TMI Blog2023 (4) TMI 649X X X X Extracts X X X X X X X X Extracts X X X X ..... recorded a prima facie opinion that the parties have colluded and formed a cartel for increase of prices in different varieties of paper and thereby warranting investigation for anti-competitive practices under the provisions of Section 3(1) read with Section 3(3)(a) of the Act in the paper industry. What is evident therefore that the information filed was neither restricted to a particular set of manufacturers but was in context of the entire paper industry connected with different varieties of paper. Reading the investigation reports and the orders passed under Sections 26(1) read with Section 26(3) of the Act would indicate that the order is an administrative order which only forms a prima facie opinion. The petitioner has been given an opportunity of producing evidence before the DG during the process of investigation and by the orders impugned the DG has called upon the petitioner to file its objections / suggestions to the investigation report. It cannot be said therefore that the petitioners doors are closed. After affording a reasonable opportunity and considering the objections and suggestions, the Commission based on the investigation reports will take an appropriate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Specialty Paper MICR / Ledger / Parchment. * It is the case of the petitioner that the respondent no.3, the Sivakasi Master Printers Association filed Information Petition No.30 of 2014. The petitioner was arrayed as opponent No.6. It was the case of Information Petitioner that there was a cartel amongst the paper mills which would get-together and facilitate price rise every month. It was the case of the informant that in order to stop this tendency and unfair trade practice to reduce this collusive increase in price, the Information Petitioner alleged contravention of Sections 3 and 4 of the Act. Similarly, the respondent No.4 All India Federation of Masters and Printers filed Information Petition No.85 of 2015. The CCI clubbed the proceedings and by orders dated 1.8.2014 and 17.11.2015 directed the DG to undertake investigation prima facie opining that the petitioner seems to be indulging in contravention in the paper industry. * Based on the orders so passed, the CCI carried out investigation and submitted a consolidated report dated 7.2.2019 which the petitioner received on 9.5.2019. Considering the report so filed, by the impugned order dated 2.5.2019, the CC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the agreements had appreciable adverse effect on competition would be done by the CCI without determining what is the relevant market. He would extensively invite the Court s attention to the pleadings in the Information Petition and the scope of investigation which was only restricted to writing and printing paper. He would submit that copier paper can never be used by the printing industry and the observations in the Investigation Report bringing copier paper within its purview was misconceived. * Mr. Thakore would submit that evidently the market that was meant to be relevant market would comprise of the varieties of writing and printing paper such as Maplitho, Cream Wove and Art Paper. The two orders passed u/S.26(1) of the Act after delineating the investigation completely in a misconceived manner brought within its sweep copier paper for the purpose of investigation though the investigation was in the writing and printing papers segment. * Mr. Thakore would submit that as the name itself suggests copier paper is used for the purpose of photocopy and office printing and, therefore, the consumers, selling points, use of the products etc. are completely diffe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scussed in the meeting were of Maplitho. There is nothing to indicate that any agreement was entered into directly or indirectly determining the sale prices of copier paper. * Mr. Thakore would submit that in the report it was an admitted fact that price parallelism analysis could not be conducted for the petitioner for the lack of data and therefore the CCI could not have drawn adverse inference against the petitioner. Mr. Thakore would rely on a decision in the case of Competition Commission of India v. Coordination Committee of Artistes and Technicians of West Bengal Film and Television and others reported in 2017(5) SCC, 17. He would rely on paragraph Nos.35 to 39 thereof to submit that while determining the question of what is the relevant market, the parameters of this judgment were ignored. * Mr. Thakore would submit that reading the orders dated 01.08.2014 and 17.11.2015, it was evident that the CCI was required to at least form a prima facie opinion. Reading the report would indicate that there was not even a whisper about copier paper. He would submit that the requirement of forming an opinion of a prima facie case based on material before the Commission is we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... communications that the inquiry was proceeding on a stage different than it ought to take, the petitioner has approached this Court. 