High Court Round UpHigh CourtsLegal RoundUpTribunals/Regulatory Bodies/Commissions Monthly Roundup

Here are our interesting picks from the stories reported this week:


To operate in State of Maharashtra, Uber and other unlicensed aggregators to apply for license before 16th March 2022: Bom HC


The Division Bench of Dipankar Datta, CJ and Vinay Joshi, J., directed UBER and other transport aggregators who have not obtained a license as per Section 93(1) of the Motor Vehicles Act to apply for the license before 16th March 2022 otherwise they shall not be able to operate in the State of Maharashtra.

Read full report, here…


Wife leaves matrimonial home and never returns after several requests and legal notice under S. 9 of HMA, alleges husband of several cruelties without any evidence: Would it amount to desertion and cruelty by wife? Del HC answers


Noting the separation of 12 years between the husband and wife, the Division Bench of Vipin Sanghi and Jasmeet Singh, JJ., found that the wife had subjected the husband to desertion and cruelty, hence decree of divorce be granted.

Read full report, here…


Right of residence under DV Act is exclusive to and isolated from any right that may arise under S. 9 of Hindu Marriage Act, 1955: Del HC


“The existence of the strained relationship between the Petitioner and the Respondent has been well established by the fact that there are more than about 60 criminal and civil cases pending between the parties.”

Read full report, here…


Law on Theft | Daughter-in-law thrown out of matrimonial home and accused of removal of letters from possession of matrimonial home: Whether Del HC will find her guilty under S. 380 IPC or not?


Chandra Dhari Singh, J., noted that instant dispute has arisen out of matrimonial discord between two people which had also, led to the filing of more than 50 criminal and civil cases between not only the husband and the wife but also their family members. It was found that for the sole purpose of harassing the other party such cases were filed by persons with no just cause or reason and substantial ground for allegations.

Read full report, here…


SC-ST Act is prospective or retrospective? Kar HC quashes criminal proceedings for offences committed in the year 1975


“…it has been a settled principle of criminal jurisprudence that when the act complained of is not an offence when committed; a free citizen cannot be brought to book merely because such act is criminalized in a subsequent legislation.”

Read full report, here…


Wife, a banker, misusing her position to get details of in-laws’ bank accounts to show husband evading payment of maintenance: Is wife guilty of criminal breach of trust? Court analyses


Manner of bringing the information before Court of law may not be morally right but it cannot be said by this act of petitioner that, petitioner caused or intended to cause any wrongful loss to petitioners or to cause wrongful gain to herself as merely by disclosing this information, no pecuniary benefit is stated to have been received by petitioner and if any maintenance or any other amount is granted by Court of law, that cannot be termed to be wrongful gain to petitioner.

Read full report, here…


Spanking on back of a woman without her consent, by a man would constitute an offence under Stalking as defined under S. 354D (1)(i) IPC? Court explains


Mere presence is not ground for common intention for proving the prior meeting of minds.

Read full report, here…


7 entities indulged in anti-competitive agreement for supply of signages for branches/offices/ATMs of SBI: E-mails exchanged between parties formed basis for manipulation of bidding process

Noting that in respect of cases concerning cartels that are hidden or secret, there is little or no documentary evidence and may be quite fragmentary, Coram of Ashok Kumar Gupta (Chairperson) and Sangeeta Verma and Bhagwant Singh Bishnoi (Members)  imposed penalties on 7 entities and signages for bid-rigging activities and cartelization with respect to the supply of signage for branches, offices and ATMs of State Bank of India.

Read full report, here…


Can SEBI proceed against a Chartered Accountant for lack of his due diligence? SAT analyses

“Lack of due diligence can only lead to professional negligence which would amount to a misconduct which could be taken up only by ICAI.”

Read full report, here…

Bombay High Court
Case BriefsHigh Courts

Bombay High Court: The Division Bench of Dipankar Datta, CJ and Vinay Joshi, J., directed UBER and other transport aggregators who have not obtained a license as per Section 93(1) of the Motor Vehicles Act to apply for the license before 16th March 2022 otherwise they shall not be able to operate in the State of Maharashtra.

