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.... CIVIL APPLICATION NO. 9583 of 2020 With R/SPECIAL CIVIL APPLICATION NO. 10933 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 1 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 10933 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 2 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 10933 of 2020 With R/SPECIAL CIVIL APPLICATION NO. 12309 of 2020 With R/SPECIAL CIVIL APPLICATION NO. 11124 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 1 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 11124 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 2 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 11124 of 2020 With R/SPECIAL CIVIL APPLICATION NO. 11122 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 1 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 11122 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 2 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 11122 of 2020 With R/SPECIAL CIVIL APPLICATION NO. 11127 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 1 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 11127 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 2 of 2022 In R/SPECIAL CIVIL APPLICATION NO. 11127 of 2020 With R/SPECIAL CIVIL APPLICATION NO. 11126 of 2020 With CIVIL APPLICATION (FOR STAY) NO. 1 of 2022 In R/SPECIAL CIVIL APPLICATION NO.....
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....tition. 3. At the outset, it requires to be observed that the petitioners of Special Civil Application No.11152 of 2020, Special Civil Application No.9521 of 2020, Special Civil Application No. 9520 of 2020, Special Civil Application No. 9583 of 2020, Special Civil Application No. 10933 of 2020, Special Civil Application No. 11124 of 2020, Special Civil Application No. 11122 of 2020, Special Civil Application No. 11128 of 2020, Special Civil Application No. 11126 of 2020, Special Civil Application No. 11123 of 2020, Special Civil Application No. 11127 of 2020, Special Civil Application No. 11150 of 2020, Special Civil Application No. 11146 of 2020 and Special Civil Application No. 11155 of 2020 have moved draft amendment in the respective petitions. Considering the facts and circumstances of the case, the same are hereby allowed in respective petitions. 4. The brief facts arising out of the petition are as under: 4.1 Petitioner No.1 is a private limited Company incorporated under the Companies Act having registered office at Ahmedabad, Gujarat. That the primary activity involves printing and binding of School Book and related material, the primary consumer of which in the State ....
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....No.3 himself, , there is overlapping information in his Information Petition and that in case No. 32 of 2018, however, he has re-filed the same with respondent No.1 for "proper investigation and outcome". The said Information Petition filed by respondent No.3 was numbered as Case No. 24 of 2019 by respondent No.1. The said Information Petition sought to make baseless allegation of restrictive tendeing by respondent No.1 and bid rigging by the successful bidders in the Pragna Tender quoted by respondent No.4 for the period from 2016-17 to 2018-19. 5. Mr. Mihir Thakore, learned Senior Counsel with Ms. Amrita Thakore, learned advocate for the petitioners in SCA No. 10933 of 2020, SCA No. 11124 of 2020, SCA No. 11122 of 2020, SCA No. 11127 of 2020, SCA No. 11126 of 2020, SCA No. 11123 of 2020, and SCA No. 11128 of 2020 has vehemently submitted that the impugned order of CCI does not comply with the requirements of Section 26(1) of the Competition Act, 2002 and the same is arbitrary, perverse and illegal. He has also submitted that the said order is nonspeaking one. According to Mr. Thakore, learned Senior Counsel, an order under Section 26(1) of the Act is required to contain an opini....
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....-sections, requires the Commission to issue various directions, take decisions and pass orders, some of which are even appealable before the Tribunal. Even if it is a direction under any of the provisions and not a decision, conclusion or order passed on merits by the Commission, it is expected that the same would be supported by some reasoning. At the stage of forming a prima facie view, as required under Section 26(1) of the Act, the Commission may not really record detailed reasons, but must express its mind in no uncertain terms that it is of the view that prima facie case exists, requiring issuance of direction for investigation to the Director General. Such view should be recorded with reference to the information furnished to the Commission. Such opinion should be formed on the basis of the records, including the information furnished and reference made to the Commission under the various provisions of the Act, as aforereferred. However, other decisions and orders, which are not directions simpliciter and determining the rights of the parties, should be well reasoned analysing and deciding the rival contentions raised before the Commission by the parties. In other words, the....
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....any opportunity, has by an order/direction under Section 26(1) been ordered/directed to be investigated against/into. Though ComPAT has been created as an appellate forum against the orders of CCI but its appellate jurisdiction is circumscribed by Section 53A of the Competition Act and no appeal is prescribed against the order of CCI under Section 26(1) of the Act. The said person/enterprise, in the absence of any remedy, has but to allow itself to be subjected to and participate in the investigation." "18(K) We are of the opinion that once petitions under Article 226 for quashing of investigation under the Cr.P.C. have been held to be maintainable, on the same parity a petition under Article 226 would also be maintainable against an order/direction of the CCI of investigation under Section 26(1) of the Competition Act particularly when the powers of the DG, CCI of investigation are far wider than the powers of Police of investigation under the Cr.P.C." "18(L) However, a petition under Article 226 of the Constitution of India against an order under Section 26(1) of the Act would lie on the same parameters as prescribed by the Supreme Court in Bhajan Lal (supra) i.e. where tre....
