.