In the Public Interest Litigation filed, one of the prayers was a direction on respondents 1 and 2 to ensure implementation of Motor Vehicle Aggregator Guidelines-2020.

Uber (Respondent 3) was a Transport Aggregator in the present matter.

Section 93(1) of the Motor Vehicles Act, 1988 required an aggregator to obtain a license from such authority and subject to such conditions as may be prescribed by the State Government. The said proviso provided that while issuing license, the State Government may follow such guidelines as may be issued by the Centre. Whereas Sub-Section 2 of 93 referred to matters which could be included as conditions of such license.

Analysis and Decision

High Court expressed that Section 93(1) is couched in negative language and once it is statutory mandate that no person shall engage himself as an aggregator unless a license is obtained, it is absolutely inappropriate for the State of Maharashtra (respondent 2) to allow such person to continue as an aggregator without he/it obtaining such a license.

Bench added that, no doubt that the Maharashtra Regulation of Aggregators Rules 2021 are still at the draft stage but till such time the said draft rules are finalized for being complied with, the 2020 Guidelines framed by the Centre would hold the field and any person willing to operate as an aggregator must follow the regulatory framework brought about by such guidelines.

Pained to observe that despite new statutory provisions having been brought into force in 2019 by amending Section 93 and the guidelines having been framed in November 2020, the respondent 2 permitted an aggregator like UBER to operate in Maharashtra without insisting for compliance of the statutory requisite.

Further, Court was also conscious of the fact that restraining the operation of UBER would cause immense prejudice and detriment of the passengers who avail of the services provided by it.

Therefore, High Court granted an opportunity to UBER and other unlicensed aggregators to apply for license as required by the provision concerned.

Lastly, the Bench directed the Transport Department of the State Government to issue an appropriate notification in the Official Gazette forthwith and not later than 9th March, 2022 empowering each and every Regional Transport Authority in the State of Maharashtra to act as the Licensing Authority for grant of license under sub-section (1) of Section 93 of the Act.

All the Operators have been directed to apply for the license by 16th March, 2022 and in case the application before the said date is not received, then the unlicensed aggregator will not be permitted to carry on further operations in the State of Maharashtra.

PIL to be listed on 4-4-2022 for reporting developments. [Savino R. Crasto v. Union of India, 2022 SCC OnLine Bom 490, decided on 7-3-2022]


Advocates before the Court:

Ms. Savina R. Crasto, petitioner-in-person, present.

Mr. Rajshekar V. Govilkar for respondent no.1.

Ms. Jyoti Chavan, AGP for respondent-State.

Mr. Janak Dwarkadas, Senior Advocate a/w Mr. Ankit Lohia, Ms. Sita Kapadia, Mr. Shashwat Rai, Mr. Akash Loya and Ms. Tvishi Pant i/by Keystone Partners for respondent nos.3 and 4

Case BriefsTribunals/Commissions/Regulatory Bodies

National Company Law Appellate Tribunal (NCLAT):  The Coram of Justice Jarat Kumar Jain (Judicial Member) and Dr Alok Srivastava (Technical Member) held that Ola’s below-cost pricing was not predatory pricing with a view to dislodging any competitor from the market but towards establishing itself as an effective and reliable brand in the market and also opening up a latent market to its advantage.

Two appeals filed by appellant Meru Travel Solutions (P) Ltd. and Fast Track Call Cab (P) Ltd. assailed the common order passed by the Competition Commission of India under Section 26(6) of the Competition Act, 2002.

Commission decided that on the basis of information submitted by Fast Track and Meru and analysis of DG’s investigation report, the dominant position of Ola in the relevant market and abuse of its dominant position was not established and Ola had not been found to have anti-competitive agreements with drivers.

By the present decision, both the appeals will be disposed off.

Analysis and Discussion

Technology | Ola v. Other Radio Taxis

Tribunal noted that before the advent of technology-leveraged, network-based aggregator models, taxi services such as Meru, Fast Track, Easy Cab, Taxi For Sure etc. also leveraged technology to pride ease of booking and taxi ride, yet Ola’s model differed from them in many ways, particularly its use of the smartphone-based application which could be used with remarkable ease by the riders and provide taxi services anywhere in the area within minutes of ‘hailing’ through the mobile phone.

