UNIT-3 COMPETITION COMMISSION OF INDIA
I NTRODUCTION
The Competition Commission of India (hereinafter Commission) is the watchdog of
CompetitionLawinIndia. ItwasestablishedbytheCentralGovernmentunderSection7of
the Competition Act 2002 with effect from 14th October 2003.
CCIconsistsofaChairpersonand6MembersappointedbytheCentralGovernment. Itisthe
duty of the Commission to eliminate practices having adverse effects on competition,
promote and sustain competition, protect the interests of consumers andensurefreedomof
trade in the markets of India.
The Commission is also required to give opinion on competition issues on a reference
received from a statutory authority established underanylawandtoundertakecompetition
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advocacy, create public awareness and impart training on competition issues.
stablishment of Commission (Section 7 of Competition Act 2002):
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It provides for the establishment of a commission by the Central government.
The Commission shall be:
● a body corporate by the name aforesaid
● having perpetual succession and
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● a common seal
● with power, subject to the provisions of this Act, to acquire, hold and dispose of
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property, both movable and immovable, and
● to contract and
● shall, by the said name, sue or be sued.
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The head office of the Commission shallbeatsuchaplaceastheGovernmentmaydecide
from time to time. Currently the head office of the Commission is in Delhi. But the
Commission may establish offices at other places in India.
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omposition of Commission (Section 8)
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TheCommissionshallconsistofaChairpersonandnotlessthantwoandnotmorethansix
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other Members to be appointed by the Central Government.
he Chairperson and every other Member shall be a person of
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1. international trade, 2. economics, 3. business, 4. commerce, 5. law, 6. finance, 7.
accountancy, 8. management, 9. industry, 10.public affairs or 11.competition matters,
includingcompetitionlawandpolicy,whichintheopinionoftheCentralGovernment,may
be useful to the Commission.
he Chairperson and other Members shall be whole-time Members.
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The Chairperson and other Members of the Commission shall be appointed by theCentral
Government.
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Term of office of Chairperson and other Members (Section 10)
● TheChairpersonandeveryotherMembershallholdofficeassuchforatermoffive
years from the date on which he enters upon his office and shall be eligible for
re-appointment:ProvidedthattheChairpersonorotherMembersshallnotholdoffice
as such after he has attained the age of sixty-five years.
● A vacancy caused by the resignation or removal of the Chairperson or any other
Member under section 11 or by death or otherwise shall be filled by fresh
appointment in accordance with the provisions of sections 9.
● TheChairpersonandeveryotherMembershall,beforeenteringuponhisoffice,make
and subscribe to an oath of office and of secrecy in such form, manner and before
such authority, as may be prescribed.
● IntheeventoftheoccurrenceofavacancyintheofficeoftheChairpersonbyreason
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of his death, resignation or otherwise, the senior most Member shall act as the
Chairperson,untilthedateonwhichanewChairperson,appointedinaccordancewith
the provisions of the Act to fill such vacancy, enters upon his office.
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● When the Chairperson is unabletodischargehisfunctionsowingtoabsence,illness
or any other cause, the senior-most Member shall discharge the functions of the
Chairperson until the date on which the Chairperson resumes the charge of his
functions.
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esignation, Removal And Suspension Of Chairperson And Other Members (Sec 11)
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TheChairpersonoranyotherMembermay,bynoticeinwritingunderhishandaddressedto
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theCentralGovernment,resignhisoffice:ProvidedthattheChairpersonoraMembershall,
unlessheispermittedbytheCentralGovernmenttorelinquishhisofficesooner,continueto
holdofficeuntiltheexpiryofthreemonthsfromthedateofreceiptofsuchnoticeoruntila
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persondulyappointedashissuccessorentersuponhisofficeoruntiltheexpiryofhistermof
office, whichever is the earliest.
heCentralGovernmentmay,byorder,removetheChairpersonoranyotherMemberfrom
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his office if such Chairperson or Member, as the case may be,—
1. is, or at any time has been, adjudged as an insolvent; or
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2. has engaged at any time, during his term of office, in any paid employment; or
3. has been convicted of an offence which, in the opinion of the Central Government,
involves moral turpitude; or
4.hasacquiredsuchfinancialorotherinterestasislikelytoaffectprejudiciallyhisfunctions
as a Member; or
5. has so abused his position as torenderhiscontinuanceinofficeprejudicialtothepublic
interest; or
6. has become physically or mentally incapable of acting as a Member.
