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Law of Competition - Case Laws

Showing 321 to 340 of 358 Records

2013 (4) TMI 441

Unfair trade practice - Application is filed u/s 19(1)(a) of the Competition Act, 2002 alleging inter-alia contravention of Sections 3 and 4 of the Act. – Informant association alleged that OP 1, the largest mineral (iron ore) producer in India, abused its dominant position and colluded with the other opposite parties this affected competition in the iron ore production market in India.

Held that – It is necessary to consider as to what will be the relevant market in this case. Having regard to these facts and circumstances, the Commission is of the view that the relevant market in this case would be the market of 'iron ore production/supply in India' and OP 1 (which holds only 16% for the year 2011-12) is not a dominant player in this market. The Commission considered the facts and data placed on record by both sides and is of the view that the relevant market definition proposed by the informant cannot be accepted. The informant has inflated the market share of OP 1 by excluding captive iron ore production, low grade iron ore having less than 60% Fe content and exports from the relevant market definition. This indicates that the relevant market was much broader than the one proposed by the informant. However the relevance of determining relevant market and dominance of an enterprise is only there in free markets. Where mining activities was being done as per the orders of the Supreme Court and pricing was looked after by another Committee, determination of relevant market may not be appropriate. The Commission is not convinced that there existed a deliberate reduction in production in view of the Supreme Court orders. Prima facie there seemed to be no collusion between OP 1 and other private parties and no competitive issue was there that required intervention of the Commission. There is no case either under section 3 or under section 4 of the Act. The case deserves to be closed under section 26 (2) of the Act and is accordingly hereby closed.
2013 (4) TMI 161

Anti-competitive agreements - Information has been filed under section 19(1)(a) of the Competition Act, 2002 informant alleging inter alia contravention of the provisions of sections 3 and 4 of the Act.

It is alleged by the informant that the opposite party associations make it compulsory for every film distributor to become their member and/or register his/its film with them before the exhibition of such film. A distributor who refuses to become a member with them is not allowed to distribute and exhibit his/its film in the territory which is governed/regulated by the respective opposite party association. It is averred by the informant that the opposite party no. 1 directed its members not to release the film 'Mausam', in its territory unless the claim of its member of Rs.2.5 crores was settled and convened its other members to intervene in the distribution of the film until recovery of dues. It is, thus, alleged that the opposite party associations acted malafidely and arbitrarily in boycotting the film with an effort to secure a claim of their member.

Held that - On a plain reading of the aforesaid circulars/letters, it is evident that the opposite party associations through these circulars/letters tried to limit/control the supply of the film in contravention of the provision of section 3 (1) read with section 3(3)(b) of the Act. By virtue of the provisions contained in section 3(3) of the Act, any agreement entered into between enterprises or associations of enterprises or persons or associations of persons or between any person and enterprise or practice carried on, or decision taken by, any association of enterprises or association of persons, including cartels, engaged in identical or similar trade of goods or provision of services, which (a) directly or indirectly determines purchase or sale prices; (b) limits or controls production, supply, markets, technical development, investment or provision of services; (c) shares the market or source of production or provision of services by way of allocation of geographical area of market, or type of goods or services, or number of customers in the market or any other similar way; (d) directly or indirectly results in bid rigging or collusive bidding, is presumed to have an appreciable adverse effect on competition. The Commission directs the Opposite Parties to cease and desist from the practices of pressurizing the distributors to settle the monetary disputes with its members and also imposed penalty to ensure effective functioning of the market.
2013 (2) TMI 941

Issues:
1. Alleged excessive and discriminatory deposit structure imposed by the opposite party for membership upon subsidiaries of Regional Stock Exchanges (RSEs).
2. Discriminatory conditions imposed on subsidiaries of RSEs in comparison to other corporate members.
3. Abuse of dominant position by the opposite party in the securities market.
4. Praying for an investigation under section 26(1) to scrutinize the conduct of the opposite party under section 4 of the Act.

Analysis:

Issue 1: Alleged Excessive and Discriminatory Deposit Structure
The informant, a subsidiary of a Regional Stock Exchange (RSE), alleged that the opposite party, a national level stock exchange, imposed an excessive and discriminatory deposit structure for membership. The informant highlighted that the deposit amount required for membership was significantly higher for RSE subsidiaries compared to other corporate members. Additionally, stringent conditions were imposed on RSE subsidiaries, such as restrictions on trading in their own name/account and limitations on sub-broker trading. The informant contended that these conditions were discriminatory and requested an investigation by the Commission.