5. Mr. Devang Vyas, learned ASG assisted by Mr. K.M. Antani and Ms. Garima Malhotra, learned advocates for the respondent Competition Commission of India made the following submissions: * Mr. Devang Vyas would submit that it is worthy to note the conduct of the Petitioner for having acquiesced to and actively participated in the proceedings before CCI and the DG for 6 (six) years. * Mr. Devang Vyas would submit that It is submitted that the first Order under Section 26(1) of the Act in Case no. 30 of 2014 wherein CCI formed a prima facie case for directing investigation into the allegations against the Paper Mills including the Petitioner herein for contraventions of the provisions of the Act more particularly Section 3(1) read with Section 3(3)(a) of the Act in the paper industry, was passed way back in August 2014. The Petitioner became well aware of this Order and was also issued the 1st notice by the DG in this regard on 28.05.2015. He further submit that the second order under Section 26(1) of the Act came to be passed by CCI on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt further held that formation of the prima facie opinion under Section 26(1) of the Act is a direction simpliciter and it is administrative in nature, and a direction is like a departmental proceeding, which does not entail civil consequences. It is further submitted by Mr. Vyas that two (2) separate Information Petitions under Section 19(1)(1) of the Act were filed before the CCI alleging collusive practices of Paper mills in the Paper Industry to simultaneously increase prices in different varieties of paper. These allegations of cartel in the first information (Case No.30 of 2014) were supported by material in the form of circulars and email. He further submitted that the Commission was of the opinion that there exists a prima facie case warranting an investigation for the contravention of provisions of Section 3(1) read with Section 3(3)(a) of the Act. Since, the 2nd information (Case No.85 of 2015) contained similar allegations of Cartel against the Paper mills in the Paper industry, CCI, issued the second order dated 17.11.2015 under Section 26(1) of the Act and tagged the same with Case no. 30 of 2014. Upon receipt of the direction from the Commission, the DG issued variou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uiry now to be initiated before the CCI and hence by way of the instant petition, the petitioner wants to avoid the inquiry which is being carried out in accordance with the provisions of the Act. * Mr. Devang Vyas would submit that impugned orders under Section 26(1) of the Act merely directs an investigation, and this investigation conducted by the DG is quasi-inquisitorial in nature and hence in any event does not affect the rights or liabilities of the petitioners. [Competition Commission of India v. Grasim Industries, Para 27.3, 32.4 and 41 thereof] . The purpose of the investigation is to examine the veracity of the allegations of Cartel against the Petitioner and determine anti-competitive effects of the petitioner s actions, if any. If the petitioner s conduct is not anti-competitive the same can be agitated before CCI as the petitioner has been provided with the opportunity to file its objections / suggestions to the DG s report and there is no reason for the petitioner to resist the proceedings which are now to be undertaken before the CCI and no prejudice would be caused to the petitioner by participating in the proceedings before the CCI. It is submitted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to increase the prices of the paper simultaneously in different varieties of paper in contravention of the provisions of Section 3 of the act. The Opposite Parties are the paper mills/paper manufacturing companies operating at different parts of the country. Case registered as Case no. 30 of 2014. 01.08.2014 CCI passed an order under Section 26(1) of the Act in Case 30 of 2014, directing an investigation to be carried by the DG into the information after forming of a prima facie opinion that the Opposite Parties including the Petitioner herein (arraigned as Opposite Party no.6) have colluded for increase of prices in different varieties of paper and thereby warranting investigation for anti-competitive practices under the provisions of Section 3(1) read with Section 3(3)(a) of the Act and hence CCI directed the DG to carry out investigation into any contravention of the provisions of the Act in the paper industry. Year 2015 One more information filed under Section 19(1)(a) of the Act by M/s All India Federation of Master Printers alleging collusive practices by forming a cartel on part of the Paper Mills f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Opposite Parties to Case No. 30 of 2014 and Case No. 85 of 2015 were deposed and email dumps also received from the Opposite Parties to the Cases. 14.11.2017 12.12.2017 Officers of the Petitioner Company Mr. Saikat Basu (Chief General Manager Sales-Paper) and Mr. Santosh Wankhoo (Vice President Marketing and Sale) were deposed on Oath before DG on 14.11.2017 and 12.12.2017 respectively [ Refer Sr. 13 and 14 @Pg 129] . 07.02.2019 Director General-CCI, filed the Investigative report in Case No.30 of 2014 and Case No.85 of 2015. 