oMembershallberemovedfromhisofficeonthegroundoffinancialorotherinterestand
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abuseofpositionunlesstheSupremeCourt,onareferencebeingmadetoitinthisbehalfby
theCentralGovernment,has,onaninquiry,heldbyitinaccordancewithsuchprocedureas
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ay be prescribedinthisbehalfbytheSupremeCourt,reportedthattheMember,oughton
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such ground or grounds to be removed.
alary and allowances and other terms and conditions of service of Chairperson and
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other Members (Section 14).
● Thesalary,andtheothertermsandconditionsofservice,oftheChairpersonandother
Members, including travelling expenses, house rent allowance and conveyance
facilities, sumptuary allowance and medical facilities shall be such as may be
prescribed.
● Thesalary,allowancesandothertermsandconditionsofserviceoftheChairpersonor
a Member shall not be varied to his disadvantage after appointment.
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UTIES OF COMPETITION COMMISSION OF INDIA
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The Competition Commission may enter into any memorandum or arrangement with prior
approvaloftheCentralGovernmentwithanyagencyofanyforeigncountry,forthepurpose
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of discharging its duties or performing its functions under the Act.
nder Section 18 the Act provides the major duties of the competition Commission. The
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commission has the following four major duties:
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1 . Eliminate practices having adverse effect on competition: It is the duty of the
commissiontobeawatchdogforprohibitinganypracticerelatingtoabuseofcompetitionin
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markets.
2. Promote and sustain competition: The main purpose of theCommissionistopromote
the competition in markets in India and try to carry on competitiveness in markets in India.
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3. Protect the interests of consumers: The ultimate aim of the competition law and the
competition commission is to protect consumers from the abuseofcompetitioninmarkets.
All the anti-competitive activities are prohibited in order to ultimately help consumers.
4. Ensure freedom of trade carried on by other participants, in markets in India: In
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order to protect the competition in markets the commission has a duty not to hinder the
freedom of trade in markets in India.
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OWER AND FUNCTIONS OF THE COMPETITION COMMISSION OF INDIA
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Chapter IV of the Competition Act 2002 deals with the duties, power andfunctionsofthe
competition commission of India
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1.Commission’sPowerofEnquiryIntoCertainAgreementsandDominantPositionof
Enterprise (Section 19): Under Section 19 the Commission is empowered to Inquire into
certain agreements and dominant position of enterprise.
The Commission may inquire into any allegedcontraventionoftheprovisionscontainedin
subsection (1) of section 3 or sub-section (1) of section 4 on
1. either on its own motion or
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2. o nreceiptofanyinformation,insuchmannerandaccompaniedbysuchfeeasmaybe
determined by regulations, from any person, consumer or their association or trade
association; or
3. referencemadetoitbytheCentralGovernmentoraStateGovernmentorastatutory
authority.
2. Commission’s Power of Enquiry Into Combination (Section 20):
● TheCommissionmay,uponitsownknowledgeorinformationrelatingtoacquisition
referredtoinclause(a)ofsection5oracquiringofcontrolreferredtoinclause(b)of
section 5 ormergeroramalgamationreferredtoinclause(c)ofthatsection,inquire
into whether such a combination has caused or is likely to cause an appreciable
adverseeffectoncompetitioninIndia:ProvidedthattheCommissionshallnotinitiate
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anyinquiryunderthissubsectionaftertheexpiryofoneyearfromthedateonwhich
such combination has taken effect.
● The Commission shall, on receipt of a notice under sub-section (2) of section 6,
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inquirewhetheracombinationreferredtointhatnoticeorreferencehascausedoris
likely to cause an appreciable adverse effect on competition in India.
3. Power To Give Opinion On Reference By Authority (Section 21):
● Where in thecourseofaproceedingbeforeanystatutoryauthorityanissueisraised
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byanypartythatanydecisionwhichsuchstatutoryauthorityhastakenorproposesto
takeisorwouldbe,contrarytoanyoftheprovisionsofthisAct,thensuchstatutory
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authority may make a reference in respect of such issue to the Commission.
