CENTRAL UNIVERSITY OF SOUTH BIHAR,
GAYA, BIHAR
TOPIC OF PROJECT:
Competition Commission of India(CCI)
SUBMITTED TO: Dr. Sanjay Prakash Srivastava
Pooja Priyadarshani
CUB1413125045
B.A.LL.B. Xth Sem.
LAW556
Competition Law
ACKNOWLEDGEMENT
1
During the course of writing this project, I have received the help, encouragement from my
teacher, colleagues, friends and others. I am very thankful to all of them. I am practically very
thankful to my “Competition Law” Teacher : Dr. Sanjay Prakash Srivastava for
encouragement and support that he provided during the preparation of the project.
I am deeply indebted to the eminent legal experts other scholars of repute whose valuable
work has been highly useful in writing this project.
2
Contents
1. Introduction………………………………………………………………4
2. Objective of Competition Commission of India……………………….4
3. Role of the Commission………………………………………………….5
4. Establishment of Commission…………………………………………..5
5. Constitution of Commission……………………………………………6
6. Power and Function of Commission…………………………………..6-7
7. Duties of the Commission…………………………………………….7
8. Procedure for Inquiry …………………………………………………8-9
9. Competition Appellate Tribunal……………………………………….9
10. Relationship between competition Advocacy and Competition Law…10
11. Case Law …………………………………………………………………11-13
12. Conclusion…………………………………………………………………..13
13. Bibiliography……………………………………………………………….14
3
Introduction
Competition Commission of India is a statutory body of the Government of
India responsible for enforcing The Competition Act, 2002 throughout India and to prevent
activities that have an appreciable adverse effect on competition in India The CCI is a
statutory body corporate which was established by the government on 14th October 2003. So
it is an artificial person that has perpetual succession. The Central Government will appoint all
its six members and the Chairperson forming the Board.
Now the main aim of the CCI is to implement the modern competition laws and philosophy of
the Competition Act, 2002. It ensures that there are no unfair practices in the market which
have a negative impact on healthy competition. This is because healthy competition is good
for the consumers of a market. Monopolistic competition or other unfair practices have an
adverse effect on economic growth.1
One of the main requirements for growth in an economy is the ease and the freedom of trade.
Firms should be able to enter the market easily and compete without any hindrances. So it is
necessary there are no unfair practices but fair competition in the market. The Competition
Commission of India (CCI) ensures the same
Objectives of the Competition Commission of India
Prevent policies and practices which have an adverse effect on constructive
competition in the economy
1
https://www.toppr.com/guides/commercial-knowledge/organizations-facilitating-business/competition-
commission-of-india-cci/
4
Promote and help sustain healthy competition in the market
Look after the interest of the consumers
Create awareness and advocate for fair competition practices
And finally, ensure freedom of trade in the market
Role of the Competition Commission of India
The preamble of the Competition Act focuses on the development of the economy and the
country by avoiding unfair competition practices and promoting constructive competition. To
achieve these objectives, the CCI attempts to do the following activities and practices,
Ensure that the markets work for the benefits of the consumers, so the welfare of the
consumers is the main priority.
Economic activities are promoting fair competition in the market for growth and
prosperity.
Implement the competition practices and policies of the Competition Act. The aim is
the best possible utilization of resources by embracing these policies.
Another role of the CCI is to ensure interaction and cooperation with the other
regulating authorities in the economy. This will ensure that the sectoral regulatory laws
are in agreeable with the competition laws.
One important role of the CCI is to carry out advocacy about competition and
competition laws. It aims to educate ministries, state governments, regulators, and other
authorities about the modern concepts of competition. And it does so by conducting
workshops, seminars, publishing papers etc.2
Establishment of Commission
1. With effect from such date as the Central Government may, by notification, appoint,
there shall be established, for the purposes of this Act, a Commission to be called the
Competition Commission of India.
2
https://www.toppr.com/guides/commercial-knowledge/organizations-facilitating-business/competition-
commission-of-india-cci/
5
2. The Commission shall be a body corporate by the name aforesaid having perpetual
succession and a common seal with power, subject to the provisions of this Act, to
acquire, hold and dispose of property, both movable and immovable, and to contract
and shall, by the said name, sue or be sued,
3. The head office of the Commission shall be at such place as the Central Government
may decide from time to time.
4. The Commission may establish offices at other places in India.3
Constitution of Commission
Section 8(1) of the Act provides that the Commission shall consist of a Chairperson and not
less than two and not more than six other members to be appointed by the Central
Government. The members will be handling the administration and Coordination division,
Investigation division, Economic division, Combination division, Anti-trust Division and
Legal division.