02.05.2019 CCI, in accordance with the procedure provided under the Competition Act, 2002 ( the Act ) under Section 26 (8) read with Regulation 21(7) of General, Regulations 2009, forwarded the copy of the Director General s report to the parties arraigned as Opposite Parties in the in case 30 of 2014 and Case no. 85 of 2015 and gave the Opposite Parties including the Petitioner, an opportunity to file their respective objections / suggestions, if any to the DG s report along with synopsis by 30.06.2019 and the date of oral hearing before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on provided by the Information Petitioners. Reading Section 26 of the Act indicates that on a receipt of a Reference from the Central Government or a State Government or an information received u/S. 19, if the Commission is of the opinion that their exists a prima facie case it shall direct investigation to be made in the matter. 8. The impugned orders dated 1.8.2014 and 17.11.2015 only recorded a prima facie opinion that the parties have colluded and formed a cartel for increase of prices in different varieties of paper and thereby warranting investigation for anti-competitive practices under the provisions of Section 3(1) read with Section 3(3)(a) of the Act in the paper industry. What is evident therefore that the information filed was neither restricted to a particular set of manufacturers but was in context of the entire paper industry connected with different varieties of paper. The relevant provisions of the Act namely; Sections 2(b,c,r and t) and Section 19 are reproduced hereunder: Section 2(b) - agreement includes any arrangement or understanding or action in concert, Whether or not, such arrangement, understanding or action is formal or in w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of its order to the Central Government or the State Government or the statutory authority or the parties concerned, as the case may be. (3) The Director General shall, on receipt of direction under Sub-Section (1), submit a report on his findings within such period as may be specified by the Commission. (4) The Commission may forward a copy of the report referred to in sub section (3) to the parties concerned: Provided that in case the investigation is caused to be made based on reference received from the Central Government or the State Government or the statutory authority, the Commission shall forward a copy of the report referred to in subsection (3) to the Central Government or the State Government or the statutory authority, as the case may be. (5) If the report of the Director General referred to in sub-section (3) recommends that there is no contravention of the provisions of this Act, the Commission shall invite objections or suggestions from the Central Government or the State Government or the statutory authority or the parties concerned, as the case may be, on such report of the Director General. (6) If, after consideration of the objection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... details. (4) 30.6.2015 / 20.7.2015 and 3.12.2015, pursuant to the request of the CCI the petitioner submitted brief on trade discount, additional discount, month wise domestic sales, annual reports for 2014-15. (5) 28.12.2015, 7.4.2016, 26.4.2016, 18.8.2017, 21.8.2017, 4.9.2017 pursuant to notices and questionnaire seeking certain details, ledger accounts, pan details, copies of bills and invoices etc. were submitted. (6) 25.1.2018, 5.2.2018, 28.2.2018, 9.3.2018, 16.3.2018 on notices for clarification on types of paper manufactured, the petitioner submitted details including on the copier variety. It also submitted certificate in terms of Section 65(B) of the Indian Evidence Act and cost audit reports of 2009 to 2014. 11. What is therefore apparent from these events is that the petitioner actively participated with the investigation. Only after rejection of an application for cross examination, by the impugned order dated 4.7.2019 did the petitioner approached this Court to challenge the Investigation Report in addition to the orders passed u/S.26(1) of the Act on the ground that copier paper was never a part of the inquiry. 12. What is evident from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statutory body exercising, inter alia, regulatory jurisdiction, even at that stage, in its discretion and in appropriate cases may call upon the concerned party(s) to render required assistance or produce requisite information, as per its directive. The Commission is expected to form such prima facie view without entering upon any adjudicatory or determinative process. The Commission is entitled to form its opinion without any assistance from any quarter or even with assistance of experts or others. The Commission has the power in terms of Regulation 17 (2) of the Regulations to invite not only the information provider but even `such other person' which would include all persons, even the affected parties, as it may deem necessary. In that event it shall be `preliminary conference', for whose conduct of business the Commission is entitled to evolve its own procedure. 