● Any statutory authority, may, suo motu, also make such a reference to the
Commission.
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● Onreceiptofareference,theCommissionshallgiveitsopinion,withinsixtydaysof
receiptofsuchreference,tosuchstatutoryauthoritywhichshallconsidertheopinion
oftheCommissionandthereafter,giveitsfindingsrecordingreasonsthereforeonthe
issues referred to in the said opinion.
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4. Power of Commission To make Reference to Statutory Authority (Section 21A):
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● WhereinthecourseofaproceedingbeforetheCommissionanissueisraisedbyany
party that any decision which, theCommissionhastakenduringsuchproceedingor
proposes to take, is or would be contrary to any provision of this Act whose
implementationisentrustedtoastatutoryauthority,thentheCommissionmaymakea
reference in respect of such issue to the statutory authority: Provided that the
Commission, may, suo motu, make such a reference to the statutory authority.
● On receipt of a reference, the statutory authority shall give itsopinion,withinsixty
daysofreceiptofsuchreference,totheCommissionwhichshallconsidertheopinion
of the statutory authority, andthereaftergiveitsfindingsrecordingreasonstherefor
on the issues referred to in the said opinion.
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5. Meetings of the Commission (Section 22):
● TheCommissionshallmeetatsuchtimesandplaces,andshallobservesuchrulesand
proceduresinregardtothetransactionofbusinessatitsmeetingsasmaybeprovided
by regulations.
● TheChairperson,ifforanyreason,isunabletoattendameetingoftheCommission,
the senior-most Member present at the meeting, shall preside at the meeting.
● AllquestionswhichcomeupbeforeanymeetingoftheCommissionshallbedecided
by a majority of the Memberspresentandvoting,andintheeventofanequalityof
votes, the Chairperson or inhisabsence,theMemberpresiding,shallhaveasecond
or/casting vote: Provided that the quorum for such meeting shall be three Members.
6. Power of Commission to Conduct Enquiry under Section 19 (Section 26):
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● On receipt of a reference from the Central Government or aStateGovernmentora
statutoryauthorityoronitsownknowledgeorinformationreceivedundersection19,
iftheCommissionisoftheopinionthatthereexistsaprimafaciecase,itshalldirect
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the Director General to cause an investigation to be made into the matter:
● Providedthatifthesubjectmatterofaninformationreceivedis,intheopinionofthe
Commission, substantially the same as or has been covered by any previous
information received, then the new information may be clubbed with the previous
information.
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● WhereonreceiptofareferencefromtheCentralGovernmentoraStateGovernment
or a statutory authorityorinformationreceivedundersection19,theCommissionis
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oftheopinionthatthereexistsnoprimafaciecase,itshallclosethematterforthwith
and pass such orders as it deems fit and send a copy of its order to the Central
Government or the State Government or the statutory authority or the parties
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concerned, as the case may be.
● The Director General shall, on receipt of direction, submit a report on his findings
within such period as may be specified by the Commission.
● TheCommissionmayforwardacopyofthereportreferredtothepartiesconcerned:
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Provided that in case the investigation is caused to be made based on reference
received from the Central Government or the State Government or the statutory
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authority, the Commission shall forward a copy ofthereportreferredtotheCentral
Government or the State Government or the statutory authority, as the case may be.
● IfthereportoftheDirectorGeneralrecommendsthatthereisnocontraventionofthe
provisionsofthisAct,theCommissionshallinviteobjectionsorsuggestionsfromthe
CentralGovernmentortheStateGovernmentorthestatutoryauthorityortheparties
concerned, as the case may be, on such a report of the Director General.
● If, after consideration of the objections and suggestions, 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
CentralGovernmentortheStateGovernmentorthestatutoryauthorityortheparties
concerned, as the case may be.
● If, after consideration of the objections or suggestions,ifany,theCommissionisof
theopinionthatfurtherinvestigationsiscalledfor,itmaydirectfurtherinvestigation
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in the matter by the Director General or cause further inquiry to bemadebyinthe
matter or itself proceed with further inquiry in the matter in accordance with the
provisions of this Act.
