TMI Blog2019 (4) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... of CMM arises in two possible situations, viz., (1) there has been a failure on the part of a person to “comply with the orders or directions” issued to him under the law or (2) on account of failure to pay fine imposed for non-compliance with orders or directions of the Commission under specified provisions (i.e., Sections 27, 28, 31, 32, 33, 42A and 43A), the Commission, after inquiry, having found absence of “reasonable cause”. The suggested interpretation of Section 42(3) of the Competition Act does not commend itself to this court. Double jeopardy - Held that:- The argument of double jeopardy can be rejected by pointing out that the penalty under Section 43 is civil in nature imposed by the statutory authority (the Commission) in exercise of the powers conferred on it by the law, the criminal complaint alleging offence under Section 42(3) carrying the additional element of failure to comply further with the said direction, the criminal action even otherwise being not violative of Article 20(2). The petitioner in the second and third captioned matters has raised questions of fact about extent of his responsibilities, his ignorance, non-service of some of the notices or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said processes, the Commission through Secretary issued show cause notices on 22.09.2016 and 02.12.2016. There being no response to such notices, the Commission imposed penalty of ₹ 5,00,000/- by order dated 09.02.2017 under Section 43 of the Competition Act. The RCCL sent a reply on 28.04.2017, the Commission issuing a notice of demand on 21.07.2017 requiring penalty amount to be deposited within thirty days. On 19.04.2018, the Commission by its order decided to initiate criminal complaint under Section 42(3) of the Competition Act, the complaint (CC No.11151/2018) being submitted in its wake. The CMM issued the process by the impugned order on 30.05.2018. The petitioner deposited the penalty on 13.08.2018 and 20.08.2018. Crl.M.C. 5324/2018 4. A company named Cinemax India Limited ( the informant ) is engaged in business of exhibition of films at its cinema halls in Kerala. On 21.09.2012, the said company gave information under Section 19(1) (a) of the Competition Act to the Commission alleging contravention of Sections 3 and 4 of the Competition Act by Films Distributors Association (FDA) of Kerala in which the petitioner was then the honourary General Secreta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use had been shown by FDA or the petitioner for non-compliance, imposed by order dated 11.12.2014 penalty on FDA in the sum of ₹ 14,60,000/-at ₹ 10,000/- per day for the period of non-compliance, i.e., 13.09.2013 to 06.02.2014, also taking note of similar non-compliance by FDA in another matter (case No.62/2012) it showing the said entity to be one indulging in habitual non-cooperation . Further, by the same order, the Commission also imposed penalty of ₹ 4,80,000/-against the petitioner, inter alia, observing that his reply dated 07.06.2013 demonstrated that he was fully aware of the notice which had been affixed outside his office on 13.09.2013 and yet had failed to comply or adduce any evidence to show that non-compliance was without his knowledge or despite due diligence on his part. 7. The copy of order dated 11.12.2014 was statedly served on the petitioner on20.12.2014. He failed to deposit the penalty within stipulated period of sixty days. A demand notice was issued by the Commission on 26.03.2015, it statedly having been served on 10.04.2015. Since no deposit was made, a recovery certificate was issued by the Commission on 22.05.2015. The penalty not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The copy of the order imposing penalty was statedly served on the petitioner on 22.11.2014. He did not make the payment. This led to demand notice dated 18.02.2015 being issued and statedly served on 26.02.2015, followed by recovery certificate issued by the Commission on 01.04.2015. The penalty not having been deposited, the Commission, by its order dated 16.03.2016, decided to initiate criminal action against the petitioner under section 42(3) of the Competition Act, the criminal complaint (No.48346/2016) having been filed before CMM in its wake. 11. As mentioned in the context of the previous matter, the challenge of the petitioner to the imposition of penalty by the Commission before the Appellate Tribunal (by appeal No.55/2015) and before the Supreme Court (by SLP) have concededly been unsuccessful. THE CONTENTIONS 12. It is the argument of the petitioners that the offence proved by Section 42(3) of the Competition Act cannot be invoked on the basis of allegation that the penalty imposed by the Commission under section 43 has not been paid, the penal clause leading to such criminal action in the court of CMM being intended to cover non-compliances of different na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Restrictive Trade Practices Commission (MRTPC) established under the said repealed Act was dissolved. The Competition Act has established, by virtue of Section 7, the Commission (called Competition Commission of India ). The law also provides for an investigative machinery which aids and assists the Commission, it being headed by a functionary styled as Director General , as envisaged in Section 41. 17. The Competition Act prohibits anti-competitive agreements (Section 3) and abuse of dominant position (Section 4). The prime duty of the Commission, as indicated by Section 18, is ibesides promoting and sustaining competition and the interest of the consumers ensuring freedom of trade. The Commission is vested with the power to inquire into allegations of anti-competitive agreements or acts of commission or omission constituting abuse of dominant position or combinations violative of the prescription of law, by detailed provisions contained in Sections 19 and 20, such power to be exercised upon receipt of information, or complaint, or on its own motion, or upon reference. For its aid and assistance, the Director General (appointed under Section 16) is vested with the dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... comply with the processes, orders or directions of the commissions or of the Director General are likely to be visited by penalty as envisaged by Section 43 which reads thus:- 43. Penalty for failure to comply with directions of Commission and Director-General. If any person fails to comply, without reasonable cause, with a direction given by (a) The Commission under sub-sections (2) and (4) of section 36; or (b) The Director-General while exercising powers referred to in sub-section (2) of section 41, such person shall be punishable with fine which may extend to rupees one lakh for each day during which such failure continues subject to a maximum of rupees one crore, as may be determined by the Commission. 