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2016 (5) TMI 882
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.... c. that though the notice aforesaid sought detailed information and documents from the petitioner but the petitioner was not provided with any documents/evidence which formed the basis of investigation; d. that the petitioner on 4th June, 2015 requested for inspection of records with the respondent no.1 CCI in order to understand the context in which notice aforesaid was issued; e. that on 18th June, 2015 DG issued another notice to the petitioner to show cause why its acts and conduct should not be treated to be in contravention of Section 3 of the Competition Act; f. that though the DG supplied a copy of the unreasoned order of the CCI under Section 26(1) of the Act but neither the CCI nor the DG explained which particular conduct of the petitioner had contravened the provisions of the Competition Act; no other documents/evidence on the basis of which impugned inquiry had been initiated and notices issued were also disclosed. g. that the application of the petitioner seeking information was rejected by the CCI on 23rd June, 2015 stating that the matter was ‗confidential'. h. that further attempts of the petitioner to gather information also did not meet w....
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....r dated 2nd December, 2015 and sought disposal of this petition in the same manner. 4. The counsel for the respondents appearing on advance notice does not controvert and states that the petition be disposed of in the same manner as order dated 2nd December, 2015 supra save that it be clarified that the petitioner shall be entitled to only those documents which are relevant to and pertain to the petitioner and that the petitioner will have an opportunity to cross examine only those witnesses whose oral statement pertains to the petitioner. 5. The counsel for the petitioner is agreeable. 6. At this stage, on request of the counsels, list on 11th December, 2015." 3. In Forech India Ltd supra, the following orders were passed on 30th November, 2015- "1. The petition impugns the order dated 6th November, 2013 of the respondent No.1 Competition Commission of India (CCI) under Section 26(1) of the Competition Act, 2002 as well as denial by the respondent No.2 Director General (DG), CCI of information in the form of inspection of documents and evidence against the petitioner sought by the petitioner from the DG, CCI. 2. On enquiry from the senior counsel for the petition....
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....e counsel for the respondents states that there is no right of cross-examination and it is in the discretion of the DG, CCI, whether to give an opportunity to cross-examine the witnesses or not. 9. It has however been enquired from the counsel for the respondents, as to how a person being investigated against would know, whether to apply for cross-examination or not, unless the evidences, if any, recorded against such person are made available / known to him. 10. The counsel for the respondents states that even if the right of cross-examination is not given by the DG, CCI, the same can be sought before the CCI, after the DG, CCI has submitted the report. 11. The senior counsel for the petitioner in this regard has drawn attention to Regulation 43 which bars a party from producing any additional evidence before the CCI and which was not produced before the DG, CCI. 12. At this stage, the counsel for the respondents states that he has received instructions that as of now, the time for submitting the report is till 30th December, 2015 and before the report is submitted, all materials available will be furnished to the petitioner and if the petitioner desires to cross-exami....
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.... 6. In this view of the matter, the petition is disposed of keeping all contentions of both the parties open and giving liberty to the parties to apply if any difficulty arise." 4. When this petition was listed next on 11th December, 2015, the following order was passed: "1. This order is in continuation of the previous order dated 9th December, 2015. 2. The counsel for the respondents states that the respondents are willing to provide copies of the documents to be used against the petitioner to the petitioner and to allow the petitioner the right to cross examine the witnesses whose evidence is intended to be used against the petitioner but object to the additional relief claimed in the petition of allowing the summoned officials of the petitioner to be accompanied by advocates. It is contended that the advocates would be permitted to cross examine the witnesses whose evidence is intended to be used against the petitioner but would not be allowed to accompany the officials of the petitioner whose statement is to be recorded by the Director General (DG), Competition Commission of India (CCI). 2. Attention of the counsel for the respondents has been drawn to Section ....
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....f their statement before the DG, reliance is placed on the Google Inc. vs. Competition Commission of India MANU/DE/1271/2015 where a Division Bench of this Court held that the investigation by DG tantamounts to commencement of trial/inquiry on the basis of an ex party prima facie opinion and it is contended that the Competition Appellate Tribunal also in its order dated 11th December, 2015 in Appeal No.105/2012 titled Lafarge India Limited Vs. Competition Commission of India and other connected appeals has held that the procedure required to be followed by the DG as a prelude to the passing of an order under Section 27 of the Act is akin to the provisions to be followed by a Civil Court in deciding a civil suit except that the DG is not bound by the technicalities of the procedure contained in the Code of Civil Procedure. 7. The respondents CCI/DG in their written submissions handed over on 28th January, 2016 have contended - a. The Competition Act belongs to the family of legislation which deals with economic offences such as Foreign Exchange Regulation Act, 1973 (FERA), Customs Act 1962 and Foreign Exchange Management Act, 1999 (FEMA). b. Section 40 of the FERA gives pow....
