TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 1640
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.... vi. PRINCIPLE OF PROPORTIONALITY IN PENALTY IMPOSITION vii. NO SECOND NOTICE CONTEMPLATED UNDER THE STATUTE viii. REPORT OF THE 'REVIEW COMMITTEE' ix. TIME IS OF ESSENCE - NO NOTICE NEEDED OF PROPOSED PENALTY x. NOTICE IS TO ANSWER THE CONTRAVENTION - NOT THE PROPOSED PENALTY xi. PENALTY ON FACTS - PROPORTIONATE 19 32 35 41 45 46 47 50 52 52 57 60 63 I. CONCLUSION 67 1. An important question involving the interpretation of certain provisions of the Competition Act, 2002, (for short "the Act") arises for consideration in this case. 2. The present statutory appeal, under Section 53T of the Act, has been filed against the judgment and order dated 19.04.2016 passed by the Competition Appellate Tribunal (for short the "COMPAT"). By the said judgment, the findings of the Competition Commission of India (for short the "Commission") that Respondent No. 1-Kerala Film Exhibitors Federation (for short the "KFEF") acted in contravention of Section 3(1) read with Section 3(3)(b) of the Act and the penalty imposed on Respondent No. 1 was upheld. The COMPAT set aside the penalty imposed on Respondent Nos. 2 and 3 and als....
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....ion 3(3) of the Act and particularly its decision to boycott distributors if they had dealings with Respondent No. 4-Crown Theatre, was anti-competitive causing appreciable adverse effect on competition. Respondent Nos. 2 and 3 were described as key persons/key decision makers who played an active role in Respondent No. 1 (KFEF), in Chapter 6 of the Report titled "Role and liability of office-bearers." NOTICE TO PARTIES BY THE COMMISSION:- 6. The Commission, by its order of 10.06.2015, upon consideration of the DG Report decided to forward a copy of the report, apart from Respondent No. 1, to Mr. Basheer Ahamed (Respondent No. 2), and Mr. M.C. Bobby (Respondent No. 3), who were the President and the General Secretary of the KFEF (Respondent No. 1) respectively, with a direction that the parties, including the individuals file their replies. Not only this, Respondent No. 1 and the individuals were directed to furnish their audited balance sheet and profit and loss account for F.Y. 2011-12, 2012-13 and 2013-14 on or before 14.07.2015. Parties were further directed to appear before the Commission for oral hearing on 22.07.2015. A notice came to be issued on 10.06.2015, in terms ....
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.... enforcing the directives of OP in controlling and restricting the exhibition of new movies across Kerala. Further, Mr. M.C. Bobby, General Secretary of OP, is also responsible for the conduct of OP being in a key position. Moreover, in spite of ample opportunity given to them, they failed to adduce any evidence to establish that the anti-competitive decisions were made without their knowledge or that they had exercised all due diligence to prevent their commissioning. 6.12 In view of the foregoing, the Commission is of the view that both Mr. Basheer Ahmed and Mr. M.С. Bobby, being in-charge of and responsible for the conduct of business of OP under section 48 of the Act, are liable to be penalised. 6.13 It is relevant to mention that in Case no. 45/2012, Kerala Cine Exhibitors Association vs. Kerala Film Exhibitors Federation and Others, the Commission had already found these two office bearers responsible under section 48 of the Act and imposed a penalty @ 7% of their average income accordingly. ORDER 7. Considering the findings elucidated in the earlier part of this order, the Commission finds that OP has indulged in anti-competitive con....
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....acie order 09.01.2013. The Commission was seized of the matter in Case no. 45 of 2012 when OP further indulged in the similar anti-competitive conduct. However, it appears that OP has turned a blind eye to the past orders of the Commission against like film associations in other states for similar anti-competitive conduct as well as the on-going investigation against it in Case No. 45 of 2012. In view of these, the Commission issues the following directions under section 27 of the Act: a. OP and its office bearers, namely, Mr. P.V. Basheer Ahmed and Mr. M.C. Bobby shall immediately cease and desist from indulging in anti-competitive conduct which they have been found to be indulging in contravention of section 3 of the Act, as explained in earlier paragraphs. This shall come into effect immediately, i.e., on the day of receipt of this order by them. b. OP shall pay penalties as worked out hereunder and deposit the penalties calculated at the rate of 10% of its average income within 60 days from the receipt of the order by them: Year Turnover/Income during the Year (in rupees) 2011-2012 824145.24 2012-2013 Not submitted 2013-2014 Not submitt....
