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2010 (3) TMI 1159 - HC - Companies LawPetition challenges the Notices issued by the Competition Commission under the Competition Act, 2002 in respect of an alliance between the petitioners and Jet Airways (India) Ltd - retrospective effect on alliance between the parties - objective to rationalise the rates and provide improved standard of service of wider choice to the customers - M.R.T.P. Commission had taken cognizance of the agreement - Competition Act, 2002 repealing the M.R.T.P. Act came into effect on 20th May, 2009 - However, the operation of Section 66 was kept in abeyance for two years, as a result of which, M.R.T.P. Commission could continue to exercise the jurisdiction till the expiry of two years from 20th May, 2009 - According to the petitioners, the M.R.T.P. Commission is already seized of the matter in enquiry and therefore, the cognizance taken by the Competitive Commission was one without jurisdiction - establishment of relevant market is an essential condition before any exercise can be undertaken by the Commission. HELD THAT:- It is clear that though the transaction and agreement may be prior to coming into force of the Act, it stands covered by the Act on the date the Act came into operation. The decision in Rajgopal's 1995 (1) TMI 67 - SUPREME COURT] case applies on all fours to the instant case. We are, therefore, of considered opinion that though the Competition Act is not retrospective, it would cover all the agreements covered by the Act though entered into prior to the commencement of the Act and sought to be acted upon. Whether the Competition Act could be said to be penal in nature - It was submitted on behalf of the petitioner that Section 43 of the Act prescribes punishment and therefore, it should be treated as a penal Act. We do not think that the Act, strictly speaking, is a penal Act. This is because the Act does not make punishable by itself an act of entering into an agreement, contrary to the provisions of the Act. Therefore, even if parties enter into an agreement covered by the Act, that by itself, does not amount to an offence. What is made punishable is disobedience of the order passed by the Commission and noncompliance. Strictly speaking, no criminal liability ensues for breach of Section 3 or 4 of the Competition Act. It seems to us that the penalty is provided only with a view to ensure or enforce compliance of the directions of the Commission, as can be seen from Section 27(1) of the Competition Act. Such a direction can be issued by the Commission only after enquiry. Necessarily, therefore, unless and until any enquiry is held and pursuant to that certain directions as envisaged by Section 2(a) to (g) are issued, there would be no question of anybody committing any offence. At the cost of repetition, it may be said that breach of Sections 3 and 4 by itself is not an offence. The agreement was valid when entered into. It was not an offence at that time nor is it an offence even today or even on the date of the coming into force of the Act. As pointed out earlier, entering into agreement contrary to the Act by itself is not an offence. The petitioners are not sought to be convicted or even tried for an act of entering into an alliance. The proceedings or the action of the Commission is at the preliminary stage only. It only seeks to look into and enquire into/investigate into the terms of the alliance. If Article 20 is to be applied, there has to be trial or prosecution for the act done prior to the coming into force of the Act. There is nothing like that. There is no doubt that the M.R.T.P. Commission had received a complaint under that Act. The said complaint No.172 of 2008 was looked into by the M.R.T.P. Commission. It is clear that the M.R.T.P. Commission had found that since the alliance had not come into effect, the mere apprehension cannot be taken into consideration and had, therefore, left the matter open for the Director General to take up the investigation if any development occurs. It is apparent that the Commission has not decided any issue at all nor has it ordered any investigation. We, therefore, find that no action whatsoever has been taken by the M.R.T.P. Commission. There could therefore be no impediment in taking any action under the new Act. Even otherwise, the provisions of the M.R.T.P. Act and the Competition Act are not identical. Since no action whatsoever is taken or proposed to be taken by the M.R.T.P. Commission, there could be no question of the petitioners being subjected to double jeopardy. Further, the M.R.T.P. Commission now stands abolished w.e.f. 14th October, 2009. There is, therefore, no question of M.R.T.P. Commission now taking any action against the petitioners. This ground of challenge has no substance at all. The submission that unless and until the Commission first determines the relevant market, the relevant geographic market, it cannot take any action u/s 4 of the Competition Act. There is no doubt that for coming at a conclusion as to whether a particular group has abused the dominant position or not, three things, namely; relevant market, relevant geographic market and relevant products are to be considered. However, for considering the effect of Section 4, it would also be necessary to look into the various other provisions of the Act. It is clear from Section 19 that the Commission can act upon receipt of information and on a reference made to it by the Central or State Government or on its own motion. It is, therefore, clear that there has to be some information before the Commission about the alleged breaches of Sections 3 and 4. If the Commission receives an information, it is supposed under Section 19 to enquire into the complaint received. Under the Code of Criminal Procedure, a Police Officer is supposed to look into the complaint and decide whether the information discloses a cognizable offence or not. If, upon reading the complaint, he finds that it does disclose a cognizable offence, he is bound to register the First Information Report and investigate into it. The law is well settled that the court should not stifle the investigation at all, except for compelling reason or when F.I.R. does not disclose any offence at all. If the analogy is to be applied here it cannot be said that the information given by respondent no.3 does not disclose any beach nor can it be said that it is a case of lack of inherent jurisdiction to the Commission to investigate. It has a power to enquire and investigate into every complaint received under the Act, as is clear from the above provision. We find that it was not necessary for the Commission to first find out the relevant geographic market, relevant products market or relevant market. Such things can be found or concluded upon investigation and not necessarily before that. Therefore, we find that no writ as sought can be issued and petition should be dismissed. We, therefore, dismiss the petition.
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