5 July, 2017
Duty of court to consider economic impact of its decisions: SC6
In a case involving Shivashakti Sugars Limited and Shree Renuka Sugar Limited, the SC made some pertinent observations on law and economics while deciding the dispute. The SC noted that law is an interdisciplinary subject and it is necessary now, in an era of liberalisation and economic growth, that the impact of other disciplines of law are kept in mind while the judici- ary is taking a decision. The SC further observed that in order to ensure a developed economy in the future, it is necessary that the judiciary while performing its judicial function considers economic analysis and the economic impact of its decisions.
In explaining the abovementioned viewpoint, the SC stated that the first duty of the court is the application of statutory provisions.
However, it also stated that in a situation where two views are possible, an interpretation is required or there is discretion given to the court by law, the courts must now favour a view which is favourable to the economic interest of the country. Conversely, it must avoid a view which has the potential to create a detrimental effect on em- ployment and growth of infrastructure, economy, or revenue of the nation.
NCLAT’s first stay of CCI’s order 7
On December 9, 2013, CCI imposed a penalty of ¤1,773 crore (approximately US$ 275 million) on Coal India Corporation Limited (‘CICL’) for abuse of dominance. On appeal, COMPAT remanded the matter back to CCI for fresh consideration. In March this year, CCI found CICL and its sub- sidiaries to have abused their dominant position by imposing unfair and discriminatory condi- tions in a Fuel Supply Agreement (‘FSA’) and held CICL in contravention of Section 4 of the Act. CCI directed CICL and its subsidiaries to cease and desist from indulging in abusive conduct and ordered that the FSA should be modified accordingly. It also reduced the penalty to ¤591 crore (approximately US$ 92 million). This order was again appealed by CICL before COMPAT.
After the merger of the two appellate tribunals i.e., COMPAT and NCLAT, as per the Finance Act, 2017, the new appeal came up before NCLAT, headed by Justice Mukopadhaya. On May 31, 2017, NCLAT passed its first interim stay order, staying the operation of the CCI’s order passed in March, 2017.
Appeal filed against M/s Great Eastern Energy Corporation Limited dismissed by COMPAT 8
COMPAT on May 8, 2017, dismissed an appeal filed by Saurabh Tripathy against an order passed by CCI under Section 26(8) of the Act in relation to a Gas Sale and Purchase Agreement (‘GSPA’) entered into between Saurabh Tripathy and M/s Great Eastern Energy Corporation Limited. COMPAT ruled that CCI should order substituted service where its order has not been served on the concerned party, that the fact that a party has belatedly been served with an order could satisfactorily explain any delay in filing of an appeal. It also held that the silence of CCI on some of the findings of DG does not entail that CCI accepts those findings.
Saurabh Tripathy filed an appeal before COMPAT on April 28, 2017, challenging an order of CCI passed on February 16, 2017 (‘Impugned Order’), which was filed beyond the limitation period of 60 days as stipulated under Section 53B(2) of the Act. Saurabh Tripathy explained the delay on the basis that since the addresses registered with CCI had changed he did not receive the Impugned Order on time. The Impugned Order was received by him belatedly on April 26, 2017. COMPAT, while accepting the explanation for the delay, noted that Regulation 22(4) read with Regulation 32(3) of the Competition Commission of India (General) Regulations, 2009 require CCI to take steps for making substituted service where the addressee has since left or is not available at the given address.
Given that an order of CCI under Section 26(8) of the Act is not appealable while that under Section 27 is appealable, Saurabh Tripathy argued that the Impugned Order is an order under Section 27 of the Act and not an order under Section 26(8) of the Act. His argument was on the basis that although CCI expressly disagreed with some of the findings of the DG, it remained silent on the rest of the findings; and in the absence of express disapproval, it should be inter- preted to mean that CCI agreed with those findings.