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....assed by the Commission under Section 26(1), the Addl. DG issued notice to Appellant No. 1 under Section 41(2) read with Section 36(2) to enable it to explain its stand viz. a viz. the allegations contained in the information. He also issued summons to various persons and recorded their statements. Not only this, he confronted Appellant No. 2 with the statements/affidavits of Shri Mukesh R. Mehta, Ms. Sandra Thomas and Shri Lal Jose to enable him to admit/deny and to explain the position of Appellant No. 1. Not only this, he confronted Appellant No. 2 with the statements made by the representative of Respondent No. 2 and various film distributors and gave opportunity to him to explain the same. After recording the statements and considering the material collected during investigation, the Addl. DG submitted report with the finding that Appellant No. 1 had acted in contravention of Section 3(1) read with Section 3(3)(b) of the Act. 21. We have minutely gone through the statements of Shri Roopesh G. Makhija, Manager of R.M. Films, Shri Mukesh R. Mehta (Proprietor of M/s. E4 Entertainment), Ms. Sandra Thomas (Managing Director of M/s. Friday Ticket) and others along with the ....
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....ppellants Nos. 2 and 3 that on the basis of the material collected during the investigation, he proposes to make observations adverse to their conduct. The Commission also did not issue any notice to Appellants Nos. 2 and 3 proposing to debar them from discharging the functions as important functionaries of Appellant No. 1. 24. No doubt, under Section 27(g), the Commission is vested with omnibus powers to pass such other order or issue such direction as it may deem fit, but that power has to be exercised in consonance with the principles of natural justice which the Commission bound to comply with in view of Section 36(1) of the Act. 25. Admittedly, no notice was given by the Commission to Appellants Nos. 2 and 3 proposing to impose penalty on them and to debar them from participating in the affairs of Appellant No. 1 and no opportunity of hearing was afforded to them to represent their cause. Thus, there is no escape from the conclusion that the directions contained in Clauses (d) and (e) of paragraph 9 of the impugned order are vitiated due to violation of the principles of natural justice and the same are liable to be quashed. 26. In the result, the ap....
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....d penalty to Respondent Nos. 2 and 3. Adequate opportunity was given to Respondent Nos. 2 and 3 when the DG Report was furnished to them and their comments were called for. Learned counsel draws attention to the appellant-Commission calling for the Income Tax Returns of Respondent Nos. 2 and 3 to reinforce his submission. Learned counsel adverted to the conduct of Respondent Nos. 2 and 3 in an earlier proceeding being Case No. 45 of 2012 to show the consistent course of anti-competitive conduct by them. Learned counsel relied on certain authorities in support of his proposition. 12. Learned counsel contended that the impugned order of COMPAT deserves to be set aside. Alternatively, it was contended that there was no justification for setting aside the monetary penalty imposed on Respondent Nos. 2 and 3. 13. Refuting the submissions of the appellant, equally ably, Mr. Harshad V. Hameed, learned counsel for Respondent Nos. 1, 2 and 3 contended that the COMPAT was justified in passing the order. According to the learned counsel, regulatory authorities ought to provide adequate notice and opportunity before imposing penalties failing which their orders would be vulnerable on t....
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....t aimed at curbing negative aspects of competition through the medium of Commission. The Commission was to look into violations of the Act based on its own knowledge or information or complaints received and references received by the Central Government, the State Governments or statutory authorities. The Commission was empowered to pass orders for granting interim relief or any other appropriate relief and compensation or to pass orders imposing penalties. An appeal was to lie to the Competition Appellate Tribunal. Originally, the Act proposed an appeal to the Supreme Court directly. However, thereafter an appeal was provided by Section 53A to the COMPAT. Since 26.05.2017, the National Company Law Appellate Tribunal (for short "NCLAT") was designated as the Appellate Tribunal for matters arising out of the area of the Commission. 18. The Act provides for investigation by the DG on directions issued by the Commission. The Act empowers the Commission to impose penalties. For the purpose of the present case, we need to briefly refer to Section 3 which deals with anti-competitive agreements; Section 4 which deals with abuse of dominant position; Section 19 which speaks of inquiry i....