Section 8(2) of the Act further provides that the Chairperson and other members be a person
of integrity, ability, and standing and who has been or is been qualifies to be a Judge of High
Court or has special knowledge and professional experience of not less than fifteen years in
international trade, economics, law, business, finance, accountancy, industry, public affairs,
or in any other matter which is in the opinion of the Central Government, may be useful to
the commission.4
Powers and Functions of the Commission:
1. To eliminate practices having an adverse effect on competition, promote and sustain
competition, protect interests of consumers and ensure freedom of trade by other
participants.
2. Inquire into certain agreements and dominant position of enterprise– It provides that
the Commission may either suo moto or on receipt of any information of alleged
3
Section 7 Competition Act,2002
4
Section 8 of Competition Act, 2002
6
contravention of Section 3 (prohibits anti-competitive agreements) may inquire into
the same.
3. Inquiry into the acquisition, control, and combinations– Section 20 of the Act entrusts
the Commission with the power to inquire into any information relating to acquisition
and determine whether such combination or acquisition may have an appreciable
adverse effect on competition (AAEC).
4. Power to regulate its own procedure(Section 36.)
5. Power to impose a monetary penalty( Section 39.)
6. Power to issue an interim order– Section 33 of the Act empowers the Commission to
issue interim orders in cases of anti-competitive agreements and abuse of dominant
position, thereby temporarily restraining any party from carrying on such an act.
7. Competition Advocacy– Section 49 of the Act provides for competition advocacy and
enumerates that the Central or the State Government may while formulating any
policy on Competition or any other matter may make reference to the Commission for
its opinion on the possible effect of such policy on Competition. However, the
opinion given by the Commission is not binding on the Central Government.5
Powers duties and functions of the Competition Commission of India
Chapter IV of the Competition Act, 2002 deals with the duties, powers and functions of the
Competition Commission of India. The said chapter comprised of 23 Sections originally out
of which 6 have been omitted by the Competition (Amendment) Act, 2007.Section 18 of the
Act deals with the duties of the commission. It provides that subject to the provisions of the
Act, it shall be the duty of the Commission to eliminate practices having adverse effect on
competition, promote and sustain competition, protect the interests of consumers and ensure
freedom of trade carried on by other participants, in markets in India. Thus, it can be said that
the Act mandates the Commission to do all what is necessary to carry out the purposes of the
Act stated in the Preamble of the Act. While performing its aforesaid duties the Commission
may, with the prior approval of the Central Government and for the purpose of discharging its
duties or performing its functions under this Act, enter into any memorandum or
arrangement, with any agency of any foreign country.
Duties of Competition Commission of India:
5
https://www.legalbites.in/competition-commission-of-india-constitution-power-and-functions/
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Discouraging anti-competitive agreements
Checking the abuse of dominant position
To help common man by providing goods and services at convenient prices.
To promote fair competition in economy
Creating equivalent chances for all producers
To create awareness among people. To know its awareness programs visit National
level essay competition by Competition Commission of India.6
Procedure for inquiry
Procedure for inquiry on complaints under section 197
1. On receipt of a complaint or a reference from the Central Government or a State
Government or a statutory authority or on its own knowledge or there exists a prima
facie case, it shall direct the Director General to cause an investigation to be made
into the matter. Information, under section 19, if the Commission s of the opinion that
2. The Director General shall, on receipt of direction under sub-section (1), submit a
report on his findings within such period as may be specified by the Commission.
3. Where on receipt of a complaint under clause (a) of sub-section (1) of section 19, the
Commission is of the opinion that there exists no prima facie case, it shall dismiss the
complaint and may pass such orders as it deems fit, including imposition o costs, if
necessary.
4. The Commission shall forward a copy of the report referred to in sub-section (2) to
the parties concerned or to the Central Government or the State Government or the
statutory authority, as the case may be.
6
https://www.indiastudychannel.com/resources/138092-Competition-Commission-of-India-CCI-and-its-duties-
2011.aspx
7
https://www.advocatekhoj.com/library/bareacts/competitionact/26.php?Title=Competition
%20Act&STitle=Procedure%20for%20inquiry%20on%20complaints%20under%20section%2019
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5. If the report of the Director General relates on a complaint and such report
recommends that there is no contravention of any of the provisions of this Act, the
complainant shall be given an opportunity to rebut the findings of the Director
General.
6. If, after hearing the complainant, the Commission agrees with the recommendation
of the Director General, it shall dismiss the complaint.
7. If, after hearing the complainant, the Commission is of the opinion that further
inquiry is called for, it shall direct the complainant to proceed with the complaint.
8. If the report of the Director General relates on a reference made under sub-section
(1) and such report recommends that there is no contravention of the provisions of this
Act, the Commission shall invite comments of the Central Government or the State
Government or the statutory authority, as the case may be, on such report and on
receipt of such comments, the Commission shall return the reference if there is no
prima facie case or proceed with the reference as a complaint if there is a prima facie
case.