Issue 2: Discriminatory Conditions
The informant argued that the conditions imposed by the opposite party on RSE subsidiaries were discriminatory and constituted an abuse of dominant position in the securities market. The informant pointed out differences in treatment between RSE members and other corporate members, including restrictions on trading activities and sub-broker permissions. The informant claimed that these differential treatments were unjust and requested the Commission to scrutinize the conduct of the opposite party under section 4 of the Act.

Issue 3: Abuse of Dominant Position
The Commission assessed the informant's submissions and determined that the opposite party held a dominant position in the securities market. However, the Commission clarified that dominance itself is not prohibited under the Competition Act, 2002; rather, it is the abuse of dominance that is prohibited. The Commission acknowledged the differences in treatment between RSE members and other corporate members, emphasizing the regulatory framework set by SEBI to revive regional stock exchanges. The Commission highlighted the risk assessment criteria and risk management systems in place to ensure market integrity and investor protection.

Issue 4: Investigation and Conclusion
After thorough analysis, the Commission concluded that the conditions imposed by the opposite party on RSE members, including the informant, were necessary for investor protection. The Commission found that the transactions between the opposite party and RSE members were distinct from those with ordinary corporate members due to the unique structure and regulatory requirements of RSE subsidiaries. Consequently, the Commission determined that there was no prima facie case under section 4 of the Act. The case was closed under section 26(2) of the Act, and the decision was communicated to all concerned parties.
2013 (2) TMI 867

Manipulation of bidding process in contravention of provision of Section 3(3)(d) - Engagement in cartelization and bid rigging - nascent stage of competition jurisdiction would be one of the factors to be taken into consideration while inflicting penalties - process of bid rigging in the matter of supply and installation, testing and commissioning of Modular Operation Theatre (MOT for short) and Medical Gases Manifold System (MGMS) at Sports Injury Centre (SIC hereinafter), Safdarjung Hospital, New Delhi.
Held that:- This was a contract for building a Operation Theatre for the Sports Injury Centre (SIC) which subject itself is relatively new. This Sports Injury Centre was to be created before the Commonwealth Games. The said games were to be held in India in the year 2010. The MDD seems to have completed this exercise within time and at least there is no evidence to suggest that the said Operation Theatre has not worked well. The Commonwealth Games were undoubtedly a matter of national importance and prestige. Some credit has to be given to MDD for this purpose. We would, therefore, bring down the penalty of MDD to 3%. In that view, showing due consideration to all the other factors, and to maintain the parity between the parties, we would bring down the penalty from 5% of the average turnover of last three years to 3% of the average turnover of last three years even in case of PES and MPS also. Calculated in that light, the penalty would be as per the following table:-
We, therefore, inflict the penalty as shown in the table. The penalties imposed by the CCI in the impugned order dated 16.04.2012 shall stand modified to that extent. The three enterprises on whom the penalties have been imposed are directed to deposit the amount of penalties within 90 days of the receipt of this order.
2013 (2) TMI 582

Section 4 of the Competition Act, 2002 invoked - Abuse of dominant position - Appellant company was engaged in activities including mining, logistics and infrastructure development used services of rail transport, owned and controlled by opposite parties (OP) for transportation of iron ore extracted from mines of informant - OP reclassified iron ore based upon its end-use, thereby imposing different freights on iron ore based on its end-use - Whether OP's action of reclassification and revision of rates/freight of commodities is violation of provisions of Act and abuse of dominant position? - Whether fixing a rate or issuing a rate circular amounts to a delegated legislation and whether the CCI could go into question of validity of such a circular which was stated to be in the nature of delegated legislation - Held that:- In exercise of the function of reclassification and revision of rates/freight by railways was no prima facie violation of the provisions of the Act as the power of reclassification and revision of rates/freight is entrusted to the Central Government under section 31 of the Railways Act, 1989. The exercise of such functions by itself, in the absence of any other cogent evidence establishing that such conduct is in violation of the provisions of the Act, does not justify a direction by the Commission to recommend the DG to investigate and analyse the conduct of the opposite parties as by the statutory provision, the legislature has authorized the Central Government to classify and revise rates/freight with respect to carriage of passenger and goods uniformly applicable for all the entities who wanted to avail the services of Indian railways for transporting their goods.
However, in the absence of any prima facie case of violations of the provisions of the Act, being made out on the basis of available material, no interference is warranted by the Commission in instant case as no abuse of dominant position is proved here.
2013 (2) TMI 534