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....f 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 a 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 sub-section (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 objections or suggestions referred to in sub-section (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 th....
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....ent of costs, if any; * * * (g) pass such other order or issue such directions as it may deem fit:- Provided that while passing orders under this section, if the Commission comes to a finding, that an enterprise in contravention to section 3 or section 4 of the Act is a member of a group as defined in clause (b) of the Explanation to section 5 of the Act, and other members of such a group are also responsible for, or have contributed to, such a contravention, then it may pass orders, under this section, against such members of the group. 36. Power of Commission to regulate its own procedure (1) In the discharge of its functions, the Commission shall be guided by the principles of natural justice and, subject to the other provisions of this Act and of any rules made by the Central Government, the Commission shall have the powers to regulate its own procedure. (2) The Commission shall have, for the purposes of discharging its functions under this Act, the same powers as are vested in a Civil Court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the following matters, namely:- (a) su....
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....nder has been committed by a company and it is proved that the contravention has taken place with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that contravention and shall be liable to be proceeded against and punished accordingly. Explanation.-For the purposes of this section,- (a) "company" means a body corporate and includes a firm or other association of individuals; and (b) "director", in relation to a firm, means a partner in the firm." COMPETITION COMMISSION OF INDIA (GENERAL) REGULATIONS, 2009 (as it stood at the relevant time) 21. Procedure for Inquiry under Section 26 of the Act.- * * * (7) If the report of the Director General mentioned under sub-regulation (1) finds contravention of any of the provisions of the Act, the Secretary shall obtain the orders of the Commission for inviting objections or suggestions from the Central Government or the State Government or the statutory authority or the parties concerned, as the cas....
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....ised in the information received under section 19 or reference from the Central Government or a State Government or a statutory authority has already been decided by the Commission in its previous order. (3A) If, after consideration of the report of the Director General referred to in sub-section (3), the Commission is of the opinion that further investigation is required, it may direct the Director General to investigate further into the matter. (9) Upon completion of the investigation or inquiry under sub-section (7) or sub-section (8), as the case may be, the Commission may pass an order closing the matter or pass an order under section 27, and send a copy of its order to the Central Government or the State Government or the statutory authority or the parties concerned, as the case may be: Provided that before passing such order, the Commission shall issue a show-cause notice indicating the contraventions alleged to have been committed and such other details as may be specified by regulations and give a reasonable opportunity of being heard to the parties concerned. 27. Orders by Commission after inquiry into agreements or abuse of dominant po....
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....her members of such a group are also responsible for, or have contributed to, such a contravention, then it may pass orders, under this section, against such members of the group. 48. Contravention by companies.- (1) Where a person committing contravention of any of the provisions of this Act or of any rule, regulation, order made or direction issued thereunder is a company, every person who, at the time the contravention was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be in contravention of this Act and unless otherwise provided in this Act, the Commission may impose such penalty on such persons, as it may deem fit which shall not be more than ten per cent. of the average of the income for the last three preceding financial years: Provided that in case any agreement referred to in sub-section (3) of section 3 has been entered into by a cartel, the Commission may unless otherwise provided in this Act, impose upon such persons referred to in sub-section (1), a penalty of up to ten per cent. of the income for each year of the continuance of such agreement. ....
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....ned, in terms of the proviso to sub-section (9) of section 26 of the Act, indicating the contraventions alleged to have been committed and the time period for responding to the notice. (9) Upon receipt of reply to the show-cause notice referred to in sub-regulation (8) from the parties concerned, and after giving them a reasonable opportunity to be heard, the Commission may pass a final order closing the matter of pass an order under section 27 of the Act. 49. Procedure for imposition of penalty under the Act. (1) Notwithstanding anything to the contrary contained in any regulations framed under the Act, no order or direction imposing a penalty under Chapter VI of the Act shall be made unless the person or the enterprise or a party to the proceeding, during an ordinary meeting of the Commission, has been given a show cause notice and reasonable opportunity to represent his case before the Commission. (2) In case of persons proceeded against in terms of section 48 of the Act, forwarding of the investigation report and/or the supplementary investigation report or issue of show-cause notice under sub-regulation (8) of regulation 22 of these regulati....