9. If the report of the Director General referred to in sub-section (2) 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.8
Competition Appellate Tribunal
Competition Appellate Tribunal was established in accordance with the provisions of
the Amendment Act, 2002.9
Its function is to hear and dispose of appeals against any direction issued or decision
made or order passed by the Competition Commission of India.
The Appellate Tribunal shall also adjudicate on claim for compensation that may arise
from the findings of the Competition Commission of India or the orders of the Appellate
Tribunal in an appeal against any findings of the Competition Commission of India and
pass orders for the recovery of compensation.10
8
Section 26 of Competition Act, 2002
9
Section 53A of Competition Act, Establishment of Appellate Tribunal.
10
https://www.google.com/amp/www.ambitionias.com/what-is-competition-appellate-tribunal.html/amp
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It consists of the chairperson, an ex or current judge of Supreme Court or the Chief
Justice of a High Court, and two other persons11 with a professional experience of not less
than twenty-five years in, competition matters, including competition law and policy,
international trade, economics, business, commerce, law, finance, accountancy,
management, industry, public affairs, administration or in any other matter which in the
opinion of the Central Government, may be useful to the Appellate Tribunal, appointed by
the central government of India.12
The Chairperson or a Member of the Appellate Tribunal shall hold office for a term of
five years and shall be eligible for re-appointment. Provided that no Chairperson or other
Member of the Appellate Tribunal shall hold office after he has attained the age of sixty-
eight years or sixty-five years respectively.13
The Relationship Between Competition Advocacy and Competition Law
A commonly accepted definition of competition advocacy is that it includes all activities of a
competition agency that are intended to promote competition apart from those that involve
enforcement of the competition law14. Such a definition suggests that advocacy and
enforcement are mutually exclusive, but they are not. In many ways they are interdependent.
Thus, as noted above, effective competition advocacy in the privatisation and regulatory
reform processes can favourably impact enforcement by creating competitive markets, in
which future abuses of dominance and collusion are less likely to occur. Success in building a
competition culture has obvious benefits for enforcement: businesses will more readily
comply voluntarily with the competition law; businesses and the public will more willingly
co-operate with enforcement actions, by providing evidence and the like; and policy makers
will more enthusiastically support the mission of the competition agency, in particular by
giving more resources to it. Perhaps less well appreciated is how competition law
enforcement can affect competition advocacy. Noted above is the importance of the agency’s
credibility and reputation to successful competition advocacy efforts. Such credibility cannot
be gained through advocacy alone; it must be enhanced by success in enforcing the
competition law. It is imperative that the agency select and successfully prosecute cases that
are widely viewed as beneficial to consumers, whether they involve destructive cartels, high
11
Section 53C of Act, 2002, composition of Appellate Tribunal
12
Section 53D of 2002 Act, Qualifications
13
Section 53F of 2002 Act, Term of office
14
ICN Report at 25.
10
profile, anticompetitive mergers or abusive conduct by notorious dominant firms. In the end,
a competition agency’s reputation will be built largely upon its record in enforcing the
competition law, and this reputation will significantly affect its influence as an advocate in
other forums.15
Cases Laws
M/S R S Industries vs Competition Commission Of India16
It is well settled that discretion with the public authority must be applied after taking into
account relevant considerations. In the present case, CCI failed to apply its mind to most of
the relevant considerations. First of all, CCI has not taken into account that its substantive
direction to cease and desist from anti-competitive conduct had not been violated.
Secondly, CCI has not considered any element of public interest, warranting an imposition of
such penalty. Undisputedly, in absence of violation of the cease and desist order, the failure
on the part of the petitioners to file an undertaking did not have any adverse effect on public
interest. CCI seemed to have completely ignored this aspect. It is also clear that the
petitioners did not benefit from non-filing of the undertaking and there was no reason why
the petitioners' contention that there failure to file undertaking was intentional, should not
have been accepted. COMPAT had stayed the penalty on account of the petitioners being
small scale industries. This consideration was completely ignored by CCI.
Cadila Healthcare Limited And Anr vs Competition Commission Of India17
It is held that the procedure adopted by the DG, who investigated the complaint as a matter,
without the CCI recording its prima facie opinion against the appellant/Cadila cannot be
termed an illegality Likewise, the rejection of the recall application (by the CCI) does not call
15
ICN Report at 75-76; but see, William E. Kovacic, Getting Started: Creating New Competition
Policy Institutions in Transition Economies, 23 Brooklyn Journal of International Law, 408 (1997),
16
W.P.(C) 5947/2014 & CM 14538/2014
17
LPA 160/2018 & CM APPL. Nos. 11741-44/2018
11
for interference. On the third point, i.e. the issue of cross examination, this appeal has to
succeed; however on the last issue, i.e. notice and proceedings in a composite manner against
the directors and Cadila, cannot be termed an illegality or irregularity; it was in accordance
with law.