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....proceeds on the mere basis that "there is some force in the submission of the Informant" only on the patently false and untenable ground that "each individual item under each package by L1 winner of that package are also lowest". He has also submitted that CCI has completely overlooked the following while arriving at this sweeping false "prima facie view" and directing investigation: 1. CCI has not adhered to the Supreme Court's direction in the case of CCI v. SAIL (Supra) that "such opinion should be formed on the basis of the records". 2. CCI has completely ignored the settled position of law that, wherever the law provides for formation of opinion, such opinion must be an honest one based on the existence of circumstances relevant to the inference, as the sine qua non for action must be demonstrable and there is no general discretion to go on a fishing expedition to find evidence. In other words, the formation of opinion must be based on objective facts, which were completely absent in this case since there is not even an iota of evidence of meeting of minds or of any agreement between the 16 empanelled printers and the entire allegation proceeds on a conjecture based on lo....
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....rcumstance leading to an inference of the kind contemplated by the section exists, the action might be exposed to interference unless the existence of the circumstances is made out. As my brother Shelat has put it trenchantly:- "It is not reasonable to say that the clause permitted the government to say that it has formed the opinion on circumstances which it thinks exist..................... Since the existence of "circumstances" is a condition fundamental to the making of an opinion, the existence of the circumstances. if questioned, has to be proved at least prima facie. It is not sufficient to assert that the circumstances exist and give no clue to what they are because the circumstances must be such as to lead to conclusions of certain definiteness. The conclusions must relate to an intent to defraud, a fraudulent or unlawful purpose, fraud or misconduct or the withholding of information of a particular kind. We have to see whether the Chairman in his affidavit has shown the existence of circumstances leading to such tentative conclusions. If he has, his action cannot be questioned because the in reference is to be drawn subjectively and even if this Court would not have....
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....he government and the action authorised thereunder is investigation but action can be taken thereunder not suo motu but only on an application by a certain number of members or by members with a certain amount of voting power or on the Registrar's report. Section 234, besides, has nothing to do with investigation as S. 235 and S. 237 have, though on a report under S. 234, the government can institute investigation under cl. (e) of S. 235. Section 10-E was inserted in the Act by Act LIII of 1963 and deals with the constitution of the Company Law Board. The Board constituted under this section consists of a Chairman and members. By a notification G.S.R. 176 dated February 1, 1964 the Central Government constituted the Company Law Board under S. 10-E. By another Notification No. G. S. R. 178 it delegated some of its powers under the Act including those under S. 237 to the Board. On the same day, it also published Rules under S. 642 (1) read with S. 10-E (5) called the Company Law Board (Procedure) Rules, 1964. Rule 3 empowers the Chairman of the Board to distribute the business of the Board among himself and the other member or members and to specify the cases or classes of cas....
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.... dichotomy, that not only the opinion was subjective but that the entire clause was made dependent on such opinion, for what the clause lays down is that the authority must come to an opinion on materials before it that there exist circumstances suggesting fraud or intent to defraud, etc. Such dichotomy, according to him, is impossible and not reasonable because it cannot be that the authority must first ascertain by holding an inquiry that there are circumstances suggesting fraud or intent to defraud, etc., and then form a subjective opinion that those circumstances are such as to suggest those very things. He emphasised that the words "opinion" and "suggesting" were clear indications that the entire function was subjective, that the opinion which the authority has to form is that circumstances suggesting what is set out in sub-cls. (i) and (ii) exist and, therefore, the existence of those circumstances is by itself a matter of subjective opinion. The legislature having entrusted that function to the authority, the Court cannot go behind its opinion and ascertain whether the relevant circumstances existed or not". 3. Both ingredients of Section 3(1) of the Act, i.e. that there ....
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....learned Senior Counsel has relied upon the decision in case of Rajasthan Cylinders v. UOI, 2018, reported in SCC Online SC 1718 and has submitted that CCI has not even prima facie found any evidence of any connected or coordinated action which can amount to bidrigging or any agreement as defined in the Competition Act, 2002. The said order is therefore ex facie without jurisdiction, perverse, illegal and liable to be set aside. 4. There is no allegation of any wrongdoing by these 16 printers in the matter of their empanelment by GCEE. Pursuant to empanelment, only these 16 persons can participate in GCEE's Tenders for the period upto which they are empanelled. For the bids invited for printing work for 2016-17, 9 empanelled printers became successful bidders in different printing packages. For the bids invited for printing work for 2017-18, 5 empanelled printers (being Mirror Image Pvt. Ltd. - Package D, Reliable Art Printery Pvt. Ltd. - Package B, Sahitya Mudranalaya Pvt. - Package C, M/s. Shri R. K. Printers and Binders Ltd. - Package E and Wilson Printcity Pvt. Ltd. - Package A) became successful bidders in different printing packages. For the bids invited for printing work f....