COMPAT while reiterating the exhaustive nature of Section 53A(1)(a) noted that the inter- pretation suggested by Saurabh Tripathy is fallacious and it does not change the fact that the Impugned Order was in fact an order under Section 26(8) of the Act, which are not appealable to COMPAT. It further observed that if CCI had not commented on some specific stipulations of the GSPA, it cannot be said that CCI did not apply itself to those stipulations. COMPAT therefore concluded that it has no jurisdiction to adjudicate on the Impugned Order and dismissed the appeal. There was also some suggestion by COMPAT on the unclear nature and uncertainty of the provisions under Section 26 of the Act.
CCI dismisses the allegations against Coal India Limited and Central Coalfields Ltd. in relation to sale of non-coking coal through spot e-auction 9
Shri Bijay Poddar (‘Informant’) filed an information against Coal India Limited (‘CIL’) and Central Coalfields Ltd. (‘CCL’) (CIL and CCL are collectively referred to as the ‘Opposite Par- ties’) before CCI alleging contravention of the provisions of Sections 3 and 4 of the Act with respect to sale of non-coking coal through ‘Spot E-auction Scheme, 2007’ (‘Scheme’) by CIL and its subsidiaries. Specifically, with respect to ‘Modalities for Special Spot E-auction 2016-17’ by CIL and ‘Sale of Coal Through Spot E-auction from High Stock Mines’ by CCL (‘Impugned E-auctions’).
The Informant alleged that even though the Scheme (formulated under The New Coal Dis- tribution Policy, 2007 (‘NCDP’) has been in force for the last 10 years, CIL and its subsidiaries have floated the Impugned E-auctions with terms and conditions that were not consistent with the NCDP. The Information submitted that CIL made special spot e-auctions beyond the terms and conditions of the Scheme which has caused huge disadvantages and monetary losses to the participants of regular spot e-auctions and accrual of undue benefits to the participants of such special spot e-auctions.
CCI noted that the Scheme had been brought before CCI by the Informant on another occa- sion in Bijay Poddar v. Coal India Limited & Ors., Case No. 59 of 2013 (‘Case 59/2013’). In that case, CCI ordered the terms and conditions of the Scheme as specified therein to be modified in light of the findings recorded in the said order.
CCI had defined the relevant market in Case 59/2013 as the market for the ‘sale of non-coking coal to the bidders under Spot e-auction in India’. In this case, CCI had held that there was a lack of mutuality and reciprocity in the contractual obligations which was due to the market power of the Opposite Parties in the relevant market. In the present matter, CCI noted that in DB Power Limited v. CIL & Anr., Case No. 72 of 2015, and Bijay Poddar v. CIL & Ors., Case No. 76 of 2015, CCI had held that no case was made out for contravention of the provisions of Section 4 of the Act. While dismissing these cases, CCI had expressed its displeasure about the piecemeal man- ner in which the Informant was laying challenge to the Scheme in a selective and convenient manner. CCI directed that CIL must examine the entire Scheme afresh after inviting suggestions from relevant stakeholders. Such participatory and consultative process would not only inspire confidence of the stakeholders but such exercise would also make the Scheme more acceptable besides obviating any possible violation of the provisions of the Act and challenge thereto.
In the instant case, CCI noted that the Informant has challenged the Impugned E-auctions as being inconsistent with the Scheme and the NCDP and that the Informant has not alleged that the Impugned E-auctions are contrary to the provisions of Section 4 of the Act. CCI therefore opined that such conduct did not disclose any anti-competitive issue per se and the remedies of the Informant would lie elsewhere if indeed there is any deviation from the original scheme or any violation of the NCDP in the process. CCI also stated that such an omnibus challenge to the terms of the Impugned E-auctions without specifying in any manner as to how the same are contrary to the provisions of Section 4 of the Act cannot be sustained, and dismissed the infor- mation vide its order dated June 2, 2017.