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....rned the Commission agrees with the recommendation of the Director General that there is no contravention, the Commission shall close the matter forthwith and pass such orders as it deems fit and communicate its orders to the Central Government or the State Government or the Statutory Authority or the parties concerned, as the case may be. 28. Now, if after consideration of the objections or suggestions sent by the Central Government, State Government or the Statutory Authority or the parties concerned the Commission is of the opinion that further investigation is called for, it may direct further investigation in the matter by the Director General or cause further inquiry to be made in the matter or itself proceed with further inquiry in the matter in accordance with the provisions of the Act. 29. Similarly, if the report of the Director General referred to in sub-section 3 recommends that there is contravention of any of the provisions of the 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 the Act. COMMISSION CAN DIFFER WITH THE DG:- 30. It will be seen that if ....
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....effect that in case of persons proceeded against in terms of Section 48 of the Act, forwarding of the investigation report and/or the supplementary investigation report or issuance of show-cause notice under sub-regulation 8 of Regulation 22 shall be deemed to be show cause notice in terms of sub-Regulation 1 of Regulation 48. Sub-Regulation 8 of Regulation 22 provided that upon completion of further inquiry in terms of sub-section (7) or (8) of Section 26 of the Act, the Commission may pass a final order closing the matter under sub-section 9 of Section 26 of the Act or pass an order under Section 27, before which it shall issue a show-cause notice to the parties concerned, in terms of the proviso to sub-section (9) of Section 26 of the Act, indicating the contraventions alleged to have been committed and the time period for responding to the notice. 35. Hence, it will be clear that prior to the amendment of Section 26 in 2023, once the Director General files the report, and the Commission does not feel the need for a further investigation/inquiry, all that is required is to issue a notice to the party by forwarding the report eliciting an answer to the contravention. In case t....
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....pportunity of hearing to the delinquent officer and records findings different from those of the enquiring authority that the charges were established, "an opportunity of hearing" may have to be read into the rule by which the procedure for dealing with the enquiring authority's report is provided principally because it would be contrary to the principles of natural justice if a delinquent officer, who has already been held to be "not guilty" by the enquiring authority, is found "guilty" without being afforded an opportunity of hearing on the basis of the same evidence and material on which a finding of "not guilty" has already been recorded." 37. As far as the present case is concerned, the Director General's report was concurred with by the Commission and hence a notice in the nature of the one issued on 10.06.2015 which is traceable to Regulation 21 read with Regulation 48 and 22 and Section 26 of the Act is enough compliance with the provisions of the Act, for the purpose of imposition of a penalty under Section 27. 38. In Competition Commission of India vs. Steel Authority of India Limited And Another (2010) 10 SCC 744, this Court observed as under:- "71. Th....
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....nt Nos. 2 and 3 as the key persons/key decision makers who played active role in Respondent No. 1-KFEF. It is also undisputed that the appellant, by its order of 10.06.2015, upon consideration of the DG Report forwarded the Report to Respondent No. 2, Mr. Basheer Ahamed, President of Respondent No. 1, and Respondent No. 3 Mr. M.C. Bobby, General Secretary of Respondent No. 1, with a direction to the individuals to file their replies and also furnish their audited balance sheet and profit and loss account for the F.Y. 2011-12, 2012-13, 2013-14 on or before 14.07.2015. They were also asked to appear for oral hearing on 22.07.2015. They were heard through common counsel by the Commission on the said date. The notice dated 10.06.2015 is set out hereinbelow:- "In the present case the commission vide its order dated 8th May 2014 under section 26 (1) of the Completion Act. 2002 (Act) had Director General (DG) to cause an investigation into the matter. Accordingly, the DG, after completion of the investigation, had filed the investigation report. The commission considered the investigation report filed by the DG in its ordinary meeting held today the commission decided to....
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....od of two years. 42. Under Section 48, every person who, at the time of the contravention, was in charge of, and was responsible along with the company was deemed to be guilty of the contravention and was liable to be proceeded and punished. The liability was fixed by the statute itself. The notice of 10.06.2015 was categoric in pointing out the fact that there are contraventions alleged in the DG Report and it was clear in fixing the individuals who were the key personnel in charge of the affairs of Respondent No. 1. A clear opportunity was given to file reply/objections. Respondent Nos. 2 and 3 can complain of no prejudice if on the basis of this notice, the Commission held them guilty for contravening the Act and proceeded to impose penalty under Section 27. We are fully convinced that the notice dated 10.06.2015 issued in the present case fulfils the requirement in law as it then stood. 43. Since we are not concerned with the amended statute w.e.f. 18.05.2023 and the regulations w.e.f. 17.09.2024, we make no comment on the same. CONTRAST OF THE ACT WITH THE MRTP ACT, 1969:- 44. To understand the nature of penalties that can be imposed under the Act, one has to neces....