3) The Commission, in cases where the inquiry has been initiated by the Commission suo moto, shall be a necessary party and in all other cases the Commission shall be a proper party in the proceedings before the Competition Tribunal. The presence of the Commission before the Tribunal would help in complet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the face of it, is an administrative direction to one of its own wings departmentally and is without entering upon any adjudicatory process. It does not effectively determine any right or obligation of the parties to the lis. Closure of the case causes determination of rights and affects a party, i.e. the informant; resultantly, the said party has a right to appeal against such closure of case under Section 26(2) of the Act. On the other hand, mere direction for investigation to one of the wings of the Commission is akin to a departmental proceeding which does not entail civil consequences for any person, particularly, in light of the strict confidentiality that is expected to be maintained by the Commission in terms of Section 57 of the Act and Regulation 35 of the Regulations. 87. Now, let us examine what kind of function the Commission is called upon to discharge while forming an opinion under Section 26(1) of the Act. At the face of it, this is an inquisitorial and regulatory power. A Constitution Bench of this Court in the case of Krishna Swami vs. Union of India [(1992) 4 SCC 605] explained the expression `inquisitorial'. The Court held that the investigating power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation furnished, reading the said decision would indicate that once a prima facie opinion is found by the Commission, no interference can be made by this Court. 14. Even otherwise, what has been held by the Supreme Court is that exercise of powers by the CCI u/S.26(1) of the Act are not adjudicatory in nature and the formation of prima facie opinion is only an administrative process which does not entail civil consequences. 15. Reading the facts on hand would indicate that on the basis of two separate informations provided under Section 19 of the Act where it was alleged that the opposite parties were engaging in collusive practices in the paper industry by jointly engaging in increasing of prices in different varieties of paper, the Commission found a prima facie opinion warranting an investigation forming a prima facie opinion that an investigation for contravention of provisions of Section 3(1) read with Section 3(3)(a) of the Act existed. 16. Reading the investigation reports and the orders passed under Sections 26(1) read with Section 26(3) of the Act would indicate that the order is an administrative order which only forms a prima facie opinion. The petitioner has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articipated. For the tender floated in 2009, the three Appellants had quoted identical rates. On that basis, the DG formed an opinion that the Appellants had contravened Section 3(3) (a) (b) and (d) read with Section 3 (1) of the Act. 29.3 The Appellant there inter alia contended that since Sections 3 and 4 of the Act were brought into force only with effect from 20 th May, 2009, the tenders prior to that date, could not be the subject matter of enquiry for ascertaining if there was a violation of Section 3 of the Act. Even the March, 2009 tender could not form the subject matter of such enquiry. As far as the tender of 2011 was concerned, since FCI in its complaint dated 4th February, 2011 did not mention it, an enquiry into that aspect by the DG was without jurisdiction. 29.4 One of the issues that arose in the appeal was whether CCI was barred from investigating the matter pertaining to the tender floated by FCI in March, 2011, which obviously did not form part of the complaint of FCI made on 4th February, 2011. It was observed in paragraphs 44 and 45 as under: 44. The CCI had entrusted the task to DG after it received representation/complaint from the FCI vid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contain his findings on each of the allegations made in the information or reference, as the case may be, together with all evidences or documents or statements or analyses collected during the investigation: (proviso not necessary) From this, the learned Counsel argued that the Director General could have seen into the tender floated on 08.05.2009 only, and no other tender as the information did not contain any allegation about the tender floated in 2011. Therefore, the investigation made into the tender floated in 2011 was outside the jurisdiction of the Director General. This argument was more particularly pressed into service, as the Director General as well as the Competition Commission of India have found that all the Appellants had entered into an agreement to boycott the tender floated in 2011 and thereby had rigged the bids. 29. We have absolutely no quarrel with the proposition that the Director General must investigate according to the directions given by the CCI Under Section 26(1). There is also no quarrel with the proposition that the Director General shall record his findings on each of the allegations made 29 in the information. However, it does not mean that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adopted by