Section 4 of the Competition Act, 2002 - abuse of dominant position - Informant claimed to be a businessman who booked a commercial office space with DLF [opposite party] under Commercial Office Space Buyer's Agreement including completion and possession of the complex within 36 months from the date of execution of the agreement but no sign of construction as against promises made by opposite party found when informant visited the site - Informant charged OP with alleging contravention of section 4 abusing its dominant position by making him sign one-sided agreement and delaying project - Held that:- The relevant market proposed by the informant, namely 'real estate developer in Delhi and Gurgaon', seems incorrect. Though the OP may have a PAN India presence but the geographic conditions prevailing in different parts of the country require determination of relevant geographic market in context of that area.Gurgaon and Delhi are different relevant geographic markets for the purposes of case at hand. Gurgaon developed in last few years in a major way and various big projects were started by the OP Group in that area. However, in Delhi, opposite party is just one of the real estate developers. here were many other real estate developers in Delhi who offered similar commercial/office space. The informant in the present case was desirous of booking an office space. Therefore, the relevant market in the present case will be market for 'development of commercial/office space in the region of Delhi'.
Section 19(4) of the Act states that the Commission needs to consider various factors stated under that section while assessing whether an enterprise enjoys a dominant position or not and as per the information available in public domain, it is clear that the OP was not the only real estate developer offering commercial office space in Delhi. There are other real estate developers as well, e.g., Ansal API, Unitech, BPTP, Omaxe, Parsavnath etc. Presence of other real estate developers offering commercial office space also indicates that the informant was not dependent upon the opposite party for provisioning of an office space. None of the factors stated under section 19(4) of the Act seem to support informant's plea of dominance of opposite party. Therefore, the opposite party does not appear to be dominant in the relevant market of 'development of commercial/office space in the region of Delhi
Thus plea regarding abuse of dominance in instant case rejected a as the OP was not dominant in the relevant market determined by the Commission - there does not exist a prima facie case under section 4 to order DG investigation as allegations related to unfair trade practices, deficiency in services etc. may be pleaded at other appropriate forums, if the informant so desires, the same being not within the ambit and jurisdiction of the Commission - Commission deems it fit to close the proceedings in the instant case under section 26(2).
2013 (2) TMI 507

Breach of provisions under Section 4 of Competition Act, 2002 - abused of dominance position - Appellant-company was engaged in development of telecommunication networks, security systems, display systems and traffic management systems filed information against AAI complaining that it was abusing its dominant position by specifying a particular technology, i.e., hydraulic bollards, in its procurement tender invitation notice for bollards, and, therefore, creating technical entry barriers for other type of bollards like one which were being produced by appellant-company - Held that:- Tribunal cannot accede to any of the prayers in the information, as it is not for this Appellate Tribunal to re-write the tender conditions. It is also not for this Tribunal to frame the policies of the bodies like Airport Authority of India. Lastly, it is also not for this Tribunal to direct the CCI to address it to Vigilance Commission.
The contention raised by informant cannot be accepted as that in requiring specific type of Bollards i.e. Hydraulic operated bollards the AAI has in any way breached any of the provision of section 4. The AAI was acting in its capacity as a consumer and as argued by the representative for the AAI it was equipped with technical committee to advise the AAI for a purchase of particular type of bollards. It cannot be imagined that a body like AAI was not equipped with the technical advice and would be acting without any such technical assistance. Therefore, if the AAI had a free choice to purchase a particular type of commodity, its hands could not be tied by taking the recourse to the competition act and the provisions there under. After all in the market the consumer would have to be given consumers dew i.e. basically his choice. The contention raised by appellant therefore, rejected.
The argument of Appellant cannot be accepted that AAI was a dominant purchaser and had abused its dominance. In fact for the purposes of deciding the dominance, both the product market as well as geographical market are to be considered and insofar as the product market is concerned, it related to all the kinds of bollards whether hydraulic operated or otherwise. It is commonly known that bollards are used everywhere. The bollards are used even for the entry into the star hotels. They are used even for controlling the traffic. They are used everywhere where security and safety is required to be maintained. Therefore, there is nothing relevant about a particular type of bollards. They are required by not only AAI but by number of other institutions. Therefore, it cannot be said that the AAI would be a dominant player. Therefore the market to be only the five airports named in the notice inviting tender cannot br restricted. Once the AAI held not to be in a dominant position, there would be no question of going further into the breach or otherwise of Section 4 of the Act.
2013 (1) TMI 736