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....ve/declaratory or negative/prohibitor, depending on whether they require a company to do or to stop doing something, or both. Negative remedies, which typically take the form of a cease-and-desist order simply require the defendant to stop the abusive behaviour. Positive remedies tend to reflect the abusive behaviour. For example, a remedy to a refusal to supply would be a duty to supply. The countermeasure to anti-competitive self-preferencing would be an obligation not to discriminate. Of course, the distinction between positive and negative remedies can be seen as purely semantic as any prohibition can be easily translated into a positive obligation, i.e. a prohibition not to engage in abusive tying corresponds to a positive obligation to untie jointly sold produces or services. Moreover, negative and positive remedies can be applied jointly, i.e. a negative cease-and-desist order might be complemented by a set of positive remedies that prescribe a specific behaviour. As behavioural remedies are tailor made, allowing competition agencies to shape them according to the needs of a specific case, they can come in many forms. Examples of behavioural remedies that have been ....
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.... of Section 48 provided that even with regard to any Director, Manager, Secretary or other Officer of the Company, they shall also be deemed to be guilty if the contravention has been committed by the Company and it is proved that the contravention had taken place with consent or connivance of the said individual or if the contravention is attributable to any negligence on the part of any Director, Manager, Secretary or other Officer of the Company. By the 2023 Amendment, a cap on monetary penalty of 10 per cent of the average income for the last 3 preceding financial years was fixed. 48. The Act which is intended to provide teeth to the regulator, namely, the Commission to check anti-competitive agreements and abuse of dominant position empowers the Commission, under Section 27, to pass monetary penalties as well as behavioural and structural remedies and such power is traceable to the opening clause of Section 27 read with Section 27(a) (b) (d) (e) and (g). The idea was that the contravention be effectively brought to an end, keeping in mind the principle of proportionality. 49. A behavioural remedy or a structural remedy is principally imposed on the enterprise. When a beh....
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....of proportionality which is based on equity and rationality. It is, in fact, a constitutionally protected right which can be traced to Article 14 as well as Article 21 of the Constitution. The doctrine of proportionality is aimed at bringing out "proportional result or proportionality stricto sensu". It is a result-oriented test as it examines the result of the law in fact the proportionality achieves balancing between two competing interests : harm caused to the society by the infringer which gives justification for penalising the infringer on the one hand and the right of the infringer in not suffering the punishment which may be disproportionate to the seriousness of the Act." NO SECOND NOTICE CONTEMPLATED UNDER THE STATUTE:- 52. In this background, reverting to the question at hand, it will be clear that all that the Act contemplates after the receipt of a report from the DG indicating contravention is to set the procedure in motion under Section 26(8) of the Act, as it then stood, read with Section 48 of the Act, Regulation 21 and 48 of the Commission (General) Regulations, 2009. This aspect has already been dealt with. There is no mandate in the statute for the issuance....
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.... of a second specific hearing before imposition of a penalty under Section 27(b) does not expose the provision to the vice of arbitrariness and unconstitutionality. The Court observed that: "197. If these considerations are kept in mind, the fact that certain types of penalties (which are pre-determined quantum for specific violations of the Act) elicit show cause notice as prelude to penalty on the one hand, and absence of any compulsion to issue a separate show cause notice preceding a penalty under Section 27(b) (although a show cause notice and full hearing is provided with opportunity to submit against the report of DG) does not in the opinion of this Court, render that provision arbitrary. 198. The court is cognizant of the fact that there are several adjudications - quasi judicial and by judicial tribunals, which envision a "rolled up" hearing which visualizes only one show cause notice - that can culminate in both an adverse finding and a consequential penalty." 3.16. In the instant case, the Delhi High Court analysed the procedure adopted by the CCI and held that this procedure gives sufficient safeguard to parties likely to be affected adversely....