IfthereportoftheDirectorGeneralrecommendsthatthereiscontraventionofanyof
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theprovisionsofthisAct,andtheCommissionisoftheopinionthatfurtherinquiryis
calledfor,itshallinquireintosuchcontraventioninaccordancewiththeprovisionsof
this Act.
7 . Power of Commission to Issue Orders AfterInquiryIntoAgreementsOrAbuseOf
Dominant Position (Section 27):
Where after inquiry the Commission finds that any agreement referred to in section 3 or
actionofanenterpriseinadominantposition,isincontraventionofsection3orsection4,as
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the case may be, it may pass all or any of the following orders, namely:—
1. d irectanyenterpriseorassociationofenterprisesorpersonorassociationofpersons,
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as the case may be, involved in such agreement, or abuse of dominant position, to
discontinueandnottore-entersuchagreementordiscontinuesuchabuseofdominant
position, as the case may be;
2. Impose such penalty, asitmaydeemfitwhichshallbenotmorethantenpercentof
the average of theturnoverforthelastthreeprecedingfinancialyears,uponeachof
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such persons or enterprises which are parties to such agreements or abuse:
3. In case any agreement referred to in section 3hasbeenenteredintobyacartel,the
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Commission may impose upon each producer, seller, distributor, trader or service
provider included in that cartel, a penalty of up to three times of itsprofitforeach
yearofthecontinuanceofsuchagreementortenpercent.ofitsturnoverforeachyear
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of the continuance of such agreement, whichever is higher.
4. Directthattheagreementsshallstandmodifiedtotheextentandinthemannerasmay
be specified in the order by the Commission;
5. DirecttheenterprisesconcernedtoabidebysuchotherordersastheCommissionmay
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pass and comply with the directions, including payment of costs, if any;
6. Pass such other orders or issue such directions as it may deem fit.
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7. Whilepassingordersunderthissection,iftheCommissioncomestoafinding,thatan
enterpriseincontraventiontosection3orsection4oftheActisamemberofagroup
asdefinedinclause(b)oftheExplanationtosection5oftheAct,andothermembers
ofsuchagrouparealsoresponsiblefor,orhavecontributedto,suchacontravention,
then it may pass orders, under this section, against such members of the group.
8 . Power of Commission to Divide the enterprise enjoying dominant position (Section
28):
TheCommissionmaybyorderinwriting,directdivisionofanenterpriseenjoyingdominant
position to ensure that such enterprise does not abuse its dominant position.
9. Power of Commission to conduct investigation of combinations (Section 29):
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heretheCommissionisoftheprimafacieopinionthatacombinationislikelytocause,or
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hascausedanappreciableadverseeffectoncompetitionwithintherelevantmarketinIndia,it
shallissueanoticetoshowcausetothepartiestocombinationcallinguponthemtorespond
within thirty days of the receipt of the notice, as to why investigation in respect of such
combination should not be conducted.
10. Power of Commission to issue Orders on certain combinations (Section31):
● WheretheCommissionisoftheopinionthatthecombinationhas,orislikelytohave,
anappreciableadverseeffectoncompetition,itshalldirectthatthecombinationshall
not take effect.
● WheretheCommissionisoftheopinionthatthecombinationhas,orislikelytohave,
an appreciable adverse effect on competition but such adverse effect can be
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eliminated by suitablemodificationtosuchcombination,itmayproposeappropriate
modification to the combination, to the parties to such combination.
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1 1. Extra-Territorial Power of Commission (Section32):
TheCommissionshall,notwithstandingthat,—(a)anagreementreferredtoinsection3has
beenenteredintooutsideIndia;or(b)anypartytosuchagreementisoutsideIndia;or(c)any
enterprise abusing the dominant position is outside India; or (d) a combination has taken
placeoutsideIndia;or(e)anypartytocombinationisoutsideIndia;or(f)anyothermatteror
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practice or action arising out of such agreement or dominant position or combination is
outsideIndia,havepowertoinquireinaccordancewiththeprovisionscontainedinsections
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19, 20, 26, 29 and 30 of the Act into such agreement or abuse of dominant position or
combinationifsuchagreementordominantpositionorcombinationhas,orislikelytohave,
an appreciable adverse effect on competition in the relevant market in India andpasssuch
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orders as it may deem fit in accordance with the provisions of the Act.