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....ad failed in their earlier attempts before CCI and were trying to take entry in job work of GCEE and was an abuse of process for personal gain. 9. CCI has also ignored the fact that the Informant had approached CCI in respect of matter which were long concluded and there was gross delay which ought to have alerted CCI as to the motivated nature of the Information Petition. 5.3 Mr. Mihir Thakore, learned Senior Counsel submits that the Order suffers from the vice of arbitrariness, discrimination and ipse dixit: (i) While CCI has the discretion to invite or not invite opposite parties in the preliminary hearing, such discretion has to be exercised in a objective, judicious and fair manner and not arbitrarily or on ipse dixit. Regulation 17 of the Regulations is a provision made by CCI itself conferring upon itself inter alia the discretion to invite "such other person" for a preliminary conference. Therefore, CCI, cannot, on the basis of a provision made by itself, suggest that it can exercise discretion on ipse dixit. It is well settled that even an administrative authority is required to act fairly and discretion is required to be exercised objectively, judiciously and fairl....
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....st. The Court would then exercise jurisdiction under Article 226 of the Constitution of India to review such a decision. 6.3 The impugned order proceeds to record a prima facie opinion that "the rates quoted by parties were not independent and appear to be based on a connected and coordinated action". For arriving at the said opinion the Commission assumes that the bid/ bidders price for all items comprised in the package were always lowest. 6.4 The above assumption is factually incorrect as has been demonstrated by the Petitioners. The Petitioners have placed on record the material which demonstrates that the assumption is factually incorrect. None of the following assertions have been denied or disputed by any of the Respondents:- (i) for the year 2016-17, R.K. Printers was the L1 bidder. The package was in two parts. In part A, R.K. Printers had quoted the lowest price, whereas, in part B, Sr. No.1 to 12 and Sr. No. 17 to 33, had quoted the lowest price of Reliable Printers. For Sr. No. 13, L1 price is of Gajjar Offset; (ii) for the year 2016-17, in the tender for teacher training modules, there were six items. In the items at Sr. No.1, Mirror Image had quoted the lowest....
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....dders are the same, that by itself would not be sufficient to form an opinion that there was an agreement which directly or indirectly results in bid rigging or collusive bidding. It is essential to look at the relevant facts which would include the nature of the relationship between the tendering agency and the bidders and the tender conditions. In support of his above submission, Mr. Joshi, learned Senior Counsel has relied upon the decision in case of Rajasthan Cylinders versus Union of India (Supra), wherein it is observed in Paragraph Nos. 85 to 92 & 95 as under: "85) The first and foremost issue which needs to be considered is that whether there was a situation of monopsony or oligopsony. 86) From the aforesaid discussion, it is clear that as far as CCI is concerned, it has come to the conclusion that there was a cartelisation among the appellants herein and a concerted decision was taken to rig the bids which were submitted persuant to the tenders issued by IOCL. On the other hand, the appellants argue that there was no such agreement and even if the bids of many bidders were identical in nature, the bidswere driven by market conditions. Their plea is that there was a ....
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....appellants. 89) We may say at the outset that if these factors are taken into consideration by themselves, they may lead to the inference that there was bid rigging. We may, particularly, emphasise the fact that there is an active trade association of the appellants and a meeting of the bidderswas held in Mumbai just before the submission of the tenders. Another very important fact is that there were identical bids despite varying cost. Further, products are identical and there are small number of suppliers with few new entrants. These have become the supporting factors which persuaded the CCI to come to the conclusion that these are suggestive of collusive bidding. 90) However, that is only one side of the coin. The aforesaid factors are to be analysed keeping in mind the ground realities that were prevailing, which are pointed out by the appellants. These attendant circumstances are argued in detail by the counsel for the appellants which have already been taken note of. We may recapitulate the same in brief hereinbelow: (i) In the present case there are only three buyers. Among them, IOCL is the biggest buyer with 48% market share. It is also a matter of record that all....
