Madras High Court: In an appeal filed by Info Edge (India) Ltd. (‘Info Edge’) against the judgment of Single Judge, wherein the Court allowed the application filed by Google and rejected the plaints, and observed that the plaints filed by Info Edge were barred by Section 61 of the Competition Act, 2002 (‘Act, 2002’), the division bench of Sanjay V. Gangapurwala and P.D.Audikesavalu, JJ. while upholding the impugned judgment, held that the civil court may not exercise the jurisdiction in the present case, as the conditions, clauses and the payment/billing system between the parties are already tested before the Competition Commission of India and the Commission has passed an exhaustive order. The parties are bound by the said order. Therefore, if certain further terms are executed, the same should be tested by the Competition Commission of India and not by the other fora.
Further, it has directed to continue the interim relief passed earlier, by asking Google not to delist the startups’ mobile applications for three weeks from the Play Store
Background:
Info Edge and others instituted suits seeking a declaration that the Google Payments Terms of Service-Seller (IN) posted on 02-06-2022, payment policies, policies relating to service fees, terms and conditions, posted by the Google India Pvt. Ltd. (‘Google’) on its websites/portals/ webpages on various dates, including the Blog postdated 17-0-2023, all relating to the implementation of Google Play Billing System (GPBS)/User Choice Billing (UCB)/Consumption-Based Model vis-a-vis the mobile application as illegal and unenforceable
Info Edge further sought a declaration that the definition of “Authorized Provider” and Clauses 15.3 of the Developer Distribution Agreement (‘DDA’), effective as of 03-10-2022, as unconscionable, illegal and unenforceable and for a consequential relief for permanent injunction.
Google filed applications seeking rejection of the plaints on the ground that the suit is barred in view of the Act of 2002 and the Payment and Settlement Systems Act, 2007 (‘PSS Act, 2007’)
The Single Judge allowed the application filed by Google and rejected the plaints, and observed that the plaints filed by Info Edge were barred by Section 61 of the Act of 2002.
Thus, the present appeal has been filed by Info Edge.
The Court navigated through the provisions of the Act of 2002 and the PSS Act, 2007 to arrive at a conclusion about oustering the civil court’s jurisdiction.
The Court noted that Section 61 of the Act of 2002 bars the jurisdiction of the civil court in respect of matters of which cognizance can be taken by the Competition Commission of India. Section 62 of the Act of 2002 provides that the provision under the Act of 2002 shall be in addition to and not in derogation of other Acts.
While examining the nature of the matters, which can be dealt with by the Competition Commission of India, the Court noted that Act of 2002 details the duties of the Commission. 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 the markets in India.
Further, the Court noted that Section 4 of the Act of 2002 prohibits an enterprise or group from abusing its dominant position. There shall be an abuse of dominant position if the enterprise or group directly or indirectly imposes unfair or discriminatory condition in purchase or sale of goods or services; or price in purchase or sale (including predatory price) of goods or service.
The Court said that the genesis of the Info Edge case is that Google is in a dominant position and by exercising its dominant position has imposed certain conditions, which are unconscionable and hit by Section 23 of the ICA, 1872. If a party abuses its dominant position, then the Commission can take cognizance of the same as referred to in Section 4 of the Act of 2002. The Commission can also injunct a party, abusing the dominant position, to discontinue and to not re-enter such agreements and or discontinue such abuse of dominant position.
The Court said that Section 62 of the Act of 2002 would apply to those cases, wherein the Competition Commission of India does not have the power or authority under the Act of 2002 to pass orders. In that case, the provisions of other statutes are not barred. Thus, Section 62 of the Act of 2002 will have to be read to mean, “will not negate Section 61 of the Act of 2002, which specifically bars the jurisdiction of the civil court in matters to be dealt with by the Competition Commission of India”.
Therefore, the Court said Sections 61 and 62 of the Act of 2002 should be read together to give a holistic meaning to these provisions’ applicability. Merely because Section 62 states that the provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force, it cannot be interpreted to mean that any individual can institute proceedings in a Commercial Court alleging abuse of dominance, while completely ignoring Section 61 of the Act of 2002.
The Court held that the grievance raised by Info Edge can be dealt with by the Commission under the Act of 2002 and not beyond the purview of the Act of 2002. Some of the plaintiffs have approached the Competition Commission of India under the Act of 2002 and were also granted reliefs. There is no reason for not approaching the Commission once again. The pleadings in the plaint also contain the averments of the order passed by the Competition Commission of India holding Google to be a dominant player in the relevant market and that Google abuses its dominant position in contravention of provisions of Section 4 of the Act of 2002.
Further, after examining the scheme of the PSS Act, 2007, the Court said that the reliefs claimed are not beyond the realm of the authorities constituted under the Act of 2002 and the PSS Act, 2007.
[Info Edge (India) Ltd v. Google India Pvt. Ltd, 2024 SCC OnLine Mad 150, decided on 19-01-2024]
Advocates who appeared in this case :
For Appellants: Senior Counsel P.Chidambaram Senior Counsel Sriram Panchu , Senior Counsel Satish Parasaran, Senior Counsel Srinath Sridevan, Advocate R.Venkat Raman,. Advocate Santhosh Ukkur, Advocate Abir Roy, Advocate D.Senthil Kumar, Advocate. Anirudh B.Menon, Advocate Harinarayanan.S.K., Advocate Sachin Menon, Advocate Deva Kumar, Vivek Pandey, Advocate Aman Shankar, Advocate. Sukanya Vishwanath , Advocate Arvind Srinivas, Arun C.Mohan, Shruthi Srinivasan,. Advocate Karthik Selvaraj, Advocate Aman Shankar
For Respondents: Senior Counsel P.S.Raman, Senior Counsel Sajan Poovayya., Advocate S.Anand, Advocate.Jesin Prabhu George, Advocate S.Girish, Advocate P. Arun Kumar, Advocate Vijayendra Pratap Singh, Advocate Ankitesh Ojha, Advocate Sayobani Basu, Advocate Raghav Seth, Advocate Shubhangni Jain, Advocate Maithreyi Canthaswamy Sharma, Advocate Krishna Sumanth, Advocate Lakshana Viravalli, Advocate Raghav Seth , Advocate Chetan Chawla