Hence, it could not be said that Ola employed technology in a much more effective and enabling fashion to provide services which previous radio taxi operators were not able to.

Market Share

Ola market share is seen to increase from 5-6% in 2012-13 to 59-60% in 2014-15 and to 61% in 2015-16. Thus, there was a significant rising trend noted upto January 2015, whereafter Ola market share had been plateauing or witnessing a gradual decline.

Though the active fleet size increased but in Tribunal’s opinion merely the size of the fleet does not decide the dominant position of a particular radio taxi service provider.

“We note that the technological edge that the platform crested by Ola which provide ease of taxi bookings, rider security, payments, drivers welfare made many riders comfortable with the network of Ola. The customer incentives worked in conjunction with these facilities and conveniences to attract riders to Ola and a certain brand image was created and reinforced over a period of time.”

Further, another highlighting factor noted was that Ola was itself facing competition in the relevant market from established players such as Meru and Fast Track and later from Uber while it was trying to establish its brand.

Below Cost Pricing | Predatory pricing by Ola?

In Tribunal’s opinion, the strategy adopted by Ola was in view of the market conditions, helped by a heavy infusion of foreign funding. Hence, there was no below-cost pricing by Ola for any sustained period of time which could be labelled as predatory pricing and abuse of its dominant position in the market.

Coram also agreed with the finding of DG that the below-cost pricing adopted from May-June 2014 onwards could be treated as the variable cost which, as argued by Senior Counsel of Respondent Ola, was the expenditure that Ola undertook to establish its brand in the market and increase its market share.

It was also noted that Uber also adopted an almost similar network approach for the provision of radio taxi, hence Tribunal was inclined to agree with Ola’s arguments that Uber was a significant competitor in the relevant market and Ola was responding to pricing actions of Uber while trying to establish itself in the Bengaluru market of radio taxi services.

Tribunal found that the situation in the present matter was akin to that in the matter CCI v. Fast Way Transmission (P) Ltd., (2018) 4 SCC 316, wherein the Supreme Court held that when an enterprise enjoys a dominant position in the relevant market, it is enabled to operate independently of competitive forces or affect its competitors or consumers or that relevant market in its favour.

“We do not think that Ola could operate independently of other competitors in the relevant market, and hence it did not enjoy a dominant position in the market.”

Conclusion

Stating that Ola started from a low market share of about 20%, Tribunal held that it cannot agree that Ola was at that initial time in a dominant position and was trying to push out competitors from the market by employing below-cost, predatory pricing.  An increase in its market share over a period of time, was due to a combination of factors, of which below-cost pricing was one.

Another significant factor, with regard to Ola’s agreements with its drivers, Tribunal noted that the agreements cover many aspects, which concern welfare measures for drivers and helping them source credit for buying vehicles. The incentives provided to drivers are dynamic and not constant in time. The drivers have the option to shift to other networks depending on their requirements and convenience.

Hence the driver’s agreement that Ola has with drivers with entirely optional and does not in any way bind the drivers to Ola’s network in any way.

Therefore, Tribunal did not find the driver’s agreements anti-competitive in violation of Section 3 of the Act.

Ola is working on generating demand through customer discounts and then bringing in more drivers to cater to the increased demand. Ola tries to create a win- win for the riders and drivers, and of course to its enterprise.

Lastly, Tribunal held that the Orders of CCI do not require any interference and therefore the appeals were dismissed. [Meru Travels Solution (P) Ltd. v. Competition Commission of India, 2022 SCC OnLine NCLAT 37, decided on 7-1-2022]


Advocates before the Tribunal:

For Appellant:

Ms. Sonal Jain, Mr. Udayan Jain, Mr. Abir Roy, Mr. Ishkaran Singh, Ms. Kajal Sharma and Ms. Riya Dhingra, Mr. Vivek Pandey, Mr. Raj Surana, Mr. Ishaan Chakrabarti, Advocates.

For Respondents:

Ms. Shama Nargis, Deputy Director, CCI.

Mr. Ajay Kumar Tandon for R-1, CCI. Ms. Purnima Singh, Ms. Neha Bhardwaj, Ms. Shivani Malik, Ms. Astha Baderiya, Advocate for R-1.