CCI dismisses suo moto case of alleged bid rigging for sugar mills 10
CCI had suo moto taken up a matter based on the findings in the Performance Audit Report of the Comptroller and Auditor General of India on Sale of Sugar Mills of Uttar Pradesh State Sugar Corporation Limited for the year ended March 31, 2011 (‘CAG Report’) which indicated cartelization/concerted bids by a group of related companies in the sale of sugar mills by the Uttar Pradesh State Sugar Corporation Limited (‘UPSSCL’) and its subsidiary M/s Uttar Pradesh Rajya Chini Evam Ganna Vikas Nigam Limited (‘UPRCGVNL’). These sugar mills came up for
sale by the Government of Uttar Pradesh (‘GoUP’) under a policy of privatization of Public Sector Undertakings (‘PSUs’) in June, 2007. On this basis, 10 operational mills of UPSSCL and 11 closed mills of UPRCGVNL were sold during the months of July-October, 2010 and January- March, 2011, respectively.
The CAG Report had observed a similarity in the bids/expected price ratio in the original and the Swiss Challenge Method (‘SCM’) rounds of bidding, the unusual withdrawals of cer- tain bids without any apparent reason and the forfeiture of the substantial security amounts deposited by the bidders. It concluded that such actions reflected some prior arrangement/un- derstanding amongst the bidders in the bidding rounds and this prevented the realisation of a fair value of the sugar mills. The Report indicated cartelisation by the participating companies namely, M/s Wave Industries Private Limited (‘Wave’), M/s PBS Foods Private Limited (‘PBS Foods’), M/s Indian Potash Limited (‘IPL’), M/s Nilgiri Food Product Private Limited (‘Nilgi- ri’), M/s Trikal Food and Agro Private Limited (‘Trikal’), M/s Giriasho Company Private Lim- ited (‘Giriasho’), M/s Namrata Marketing Private Limited (‘Namrata’), and M/s SR Buildcon Private Limited (‘SR Buildcon’). Factors such as a common director, common correspondence addresses, email addresses and contact numbers between some of the bidders, sequential num- bers on the demand drafts and stamp papers submitted during the bidding process were held to be indicative of collusion.
On the basis of the CAG Report, CCI took the view that there appeared to be a prima facie case of tacit agreement/understanding/arrangement among the bidders for the sugar mills sold by UPSSCL and UPRCGVNL in violation of the provisions of Sections 3(3)(a) and 3(3)(d) of the Act. Accordingly, the matter was referred to the DG for investigation. The DG report confirmed observations of the CAG Report regarding the common directors, sequential numbers on the demand drafts and stamp papers submitted by some of the bidders during the bidding process. On this basis, DG concluded that there was an understanding among the bidders i.e., Wave, Nil- giri, Trikal, Giriasho, Namrata, and SR Buildcon (collectively referred to as the ‘Parties’) to not bid against each other, to act in a collusive manner and directly/indirectly decide the prices of the mills in violation of Sections 3(3)(a) and 3(3)(d) of the Act. The issue before CCI was whether competition was distorted as a result of collusion among the Parties thereby preventing oth- er potential bidders from participating in the process. Specifically, collusion by Wave and PBS Foods in the process of bidding for the 10 operational sugar mills of UPSSCL and by Wave, Nil- giri, Trikal, Giriasho, Namrata, and SR Buildcon in the process of bidding for the 11 closed sugar mills of UPRCGVNL was the subject matter.
In its assessment, CCI made the following observations:
Firstly, it examined the background of the disinvestment of the sugarmills. It noted that because of the heavy losses incurred by the sugar mills, the GoUP made a decision to disinvest them through a strategic sale process which was challenged in the courts. It was noted by CCI that an order of the Allahabad High Court ef- fectively prohibited the purchasers of the mills from closing the sugar mills and changing the use of the accompanying land property. Further, a direction of the SC made the transfer of title of the sugar mills to a purchaser dependent on the final adjudication of the appeal which was pending before it during the bidding process. CCI observed that although both these orders did not stay the sale of the sugar mills, they may have rendered purchase of the mills less attractive to the prospective buyers.