Supplementary Order u/s 27 of the Competition Act, 2002 - In earlier order Commission found that DLF Ltd. had abused its dominant position and violated the provisions of Section 4 of the Competition Act, 2002 - Held that:- The Commission, in its order, observed that while heavy penalties were imposed in the agreement for default of allottee, there were insignificant penalties on DLF for its own defaults. A reference was made to clause 35 of the agreement, which shows abuse of dominance. The company can refuse to condone delay and can cancel the apartment even if the allottee was prepared to pay interest on delayed payment. While in case of company, the company for itself has reserved so many excuses for non delivery of possession and for scrapping the contract altogether or for delaying the project.
It has given itself the powers to extend the period of delivering possession but for the allottee, the sole discretion lies with the company to cancel the flat in case of delayed payment. In case of condoning delay, the Company could be charging interest to the tune of 15% for 1st 90 days and thereafter 18%. However, for the default of the company, the company was liable to pay only 9% interest to the allottee on only such amount which the company deemed refundable to the allottee. That makes the clause abusive, one sided and shows blatant abuse of dominance.
In clause 12, the company has given events of defaults and consequences for the allottee. The company has nowhere given in the entire agreement the events of defaults for itself. The Commission considers that the defaults can be on the part of the company as well on the part of the allottees and the agreement should provide for defaults of both the parties and the agreement must be equitable in dealing with both the sides and levy of interest /penalty should of equal level on both sides. The Commission also considers that Force Majeure in clause 39 should be defined as understood in common parlance of law. The consequent modifications are suggested in the clauses 35 & 39.
In view of the modified clauses/sub clauses as suggested above in the agreement, certain clauses/sub clauses of the agreement have become superfluous. The Commission has suggested deletion of these clauses. Certain clauses of the agreement, in view of the suggested modified clauses, needed small changes so as to bring them in consonance with the modified clauses. These changes are minor in nature and have been suggested wherever needed. Some clauses are closely interlinked with the abusive clauses and had to be modified so that the abuse was not perpetuated. These interlinked clauses wherever existed have been accordingly modified. The clauses which needed fine tuning with the modified clauses have also been accordingly modified and the suggested clauses have been given in the table below.
The terms of the agreement to be entered into with the allottee were never shown to the allottee at the time of booking of the apartment. These terms and conditions of the agreement were prepared and framed by the company unilaterally without consulting the buyer. Once the company had already received considerable amount from the applicants/buyers, this agreement was forced upon the allottees and the allottee had no option but to sign the agreement, as otherwise the agreement provided for heavy penalties and deduction from the money already deposited by the allottees with the company, which itself was an abuse of dominance. The appropriate procedure would have been that a copy of the agreement which DLF proposed to enter with the allottee should have been made available to the applicants at the time of inviting applications. The agreement should be signed within a reasonable time from the date of allotment and all additional amounts should be demanded from the allottee only when the agreement has been signed. Any allottee, who was not agreeable to the terms of agreement, should have liberty to withdraw his application and should be given the entire application amount back.
The Commission thus considered all the clauses of the Buyer's Agreement. The reasons for proposed modification are given.The modifications suggested have been given in tabular form at the end opposite the existing clause.
2013 (1) TMI 532

Competition Act – termination of commission payable to agents by the Airlines - appellant were travel agents to whom foreign airlines used to pay commission on sale of tickets - airlines discontinued commission by forming a cartel and were abusing their dominant position - Competition Commission of India rejected the argument of the informant that on a particular route, a particular airlines operating thereupon should be the relevant market - Whether foreign airlines had abused their dominant position in terminating commission payable to travel agents ? – Held that:- CCI has rightly observed that as long as the consumer is transported to his ultimate destination, the route taken hardly matters. The airlines which provide international flight services to the consumers of India for travel to various destinations outside India and those routes are not necessarily fixed. The CCI had rightly observed that these routes are substitutable. The selection by the consumer for a particular airline would be on the basis of various factors namely the timing, quality of service and also air fare charged by the airlines.
It is not necessary that the route taken by one airlines operating would be the same in case of other Airline operating on that route. It could be via some other city. It will make no difference to the consumer so long as airline reaches the consumer to his destination. Therefore, it would be wrong to hold one route as the relevant market for that particular airlines. CCI is right in holding that the relevant market for the respondents was the international routes reaching from and to India from the foreign destinations and not a particular route of being operated by a particular airline.
Director General had concluded on the basis of his investigation that it was not proved that foreign airlines hold about 90 per cent market share in the relevant market of international flying to and fro from India. The appellant was unable to give any specific statistics before the CCI or even before the Court. On the other hand, from the documents on record, it is clear that none of the nine foreign airlines has substantial market share in the relevant market of international flight services in India.
Thus Director General referring to the information available to the DGCA has come to the conclusion that individually none of the opposite parties has a market share of more than 5 per cent or 6 per cent of the International traffic. Again as per the study conducted by the CAPA most of the opposite parties do not have any meaningful share in the international flying market based on the seat strength. Therefore, the CCI has committed no error in coming to the conclusion that individually speaking none of the opponent could be said to be in a dominant position.
Joint decision to terminate the commission system is not accepted as individual foreign airlines cannot be clubbed together and held to be enterprise. They are all independent companies. There is no evidence of enmity of these airlines with the travelling agents nor is there any support to suggest that there was any meeting of minds among them. There was no joint decision to terminate the commission system as there is no agreement spelling out a cartel or any meetings of mind between these independently operating foreign airlines.
The decision by these airlines was an independent decision and as such there could be no question of violation of section 3(3). There is no evidence that the travel agents have suffered. On the other hand in the line of world trend, the system has been substituted with Net Fare Model all over the world and not only in India.
2012 (12) TMI 398