Mahindra Electric Mobility V. CCIAnd Anr18
the following conclusions are recorded and directions issued:
i. Section 22(3) of the Competition Act (except the proviso thereto) is declared
unconstitutional and void;
ii. Section 53E (prior to the amendment in 2017) is declared unconstitutional and void:
however, this is subject to the final decision of the Supreme Court in the writ petitions
challenging the Finance Act, 2017;
iii. All other provisions of the Competition Actare held to be valid subject to the
following orders:
a. The CCI shall frame guidelines with respect to the directions contained in
para 179 of this judgment, i.e. to ensure that one who hears decides is
embodied in letter and spirit in all cases where final hearings are undertaken
and concluded. In other words, once final hearings in any complaint or batch
of complaints begin, the membership should not vary- it should preferably be
heard by a substantial number of 7 or at least, 5 members.
b. The Central Government shall take expeditious steps to fill all existing
vacancies in the CCI, within 6 months;
c. The CCI shall ensure that at all times, during the final hearing, the judicial
member (in line with the declaration of law in Utility Users Welfare
Association, (supra) is present and participates in the hearing;
d. The parties should in all cases, at the final hearing stage, address arguments,
taking into consideration the factors indicated in Excel Crop Care (supra) and
any other relevant factors; they may also indicate in their written submissions,
or separate note, of submissions, to the CCI, why penalty should not be
awarded, and if awarded, what should be the mitigating factors and the
quantum- without prejudice to their other submissions.
18
W.P.(C) 11467/2018, CM APPL. 44376-44378/2018
12
Iv Since the petitioners had not availed the remedy of appeal (and had approached this
Court) it is open to such of them who wish to do so, to approach the Appellate Tribunal,
within 6 weeks; in such eventuality, the Appellate Tribunal shall entertain their appeals and
decide them on their merits in accordance with law, unhindered by the question of limitation.
CCILtd. Vs. JCIT
held that the assessee had not retained shares with the intention of earning dividend income
which was only incidental to the shares remained unsold by the assessee. The High Court,
therefore, held that no disallowance of expenses was required in relation to dividend from
trading shares
Competition Commission of India v. Steel Authority of India Limited 19
the Supreme Court held that the CCI was a proper party before the Tribunal and directed
SAIL to pay costs of Rs. 25,000/- to the JSPL for extension of time for filing a further reply.
The Supreme Court further directed that in the event the report prepared by the DG during the
period 8th December 2009 to 11th January 2010 had been received, the CCI should proceed
in accordance with the provisions of the CA as well as principles of law enunciated in its
judgment after giving proper notice to JSPL and SAIL and pass appropriate orders. The order
dated 15th February 2010 of the Tribunal was modified to the above extent
Conclusion
The Commission needs to swing into action undertaking substantial capacity building to
implement the extra territorial jurisdiction that is embodied in the Competition Act, 2002.
As India integrates at a fast pace with the global economy there is a need to ensure
international co-operation to tackle cross border challenges. Even though the Competition
Act embodies the ‘effects’ doctrine, its implementation has been more or less ineffective. The
Competition Act is yet to fully come into force as a result of which a significant
jurisprudence under the legislation is yet to be developed. Moreover, the actual implicationsin
enforcing the rather broad mandate prescribed for the Competition Commission of India are
to be fully realized.The difficulties in implementing the provisions are yet to be encountered;
they can only be anticipated or predicted based on the analysis of the bare provisions of the
enactment. There is no obvious solution to this dilemma. The agency must simply exercise
good judgment in selecting and pursuing its advocacy projects. It must seek out matters that
19
2010) 10 SCC 744
13
are economically important, politically visible, that will not occupy too many resources and
in which the agency has a reasonable chance of success. It must give ongoing attention to
building a competition culture through aggressive public relations and dissemination of
information. And importantly, it must not neglect its law enforcement responsibilities. It must
exercise the same care and expend at least the same amount of energy in finding and
prosecuting violations of the law as it does in its advocacy efforts.
Bibliography
Competition Act, 2002
Monopolistic and Restrictive Trade Practice Act, 1969
Www.cci.gov.in
Www.indiankanoon.com
Www.advocatekhoj.com
Www.manupatra.com
Www.slideshare.net
https://www.google.com/amp/www.ambitionias.com/what-is-competition-appellate-
tribunal.html/amp
https://www.indiastudychannel.com/resources/138092-Competition-Commission-of-
India-CCI-and-its-duties-2011.aspx
https://www.legalbites.in/competition-commission-of-india-constitution-power-and-
functions/
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