Mr. Rajshekhar Rao, Sr. Advocate with Ms. Nisha Kaur Uberoi, Mr. Gautam Chawla, Mr. Raghav Kacker, Ms. Sonal Sarda and Mr. Samriddha Gooptu, Ms. Sakshi Agarwal, Mr. Ishan Arora, Mr. Madhav Kapoor, Advocates for R-2.

Case BriefsTribunals/Commissions/Regulatory Bodies

Competition Commission of India (CCI): Coram comprising Ashok Kumar Gupta (Chairperson) and Sangeeta Verma and Bhagwant Singh Bishnoi (Members) took suo motu cognizance of the matter regarding alleged prevention of entry of app-based taxi aggregator companies in the State of Goa.

Based on newspaper reports regarding alleged concerted action to prevent entry app-based taxi aggregator companies in the State of Goa, Commission took up the present matter suo motu against tourist taxi unions operating in the State of Goa.

Another significant issue in the matter was that the constant strikes by various taxi unions, tourists were getting affected in Goa.

What were the demands of the above-stated Unions?

  • Crackdown on Illegal Taxi
  • Cancellation of installation of speed governors.

Prima Facie Observation of the Commission

Taxi Unions conduct in not allowing any app-based service providers in the State of Goa was putting a restrain on services based on technology and limiting the competition, technical development as well as investment in provision of relevant services.

Another observation was that the reforms by the State Government in terms of bringing transparency and improvement in the delivery of services was also being prevented.

The above resulted in restriction to the choice of consumers which was in contravention of Section 3(3)(b) read with Section 3(1) of the Competition Act.

In view of the above observations, DG was directed to conduct an investigation and submit a report.

What was in the DG’s report?

DG found the conduct of taxi unions to be in violation of Sections 3(1) and 3(3)(b) of the Competition Act.

DG noted that there are no fare meters and organised groups of taxi operators in Goa control the rates as well as the routes. Further, it was observed that the taxi operators in North and South Goa use different rate charts and tourists in Goa have to pay more than thousands of rupees even for short distance travel.

During investigation, certain violent incidents were reported alleging manhandling of Zoomcar users and their vehicles damaged by local taxi union operators.

Commission’s Observation on perusing DG Report

Coram noted that no material was placed in regard to conduct of OPs indulging in strikes except few YouTube videos, Facebook Blogs and news clippings and such material remained uncorroborated and unauthenticated.

DG failed to examine the reasons mentioned by the OPs for resorting to strikes, which included increase in fees for permits, backdoor entry of app-based taxi aggregators and installation of speed governors in taxis. OP-4 had pointed out certain other issues such as:

proposed Mopa Airport, Speed Governors, Harassment of taxi drivers at the airport, frequent requests to the Government of Goa for putting up taxi fare rates at all tourist destinations, to stop private cars operating as illegal taxies, and to stop private cars being given on rent for self-driving’

Restriction on entry of OLA and UBER

Authorised representative of Uber stated that Uber did not even apply for any license for starting app-based taxi services in the State of Goa.

With regard to OLA, DG failed to examine the reasons behind its exit from the State of Goa, though it was noted that Shekhar Dutta, Senior Director, ANI Technologies (OLA), had stated that they had received threats from Taxi Owners Associations (without naming any specific OPs) and the association members vandalized the assets and did gherao of their office premises without elaborating any details of such incident in precise manner.

“…meeting with head of political executive in a joint representation, raising grievances cannot be said to violate the provisions of Competition Act.”

Though nothing on record was placed to show that the OPs gave any joint representation to the State Government.

Concluding the matter, Coram observed that State of Goa took a policy decision and issued guidelines titled as “Guidelines for Taxi Operator/ Radio Taxis/ Rent A Car and Taxi App Aggregators in the State of Goa” as per which app-based taxi aggregators were permitted to operate and were allowed to have range bound dynamic pricing which was on lines of the business model of OLA & Uber.

“despite the opposition of OPs, the State of Goa does not appear to have acceded to or conceded to the demands of the OPs and the policy allowing entry of app based taxi aggregators was eventually notified.”