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....ven some order for the supply of specific cylinder. For this purpose, it has framed its broad policy as well. This also shows that control remains with IOCL. Thus, the appellants appear to be correct when they say that all the participants in the bidding process were awarded contracts in some State or the other which was aimed at ensuring a bigger pool of manufacturers so that the supply of this essential product is always maintained for the benefit of the general public. Had IOCL left some manufacturers empty handed, in all likelihood, they would have shut their shops. However, IOCL wanted all manufacturers to be in the fray in its own interest. Therefore, it was necessary to keep all parties afloat and this explains why all 50 parties obtained order along with 12 new entrants. (vi) There is another very relevant factor pointed out by the appellants, viz., the governmental control which is regulated by law. As pointed out above, it is not only the three oil companies which can supply LPG to domestic consumers in 14.2 kg LPG cylinders as mandated in the LPG (Regulation and Distribution) Order, 2000 which is issued under the provisions of Essential Commodities Act, 1955, even ....
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....is quite close to each other. Therefore, it became necessary to sustain themselves in the market. Hence, the factor that these suppliers are from different region having different cost of manufacture would lose its significance. It is a situation where prime condition is to quote the price at which a particular manufacturer can bag an order even when its manufacturing cost is more than the manufacturing cost of others. The main purpose for such a manufacuring would be to remain in the fray and not to lose out. Therefore, it would be ready to accept lesser margin. This would answer why there were near identical bids despite varying cost". 95) To recapitulate, the two prime factors against the appellants, which are discussed by the CCI, are that there was a collusive tendering, which is inferred from the parallel behaviour of the appellants, namely, quoting almost the same rates in their bids. The parameters on the basis of which these aspects are to be judged are stated in Excel Crop Care Limited as follows: "50. It needs to be emphasised that collusive tendering is a practice whereby firms agree amongst themselves to collaborate over their response to invitations to tender. M....
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....ditions of competition which do not respond to the normal conditions of the market, having regard to the nature of the products, the size and number of the undertakings, and the volume of the said market. Such is the case especially where the parallel behaviour is such as to permit the parties to seek price equilibrium at a different level from that which would have resulted from competition, and to crystallise the status quo to the detriment of effective freedom of movement of the products in the [internal] market and free choice by consumers of their suppliers." (emphasis supplied) At the same time, the Court also added that the existence of a concerted practice could be appraised correctly by keeping in mind the following test: "If the evidence upon which the contested decision is based is considered, not in isolation, but as a whole, account being taken of the specific features of the products in question." 6.8 The Commission failed to take into consideration the relevant factors viz.;- (i) the tendering agency was the sole procurer of text books in the State of Gujarat. It was a case of "MONOPSONY". In the case of a MONOPSONY, the buyer is in a dominant position and has....
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.... of bid rigging. The procedure to be followed by the Commission to be fair has to be the same for all parties to the Complaint. If the opportunity is provided to the GCEE it is also required to be provided to the Petitioners. The Petitioners would also have been able to place on record the correct facts and the Commission on appreciation of such facts could have taken a different view in the matter. The impugned order is premised on a procedure which cannot be said to be fair and is therefore illegal being violative of article 14 of the constitution of india. 6.11 The contention that the Commission and the Director General are independent entities since the Commission is discharging a quasi judicial function whereas the Director General is undertaking an inquisitorial jurisdiction would not be applicable in the facts of the present case. A common affidavit in reply has been filed on behalf of the Commission and the Director General. This is clearly reflective of predetermination and mitigates against any possibility of independence in the adjudication proceedings. In support of the above submission, Mr. Joshi, learned Senior Counsel has relied upon the decision in case of Union o....
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....1 and the reasons provided while passing the Impugned Order under section 26(1) of the Act thereby amounting to fling of an appeal against the said order, which in respectful submission cannot be entertained and does not warrant interference by way of judicial review under Article 226 of the Constitution of India. That, the instant Petition is liable to be dismissed as the Petitioners under the garb of this Writ Petition, are attempting to appeal against an order passed by the Respondent No.1 under Section 26(1) of the Act which, as held, explicitly by the Hon'ble Supreme Court, as not appealable, in Competition Commission of India v/s Steel Authority of India (Supra), wherein Para 41 reads as under: "41. The provisions of Sections 26 and 53A of the Act clearly depict the legislative intent that the framers never desired that all orders, directions and decisions should be appealable to the Tribunal. Once the legislature has opted to specifically state the order, direction and decision, which would be appealable by using clear and unambiguous language, then the normal result would be that all other directions, orders etc. are not only intended to be excluded but, in fact, have....
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....or the purpose of investigation. 8.3 Mr. Vyas, learned ASG has further submitted that the Hon'ble Supreme Court of India in CCI vs SAIL (Supra) has observed that an order passed under Section 26(1) of the Act is an administrative order and the Competition Commission has to form a prima facie opinion without entering into adjudicative or determinative process. The Hon'ble Apex Court 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. He ahs relied upon the following observations made in paras- 31, 38, 87, 91 and 93 of the said judgment: "31. We would prefer to state our answers to the points of law argued before us at the very threshold. Upon pervasive analysis of the submissions made before us by the learned counsel appearing for the parties, we would provide our conclusions on the points noticed supra as follows: 1) In terms of Section 53A(1)(a) of the Act appeal shall lie only against such directions, decisions or orders passed by the Commission before the Tribunal which have been specif....
