Prima facie investigation under competition law upheld where the Commission relied on relevant material and recorded reasons.

A Section 26(1) direction to investigate under the Competition Act is a preliminary administrative step based on a prima facie view, not a final adjudication. The Commission may act on information, tender data, procuring-agency responses, and allegations such as bid rigging if the order shows relevant material and some reasoning. At that stage, the writ court will not reappreciate disputed commercial or statistical facts, substitute a merits-based assessment, or interfere merely because alternative inferences are possible. Allegations of arbitrariness, non-application of mind, discrimination, or procedural illegality must be supported by demonstrated prejudice or statutory breach. The challenge to the investigation order was therefore not made out, and the order was sustained.

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Issues: Whether the order under Section 26(1) of the Competition Act, 2002 directing investigation was liable to be quashed for want of a prima facie case, non-application of mind, arbitrariness, discrimination, or procedural illegality, and whether the writ petitions were premature.

Analysis: The statutory scheme under Sections 19 and 26 permits the Commission to act on information and, if it forms a prima facie opinion that a contravention may exist, to direct investigation. At the Section 26(1) stage the function is only preliminary and administrative in nature, and the Court reiterated that the Commission is not required to conduct a full adjudication or determine rights conclusively at that point. The impugned order was examined to see whether it disclosed some reasoning and whether relevant material had been considered. The Court found that the Commission had referred to the information, the tender data, the response of the procuring agency, and the allegation of bid rigging based on item-wise pricing, and had recorded a prima facie view that investigation was warranted. The petitioners' challenge essentially invited a merits review of competing factual inferences from commercial and statistical material, which is not appropriate at the investigative stage. The Court also held that the existence of disputed facts, the availability of remedies during investigation and after the DG report, and the absence of any final determination militated against interference under Article 226. The plea of discrimination in calling only one opposite party for preliminary conference did not persuade the Court to hold the order illegal in the absence of demonstrated prejudice or statutory breach.

Conclusion: The challenge to the investigation order was not made out, and the order directing inquiry was sustained.

Final Conclusion: The petitions failed because the Commission's decision to trigger investigation on a prima facie view was treated as a valid administrative step within the statutory framework, leaving the parties to raise their substantive defences in the inquiry proceedings.

Ratio Decidendi: A Section 26(1) direction is sustainable if it reflects a prima facie opinion based on relevant material and some reasoning, and a writ court will not reappreciate contested facts or substitute its own merits-based assessment at the investigation stage.

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