Hence no case of contravention of Sections 3(1) read with 3(3) of the Competition Act was made out. [Alleged anti-competitive conduct of taxi unions in the State of Goa, In re., Suo Motu Case No. 2 of 2018, decided on 22-06-2021]

Case BriefsForeign Courts

United Kingdom Supreme Court: A Full Bench of Lord Reed (President), Lord Hodge (Deputy President), Lady Arden, Lord Kitchin, Lord Sales, Lord Hamblen and Lord Leggatt dismissed the appeal finding no reason to interfere with the impugned decision of the Employment Tribunal.

Background

The facts of the case are such that the first appellant, Uber BV, is a Dutch company that owns the rights in the Uber app, second appellant being Uber London Ltd (“Uber London”), a UK subsidiary of Uber BV which is licensed to operate private hire vehicles in London and the third appellant being Uber Britannia Ltd, another UK subsidiary of Uber BV which holds licenses to operate such vehicles outside London but has been collectively called “Uber” for the purpose of the judgment. The claimants, and respondents to this appeal, are individuals who work or used to work as private hire vehicle drivers, performing driving services booked through the Uber app. The claimants further filed a claim to establish whether an Uber driver is a “worker” for the purposes of employment legislation which gives “workers” rights to be paid at least the national minimum wage, to receive annual paid leave and to benefit from certain other protection which was decided in claimants favour stating that claimants were “workers” who, although not employed under contracts of employment, worked for Uber London under “workers’ contracts” within the statutory definition of Section 230(3) of the Employment Rights Act 1996. Assailing this order an appeal was filed by Uber before Employment Appeal Tribunal which was further dismissed, and a further appeal to the Court of Appeal was filed which came to be dismissed again. Aggrieved by this, the instant appeal was filed challenging the impugned order before this Court.

Issues

Issue 1: Whether an Uber driver is a “worker” for the purposes of employment legislation which gives “workers” rights to be paid at least the national minimum wage, to receive annual paid leave and to benefit from certain other protections?

Issue 2: What periods during which a driver is employed under a worker’s contract count as working time?

 Submissions

 Counsel for the appellants submitted that relying on the terms of the written agreements between Uber BV and drivers and between the Uber companies and passengers and thereby states that when a request to book a private hire vehicle made through the Uber app is accepted, a contract is thereby created between passenger and driver, to which no Uber entity is a party and under which the driver is solely responsible for providing transportation services to the passenger. Uber also relies on terms of the written agreements which state that the only role of Uber BV is to provide technology services and to act as a payment collection agent for the driver and that the only role of Uber London (and other Uber UK companies) is to act as a booking agent for drivers.

Analysis

There are five aspects to justify that the claimants were working for and under contracts with Uber, these are as follows:

  1. When a ride is booked through the Uber app, it is Uber that sets the fare and drivers are not permitted to charge more than the fare calculated by the Uber app. It is therefore Uber which dictates how much drivers are paid for the work they do.
  2. Second, the contract terms on which drivers perform their services are imposed by Uber and drivers have no say in them.
  3. Third, once a driver has logged onto the Uber app, the driver’s choice about whether to accept requests for rides is constrained by Uber. One way in which this is done is by monitoring the driver’s rate of acceptance (and cancellation) of trip requests and imposing what amounts to a penalty if too many trip requests are declined or cancelled by automatically logging the driver off the Uber app for ten minutes, thereby preventing the driver from working until allowed to log back on
  4. Fourth, Uber also exercises significant control over the way in which drivers deliver their services. One of several methods mentioned in the judgment is the use of a ratings system whereby passengers are asked to rate the driver on a scale of 1 to 5 after each trip. Any driver who fails to maintain a required average rating will receive a series of warnings and, if their average rating does not improve, eventually have their relationship with Uber terminated.
  5. A fifth significant factor is that Uber restricts communications between passenger and driver to the minimum necessary to perform the particular trip and takes active steps to prevent drivers from establishing any relationship with a passenger capable of extending beyond an individual ride.