23. The clause contained in sub-Section (3) of Section 42 is the only offence prescribed by the Competition Act, the jurisdiction to deal with which is conferred on the Chief Metropolitan Magistrate of Delhi, the pre-requisite being a complaint made by the Commission or any of its officers on its behalf. This offence is provided, with punishment thereby attracted indicated, (in Chapter-VI), under the heading of penalties . Noticeably, the power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s power under Section 41(2) cannot be equated with failure to comply with the orders of the Commission within the meaning of Section 42(3). 27. It is further the submission of the petitioners that the failure to comply with processes of the Commission under Section 36 or of the Director General under Section 41 attracts penalty in terms of Section 43, as has been imposed in the present cases, prosecution for the offence under Section 42(3) would be in the nature of double jeopardy prohibited by Article 20(2) of the Constitution of India. 28. The above arguments do not impress this court. The reasons may be set out hereinafter. 29. It is well settled that use of a comma and word or between two parts of a clause makes the two parts disjunctive. In Union of India v. Rabinder Singh, [2012] 12 SCC 787, while construing similarly placed clause appearing in Section 42(f) of the Army Act, 1950, it was observed thus:- 25. We accept the submission of Shri Tripathi that the two parts of Section 52(f) are disjunctive, which can also be seen from the fact that there is a comma and the conjunction or between the two parts of this clause (f) viz. (i) does any other thing with in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 42 is included as one of the possible reasons leading to such criminal action, it being provided by a disjunctive clause, the words or fails to pay the fine imposed under sub-section (2) being preceded and followed by a comma. The comma (,) appearing prior to the said words separates it from the words if any person does not comply with the orders or directions issued . The use of comma (,) is with a purpose. It indicates that a cause of action for criminal complaint to be filed in the court of CMM arises in two possible situations, viz., (1) there has been a failure on the part of a person to comply with the orders or directions issued to him under the law or (2) on account of failure to pay fine imposed for non-compliance with orders or directions of the Commission under specified provisions (i.e., Sections 27, 28, 31, 32, 33, 42A and 43A), the Commission, after inquiry, having found absence of reasonable cause . This court does not accept the argument that the words orders and directions in the first limb of section 42(3) are to be read as qualified by reference to the failure to pay the fine imposed under Section 42(2) as appearing in the second limb of Section 42( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is acquitted or convicted by a court of competent jurisdiction, while the conviction or acquittal stands effective . A man acquitted shall also not be liable to be tried again. (2-12-1948). On the next day, the extracted intervention of Shri T.T. Krishnamachari was accepted, sounding the death knell for autrefois acquit and leading to Article 20(2) as it stands today. Shri T.T. Krishnamachari (Madras: General): Mr Vice-President, Sir, the point I have to place before the House happens to be a comparatively narrow one. In this Article 14, clause (2) reads thus: No person shall be punished for the same offence more than once . It has been pointed out to me by more Members of this House that this might probably affect cases where, as in the case of an official of Government who has been dealt with departmentally and punishment has been inflicted, he cannot again be prosecuted and punished if he had committed a criminal offence; or, per contra, if a government official had been prosecuted and sentenced to imprisonment or fine by a court, it might preclude the Government from taking disciplinary action against him. Though the point is a narrow one and one which is capable of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same offence . (Per Charles, J. in R. v. Miles [(1890) LR 24 QBD 423 : (1886-90) All ER Rep 715 (CCR)] .) To the same effect is the ancient maxim Nimo Bis Debet Puniri Pro Uno Delicto , that is to say that no one ought to be twice punished for one offence or as it is sometimes written Pro Eadem Causa , that is, for the same cause. ** ** ** 11. These were the materials which formed the background of the guarantee of fundamental right given in Article 20(2). It incorporated within its scope the plea of autrefois convict as known to the British jurisprudence or the plea of double jeopardy as known to the American Constitution but circumscribed it by providing that there should be not only a prosecution but also a punishment in the first instance in order to operate as a bar to a second prosecution and punishment for the same offence. 12. The words before a court of law or judicial tribunal are not to be found in Article 20(2). But if regard be had to the whole background indicated above it is clear that in order that the protection of Article 20(2) be invoked by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d his position to regain bank stock he had used as collateral on defaulted loans through a series of bank loans to other parties. Upon investigation the Office of the Comptroller of Currency (OCC) found that the loans were made in violation of several banking statutes and regulations. The OCC fined and debarred Hudson for the violations. Later, he faced criminal indictment in the Federal District Court for violations tied to those same events. Hudson objected, arguing that the indictment violated the double jeopardy clause of the Fifth Amendment. Overruling United States v. Halper [104 L Ed 2d 487 : 490 US 435 (1989)] , wherein the Court had ruled as unconstitutional successive proceedings taking place in similar circumstances to Hudson s case, the Court in Hudson [Hudson v. United States, 139 L Ed 2d 450 : 522 US 93 (1997)] reaffirmed the distinction established between the civil and criminal nature of the particular successive punishment, in United States v. Ward [65 L Ed 2d 742 : 448 US 242 (1980)] . The US Supreme Court thus held in Hudson case [Hudson v. United States, 139 L Ed 2d 450 : 522 US 93 (1997)] that the double jeopardy clause did not preclude his subsequent crimi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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