It held that these factors were obvious reasons for the lack of competition and the reluctance of bidders to bid at or above the expected price. There was no evidence found during the investigation to show that the lack of participation during the bidding was because of collusion among the Parties;
Secondly, CCI noted that the tender conditions and the methodology adopted for inviting bids enabled any potential bidder who satisfied the eligibility criteria to participate in the original and SCM bidding round. DG investigation also did not unearth evidence of collusion or coercion which prevented potential bidders from participating in the bidding process. On the basis of the information provided and taking into consideration the circumstances of the sale, CCI concluded that it was not possible to draw an inference of collusion merely based on the fact that some of the Parties had a common director and submitted demand drafts/stamp paper bearing consecutive numbers; and
Lastly, CCI held that even if the Parties were related, it was not sufficient to find any contravention as there was no evidence to show collusion or coercion that prevented other potential bidders from participating in the bidding process. This was further solidified by the submission of the Chief Secretary of GoUP in the Al- lahabad High Court which stated that no complaint had been received from any company claiming that they had been prevented from participation. It was reiter- ated that in the absence of meeting of minds, mere commonality of directors in the bidding companies of the original round and companies participating in the
SCM round was not conclusive to show any collusive arrangement.
Based on the aforementioned reasons, CCI dismissed the case. However, another issue of ju- risdiction was also raised in the present matter which was addressed separately in a supplemen- tary ruling by the CCI Member, Augustine Peter. The Parties to the case had called in question the jurisdiction of CCI on two grounds, namely:
That the present case deals with the alleged practice of collusive bidding of sugarmills of UPSSCL which does not in law relate to production, supply, distribution, storage, acquisition, or control of goods or services under Section 3(1) of the Act and therefore the Act had no applicability in this instance; and
The Parties had also questioned CCI on the ground that the applicability of Sec- tion 3(3) is only to persons or enterprises engaged in similar trade of goods or services i.e., competitors and for this reason CCI does not have jurisdiction as the Parties are engaged in diverse activities and are not competitors at a horizontal level.
Upon analysing the Act and the judicial precedents, the Member emphasised that the phrase ‘in respect of’ in Section 3(1) of the Act ensures that the provision cannot be limited only to agreements involving goods and services. It was clarified that all activities related, con- nected, or attributable to the production, supply, distribution, storage, acquisition, or control of goods and/or services are included in Section 3(1). Therefore, since sugar mills are connected to the production of sugar, CCI does have jurisdiction. The contention of the Parties on not being competitors was also dismissed as it was held that the Parties in fact acted as competitors when they bid for the sugar mills, irrespective of whether they were involved in such business activity previously or not. For the above reasons, it was held that CCI would have jurisdiction on both the grounds contended by the Parties.
A decision taken by a consumer to purchase/avail goods/services from a particular supplier cannot be termed as collusion: CCI 11
On March 5, 2017, CCI dismissed a complaint filed by M/s Applesoft (‘Applesoft’) against the Chief Secretary to the Government of Karnataka (‘CSGK’), the Principal Secretary to the Gov- ernment of Karnataka (‘PSGK’) and the Secretary, Kannada Ganaka Parishad (‘SKGP’) (CSGK, PSGK, and SKGP are collectively referred to as the ‘Opposite Parties’), which alleged contraven- tion of the provisions of Sections 3 and 4 of the Act by mandating the use of a specific Kannada language software i.e., ‘Nudi’ software, to the exclusion of other Kannada language softwares.
The informant, Applesoft, develops software in Indian languages with the objective to bridge the divide that arises because of the lack of local language support resulting out of com- puterisation. The information filed alleged that the actions of CSGK and PSGK by way of issuing directions/notices/circulars mandating the use of ‘Nudi’ software alone had adversely impacted competition in the market as no software other than ‘Nudi’ would be used within the adminis- tration of the Government of Karnataka. It was further alleged that the mandate had compelled private users of IT technology, tools or resources to use the said software for communications with any public institution in the State.