Maintainability of compensation applications u/s 12B of MRTP Act - whether initiation of separate proceedings either u/s 10 or u/s 36B of MRTP Act alleging unfair trade practices by the respondents is mandatory for making a compensation application u/s 12B - Held that:- MRTP Commission has been vested with the powers under sub-section (3) of Section 12B of the MRTP Act to make an inquiry to the allegations of monopolistic or restrictive or unfair trade practice made in the application filed under sub-section (1) of Section 12B of the MRTP Act and to determine the amount of compensation realizable from the undertaking or the owner thereof, or, as case may be, from the other person, towards loss or damage caused to the applicant by reason of any monopolistic or restrictive, or unfair trade practice carried on by such undertaking or other person. These powers vested in the MRTP Commission under sub-section (3) of Section 12B of the MRTP Act are independent of its powers under Section 10 and Section 36B of the MRTP Act.
There is also no reference in either Section 10 or in Section 36B of the MRTP Act to any of the provisions of Section 12B of the MRTP Act and if the Parliament intended to make Sections 10, 12B and 36B of the MRTP Act interdependent, there would have been some indication of this intention of Parliament in Section 10 or in Section 36B of the MRTP Act - In the absence of any such indication of this intention of Parliament to make the provisions of Section 12B of the MRTP Act dependent on initiation of an inquiry or proceeding under Section 10 or Section 36B of the MRTP Act, the Competition Appellate Tribunal clearly erred in coming to the conclusion that interdependence of the provisions of Section 10 or Section 36B with Section 12B cannot be lost sight of and in the absence of a separate proceeding alleging unfair, monopolistic or restrictive trade practice, an application for compensation under Section 12B of the MRTP Act is not maintainable.
2012 (11) TMI 1324

Issues involved:

1. Violation of principles of natural justice
2. Exceeding the jurisdictional limits set by the Division Bench in its previous order
3. Non-application of mind/non-fulfillment of Section 11C on facts

Summary:

Violation of principles of natural justice:

The appellant, DLF, argued that SEBI's order was made in violation of principles of natural justice as SEBI first heard the complainant in the absence of DLF and then asked DLF to make submissions separately. The court held that no right to hearing was required at the stage of SEBI deciding whether to direct an investigation or not. The court emphasized that the exercise of power in question was only inquisitorial and not adjudicatory. Therefore, the principles of natural justice were not violated as no charges were made against DLF by SEBI at this stage.

Exceeding the jurisdictional limits set by the Division Bench in its previous order:

DLF contended that SEBI exceeded the jurisdictional limits set by the Division Bench in its previous order by considering additional materials outside the two original complaints. The court clarified that the Division Bench did not set any jurisdictional limits but only mandated SEBI to investigate the two complaints as the other material had never been placed before SEBI. The court held that SEBI was free to investigate and take into account any additional material in keeping with its plenary powers under the SEBI Act.

Non-application of mind/non-fulfillment of Section 11C on facts:

DLF argued that SEBI did not have "reasonable ground to believe" as required u/s 11C of the SEBI Act. The court held that SEBI's decision was based on relevant considerations and there was a direct nexus between the material considered and the conclusion reached. The court found that SEBI had considered the relations between DLF and Sudipti, failure to disclose the FIR against Sudipti, and the duty on DLF to disclose facts in the DRHP. The court concluded that SEBI's order was based on relevant factors and was not arbitrary or irrational.

Conclusion:

The appeal was dismissed as the court held against DLF on all three points, finding no violation of principles of natural justice, no exceeding of jurisdictional limits, and proper application of mind by SEBI in fulfilling the requirements u/s 11C.
2012 (9) TMI 1235

Issues Involved:
1. Whether games of skill are considered "business activity" protected under Article 19(1)(g) of the Constitution of India.
2. Whether the Games of Rummy, Chess, Golf, Poker, Bridge, and Snooker are games of skills.
3. Whether there is any restriction on playing the aforementioned games of skill with stakes on the websites making profit.
4. Whether wagering and betting on games of skill make the activity "Gambling".
5. Whether there can be restriction on advertising and promoting the website offering the aforesaid games of skill.
6. Can the banks refuse to provide normal banking services to the websites once it is determined that the Company is conducting normal business activities?
7. Can the Company or its Directors, agents, players etc. be held liable under any penal laws as long as they are only offering games of skill which are declared to be normal business activities?