the persons complained against. For this purpose, no doubt, the starting point of inquiry would be the allegations contained in the complaint. However, while carrying out this investigation, if other facts also get revealed and are brought to light, revealing that the 'persons' or 'enterprises' had entered into an agreement that is prohibited by Section 3 which had appreciable adverse effect on the competition, the DG would be well within his powers to include those as well in his report. Even when the CCI forms prima facie opinion on receipt of a complaint which is recorded in the order passed Under Section 26(1) of the Act and directs the DG to conduct the investigation, at the said initial stage, it cannot foresee and predict whether any violation of the Act would be found upon investigation and what would be the nature of the violation revealed through investigation. If the investigation process is to be restricted in the manner projected by the Appellants, it would defeat the very purpose of the Act which is to prevent practices having appreciable adverse effect on the competition. We, therefore, reject this argument of the Appellants as well touchin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d against Cadila on the strength of a general order passed by the CCI on 17th November, 2015 where it stated as under: in the course of investigation, if involvement of any other party is found, the DG shall investigate the conduct of such other parties who may have indulged in such contravention . 32.3 After the DG‟s report was submitted to the CCI, a copy thereof was provided to Cadila, which objected to the report. It also relied upon the decision of this Court in Google Inc. v. Competition Commission of India (Supra). However, the CCI rejected these objections. After its appeal against the said order was dismissed by the COMPAT, Cadila filed a writ petition before the learned Single Judge. The said writ petition was dismissed by the learned Single Judge by an order dated 9th March, 2018 and against the said dismissal, Cadila approached the Division Bench. 32.4 In dismissing Cadila‟s appeal, the DB of this Court, after analysing the decision in Competition Commission of India v. Steel Authority of India Limited (supra) and Excel Crop Care Limited v. Competitive Commission of India (supra), held as under: 43. Cadila's argument, that in Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, with Excel Crop Care specifically dealing with the question of alleged subject matter expansion (in the absence of any specific order under Section 26 (1)) and the Supreme Court clarifying that the subject matter included not only the one alleged, but other allied and unremunerated ones, involving others (i.e. third parties), the issue is no longer untouched; Cadila, in the opinion of this court, is precluded from stating that a specific order authorizing transactions by it, was a necessary condition for DG's inquiry into its conduct. This court is further reinforced in its conclusion in this regard by the express terms of the statute: Section 26 (1) talks of action by CCI directing the DG to inquire into the matter . At this stage, there is no individual; the scope of inquiry is the tendency of market behaviour, of the kind frowned upon in Sections 3 and 4. The stage at which it CCI can call upon parties to react is when it receives a report from DG stating there is no material calling for action, it has to issue notice to the concerned parties (i.e. the complainant) before it proceeds to close the case (Sections 26 (5) and (6)). On the other hand, if the DG's repor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt case, however, the language of the order passed by the CCI on 26 th February, 2011, is broad enough to cover an investigation by the DG into what appeared to be prima facie violation of Section 4 of the Act by GIL. The Court had considered the decisions of Barium Chemicals Limited (Supra) and Rohtas Industries Limited (Supra). In the words of the Delhi High Court an order of the CCI under Section 26(1) of the Act only triggers the investigation. 18. The High Court in its writ jurisdiction cannot delve into the merits and demerits of the report when as is also evident from the impugned order by which the request of the petitioner for cross examination of witnesses has been rejected that the CCI has granted liberty to the petitioner to file affidavits in rebuttal to dispute the conclusions drawn by the DG based on the depositions etc. 19. In the decisions in the case of Flipcart Internet Pvt. Ltd. v. CCI and Amazon Seller Services v. CCI, the Karnataka High Court through the Division Bench Writ Appeal 562 of 2022 dated 23.7.2021, paragraph Nos.17, 19 to 24, 27, 28, 40, 45 and 47 held as under: 17. In the considered opinion of this Court, the CCI certainly have a j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C 744] Further, it is clear from the Statement of Objects and Reasons that this law was foreseen as a tool against concentration of unjust monopolistic powers at the hands of private individuals which might be detrimental for freedom of trade. Competition law in India aims to achieve highest sustainable levels of economic growth, entrepreneurship, employment, higher standards of living for citizens, protect economic rights for just, equitable, inclusive and sustainable economic and social development, promote economic democracy, and support good governance by restricting rent seeking practices. Therefore, an interpretation should be provided which is in consonance with the aforesaid objectives. 