CCI on analysing the information observed that CSGK and PSGK are only carrying out pol- icy functions of the Government of Karnataka and are not suppliers of the service in competi- tion with the other language software developers in the market. The main objective of CSGK, PSGK and SKGP in this regard was to improve the government’s administrative process and to ensure that there are no software compatibility issues in communications with any other public institutions in the State for exchange of data or information in Kannada language. For these rea- sons, CCI concluded that the Government of Karnataka is not an ‘enterprise’ within the mean- ing of Section 2(h) of the Act and therefore no contravention of Section 4 of the Act can be made against the Opposite Parties. CCI also dismissed the allegation of contravention of Section 3(3) of the Act which is based on the actions of CSGK and PSGK allegedly colluding with SKGP to use only ‘Nudi’ software by stating that a consumer’s decision to purchase goods or services from a particular seller or supplier cannot be termed as collusion. It was further observed that private players who were allegedly ‘compelled’ to use the ‘Nudi’ software did so only to ensure seamless connection with the State Government. In light of the above mentioned reasons, CCI dismissed the complaint under Section 26(2) of the Act.
Exaggerated electricity bill not a competition concern 12
On May 3, 2017, CCI dismissed an information filed by Mr. Budhheshwaran Shukla (‘Shukla’) against Executive Engineer, Electricity Distribution Division-I and Chairman, Uttar Pradesh Power Corporation Limited (‘UPPCL’) (collectively referred to as the ‘Power Distributors’). The information alleged a violation of Section 4 of the Act.
Shukla is the proprietor of M/s Adarsh Hosiery located in Uttar Pradesh and UPPCL is de- scribed to be responsible for planning and managing the power sector in Uttar Pradesh through transmission, distribution and supply of electricity. On the basis of the information filed, CCI observed that the dispute between Shukla and the Power Distributors was regarding an exag- gerated electricity bill, and therefore an individual consumer dispute rather than a competition issue. Having found no appreciable adverse effect on competition (‘AAEC’), CCI closed the mat- ter under Section 26(2) of the Act.
Residential flats and residential plots do not constitute the same relevant product market: CCI 13
On May 5, 2017, CCI dismissed an information filed by Sh. Ujjwal Narayan and Sh. Abhay Kumar Sinha (‘Buyers’) against M/s Goel Enclave (‘GE’), Mr. Mahesh Aggarwal, Ms. Neelam Aggarwal, and Mr. Rohin Goel (GE, Mr. Mahesh Aggarwal, Ms. Neelam Aggarwal, and Mr. Rohin Goel col- lectively referred to as the ‘Sellers’), the Chief Officer in-charge of District Panchayat, Lucknow, District Magistrate of Lucknow, Chairman of Lucknow Development Authority, Chairman of Madhyanchal Vidyut Vitran Limited, Lucknow, Director General, Police Fire Services, and the Government of Uttar Pradesh (collectively referred to as the ‘Government Agents’) were made the pro-forma parties. The Buyers had alleged a violation of Section 4 of the Act against the Sellers on the basis that the Sellers had imposed arbitrary, unfair and unreasonable conditions in terms of: (i) not giving possession of the flats as per the agreed time; (ii) not handing over the maintenance responsibility to the resident welfare associations; and (iii) charging lifetime maintenance charges of ¤80,500 (approximately US$ 1,250) per flat and car parking charges of ¤35,000 (US$ 550) per flat which was not agreed upon. It was further observed by CCI that the al- legations are primarily directed towards the Sellers and that the Government Agents are merely pro-forma parties to the case.
CCI defined the relevant market as the market for ‘the provision of services for development and sale of residential flats in Lucknow’. In doing so, it made a distinction in the relevant product market by distinguishing between residential flats and residential plots. CCI noted that resi- dential flats are a separate relevant market as the construction of a flat is done by the developer before giving possession to the consumer unlike residential plots where the consumer decides the floor plan, the structure, and such other particulars. Therefore, residential flats and residen- tial plots are not substitutable and have different characteristics in the eyes of a consumer. For this reason, CCI defined the relevant product market as ‘the provision of services for develop- ment and sale of residential flats’.
