Saturday 11 June 2011

AP High Court held business model of Amway India illegal

This is the gist of the judgement of Andhra Pradesh High Court while deciding the writ petitions No. 20470 and 20471 of 2006 filed by Amway India. The Division Bench of Andhra Pradesh High Court comprised Honourable Chief Justice G S Singhvi and Honourable Justice C V Nagarjuna Reddy.

PRIZE CHITS AND MONEY CIRCULATION SCHEMES (BANNING) ACT, 1978, Sections 2(c) and 3 – Money Circulation Schemes – Applicability of provisions of Act to Pyramid Structured marketing Scheme being run by first petitioner through which money is earned by enrolling members – Scheme whether attracts definition of ‘Money Circulation Scheme’ banned under the Act – Writ petitions filed to declare that provisions of the Act have no application to the scheme run by 1st petitioner (Amway India) and to restrain the respondents from interfering with petitioners’ business – Complaint made again petitioners that it is a money circulation scheme prohibited under Section 3 of the Act which petitioners denied – Plea taken by petitioners that none of the ingredients of Section 2(c) of the Act exist in the business carried on by them as there is neither quick or easy money involved in the scheme nor the money received by promoter or sponsor member depends on any event or contingency relative or applicable to enrolment of new members into the scheme – Petitioners further pleaded that the scheme does not provide for payment of money on a mere enrolment to attract Section 2(c) of the Act – Respondents taken a plea that scheme involved easy quick money by enrolling members into the scheme which is prohibited under the Act – ingredients of Section 2(c) – It must be proved that first petitioner is promoting or conducting a scheme for the making of quick or easy money and the chance or opportunity of making quick or easy money must be shown to depend upon an event or contingency relative or applicable to enrolment of members into that scheme – Held that scheme of first petitioner provides for easy / quick money to its distributors – The money which the sponsor member at the top of the line gets depends upon members whom he enrolls or the members enrolled by him enroll – Payment made by a member on his enrolment and his future earnings by enrolling other members constitute event or contingency relative to his enrolment – Distributor gets all the said money as a consideration for a promise made by the sponsor at the time of his enrolment – Thus, held that both the ingredients of Section 2(c) of the Act in respect of distributor satisfied – Inducement for aggressive enrolment of new members to earn more commission is inherent in the scheme – Scheme provides for sufficient inducements for its members to chase for new members to make quick  easy money – By promising payment of commission on the business turned out by down-line members sponsored either directly or indirectly by the up-line members constituting a contingency relative to enrolment of members, first petitioner (promoter) is earning quick / easy money from its distributors apart from ensuring its distributors to earn quick/easy money – The two ingredients are thus satisfied in the case of promoter too – Held that the scheme run by petitioners squarely attracts the definition of ‘Money Circulation Scheme’ as provided in Section 2(c) of the Act..
As regards Writ Petition Nos. 24799 of 2000, 7515 of 2003, 22914, 22915, 22916, 22913, 21128, 20616, 23737, 26149 of 2006, 3202, 2462, 9397 and 9398 of 2007, which were listed for hearing along with these petitions, it is appropriate to observe that the Court did not have the benefit of the arguments of the learned counsel appearing for the petitioners.  It is, therefore, appropriate that all these petitions be listed for hearing on   24.8.2007.
Finally, The Division Bench held that the following writ petitions on the same issue would be decided soon. However, once these writ petitions came on the Bench while hearing another writ petition filed by Gemini Techno, just another copycat of Amway India, another Division Bench comprising Justice Ramesh Ranganathan and Goda Raghuram dismissed them as the matter has already been decided and there is nothing to hear further on Amway India's business model.
After reading this judgement also, the Amway apologists are adamant enough to support the crooks who have been stealing the hard-earned money of Indians. 

18 comments:

Shyam Sundar said...

You raise your hooded ugly head once gain even after telling many times that you are banned here.
Anyway, who said that the customers do not exist. That is the unabashed job of these crooks to find new lamb all the time. You always find a new lamb and after churning him out go and look for another lamb.
One thing is sure. You Amway apologists are shameless people. Even if you are told to go away,you once again approach people begging them to join the scheme. That is why AP High Court stated that it is a vicious circle.

Joecool said...

LOL, IBOFB trying to post his propaganda BS again? What a moron. LOL

Views maker said...

hi,

1) i would like to know whether AMWAY is banned in AP?

2) Can i have the judgment copies of the AP high court and Supreme court of India.. regarding illegal business model of AMWAY..

3) i am seeking these information to share with my friends, who is crazy on AMWAY..

Regards,
N.Mayilsamy

Shyam Sundar said...

Send me your email ID to enable me to send you the AP HC judgement.

meenu said...

@ Mr. Shyam Sunder: please mail me a copy of the case at tajmahal2011@gmail.com.

i want to show it to my crazy freinds who are mad for amway and unknowingly cheating other people.

INDU said...

why u r saying aal these i don`t know .but what i found that no bussiness is like amway.It has great brand name like nutrilite ,artistry attitude. if persom like to have bussiness with this good name .why most of indian have problem.with low investment any one can do bussiness.what happen in traditional bussines. a bussinessman open his shop two or three or more places. similarly we all ABO`s as family use the product and share with other people and enjoy the life .so why u aal having problem. INDIAN MEIN SIRF PAISE WALO KO JINE KA ADHIKAR HAIN.KOI JAYADA PAISA BANAYE TO PROBLEM.I don`t know what will happen

Shyam Sundar said...

Indu,
You pretend that you did not understand why I am telling all these things. I have been trying to bring awareness among people not to fall prey to these illegal operators. These monsters have been churning out large chunks of money from the gullible and pretending that they are doing lawful business.

Rajat arora said...

i want to know wheather amway has the rights to do the business AP or not,,, can anyone tell me about it...

Rajat arora said...

i want to know weather amway is banned in AP or not,, can anyone tell me about it,,,,,

Rajat arora said...

i want to know weather amway is banned in AP or not,, can anyone tell me about it,,,,,

Shyam Sundar said...

Amway has been doing business illegally all over India because there is nobody to complain against their illegal business. Moreover, they secured the nefarious support of politicians and the bureaucrats turn a Nelson's eye as long as there are no complaints.
The Madras High Court rightly pointed out that these bureaucrats always try to close the stable after the horse escaped.

anand said...

Mr. Shyam Sunder: please mail me a copy of the case "AP High Court held business model of Amway India illegal" at anand.ganore@gmail.com

shekhars said...

send me a copy of AP high court decision and Supreme court's decision of up-handling the high court's decision at shekhars.sharma1@gmail.com

shekhars said...

send me a copy of AP high court decision and Supreme court's decision of up-handling the high court's decision at shekhars.sharma1@gmail.com

Himanshu said...

I appreciate your work Shyam. I am also approached by one of my ex-schoolmate to join this vicious circle called Amway. I tried to neglect him but he is keen to pull into this.

Could you please share me AP high court judgement copy on my e-mail: hkhatri27@gmail.com

Shyam Sundar said...

Himanshu, go to back pages to find the full judgement of AP High Court on Amway India.

Ajith T V said...

@ Mr. Shyam Sunder: please mail me a copy of the case at ajithtv.3@gmail.com.

i want to show it to my freinds who are mad for amway.

Shyam Sundar said...

Dear Ajit, It is available in this blog. Just type AP high court in the search box.