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....raining 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 record before the Commission, it is apparent that there is every likelihood of the party to the lis, suffering irreparable and irretrievable damage or there is definite apprehension that it would have adverse effect on competition in the market. The power under Section 33 of the Act to pass temporary restraint order can only be exercised by the Commission when it has formed prima facie opinion and directed investigation in terms of Section 26(1) of the Act, as is evident from the lan....
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....ative 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 (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 submitted to the Commission itself or close the case in te....
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....Investigation report once it is submitted by the DG to the CCI. Parties are also afforded a fair and reasonable opportunity of a personal hearing before the Commission for consideration of the said objections or suggestions to the Investigation report. Mr. Devang Vyas, learned ASG has relied upon the decision in case of Flipkart Internet Pvt. Ltd. v. Competition Commission of India and Others (Supra), wherein it is observed in Para-22, 23 and 27 as under: "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, department....
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....ssion, in cases where the inquiry has been initiated by the Commission suo motu, 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 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 faci....
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....ion 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 Krishna Swami v. Union of India [(1992) 4 SCC 605] explained the expression "inquisitorial". The Court held that 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 Centra....
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....Indeed, the directions given by the CCI to the DG under Section 26 (1) of the Act is only to "trigger‟ investigation. 34. The aforementioned decisions clarify that an order of the CCI under Section 26 (1) of the Act "triggers ‟ investigation by the DG, and that the powers of the DG are not necessarily circumscribed to examine only such matters that formed the subject matter of the original complaint. No doubt, the language of the order passed by the CCI issuing directions to the DG will also have a bearing on the scope of such investigation by the DG. In the present 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". 8.8 Learned ASG Mr. Devang Vyas has submitted that therefore, the Petitioners herein cannot be allowed to circumvent this procedure and abuse the process of law by invoking writ jurisdiction of this Hon'ble Court and raising grounds of objecting to the correctness of the information, which can be espoused at the stage of filing its objections or suggestions to the DG's report (or ref....
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....s and substance, hence, deserve to be dismissed and are accordingly, dismissed". 8.10 In view of the above submissions, it is submitted by learned ASG Mr. Vyas that the Writ Petition is premature and based on conjectures and surmises and deserves to be dismissed on this ground itself. He has relied upon the following judgments:- (a) Flipkart Internet Pvt. Ltd. v/s Competition Commission of India and Amazon Seller Services v/s Competition Commission of India (Supra) - Para 17, 19,20, 24: "17. It is also pertinent to note that the definition of 'Agreement' under the Act is an encompassing/inclusive one. It includes any arrangement, understanding or action in concert neither necessarily in writing nor intended to be enforceable by legal proceedings. Further, the list of vertical agreements provided under Section 3(4) of the Act is an inclusive one. "19. The IT industry body the National Association of Software and Services Companies (Nasscom) estimated that the Indian ecommerce market was $33 billion in 2017-18 that reached $38.5 billion during 2018-19. Flipkart and Amazon comprise bulk of the online retail market in India.1Though these platforms are used for selling ....
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....b) Amazon Seller Services v/s Competition Commission of India and Flipkart Internet Pvt. Ltd. v/s Competition Commission of India (Supra) - Para 58-64 "58. Petitioners have pleaded in extenso and submitted elaborate arguments on the merits of the matter. But, in a writ petition filed under Article 226 of the Constitution of India, seeking judicial review, the High Court can examine only the decision making process with the exception namely the cases involving violation of fundamental human rights. The law on the point is fairly well settled. It may be profitable to recall following opinion of Lord Greene in Associated Provincial Picture Houses Ltd., Vs. Wednesbury Corporation23 : "It is true that discretion must be exercised reasonably. Now what does that mean? Lawyers familiar with the phraseology used in relation to exercise of statutory discretions often use the word 'unreasonable' in a rather comprehensive sense. It has frequently been used and is frequently used as a general description of the things that must not be done. For instance, a person entrusted with a discretion must, so to speak, direct himself properly in law. He must call his own attention to the ma....