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.... 8. I have considered the rival contentions on the aspect of officials of the petitioner if summoned by DG to be accompanied by advocates. 9. I have, speaking for the Division Bench of this Court, in Google Inc. supra, with respect to the proceedings before the DG held as under- "18. We, for the following reasons conclude that order of the CCI/direction to the DG, CCI in exercise of power under Section 26(1) of the Act, to cause investigation, is capable of review/recall: .............. (C) The DG, during the course of such investigation, by virtue of Section 41(2) read with Section 36(2) of the Act has the same powers as are vested in a Civil Court under the Code of Civil Procedure, 1908, while trying a suit in respect of, (i) summoning and enforcing the attendance of any person and examining him on oath, (ii) requiring the discovery and production of documents, (iii) receiving evidence on affidavit, (iv) issuing commissions for the examination of witnesses and documents, and (v) requisitioning public records or documents from any public office. The DG is further empowered by Section 41(3) read with Sections 240 and 240A of the Companies Act, 1956 to keep in its cus....
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....y limited and from investigation/inquiry pursuant to an FIR by the Police which in some cases has been held to be not causing any prejudice and thus furnishing no cause of action for a challenge thereto. (H) Before registration of an FIR the concerned Police Officer is not to embark upon an inquiry and is statutorily obliged (under Section 154(1) of the Cr.P.C.) to register a case and then, if has reason to suspect (within the meaning of Section 157(1) Cr.P.C.) to proceed with the investigation against such person. Per contra, as noticed above, investigation by the DG under the Competition Act commences not merely on the receipt of reference/information but only after CCI has formed a prima facie opinion of violation of the provisions of the Act having been committed. (M) Just like an investigation by the Police has been held in Bhajan Lal (supra) [1992 Supp (1) SCC 335] to be affecting the rights of the person being investigated against and not immune from interference, similarly an investigation by the DG, CCI, if falling in any of the aforesaid categories, cannot be permitted and it is no answer that no prejudice would be caused to the person/enterprise being investigated ....
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....extends,- (i) in all courts including the Supreme Court; (ii) before any tribunal or person legally authorised to take evidence; and (iii) before any other authority or person before whom such advocate is by or under any law for the time being in force entitled to practise." which though earlier had not been notified and was thus not in operation, had been notified on 19th June, 2011. 11. It was inter alia held - "17. Having given our thoughtful consideration to the matter, we, with respect are unable to concur with the view taken by the High Courts of Calcutta and Bombay and for the reasons hereafter appearing hold that a proposed wilful defaulter, in the hearing before the GRC, would have a right of representation though an advocate. ............ (Q) That takes us to Section 30 of the Advocates Act supra conferring in the advocates a right to practice. Chief Justice of India Justice T.S. Thakur speaking for the High Court of Karnataka in M/s. Kothari Industrial Corporation Limited v. The Coffee Board MANU/KA/0414/1999 held that the right of an advocate to practice before any Court or Tribunal, contained in Section 30 of the Advocates Act,....
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....the DG for investigation. 13. As far as the judgments cited by the counsel for the respondent are concerned, i. Poolpandi supra is of an era before Section 30 of the Advocates Act had come into force and hence would not be applicable hereto. Moreover, what was for consideration therein and adjudicated was, whether a person summoned during investigation under the Customs Act is entitled to protection of Article 20(3) of the Constitution of India and suffers mental torture by being called away from the comfort of his house and office and being questioned. Both were answered in the negative. It was held that since the person so summoned is not an accused, Article 20(3) has no application and that there is no constitutional right to claim comforts to which the person is used to, during investigation. It is settled principle that a judgment is a precedent on what was for decision and decided therein and not for what may be logically deduced therefrom. Supreme Court, in the said judgment, was not concerned with the question, as in this petition i.e. whether a person has been called for giving statement before a person who is authorized to take evidence has a right to avail servi....
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....port which they prepared had wide repercussions owing to containing findings of facts accusing, condemning and leading to judicial proceedings and exposing those against whom they are directed to criminal prosecution or to civil action and may bring winding up of a company or may be used as basis to wind up the company and held that for the reason of the consequences flowing from their report, the Inspectors "must act fairly" owing to the duty-even though only administrative, which they performed. It was further observed that before the Inspectors condemned or criticised, they must give the person a fair opportunity of correcting or contradicting what is said against the person. In my opinion the aforesaid is true of the role of the DG also and as a part of the duty to act fairly, DG ought to allow the officials of the petitioner summoned, if so desire, to be accompanied by Advocates. The fear of the DG of the Advocates is also not understandable. DG has full discretion to regulate its proceedings and ensure and control that the presence of the advocates does not delay its proceedings, as was the apprehension expressed. Sachs L.J., in his opinion in the aforesaid judgment observed ....