21. In the light of the aforesaid, in order to achieve the object of the Act of 2002, the question of interference does not arise. The appellants do have a right to participate in the proceedings and/or under an obligation to produce all the material as desired during the enquiry by the Director General. The appellants want to crush the proceedings at a preliminary stage in a similar manner like quashing of FIR as prayed in a petition filed under Section 482 of the Cr.PC. Earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is found to be wholly without jurisdiction or for some other reason if it is wholly illegal. However, ordinarily the High Court should not interfere in such a matter. 22. The Hon'ble Supreme Court in the aforesaid case has held that unless and until the show cause notice is vague or has been issued by an authority not competent to do so, interference can be done in the matter. In the present case, the order passed by the CCI directing an enquiry is the first stage of initiating process under the CCI Act and the enquiry is yet to commence. The appellants do not want to participate in the enquiry for the reasons best known to them. 23. The present case is not a case where the mala fides are alleged against the Regulator, nor there is any jurisdictional infirmity. The order passed under Section 26(1) is neither an adjudication, nor determinative, but merely an inquisitorial, departmental proceedings in the nature of a direction to the Director General to make an investigation. It is neither a judicial nor a quasi judicial proceedings as held by the Hon'ble Supreme Court in the case of CCI v. SAIL. Paragraphs 31, 38, 87 and 91 of the judgment reads as under; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would help in complete adjudication and effective and expeditious disposal of matters. Being an expert body, its views would be of appropriate assistance to the Tribunal. Thus, the Commission in the proceedings before the Tribunal would be a necessary or a proper party, as the case may be. (4) During an inquiry and where the Commission is satisfied that the act is in contravention of the provisions stated in Section 33 of the Act, it may issue an order temporarily restraining the party from carrying on such act, until the conclusion of such inquiry or until further orders without giving notice to such party, where it deems it necessary. This power has to be exercised by the Commission sparingly and under compelling and exceptional circumstances. The Commission, while recording a reasoned order inter alia should: (a) record its satisfaction [which has to be of much higher degree than formation of a prima facie view under Section 26(1) of the Act] in clear terms that an act in contravention of the stated provisions has been committed and continues to be committed or is about to be committed; (b) it is necessary to issue order of restraint; and (c) from the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the investigating power granted to the administrative agencies normally is inquisitorial in nature. The scope of such investigation has to be examined with reference to the statutory powers. In that case the Court found that the proceedings, before the High-Power Judicial Committee constituted, were neither civil nor criminal but sui generis. 91. The jurisdiction of the Commission, to act under this provision, does not contemplate any adjudicatory function. The Commission is not expected to give notice to the parties i.e. the informant or the affected parties and hear them at length, before forming its opinion. The function is of a very preliminary nature and in fact, in common parlance, it is a departmental function. At that stage, it does not condemn any person and therefore, application of audi alteram partem is not called for. Formation of a prima facie opinion departmentally (the Director General, being appointed by the Central Government to assist the Commission, is one of the wings of the Commission itself) does not amount to an adjudicatory function but is merely of administrative nature. At best, it can direct the investigation to be conducted and report to be submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into, hence, the present petitions/appeals are premature. 45. It is also contended by the learned Senior counsel appearing for the appellants that the harm is going to be caused to the business reputation of the appellants and before passing an order under Section 26(1) of the Act of 2002, the appellants should have been invited for a discussion. 