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....t is a patent error which can be corrected by certiorari but not a mere wrong decision. Quoting Morris J, it is held as follows: 10. ............ "The essential features of the remedy by way of certiorari have been stated with remarkable brevity and clearness AIR 1954 SC 440 W.P No.3363/2020 C/W W.P No.4334/2020 by Morris, L.J. in the recent case of Rex v. Northumberland Compensation Appellate Tribunal [(1952) 1 KB 338 at 357]. The Lord Justice says: "It is plain that certiorari will not issue as the cloak of an appeal in disguise. It does not lie in order to bring up an order or decision for re-hearing of the issue raised in the proceedings. It exists to correct error of law when revealed on the face of an order or decision or irregularity or absence of or excess of jurisdiction when shown." 61. In G.B. Mahajan and others Vs. Jalgaon Municipal Council and others26, the Hon'ble Supreme Court of India speaking through Justice M.N. Venkatachaliah (as he then was), referring to Prof. Wade's comment on Wednesbury doctrine, has held that the point to note is that a thing is not unreasonable in the legal sense merely because Court thinks it unwise. Prof. Wade's comme....
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....xamining the validity of the exercise of administrative discretion. After analyzing the law with regard to Constitutional review in UK and the cases involving human rights, he has stated that it is quite inappropriate to speak of the decline or demise of Wednesbury test. He has concluded that Wednesbury Principles are still alive as follows: "In the ultimate analysis, it can be said that the Wednesbury principles are still alive and applicable in judicial review of administrative discretion where no constitutional/fundamental rights are involved. Wednesbury, is but a facet and an enduring facet of the larger landscape of judicial review. These issues and aspects are not a matter of mere semantics but are the constitutional underpinnings of the exercise of judicial power and the limits thereof." 63. In the case on hand, the informant has filed information and appended material papers, which according to the informant support its allegations. It was submitted by the learned Additional Solicitor General that the Commission has also called upon the informant to file a Certificate under Section 65B of the Indian Evidence Act and the penalty for incorrect information is upto Rs.....
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....der itself is appealable before the Tribunal and only after this stage, there is a specific right of notice and hearing available to the aggrieved/affected party. Thus, keeping in mind the nature of the functions required to be performed by the Commission in terms of Section 26(1), we are of the considered view that the right of notice of hearing is not contemplated under the provisions of Section 26(1) of the Act." 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 Excel Crop Care the issue was inclusion of more than one instance or incident within the ambit of investigation (given that the complaint was in respect of one tender only) is distinguishable, is in this court's opinion, insubstantial and needs to be rejected. Its reliance on Grasim Industries, is no longer apt. At the stage when the CCI takes cognizance of information, based on a complaint, and requires investigation, it does not necessarily have complete information ....
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....ons 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 report recommends otherwise, it is obliged to proceed and investigate further (Sections 26 (7) and (8)). Again Section 27 talks of different "parties" [enterprise or association of enterprises or person or association of persons‖- per - per Section 27 (a)]. Likewise, the steps outlined in Section 26 are amplified in the procedure mandated by Regulation 20 and 21, which requires participation by "the parties" in the event a report after DG's inquiry, which is likely ....
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....ase. For the above submissions, he had relied upon the decision in case of Flipkart Internet Pvt. Ltd. v. Competition Commission of India and Others (Supra), wherein Para-26 reads as under: "26. The Hon'ble Supreme Court in the case of CCI Vs. Bharthi Airtel Ltd., reported in (2019) 2 SCC 521, in paragraph 121 has held as under; "121. Once we hold that the order under Section 26(1) of the Competition Act is administrative in nature and further that it was merely a prima facie opinion directing the Director General to carry the investigation, the High Court would not be competent to adjudge the validity of such an order on merits. The observations of the High Court giving findings on merits, therefore, may not be appropriate." The Hon'ble Supreme Court in the aforesaid case has held that the order under Section 26(1) of the Act of 2002 is administrative in nature and the High Court would not be competent to adjudicate the validity of such an order on merits. In the light of the aforesaid, the question of adjudicating the validity of an order passed under Section 26(1) on merits does not arise. 8.14 Mr. Devang Vyas, learned ASG has submitted that with a view to elici....
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....hat out of the respondents before the CCI, even 6 respondents have not got a single bid and 5 have never got any work in 3 years. He has submitted that though Section 26(1) is an administrative order, it should fulfill teh requirement of reasonableness. According to him, the formation of the information by the CCI is without any basis, there is no prima-facie ground shown or narrated in the impugned order for initiation of the inquiry by the DG. 9.2 Mr. Thakore, learned Senior Counsel has relied upon the decisions in case of : (i) Mohd. Mustafa v. Union of India, 2022 (1) SCC 294, wherein in para 16-18, it is observed that: "16. The grounds on which administrative action is subject to judicial review are illegality, irrationality and procedural impropriety. The following observations made by Lord Diplock in Council of Civil Service Unions and others v. Minister for Civil Service are apt: "By 'illegality' as a ground for judicial review I mean that the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it. Whether he has or not is par excellence a justiciable question to be decided, in the event of dispute, by t....
