There is no pre-condition that a person approaching the Competition Commission of India must be personally aggrieved by the act, the Supreme Court of India held in a judgment delivered this week.

The judgment authored by Justice Rohinton Nariman set aside the NCLAT’s conclusion on right to approach the CCI and in doing so restored the playing field as level to consumers and informants.

The top court was hearing an appeal against the National Company Law Appellate Tribunal judgment that declined to interfere with a CCI decision. The CCI had declined to direct an investigation into allegations of violation of competition law by cab aggregators Uber and Ola.

The top court agreed with the NCLAT — and hence the CCI’s rejection of an investigation. But it set aside the tribunal’s conclusion on the issue of who can approach the CCI to seek directions for an investigation.

It is difficult to agree with the judgment of the NCLAT in its narrow construction of the Section 19 of the act, which therefore stands set aside, said the top court.

NCLAT Judgment Was A Surprise, Say Lawyers

The case began with an informant Samir Agrawal approaching the CCI to seek initiation of an inquiry against Ola and Uber, alleging that they entered into price-fixing agreements in violation of the competition law.

The informant, a practicing lawyer, did not succeed at the CCI as the regulator found no prima facie merit in the information and declined to order an investigation. Against this, he approached the NCLAT.

The NCLAT, in May 2020, agreed with the CCI’s conclusion of there being no prima facie substance in the allegations and dismissed the appeal.

The appellate tribunal, however, made observations on who can approach the CCI with information on an anti-competitive practice. The law says the commission may inquire into an alleged contravention of its provisions either on its own motion, via reference by the central or state government, or on receipt of information “from any person, consumer or their association or trade association”.

The tribunal interpretated the phrase “any person” in Section 19(1)(a) of the Competition Act to mean a person who “has suffered an invasion of his legal rights as a consumer or beneficiary of healthy competitive practices”.

“Any other interpretation would make room for unscrupulous people to rake issues of anti-competitive agreements or abuse of dominant position targeting some enterprises with oblique motives,” the NCLAT judgment said.

This conclusion came as a surprise to the practitioners of competition law, said Delhi-based advocate, Vaibhav Gaggar, who specialises in competition law practice.

Supreme Court Set Aside The NCLAT Finding On Locus Standi

The Supreme Court examined the provisions of the Competition Act while setting aside the NCLAT observations on the issue of locus-standi — the right to be heard.

The top court noted that the 2007 amendment to the competition law replaced the phrase “receipt of a complaint” with “receipt of any information in such manner and”.

Through this amendment, the top court said, the scope of the Section 19 of the Act was widened and enabled the commission to receive information from any person irrespective of whether they are personally affected or not.

“Whereas, a complaint could be filed only from a person who was aggrieved by a particular action, information may be received from any person, obviously whether such person is or is not personally affected. This is for the reason that the proceedings under the act are proceedings in rem which affect the public interest,” the Supreme Court said while explaining the 2007 amendment.

Anand Desai of DSK legal agreed with the top court’s finding.

The top court also highlighted protective measures in place against unscrupulous people who raise issues to target others with oblique motives.

It pointed to the provision of the law that allow for a penalty of up to Rs 1 crore against any person who provides any information in a reckless and malafide manner.

“….the judicious use of heavy costs being imposed when the information supplied is either frivolous or malafide, can keep in check what is described as the growing tendency of persons being ‘set up’ by rivals in the trade,” noted the top court.

Gaggar said the top court’s clarification will have an impact on pending cases which may have got derailed due to the NCLAT judgment and hopes that things from now on will progress speedily.

That view was shared by Sameer Jain of PSL Advocates & Solicitors.

“The Supreme Court judgment basically means that anybody can make a complaint about an anti-competitive practice and price fixation. It will promote more competitive market environment since the complainants will not have to prove an additional requirement of personal injury,” said Jain, founder and managing partner, PSL Advocates & Solicitors.

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