CCI | Can BCI be covered under the ambit of an ‘enterprise’ under S. 2(h) of Competition Act? Read why it was asserted that BCI misused its dominant position

Competition Commission of India (CCI): The Coram comprising of Ashok Kumar Gupta (Chairperson) and Sangeeta Verma and Bhagwant Singh Bishnoi (Members), considered whether Bar Council of India is an ‘enterprise’ under Section 2(h) of the Competition Act.

Informant filed the present information under Section 19(1)(a) of the Competition Act, 2002 alleging contravention of the provisions of Section 4 of the Act by Bar Council of India (BCI/OP 1).

Informant worked as an executive engineer and planned to voluntarily retire to pursue legal education. He submitted that he appeared for LLB (3 years) entrance examination in the State of Andhra Pradesh and secured 1st rank in the examination.

Informant stated that BCI enjoys the dominant position in controlling legal education as well as legal practice in India.

Colourable Exercise of Power

Informant alleged that BCI has allegedly imposed maximum age restrictions upon the new entrants to enter into the legal education and thus, created indirect barriers to the new entrants in the profession of legal service.

The impugned Clause 28 has been incorporated by the BCI in contravention of Section 4 of the Act by ‘misusing its dominant position’. By having done so, the BCI has also allegedly indulged in colourable exercise of power.

With the above practice, the members of BCI conspired to reduce the competition to its electors and created indirect barriers in the profession of legal service.

Therefore, in view of the above, informant sought that the said clause be declared illegal and void ab initio and maximum penalty shall be imposed for violation of Section 4 of the Competition Act and in indulging in colourable exercise of power.

Analysis and Decision

Bench on perusal of the facts and circumstances of the case stated that it is imperative to examine the status of BCI as an enterprise within the contours of the provisions of Section 2(h) of the Competition Act before proceeding further with regard to the allegation raised.

Whether the Bar Council of India is an ‘enterprise’ under Section 2(h) of the Competition Act?

Term ‘enterprise’ has been defined under Section 2(h) of the Competition Act, as a person or a department of the Government, engaged in any activity relating to the provision of any kind of services.

Commission on going through the objective and functions of the BCI, noted that BCI appears to carry out functions which are regulatory in nature in respect of the legal profession, hence cannot be said to be an ‘enterprise’ within the meaning of Section 2(h) of the Competition Act, 2002.

In Case No. 39 of 2014, In Re: Dilip Modwil and Insurance Regulatory and Development Authority (IRDA), decided on 12-09-2014, Commission had observed that any entity can qualify within the definition of the term ‘enterprise’ if it is engaged in any activity which is relatable to the economic and commercial activities specified therein. It was further observed that regulatory functions discharged by a body are not per se amenable to the jurisdiction of the Commission.

Therefore, in view of the above discussion, Coram opined that no prima facie case under the provisions of Section 4 of the Competition Act was found and no case for grant of relief as sought under Section 33 of the Act arose. [Thupili Raveendra Babu v. BCI, 2021 SCC OnLine CCI 1, decided on 20-01-2021]

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