Summary:

Issue 1: Whether games of skill are considered "business activity" protected under Article 19(1)(g) of the Constitution of India.
A stake in a game of skill between players does not amount to gambling as per the decision of the Apex Court. Earnings from playing such games by any professional would be a professional or a business activity protected under Article 19(1)(g) of the Constitution of India when played in the physical form. However, online games conducted by gaming houses or websites are illegal in States where gambling is prohibited.

Issue 2: Whether the Games of Rummy, Chess, Golf, Poker, Bridge, and Snooker are games of skills.
The games of Rummy, Chess, Golf, Bridge, and Billiards are categorically opined as games of skill, with the element of chance being negligible or insignificant. Poker, however, cannot be accepted as a game of skill and is more in the form of gambling.

Issue 3: Whether there is any restriction on playing the aforementioned games of skill with stakes on the websites making profit.
There is no restriction on playing the aforementioned games of skill with stakes on the website making profit as the same does not amount to gambling. However, online gaming sites offering prize money and partaking a slice of the winning hand are illegal in States which prohibit gambling.

Issue 4: Whether wagering and betting on games of skill make the activity "Gambling".
Wagering or betting on a game of skill does not come within the definition of gaming or gambling. However, online gaming sites offering prize money and partaking a slice of the winning hand are considered illegal.

Issue 5: Whether there can be restriction on advertising and promoting the website offering the aforesaid games of skill.
Advertising or promoting websites offering online games for prize money and winning through betting confirms that these sites are virtual Casinos, which are illegal. Sponsors advertising or promoting their own product on such sites also attract penal consequences.

Issue 6: Can the banks refuse to provide normal banking services to the websites once it is determined that the Company is conducting normal business activities?
Banks can refuse to provide normal banking services to websites offering online gaming involving money as such activities cannot be held to be legal. Payment gateways for gambling are blocked by the Reserve Bank of India as per the Information Technology Rules of 2011.

Issue 7: Can the Company or its Directors, agents, players etc. be held liable under any penal laws as long as they are only offering games of skill which are declared to be normal business activities?
Since online gaming cannot be held to be legal in States which prohibit gambling, the Company and its directors, agents, players, are liable to penal consequences.

Conclusion:
The petition stands disposed of with all queries answered. The Court emphasized the need for regulation in the online gaming industry to prevent illegal activities and tax evasion. The file is consigned to the Record Room.
2012 (3) TMI 616

Issues Involved:
1. Notice to the appellant in penalty proceedings.
2. Mandatory nature of penalty u/s 20 of the RTI Act.
3. Judicial review of penalty imposed by CIC.

Summary:

1. Notice to the appellant in penalty proceedings:
The appellant contended that the learned Single Judge disposed of the writ petition without issuing notice to the appellant, who had sought the information u/s 20 of the RTI Act. The appellant argued that the penalty proceedings are adversarial and the information seeker should be heard. However, the court held that the information seeker has no right of participation in penalty proceedings, which are between the CIC and the erring information officer. The court referenced its judgment in Ankur Mutreja v. Delhi University, stating that the role of the CIC is supervisory and not merely adjudicatory, and the information seeker does not have a locus in penalty proceedings beyond the decision of the complaint/appeal.

2. Mandatory nature of penalty u/s 20 of the RTI Act:
The appellant argued that the use of the word "shall" in Section 20(1) indicates that the imposition of penalty is mandatory. The court, however, noted that the imposition of penalty is dependent on variables such as "without reasonable cause," "malafidely," "knowingly," and "reasonably and diligently." The court held that these expressions are relative and indicative of discretion vested in the authority imposing the punishment. The court cited precedents where similar language was interpreted as not mandating an absolute imperative but allowing for discretion.

3. Judicial review of penalty imposed by CIC:
The court held that the quantum of fine is discretionary and subject to judicial review under Article 226 of the Constitution. The court found that the learned Single Judge had valid reasons for reducing the penalty from Rs. 25,000 to Rs. 2,500, recoverable in ten equal monthly installments. The court upheld the discretion exercised by the Single Judge and dismissed the appeal, finding no merit in the appellant's contentions.