47. In the light of the aforesaid, in the considered opinion of this Court, by no stretch of imagination, the process of enquiry can be crushed at this stage. In case, the appellants are not at all involved in violation of any statutory provisions of Act of 2002, they should not feel shy in facing an enquiry. On the contrary, they should welcome such an enquiry by the CCI. The writ petitions filed against the order dated 13.1.2021 and the present writ appeals are nothing but an attempt to ensure that the action initiated by the CCI under the Act of 2002 does not attain finality and the same is impermissible in law as the Act of 2002 itself provides the entire mechanism of holding an enquiry, granting an opportunity of hearing, passing of a final order as well as appeal against the order passed by the CCI. In the considered opin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e them in grave cases where the subordinate tribunals or bodies or officers act wholly without jurisdiction, or in excess of it, or in violation of the principles of natural justice, or refuse to exercise a jurisdiction vested in them, or there is error apparent on the face of the record, and such act, omission, error, or excess has resulted in manifest injustice. However extensive the jurisdiction may be, it is not so wide or large AIR 1952 SC 192 W.P No.3363/2020 C/W W.P No.4334/2020 as to enable the High Court to convert itself into a Court of appeal and examine for itself the correctness of the decision impugned and decide what is the proper view to be taken or the order to be made. 60. In T.C. Basappa Vs. T. Nagappa and Another25, it is held that a tribunal may be competent to enter upon an enquiry but in making the enquiry it may act in flagrant disregard of the rules of procedure or where no particular procedure is prescribed, it may violate the principles of natural justice. A writ of certiorari may be available in such cases. An error in the decision or determination itself may also be amenable to a writ of certiorari but it must be a manifest error apparent on the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aptly apply to these cases. ... But I cannot accept that it is constitutionally appropriate, save in very exceptional circumstances, for the courts to intervene on the ground of unreasonableness to quash guidance framed by the Secretary of State and by necessary implication approved by the House of Commons, the guidance being concerned with the limits of public expenditure by local authorities and the incidence of the tax burden as between taxpayers and ratepayers. Unless and until a statute provides otherwise, or it is established that the Secretary of State has abused his power, these are matters of political judgment for him and for the House of Commons. They are not for the judges or your Lordships' House in its judicial capacity. For myself, I refuse in this case to examine the detail of the guidance or its consequences. My reasons are these. Such an examination by a court would be justified only if a prima facie case were to be shown for holding that the Secretary of State had acted in bad faith, or for an improper motive, or that the consequences of his guidance were so absurd that he must have taken leave of his senses . (Emphasis supplied) W.P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the case of Samir Agrawal v. Competition Commission of India reported in 2021(3) SCC, 136, Hon ble Supreme Court in paragraph Nos.14 to 15, 17, 19, 20 and 23 held as under: 14. A reading of the provisions of the Act and the 2009 Regulations would show that any person may provide information to the CCI, which may then act upon it in accordance with the provisions of the Act. In this regard, the definition of person in Section 2(l) of the Act, set out hereinabove, is an inclusive one and is extremely wide, including individuals of all kinds and every artificial juridical person. This may be contrasted with the definition of consumer in Section 2(f) of the Act, which makes it clear that only persons who buy goods for consideration, or hire or avail of services for a consideration, are recognised as consumers. 15. A look at Section 19(1) of the Act would show that the Act originally provided for the receipt of a complaint from any person, consumer or their association, or trade association. This expression was then substituted with the expression receipt of any information in such manner and by the 2007 Amendment. This substitution is not without significance. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y person aggrieved by an order of the disciplinary committee of a State Bar Council. It was held that since the Advocate General could not be said to be a person aggrieved by an order made by the disciplinary committee of the State Bar Council against a particular advocate, he would have no locus standi to appeal to the Bar Council of India. In so saying, the Court held: 11. From these cases it is apparent that any person who feels disappointed with the result of the case is not a person aggrieved . He must be disappointed of a benefit which he would have received if the order had gone the other way. The order must cause him a legal grievance by wrongfully depriving him of something. It is no doubt a legal grievance and not a grievance about material matters but his legal grievance must be a tendency to injure him. That the order is wrong or that it acquits some one who he thinks ought to be convicted does not by itself give