On the basis of the information filed, CCI observed that GE is not dominant in the relevant market as there are a large number of other major players, who exercise competitive restraints on GE. Having found GE not dominant, CCI concluded that the allegation under Section 4 does not stand. It further observed that there is no agreement between the Sellers and the Govern- ment Agents that could be termed as anti-competitive under Section 3 of the Act. The matter was therefore dismissed by CCI.
CCI issued a closure order in favour of WhatsApp 14
In an interesting development, CCI has issued a closure order under Section 26(2) of the Act in favour of WhatsApp Inc. (‘WhatsApp’). The informant, Vinod Gupta, filed a complaint against WhatsApp alleging contravention of the provisions of Section 4 of the Act. Specifically, it was alleged that:
i. WhatsApp had engaged in predatory pricing, by removing the subscription fees charged to its users. Further, WhatsApp had enlarged its consumer base substan- tially from 450 million to over one billion and was providing instant messaging services to its users by sourcing funds from its parent company, Facebook; and
ii. WhatsApp’s new privacy policy was in contravention of Section 4 of the Act, since by mandating users to agree with its terms of service and privacy policy and us- ing the information/data for targeted advertisements on Facebook,WhatsApp had used user information to its own commercial advantage. It was also alleged that the manner in which the user’s consent is taken by WhatsApp was deceptive, as almost the entire community of users of WhatsApp in India are not equipped to even read, much less, comprehend, the consequences of the terms and conditions. With respect to the relevant product market, CCI noted that WhatsApp is an instant communication app for smartphones using standard cellular mobile numbers, and is a platform for communication through texting, group chats, voice and video calls. CCI held that instant mes- saging services using communication apps cannot be considered a substitute to the traditional electronic communication services, since instant messaging using communication apps is: (i) based on the internet; and (ii) provides additional functionalities, such as the ability to view
contacts that are online.
CCI limited the geographic market to India. In limiting the geographic scope of the market
to India, CCI considered that: (i) while all consumers with access to internet are in principle free to download and install any app they want, irrespective of their geographic location anywhere in the world, competitive conditions, regulatory architecture and players may vary in different countries/regions; and (ii) the information pertained to the alleged anti-competitive conduct of WhatsApp within the geographic boundary of India.
On this basis, CCI defined the relevant market as the market for ‘instant messaging services using consumer communication apps through smartphones in India’.
Based on the publically available reports, CCI held that while there were several other play- ers in the market such as Hike,Viber,WeChat and Snapchat,WhatsApp topped the list of instant messaging apps and thus found it to be in a dominant position in the relevant market.
On the issue of predatory pricing, CCI noted that it was a standard practice in the industry to not charge users for communication apps. CCI observed that while WhatsApp used to charge a subscription fee from its customers, it may have stopped doing so, because of the prevailing industry practice followed by its competitors of providing services in relation to instant mes- saging for free. Further, CCI noted that users could easily switch from one instant messaging app to another since: (i) all the instant messaging apps were available for free; (ii) multi-homing is possible (i.e., all the instant messaging apps can be downloaded onto all smartphones and they can co-exist on the same handset, without taking much capacity); (iii) post the download, users can easily move on from one app to another; (iv) costs of switching to a new app is minimal for users; and (v) information about a new app is readily available. Therefore, CCI concluded that even though WhatsApp appears to be dominant in the relevant market, the allegations of preda- tory prices have no substance. CCI also noted that the expansion of Hike Messenger to nearly 100 million user-base within three years of launching their services into the aforesaid market reflected that were no significant barriers to entry in the relevant market.