1 2. Power of Commission to Issue Interim Orders (Section33):
Where during an inquiry, the Commission is satisfied that an act in contravention of
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sub-section (1) of section 3 orsub-section(1)ofsection4orsection6hasbeencommitted
and continues to be committed or that such act is about to be committed, theCommission
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may, by order,temporarilyrestrainanypartyfromcarryingonsuchactuntiltheconclusion
ofsuchinquiryoruntilfurtherorders,withoutgivingnoticetosuchparty,whereitdeemsit
necessary.
1 3.Appearance before Commission (Section 35):
A person or an enterprise or the Director General may eitherappearinpersonorauthorise
one or more chartered accountants or company secretaries of cost accountants or legal
practitioners or any of his or its officers to present his or its case before the Commission.
1 4.Power of Commission to regulate its own procedure (Section36(1):
Inthedischargeofitsfunctions,theCommissionshallbeguidedbytheprinciplesofnatural
justice and, subject to the other provisions oftheActandofanyrulesmadebytheCentral
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overnment, the Commission shall have the powers to regula15.Power of civil Court
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(Section 36(2):
TheCommissionshallhave,forthepurposesofdischargingitsfunctionsunderthisAct,the
same powers as are vested in a Civil Court under the Code of CivilProcedure,1908(5of
1908), while trying a suit, inrespectofthefollowingmatters,namely:-(a)summoningand
enforcing the attendance of any person and examining him on oath; (b) requiring the
discovery and production of documents; (c) receiving evidence on affidavit; (d) issuing
commissionsfortheexaminationofwitnessesordocuments;(e)requisitioning,subjecttothe
provisionsofsections123and124oftheIndianEvidenceAct,1872(1of1872),anypublic
record or document or copy of such record or document from any office.
1 6.Power to call experts: (Section 36(3):
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The Commission may call upon such experts, from the fields of economics, commerce,
accountancy, international trade or from anyotherdisciplineasitdeemsnecessarytoassist
the Commission in the conduct of any inquiry by it.
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1 7.Power to call for documents/Information: (Section 36(4):
The Commission may direct any person:
(a)toproducebeforetheDirectorGeneralortheSecretaryoranofficerauthorizedbyit,such
books, or other documentsinthecustodyorunderthecontrolofsuchpersonsodirectedas
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may be specified or described in the direction, being documents relating to any trade, the
examination of which may be required for the purposes of this Act;
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(b)tofurnishtotheDirectorGeneralortheSecretaryoranyotherofficerauthorizedbyit,as
respects the trade or such other information as may be in his possession in relation to the
trade carried on by such person, as may be required for the purposes of this Act.
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1 8. Power to Rectify orders (Section 38).
Withaviewtorectifyinganymistakeapparentfromtherecord,theCommissionmayamend
any order passed by it under the provisions of this Act.
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ONCLUSION The Competition Commission of India (CCI) plays a pivotal role in
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ensuring a competitive and fair market environment in India. As the regulatory authority
under the CompetitionAct,2002,itisentrustedwitheliminatinganti-competitivepractices,
promoting market efficiency, protecting consumer interests, and ensuring freedom of trade.
ithextensivepowersofinquiry,investigation,andenforcement,theCCIactivelymonitors
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anti-competitive agreements, abuse of dominant positions, and combinations that may
adversely impact market competition. Its ability toissueorders,imposepenalties,andeven
regulatemergersandacquisitionsreflectsitssignificanceinmaintainingalevelplayingfield
in the Indian economy.
y fostering a competitive ecosystem,theCCIcontributestoeconomicgrowth,innovation,
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and consumer welfare. As markets evolve with globalization and technological
advancements,theCommissioncontinuestoadaptandstrengthenitsregulatoryframeworkto
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a ddressemergingchallenges.Ultimately,theCCIservesasaguardianofcompetitionlawin
India, ensuring that markets function efficiently and fairly for businesses and consumers
alike.
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