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....asonably. 18. Conditions prompted by extraneous or irrelevant considerations are unreasonable and liable to be set aside by Courts in exercise of its power under judicial review. (See: State of U.P. v. Raja Ram Jaiswal , Sheonandan Paswan v. State of Bihar & Others, Sant Raj v. O.P. Singla, Padfield v. Minister of Agriculture). A decision can be arrived at by an authority after considering all relevant factors. If the discretionary power has been exercised in disregard of relevant consideration, the Court will normally hold the action bad in law. Relevant, germane and valid considerations cannot be ignored or overlooked by an executive authority while taking a decision. It is trite law that Courts in exercise of power under judicial review do not interfere with selections made by expert bodies by reassessing comparative merits of the candidates. Interference with selections is restricted to decisions vitiated by bias, mala fides and contrary to statutory provisions. (See: Dalpat Abasaheb Solunke v. Dr. B.S. Mahajan, Badrinath v. State of T.N., National Institute of Mental Health and Neuro Sciences v. Dr. K. Kalyana Raman, I. P. S Dewan v. Union of India, UPSC v. Hiranyalal Dev20....
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....tatutes. In London Graving Dock Co. Ltd. V. Horton (AC at p.761), Lord MacDermot observed: (All ER p. 14 C-D) "The matter cannot, of course, be settled merely by treating the ipsissima vertra of Willes, J as though they were part of an Act of Parliament and applying the rules of interpretation appropriate thereto. This is not to detract from the great weight to be given to the language actually used by that most distinguished judge...." 10. In Home Office v. Dorset Yacht Co. (1970 (2) All ER 294) Lord Reid said, "Lord Atkin's speech.....is not to be treated as if it was a statute definition it will require qualification in new circumstances." Megarry, J in (1971) 1 WLR 1062 observed: "One must not, of course, construe even a reserved judgment of Russell L.J. as if it were an Act of Parliament." And, in Herrington v. British Railways Board (1972 (2) WLR 537) Lord Morris said: (All ER p. 761c) "There is always peril in treating the words of a speech or judgment as though they are words in a legislative enactment, and it is to be remembered that judicial utterances made in the setting of the facts of a particular case." 11. Circumstantial flexibility, one additional or ....
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....ve filed joint affidavit-in-reply at Pagfe-568 onwards wherein they have raised the question of maintainability of the petition itself and has also narrated various decisions of various Courts and have contended that the CCI has exercised its power under Section 26 of the Act and there is no bias and the impugned order has been passed within the parameters and jurisdiction of the Commission. It is also contended that the petitioners will get appropriate opportunity as per the provisions of CCI and by initiation of inquiry no prejudice or legal right of the petitioner is affected. 12. The rejoinder has been filed by one Mr. Khagen Ramanlal Patel against the said affidavit-in-reply wherein he has reported the facts narrated in the petition and has also referred to various decisions contendeing that judicial review of the administration order of the CCI is amenable to the jurisdiction of the High Court. It is contended that respondent No.1 has arbitrarily and discriminatorily invited one of the opposite parties and allowed it to make submissions before issuing the order, while tenying opposite parties of such similar opportunity. It is also contended that due to such opportunity bein....
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.... or collusive bidding, shall be presumed to have an appreciable adverse effect on competition: Provided that nothing contained in this sub-section shall apply to any agreement entered into by way of joint ventures if such agreement increases efficiency in production, supply, distribution, storage, acquisition or control of goods or provision of services. Explanation.-For the purposes of this sub-section, "bid rigging" means any agreement, between enterprises or persons referred to in sub-section (3) engaged in identical or similar production or trading of goods or provision of services, which has the effect of eliminating or reducing competition for bids or adversely affecting or manipulating the process for bidding. (4) xxx xxx xxx Section 19. Inquiry into certain agreements and dominant position of enterprise.- (1) The Commission may inquire into any alleged contravention of the provisions contained in subsection (1) of section 3 or sub-section (1) of section 4 either on its own motion or on - (a) receipt of any information, in such manner and] accompanied by such fee as may be determined by regulations, from any person, consumer or their association or trade asso....
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.... (5), if any, the Commission agrees with the recommendation of the Director General, it shall close the matter forthwith and pass such orders as it deems fit and communicate its order to the Central Government or the State Government or the statutory authority or the parties concerned, as the case may be. (7) If, after consideration of the objections or suggestions referred to in sub section (5), if any, the Commission is of the opinion that further investigations is called for, it may direct further investigation in the matter by the Director General or cause further inquiriy to be made by in the matter or itself proceed with further inquiry in the matter in accordance with the provisions of this Act. (8) If the report of the Director General referred to in sub-section (3) recommends that there is contravention of any of the provisions of this Act, and the Commission is of the opinion that further inquiry is called for, it shall inquire into such contravention in accordance with the provisions of this Act. Section 53A. Appellate Tribunal.- The National Company Law Appellate Tribunal constituted under section 410 of the Companies Act, 2013 ( 18 of 2013) shall, on and fr....
