In this leading case, the Supreme Court of India had judiciously delineated the limits of exercise of power by the Competition Commission of India and Competition Appellate Tribunal (now replaced by NCLAT) so that they both do not muddle each other in their proceedings.
Jindal Steel & Powers Ltd submitted an information before the Competition Commission of India alleging that the Steel Authority of India Limited had an exclusive supply agreement with Indian railways for the supply of rails and thereby leading to anti-competitive practices and abuse of dominant position. After finding that a prima facie case prevailed, the CCI (without giving an opportunity to SAIL to file a detailed reply) referred the matter to the Director General for investigation. SAIL challenged the order before COMPAT whereby COMPAT stayed the investigation proceedings by the Director General and refused to prosecute CCI as a party before it. Discontented by the decision of the COMPAT, the CCI approached the Apex Court which while giving its decision formulated the following issues:
Whether the dictums passed by the CCI in exertion of its power under Section 26(1) of the Act establishing a prima facie opinion would be appealable in terms of Section 53(A) of the Act?
Whether the affected parties (as a matter of right) are entitled to notice or hearing at the prefatory stage or forming an opinion as to the existence of the prima facie case and whether it is mandatory on the part of the commission to record reasons whilst formulating prima facie opinion?
Whether the CCI would be a requisite or at least a proper party in the proceeding before the Tribunal in an appeal brought by any party?
In which phase and what manner, the CCI can exert powers vested under Section 33 of the Act to issue temporary restraint orders?
Whether it is mandatory on the part of the Commission to record reasons for shaping prima facie opinion in terms of Section 26(1) of the Act?
What directions are required to be issued by the Court to ensure proper compliance of the procedural requirements whilst keeping in mind the scheme of the Act and the legislative intent?
Hence, the Apex Court had effectively put forward in detail the rationale behind the enforcement of the Competition Act, 2002 by giving autonomy to the Competition Commission of India to carry out its functions bluntly.
ABOUT THE AUTHOR
Riya Gulati is a Paralegal at Law Offices of Caro Kinsella & Youth Ambassador for the ONE Campaign, Ireland.
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