Conclusion:
The court dismissed the appeal, upholding the reduction of the penalty by the learned Single Judge and affirming that the information seeker has no right to participate in penalty proceedings, which are supervisory in nature and not adversarial. The court also clarified that the imposition of penalty u/s 20 of the RTI Act is discretionary and not mandatory.
2012 (2) TMI 503

Whether the existence of an arbitration agreement between the parties is a bar to the maintainability of the information and the proceedings arising therefrom before the Commission? - whether the petitioner is an 'enterprise' within the meaning of the expression as defined in Section 2(h) of the Act? - Held that:- 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.
The petitioner has entered into a Concession Agreement under its PPP policy. It is, therefore, clear that respondent No. 2 is performing a commercial activity and rendering services for a charge, which, prior to the entering into the aforesaid agreement with the petitioner, was being performed by the petitioner. The petitioner is also carrying out an activity, viz. running the railways, which also has a commercial angle and is capable of being carried out by entities other than the State, as is the case in various other developed countries. It is, therefore, not an inalienable function of the State. Therefore, the submission of the petitioner that it is not covered by the definition of 'enterprise', has no merit and is rejected.
2011 (12) TMI 794
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered in this judgment are:
- Whether the writ petition is maintainable given the concurrent proceedings before the Competition Commission of India (CCI) regarding the same subject matter.
- The applicability and implications of the doctrine of election of remedies in the context of concurrent legal proceedings.
- The scope of the writ jurisdiction under Article 226 of the Constitution of India in relation to statutory remedies under the Competition Act, 2002.
- Whether the amendment to the writ petition to include specific challenges to the Memorandum of Understanding (MoU) dated 1st February 2003 is permissible.
- The impact of the writ proceedings on the ongoing proceedings before the CCI and the potential for conflicting decisions.
2. ISSUE-WISE DETAILED ANALYSIS
Issue 1: Maintainability of the Writ Petition
- Legal Framework and Precedents: Article 226 of the Constitution provides for the writ jurisdiction of High Courts. The Competition Act, 2002, especially Sections 3, 4, 18, 60, 61, and 62, outlines the jurisdiction and powers of the CCI.
- Court's Interpretation and Reasoning: The court emphasized that the writ jurisdiction under Article 226 is not ousted by the statutory remedy available under the Competition Act. The two remedies are concurrent and not mutually exclusive.
- Key Evidence and Findings: The petitioner's claim of infringement of fundamental rights and the distinct nature of reliefs sought in the writ petition and the CCI proceedings were pivotal.
- Application of Law to Facts: The court found that the issues raised in the writ petition, such as promissory estoppel and legitimate expectation, fall within the court's jurisdiction and cannot be addressed by the CCI.
- Treatment of Competing Arguments: The respondents argued that allowing both proceedings would lead to conflicting decisions and constitute an abuse of process. The petitioner contended that the writ jurisdiction is broader and addresses constitutional rights.
- Conclusions: The writ petition is maintainable as it addresses issues beyond the scope of the CCI, and the doctrine of election of remedies does not apply.
Issue 2: Amendment of the Writ Petition
- Legal Framework and Precedents: Order 6 Rule 17 of the Civil Procedure Code governs the amendment of pleadings. The court referenced precedents that favor a liberal approach to amendments.
- Court's Interpretation and Reasoning: The court allowed the amendment, emphasizing that it is necessary for resolving the real controversy and does not cause injustice to the respondents.
- Key Evidence and Findings: The proposed amendment sought to specifically challenge the MoU, which was central to the dispute.
- Application of Law to Facts: The court found that the amendment was essential to address the core issues and did not prejudice the respondents.
- Treatment of Competing Arguments: The respondents contended that the amendment was not bona fide and aimed at delaying proceedings. The court disagreed, noting the importance of addressing the substantive issues.
- Conclusions: The amendment was allowed, subject to costs, to facilitate a comprehensive resolution of the dispute.
3. SIGNIFICANT HOLDINGS
- Verbatim Quotes of Crucial Legal Reasoning: "The writ petition is maintainable as issue of promissory estoppel and legitimate expectation cannot be pre-judged at this stage, but the final order in this matter has to be put on hold till the validity of the Memorandum of Understanding of 1st February, 2003 is finally decided in the proceedings under the Competition Act, 2002."
- Core Principles Established: The writ jurisdiction under Article 226 is not ousted by statutory remedies, and concurrent proceedings can be maintained if they address distinct legal issues.
- Final Determinations on Each Issue: The writ petition is maintainable and the amendment to the petition is allowed. However, the final decision on the writ petition is deferred pending the outcome of the CCI proceedings to avoid conflicting decisions.
2011 (11) TMI 649

Issues involved: Interpretation of provisions of The Competition Act, 2002 regarding referral to Competition Commission.

The appellant argued that the learned Single Judge did not grant the relief sought by the respondent in the writ petition and questioned the need for the High Court to refer the matter to the Competition Commission u/s 21 of The Competition Act. The appellant contended that only a Statutory Authority, as defined in Sec. 2(w) of the Act, can make such a reference, excluding the High Court. It was suggested that the respondent could approach the Competition Commission by filing an application u/s 19 of the Act if desired.

