https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=772488 https://www.taxtmi.com/caselaws?id=772488 Interpretation and application of Section 29 of the Competition Act, 2002 - issuance of a show cause notice (SCN) u/s 29(1) mandates a mandatory investigation into the combination by the Competition Commission of India (CCI) - nature of the discretion vested in the CCI under Section 29(1A) regarding whether to entrust the investigation to the Director-General (DG) - HELD THAT:- Section 29 of the Act has not differentiated the scrutiny of combination under the Competition Act in a two-phase mechanism. The expression used in Sections 29(1) and 29(1A) of the Competition Act needs to be appreciated. In Section 29(1), the word "shall" is used, and in Section 29(1A), the word "may" is used. The literal construction of the particular expressions or words gives sufficient discretion to the Commission, i.e., after receiving the response to the SCN issued under Section 29(1) of the Act. The majority Judgment lays emphasis on literal interpretation of a provision of law as the first option for ascertaining the scope and meaning of a provision. The word "may" in Section 29(1A) has been interpreted as "shall", warranting unintended steps in exercising the discretion of CCI. Therefore, the view taken in paragraphs 128 to 131 is contrary to the plain construction of Sections 29(1) and 29(1A) of the Competition Act. It is fairly well established and axiomatic where the legislation uses two words may and shall in two different fronts of the same provision prima facie it would appear that the legislature manifested its intention to make one part directory and another mandatory. The court finds out from the language of the provision whether both directory and mandatory are intended by the legislature. The nature of apparent legal infirmity in construing Section 29(1A) is taken note of, and by applying the test whether it is absolutely necessary, and essential that the interpretation already applied should be reopened, we notice that the jurisdiction and discretion of Competition Commission is curtailed contrary to the explicit language of Section 29 (1) and 29(1A) of the Act - The Competition Commission, being an Expert Body, decides on the course of action to be followed by the Commission after receiving a response to the SCN that it is not always necessary to escalate the verification to the DG for investigation under Section 29(1A) of the Act. This Court is of the view that the grounds under review, do not fall within the purview of an error apparent on the face of the record, but re-agitate to take a different view in law, on the construction of the proviso to Section 31(4) of the Insolvency and Bankruptcy Code, 2016 (IBC, 2016'). Such an exercise does not fall strictly within the ambit of review. Conclusion - The review petition challenging the majority judgment's interpretation of Section 29(1) and 29(1A) is allowed, with the Court clarifying the mandatory and discretionary aspects of these provisions. Therefore, the Review Petition is without merit and is, accordingly, dismissed. Case-Laws Law of Competition Fri, 16 May 2025 00:00:00 +0530