With respect to privacy policy, CCI noted that the allegation that WhatsApp was abusing its dominant position by using user information to its commercial advantage fell within the ambit of the provisions of the Information Technology Act, 2000 (‘IT Act’) and held that the breach of the IT Act does not fall within the purview of the Act.
CCI passed another batch of ‘cease and desist’ orders against Coal India Limited 15 By way of a background, CCI had held CIL and its subsidiaries to be dominant in the market of ‘production and supply of non-coking coal to thermal producers including the captive power plants in India’ and found them to have abused their dominant position by imposing unfair and discriminatory conditions in the FSA and Memorandum of Understanding (‘MoU’) vide its or- der dated March 24, 2017 in Case Nos. 03, 11, and 59 of 2012.
Similarly, in the present matter, which was initiated on the basis of an information filed by GHCL Limited (‘GHCL’) against CIL and Western Coalfields Limited (CIL and Western Coalfields Limited collectively referred to as the ‘Opposite Parties’), CCI found that CIL on account of its dominance in the supply of non-coking coal has not evolved the terms and conditions of the FSA by way of a bilateral mutual process. The MoU which was to be mandatorily signed along with the FSA by companies like GHCL, which operated as captive power plants, read with the Letter of Assurance (‘LoA’): (i) reduced the quantity and trigger levels for CIL; (ii) diluted the obligation on CIL to pay compensation; and (iii) incorporated unfair clauses with respect to deemed delivered quantity, exploitative bank guarantees, and sampling, testing and grading of coal. Further, CCI noted that the LoA to be signed by the customers of CIL were also unilateral and unfair, which included, inter alia: (i) conditions on customers of CIL to fulfill certain obli- gations in a time bound manner and imposed penalty on them while there was no such corre- sponding obligations on CIL; and (ii) no responsibility, whatsoever, on CIL and its subsidiaries in case of any lapse on their part. CCI held the mandatory requirement to sign the MoU as a pre-condition to the FSA to be discriminatory vis-à-vis the power utilities companies, who were not required by CIL to sign an MoU.
CCI, thus held the Opposite Parties to be in contravention of Section 4(2)(a)(i) of the Act by order dated April 21, 2017, for imposing unfair and discriminatory conditions and for indulging in unfair and discriminatory conduct in the matter of supply of non-coking coal.
It directed CIL to cease and desist from such abusive conduct and modify its agreements after consulting all the stakeholders. Given that CCI had already imposed a penalty of ¤591.01 crore (US$ 92 million) on CIL by its order dated March 24, 2017, it did not impose any further penalty on the Opposite Parties.
Separately, CCI, in another batch of information16 filed by Madhya Pradesh Power Gener- ating Company Limited, West Bengal Power Development Corporation Ltd., and Sponge Iron Manufacturers Association (collectively referred to as the ‘Power Utilities’) against CIL and its subsidiaries found CIL and its subsidiaries to be dominant in ‘supply of non-coking coal to the consumers including thermal power producers and sponge iron manufacturers in India’. CCI noted that most of the instances of abuses alleged against CIL were already covered in Case Nos. 03, 11, and 59 of 2012, and no separate order was required in that respect.
Besides, it noted similar findings regarding the MoU noted above in Case No. 8 of 2014, and also held CIL to be in contra- vention of Section 4(2)(a)(i) of the Act for imposing discriminatory conditions with respect to grade review of coal for non-thermal buyers like Sponge Iron Manufacturers Association. CCI again directed CIL to cease and desist its abusive conduct vide order dated April 21, 2017 on the lines of its order dated April 21, 2017 passed in the Case No. 8 of 2014.
6 Civil Appeal No. 5040 of 2014
7 Competition Appeal (AT) No. 1/2017
8 Appeal No. 16/2017
9 Case No. 18 of 2017
10 Suo Moto Case No. 1 of 2013
11 Case No. 08 of 2017
12 Case No. 06 of 2017
13 Case No. 04 of 2017
14 Case No. 99 of 2016
15 Case No. 8 of 2014
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
