Judgement

RANGANATHAN, J. :- This appeal has been preferred under Section 65 of the Monopolies & Restrictive Trade Practices Act (the Act) from an order of the Central Government (C.G.) dated 20-9-88. By the said order the C.G. granted an application made by respondent No. 1 (hereinafter referred to as the Modis) under Section 22 of the Act for permission to establish an undertaking for the manufacture of Ossein and Gelatine in the State of Rajasthan. The petitioner, which claims to be an association of Ossein and Gelatinc manufacturers in India, made representations before the C.G. objecting to the grant of the application by the Modis. These objections having been rejected and the application granted by the said order, the aggrieved petitioner has preferred this appeal. We admit the appeal and, having heard counsel on both sides, proceed to dispose of the appeal finally.

2. The following contentions have been urged by Sri Divan in support of the appeal:

(a) The order dated 20-9-88 is vitiated as it merely sets out the bald conclusions of the officer concerned. It is not a reasoned or well considered order.

(b) The appellant had pointed out that the grant of permission to Modis would be against public interest. It would completely cripple the small scale businesses of the members of the appellant association which, even earlier, had been functioning far below capacity due to insufficient supply of crushed bones. These objections had not been properly dealt with in the order.

(c) The order has been passed by one Sri Vijayaraghavan whereas a personal oral hearing the matter had been given by one. Sri S. S. Khosla. This has resulted in the violation of the fundamental rule of natural justice that "he who hears must decide".

(d) The hearing had taken place on 23-1-86. while the final order was passed more than two and half years later. This, coupled with the change in personnel referred to above, has resulted in the denial of natural justice to the petitioner.

(e) Modis had stated in their application that bonemeal would be the raw material used by them but, later, they changed it into "crushed bones". The appellant had no opportunity of meeting the new case.

(f) The representative of Modis had presented certain documents at the personal hearing but copies thereof had not been supplied to the appellant despite a grievance made by it the very next day.

3. The appellants contentions broadly fall under two heads: one, the denial of natural-justice and two, the failure to pass a reasoned order. It will be convenient to deal with the latter objection first.

4. We are unable to accept the appellants contention that the impugned order is bald, unreasoned or cryptic and violates the requirements for such an order enunciated in the Oramco case, (1987) 2 SCC 620 : (AIR 1987 SC 1564), where this Court reaffirmed the following observations made in the Bombay Oil case, (1984) 1 SCR 815 (AIR 1984 SC 160):

"We must, however, impress upon the Government that while disposing of applications under Sections 21, 22 and 23 of the Monopolis and Restrictive Trade Practices Act, 1969, it must give good reasons in support of its order and not merely state its bald conclusion. The faith of the people in administrative tribunals can be sustained only if the tribunals act fairly and dispose of matters before them by well considered orders........"

The order of the Government is a detailed and elaborate one. It sets out the contentions and deals with them seriatim. The point made that existing units were already functioning below capacity due to insufficient supply of crushed bones and that the entry of the Modis into the arena would drive them out of business has not been overlooked. Only, as against this the Government has considered to be more weighty the economic advantages in granting the application of the Modis arising out of the circumstances: (a) that they would be setting up the industry in a backward area; (b) that they had categorically undertaken to export