Observations

Issue 1:

The Court observed that as per the facts there was no written contract between the drivers and Uber London, the nature of their legal relationship had to be inferred from the parties’ conduct and there was no factual basis for asserting that Uber London acted as an agent for drivers The correct inference was that Uber London contracts with passengers and engages drivers to carry out bookings for it. Moreover, it was also observed that it is wrong in principle to treat the written agreements as a starting point in deciding whether an individual is a “worker”.

The Court relied on judgment Autoclenz Ltd v. Belcher [2011] UKSC 41 and observed that the correct approach is to consider the purpose of the relevant employment legislation which is to give protection to vulnerable individuals who have little or no say over their pay and working conditions because they are in a subordinate and dependent position in relation to a person or organization which exercises control over their work. The legislation also precludes employers, frequently in a stronger bargaining position, from contracting out of these protections.

Issue 2:

As per Working Time Regulations 1998, “working time” is defined in regulation 2(1), in relation to a worker, as “any period during which he is working, at his employer’s disposal and carrying out his activity or duties”. Therefore the Court observed that time spent by the claimants working for Uber was not limited to periods when they were actually driving passengers to their destinations, but included any period when the driver was logged into the Uber app within the territory in which the driver was licensed to operate and was ready and willing to accept trips.

Held

The Court thus held that taking these factors together, the transportation service performed by drivers and offered to passengers through the Uber app is very tightly defined and controlled by Uber. Drivers are in a position of subordination and dependency in relation to Uber such that they have little or no ability to improve their economic position through professional or entrepreneurial skill. In practice the only way in which they can increase their earnings is by working longer hours while constantly meeting Uber’s measures of performance. Thus it was considered that comparisons made by Uber with digital platforms which act as booking agents for hotels and other accommodation and with minicab drivers do not advance its case. The court rightly found the drivers to be “workers”. The Court also rightly decided to not interfere with the employment tribunal’s decision regarding ‘working hours’.[Uber BV v. Aslam, [2021] UKSC 5 , decided on 19-02-2021]


Arunima Bose, Editorial Assistant has put this story together

Case BriefsSupreme Court

Supreme Court: In a plea seeking inquiry into the alleged anti-competitive practices of Ola and Uber of entering into price-fixing agreement, the 3-judge bench of RF Nariman*, KM Joseph, Krishna Murari, JJ has refused to interfere with the concurrent finding of CCI and NCLAT that Ola and Uber do not facilitate cartelization or anti-competitive practices between drivers, who are independent individuals, who act independently of each other, so as to attract the application of section 3 of the Competition Act, 2002.

Why was an inquiry sought?

An informant sought that the Competition Commission of India initiate an inquiry, under section 26(2) of the Competition Act, 2002, into the alleged anti-competitive conduct of ANI Technologies Pvt. Ltd. [Ola], and Uber India Systems Pvt. Ltd., Uber B.V. and Uber Technologies Inc. [Uber], alleging that they entered into price-fixing agreements in contravention of section 3(1) read with section 3(3)(a) of the Act, and engaged in resale price maintenance in contravention of section 3(1) 1 read with section 3(4)(e) of the Act. According to the Informant, Uber and Ola provide radio taxi services and essentially operate as platforms through mobile applications which allow riders and drivers, that is, two sides of the platform, to interact. Due to algorithmic pricing, neither are riders able to negotiate fares with individual drivers for rides that are booked through the apps, nor are the drivers able to offer any discounts. Thus, the pricing algorithm takes away the freedom of riders and drivers to choose the best price on the basis of competition, as both have to accept the price set by the pricing algorithm.

Further, despite the fact that the drivers are independent entities who are not employees or agents of Ola or Uber, the driver is bound to accept the trip fare reflected in the app at the end of the trip, without having any discretion insofar as the same is concerned. The drivers receive their share of the fare only after the deduction of a commission by Ola and Uber for the services offered to the rider.

What did the counsels say?

Senior Advocate Abhishek Manu Singhvi, appearing on behalf of Uber, walked the Court through the concurrent findings of fact of the CCI and the NCLAT and said that every driver of a taxi cab, who uses the Ola or Uber app, can have several such apps including both Ola, Uber and the apps of some of their competitors, and can take private rides de hors these apps as well.