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....n also provides as to agreement which may be even in action. Whether there was an anti-competetive agreement under Section 3, has to be decided on the facts and circumstances of each matter. 15.1 Now, according to Section 19, provision has been made enabling the Commission to inquire into certain agreements and dominant position of enterprise. The Commission has been vested with an authority to inquire into agreement on the basis of receipt of any information which may be sent by any persons, consumer or Association or trade association or even by reference made by either State Government or Central Government or an Statutory Authority. Thus, power of the Commission to inquire is subject to the various provisions of the Act, as held in various decisions referred to hereinabove. The power exercised under Section 19(1) of the Act by the Commission is not a judicial power but it is an administrative in nature. Now it is well established principles of law that when any authority exercises administrative power regarding any inquiry, the Court does not sit as a Court of Appeal over the decisions of such authority but Court clearly reviews the manner in which the decision was made. It is....
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.... exist or not. The order under Section 26(1) of the Act can be passed when there is prima-facie material to direct an inquiry and elaborate reasons are not required, as Commission is required to express only a tentative view. It is also settled that in case elaborate reasons are provided in the order passed under Section 26(1), it will certainly prejudice the person against whom the complaint has been made, and therefore, the Statute provided a safeguard for holding an inquiry after an order is passed under Section 26(1) and the Director General is certainly required to grant an opportunity of hearing by holding inquiry in the matter. 15.4 Now considering the provision of Section 53A, admittedly, the order of inquiry passed by the Commission, by virtue of power under Section 26(1) of the Act, no appeal is permissible. Therefore, the Constitutional power under Article 226 is available to the concerned person to challenge the order of the inquiry issued by the Commission under Section 26(1) of the Act. But, the action under Section 26(1) being an administrative in nature, there would be a judicial restrain on the High Court to interfere with such administrative order unless and unti....
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....ct very clearly in its response. In the written response/ comments filed by GCEE, it has been stated that it does not look at individual prices of each and every item but is concerned with the total cost of procurement for the total quantity of books and other items as it is interested in bringing down the total cost of procurement and doing efficient purchase......" 24. Upon perusal of the tables from A to D for certain packages against the tables from E to N as mentioned above, it is apparent that LI rates in total were not the negotiated rates but the rates derived from individual quoted prices Moreover, from the tables extracted above it is also quite evident that the prices quoted for each individual item under each package by L1 winner of that package are also the lowest Therefore, the Commission, prima facie notes that there is some force in the submission of the Informant. It appears that the rates quoted by the bid parties were not independent and appear to be based on a connected and coordinated action between OP-2 to 17, warranting an investigation under the provisions of Section 3(1) read with Section 3(3)(d) of the Act. 25. Apart from the above, the Informant has....
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....of the provisions of Section 48 of the Act. 31. Nothing stated in this order shall tantamount to a final expression of opinion on the merits of the case and the DG shall conduct the investigation without being swayed in any manner whatsoever by the observation made herein. 17. Now, considering the material placed on record, it reveals that the Commission has initiated proceedings in accordance with Section 26 of the Act, pursuant to it, forming an opinion under Section 26(1) of the Act as to the existence of a prima-facie case. This exercise has been undertakne on the basis of the information received by the Commission from Respondent No.3 regarding the Cartel in the form of anti-competitive agreement. No Statutory right is availabe to the person concerned against whom any inquiry is ordered to be initiated by the Commission on the exercise of its administrative power available to it under the Act. Further, it is well settled that in an order of Inquiry under Section 26, which is only prima-facie opinion and does not affect the rights of any person, it cannot be reviewed by the High Court unless and until it is shown that it is contracry to any provisions of the Act or irrelev....
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....the person concerned relating to material, which may be in the form of business transactions, information relating to Accounts or such statistical data, etc. The Court has no such expertise in evaluating or interpreting the business data or statistical data pertaining to a particular commercial activity. Any such information which is in the form of statistical data relating to any business or commercial transaction and accounting procedure may be interpreted in a different manner by different person having such expertise, knowledge in such fields. The angle of interpretation of such data may be different by different person and, therefore, the submission of the petitioner that information relating to the statistical datea including the interpretation of effect of L1 price in each packet and the negotiated price thereof, etc., is misunderstood by the Commission, cannot be accpeted at this stage, as it is prerogative of the Commission to form prima-facie opinion as to initiation of inquiry. The impugned order of the Commission has dealt with these aspects from its own angle. At this stage, this Court cannot decide such question as to whether the angle or interpretation adopted by the....