rise to a legal grievance . (page 491) 20. It must immediately be pointed out that this provision of the Advocates Act, 1961 is in the context of a particular advocate being penalized for professional or other misconduct, which concerned itself with a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p Care Limited v. CCI reported in 2017(8) SCC, 47, paragraph Nos.44 and 45 read as under: 44) The CCI had entrusted the task to DG after it received representation/complaint from the FCI vide its communication dated February 04, 2011. Argument of the appellants is that since this communication did not mention about the 2011 tender of the FCI, which was in fact even floated after the aforesaid communication, there could not be any investigation in respect of this tender. It is more so when there was no specific direction in the CCI s order dated February 24, 2011 passed under Section 26(1) of the Act and, therefore, the 2011 tender could not be the subject matter of inquiry when it was not referred to in the communication of the FCI or order of the CCI. The COMPAT has rejected this contention holding that Section 26(1) is wide enough to cover the investigation by the DG, with the following discussion: 28. As per the sub-section (1) of Section 26, there can be no doubt that the DG has the power to investigate only on the basis of the order passed by the Commission under Section 26(1). Our attention was also invited to sub-section (3) of Section 26 under which the Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrel with the proposition that the Director General shall record his findings on each of the allegations made 29 in the information. However, it does not mean that if the information is made by the FCI on the basis of tender notice dated 08.05.2009, the investigation shall be limited only to that tender. Everything would depend upon the language of the order passed by the CCI on the basis of information and the directions issued therein. If the language of the order of Section 26(1) is considered, it is broad enough. At this juncture, we must refer to the letter written by Chairman and Managing Director of FCI, providing information to the CCI. The language of the letter is clear enough to show that the complaint was not in respect of a particular event or a particular tender. It was generally complained that appellants had engaged themselves in carteling. The learned counsel Shri Virmani as well as Shri Balaji Subramanian are undoubtedly correct in putting forth the argument that this information did not pertain to a particular tender, but it was generally complained that the appellants had engaged in the anticompetitive behaviour. When we consider the language of the order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... practices having appreciable adverse effect on the competition. We, therefore, reject this argument of the appellants as well touching upon the jurisdiction of the DG. 24. Both the learned advocates for the respective parties had extensively relied on a decision in the case of CCI v. Coordination Committee of Artist (Supra). Mr. Thakore had relied on this decision in the context of Relevant Market to submit that the first and the foremost aspect that needs determination is what is the relevant market in which the competition is affected. This was argued with regard to the degree of interchangeability between all the products. It was his case that there cannot be interchangeability between copier paper and printing and writing paper. Section 3 of the Act was therefore necessarily to be kept in mind and delineation was mandatory. 25. In a clarificatory order passed by the Hon ble Supreme Court on 07.05.2018 in Misc. Application No.490 of 2017 in Civil Appeal No.6691 of 2014, the Supreme Court held as under: This application is preferred by the Competition Commission of India seeking certain clarifications with regard to the judgment dated 07.03.2017 rendered in this a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttee has been formulated and answered. As mentioned above, the submission of the applicant is that though paragraph 8 of the judgment rightly records that anti-competition agreements listed under Section 3(3) are per se treated as adversely affecting the competition to an appreciable extent, the aforesaid reading of the issue in respect of 'relevant market' may give an impression that there is also a necessity to delineate relevant market in all such cases. We clarify that such delineation is not mandatory in terms of the statutory scheme of the Act, particularly having regard to the statutory presumption contained in Section 3 of the Act itself. We, therefore, clarify the observations made in paragraphs 13, 30 and 32 of the judgment dated 07.03.2017, to the limited extent that the determination of 'relevant market' is not a mandatory pre-condition for making assessment of the alleged violation under Section 3 of the Act. The application stands disposed of with the aforesaid clarification. 26. Reading of the clarificatory order indicates that the Supreme Court held that the determination of Relevant Market is not a mandatory pre-condition for mak ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