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....ement for the CCI to issue penalty guidance along with reasons in case of deviation from the guidance will add another layer of safeguard to the already existing process that has been upheld by the Delhi High Court to be constitutionally valid. On the basis of this and in light of the observations of the Delhi High Court as discussed above, the Committee felt that a separate penalty hearing may not be recommended. Quantum of Penalty for individuals 3.18. Currently, the Competition Act does not provide any mechanism or quantum of penalty that may be imposed on individuals. In the absence of any guidance, it was pointed out to the Committee that the CCI has been using the same standard as used for enterprises under Section 27 for the purpose of imposing penalties on individuals i.e. imposition of penalty up to 10% of the average income for the past three years of the individual. 3.19. The Committee deliberated on these issues and recommended that unless otherwise stated in the Competition Act, a provision should be introduced to reflect the quantum of penalty that may be imposed on individuals for the purposes of the contraventions ....
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....ion, like the MRTP Commission would continue to be a toothless body. It is also to be emphasized that both in SAIL's case (supra) and in Excel Crop's case (supra), timebound disposal of proceedings before the Commission has been emphasized. 58. In SAIL's case (supra), the following was held in paragraph 134 and 136: "134. The scheme of the Act and the Regulations framed thereunder clearly demonstrate the legislative intent that the investigations and inquiries under the provisions of the Act should be concluded as expeditiously as possible. The various provisions and the Regulations, particularly Regulations 15 and 16, direct conclusion of the investigation/inquiry or proceeding within a "reasonable time". The concept of "reasonable time" thus has to be construed meaningfully, keeping in view the object of the Act and the larger interest of the domestic and international trade. 136. In our considered view the scheme and essence of the Act and the Regulations are clearly suggestive of speedy and expeditious disposal of the matters. Thus, it will be desirable that the competent authority frames regulations providing definite time-frame for completion of investiga....
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....ng a second show-cause notice this Court has observed thus: As regards the modification requiring a second show-cause notice, neither the ordinary law of the land nor the industrial law requires an employer to give such a notice. In none of the decisions given by courts or the tribunals such a second show-cause notice in the case of removal has ever been demanded or considered necessary. The only class of cases where such a notice has been held to be necessary are those arising under Article 311. Even that has now been removed by the recent amendment of that article. To import such a requirement from Article 311 in industrial matters does not appear to be either necessary or proper and would be equating industrial employees with civil servants. In our view, there is no justification on any principle for such equation. Besides, such a requirement would unnecessarily prolong disciplinary enquiries which in the interest of industrial peace should be disposed of in as short time as possible. In our view it is not possible to consider this modification as justifiable either on the ground of reasonableness or fairness and should therefore be set aside. It is thus clear ....
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....planation". In other words, different stages in domestic enquiry were never in the contemplation of the framers of the Standing Order. That being the position it would be difficult to attribute any intention to the framers thereof to provide for a second opportunity being given to the delinquent of showing cause against the proposed punishment. The latter part of para 3 merely casts a unilateral obligation on the concerned authority or the officer to give due consideration to the gravity of the misconduct and the previous record of the delinquent in awarding the maximum punishment." (Emphasis supplied) 62. Once the explanation is offered, it is for the Commission to conclude whether there is breach of the Act or not. As to what penalty to impose, it will be guided by the doctrine of proportionality, when it chooses the penalty or penalties from the menu of penalties available. 63. Furthermore, appeal is provided under section 53A and 53T of the Act. The appellate body also shall examine whether the penalty imposed by the original authority is proportionate. By doing so, the appellate authority/court is not curing the violation of natural justice since there is no vio....
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....s. 2 and 3 with its affairs including administration, management and governance, in any manner for a period of 2 years and corresponding directions were issued to Respondent Nos. 2 and 3 to not to associate with Respondent No. 1. 65. We do not find that the penalty is disproportionate. The monetary penalty was meagre. The acts committed had serious and deleterious effect on the informant and the general public and unless deterrent penalties were imposed prejudice to public would have been enormous. The penalty imposed, as above, cannot be said to be of such a nature as to shock the conscience of a judicially trained mind. 66. Respondent Nos. 2 and 3 were also found to have indulged in similar anti-competitive conduct in Case No. 45/2012 before the Commission, and in that case, a penalty of 7 percent of their average income for the past 3 years was imposed. In spite of that, they continued with their anti-competitive conduct resulting in the present case being lodged. It is very clear that mere monetary penalty has not acted as a deterrent on Respondent No. 2 and 3 as well as Respondent No. 1. A behavioural remedy like the one ordered in the present case would alone protect th....