Upon review, it was observed that the learned Single Judge did not make a reference u/s 21 of the Act. Despite this, the respondent's counsel indicated that their client would submit a formal application u/s 19 of The Competition Act. Consequently, no further orders were deemed necessary, especially since the Single Judge's view was preliminary, allowing the appellant to contest any such application on all available grounds.

The appeal was thus disposed of, with no additional directions issued.
2011 (11) TMI 648

Direct the Competition Commission to enquire into the alleged contravention of the provisions of Section 3 and Section 4 by respondent no.2 by its aforesaid constitutional provisions and conduct under Section 26 of the Competition Commission Act, 2002. The petitioner may appear before the Commission on 28.11.2011. The petitioner shall present before the Commission a memorandum containing its grievances in this respect on the said date.
It is made clear that observations made by me in relation to the case of respondent no.2 are only prima facie, and shall not prejudice their case and the Commission shall enquire into the same independently.
2011 (9) TMI 840

Writ petition - petition claimed payment of the monies spent by him in television show "Kaun Banega Crorepati-2 (KBC)" - petitioner had spent large sums of monies in his attempt to participate in the said show but had not been able to - organizers of the show were duping the participants of crores of rupees and indulging in foul play – Held that:- CCI (Competition Commission of India) dismissed complaint holding that allegations of petitioner were to be tested in light of opposite party being in a dominant position and, thus, discriminating in selection of contestants for participation in programme/show and adopting unfair means therein; however, on basis of viewership ratings, it was found that share of viewers of said television show was not so much for which it could be said that show was in a dominating position - therefore, petition against impugned order was to be dismissed
2011 (8) TMI 1073

Whether a party before the District Consumer Forum/State Commission cannot be compelled to engage services of an advocate?
Whether a person under the purported cover of being an “agent” can represent large number of persons before the forums created under the Consumer Protection Act, 1986 (In short the ‘Act’) and the Rules made thereunder?
Whether somebody who is not a legal practitioner, can represent large number of parties before their forums thereby frustrating objects embodied in the Advocates Act?
2011 (6) TMI 1043

Issues Involved:

1. Relevant Market Definition
2. Dominant Position of NSE
3. Abuse of Dominant Position by NSE
4. Leveraging Dominance
5. Exclusionary Conduct

Issue-wise Detailed Analysis:

1. Relevant Market Definition:

The Commission determined the relevant market as the stock exchange services for the currency derivatives (CD) segment in India. It was established that the CD segment is distinct from other segments like equity, F&O, and WDM, as well as from the OTC market. The CD segment was introduced as a new and distinct market by policymakers, and the services provided in this segment are functionally and statutorily segregated from other stock exchange services. The Commission rejected the applicability of the SSNIP test due to the lack of historical price data and the unique nature of the CD segment.

2. Dominant Position of NSE:

The Commission found NSE to be in a dominant position in the relevant market, defined as the stock exchange services for the CD segment in India. This conclusion was based on NSE's significant market share in various segments, its financial strength, extensive network, and vertical integration. NSE's ability to sustain a zero pricing policy and its substantial financial resources compared to competitors like MCX-SX and USE further reinforced its dominant position.

3. Abuse of Dominant Position by NSE:

The Commission identified several abusive practices by NSE, including the waiver of transaction fees, admission fees, and data feed fees, as well as the denial of APIC to ODIN software. These practices were deemed unfair and exclusionary, aimed at eliminating competition and harming competitors like MCX-SX. The zero pricing policy was considered annihilating or destructive pricing, contravening section 4(2)(a)(ii) of the Competition Act.

4. Leveraging Dominance:

NSE was found to have leveraged its dominant position in the non-CD segment to protect its position in the CD segment, violating section 4(2)(e) of the Act. The Commission concluded that NSE used its strengths from other segments to unfairly maintain its dominance in the CD segment, which was evident from its cross-subsidization practices and exclusionary conduct.

5. Exclusionary Conduct:

The Commission determined that NSE's conduct in denying APIC to ODIN and placing FTIL on a watch list was exclusionary, affecting both the aftermarket for trading software and the main relevant market. This conduct was aimed at foreclosing competition and imposing supplementary obligations on clients, contravening sections 4(2)(b)(i) and (ii), 4(2)(c), and 4(2)(d) of the Act.

Conclusion:

The Commission ordered NSE to cease and desist from unfair pricing and exclusionary conduct, maintain separate accounts for each segment, and modify its zero price policy. A penalty of Rs. 55.5 crores was imposed on NSE for its contraventions, reflecting 5% of its average turnover over the last three years. The decision emphasized the need for fair competition and the protection of consumer interests in the stock exchange services market.