Advocate Rajshekhar Rao, appearing for Ola, agreed with Dr. Singhvi’s submissions on merit but questioned the locus standi of the informant, an “independent practitioner of law”. He, thus, prayed before the Supreme Court that “in such cases heavy costs should be imposed to deter such persons from approaching the CCI with frivolous and/or mala fide information, filed at the behest of competitors.”

Additional Solicitor General Balbir Singh, appearing on behalf of the CCI, however, stated that though he would support the CCI’s Order closing the case, he would also support the right of the Appellant to approach the CCI with information.

What did the Supreme Court say?

Informant’s locus standi

A reading of the provisions of Competition Act, 2002 and the Competition Commission of India (General) Regulations, 2009 shows that “any person” may provide information to the CCI, which may then act upon it in accordance with the provisions of the Act. The definition of “person” in section 2(l) of the Act is an inclusive one and is extremely wide, including individuals of all kinds and every artificial juridical person.

Section 19(1) of the Act originally provided for the “receipt of a complaint” from any person, consumer or their association, or trade association. This expression was then substituted with the expression “receipt of any information in such manner and” by the 2007 Amendment. This substitution is not without significance.

A complaint could be filed only from a person who was aggrieved by a particular action, information may be received from any person, obviously whether such person is or is not personally affected. This is for the reason that the proceedings under the Act are proceedings in rem which affect the public interest. That the CCI may inquire into any alleged contravention of the provisions of the Act on its own motion, is also laid down in section 19(1) of the Act.

“Even while exercising suo motu powers, the CCI may receive information from any person and not merely from a person who is aggrieved by the conduct that is alleged to have occurred. This also follows from a reading of section 35 of the Act, in which the earlier expression “complainant or defendant” has been substituted by the expression, “person or an enterprise,” setting out that the informant may appear either in person, or through one or more agents, before the CCI to present the information that he has gathered.”

However, Section 45 of the Act is a deterrent against persons who provide information to the CCI, mala fide or recklessly, inasmuch as false statements and omissions of material facts are punishable with a penalty which may extend to the hefty amount of rupees one crore, with the CCI being empowered to pass other such orders as it deems fit.

“This, and the judicious use of heavy costs being imposed when the information supplied is either frivolous or mala fide, can keep in check what is described as the growing tendency of persons being “set up” by rivals in the trade.”

The 2009 Regulations also do not require the informant to state how he is personally aggrieved by the contravention of the Act, but only requires a statement of facts and details of the alleged contravention to be set out in the information filed. Also, regulation 25 shows that public interest must be foremost in the consideration of the CCI when an application is made to it in writing that a person or enterprise has substantial interest in the outcome of the proceedings, and such person may therefore be allowed to take part in the proceedings. Further,

“CCI must maintain confidentiality of the identity of an informant on a request made to it in writing, so that such informant be free from harassment by persons involved in contravening the Act.”

“Person aggrieved”

Since the CCI and the NCLAT deal with practices which have an adverse effect on competition in derogation of the interest of consumers, the Act vests powers in the CCI and enables it to act in rem, in public interest. Hence, a “person aggrieved” must, in the context of the Act, be understood widely and not be constructed narrowly.

Further, it is not without significance that the expressions used in sections 53B and 53T of the Act are “any person”, thereby signifying that all persons who bring to the CCI information of practices that are contrary to the provisions of the Act, could be said to be aggrieved by an adverse order of the CCI in case it refuses to act upon the information supplied. By way of contrast, section 53N(3) speaks of making payment to an applicant as compensation for the loss or damage caused to the applicant as a result of any contravention of the provisions of Chapter II of the Act, having been committed by an enterprise. By this sub-section, clearly, therefore, “any person” who makes an application for compensation, under sub-section (1) of section 53N of the Act, would refer only to persons who have suffered loss or damage, thereby, qualifying the expression “any person” as being a person who has suffered loss or damage.

It was, hence, noticed,

“when the CCI performs inquisitorial, as opposed to adjudicatory functions, the doors of approaching the CCI and the appellate authority, i.e., the NCLAT, must be kept wide open in public interest, so as to subserve the high public purpose of the Act.”

[Samir Agrawal v. Competition Commission on India, 2020 SCC OnLine SC 1024, decided on 15.12.2020]