{"id":280943,"date":"2023-01-04T11:00:12","date_gmt":"2023-01-04T05:30:12","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=280943"},"modified":"2023-01-27T17:26:34","modified_gmt":"2023-01-27T11:56:34","slug":"nclat-cci-competition-act-2002-competition-commission-india-dlf-trade-legal-research-news-updates-buyer-seller-dlf","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/01\/04\/nclat-cci-competition-act-2002-competition-commission-india-dlf-trade-legal-research-news-updates-buyer-seller-dlf\/","title":{"rendered":"NCLAT sets aside clean chit to DLF in allegations of abuse of dominant position case; CCI to hear matter afresh"},"content":{"rendered":"
\n

\n

National Company Law Appellate Tribunal:<\/b> A bench comprising of Rakesh Kumar*, J.<\/b>, and Dr. Ashok Kumar Mishra (Technical Member) set aside the impugned order passed by Competition Commission of India (CCI) rejecting a complaint against DLF and its subsidiary for alleged abuse of the dominant position based on a second\/supplementary report from Director General (DG) and directed to examine the matter with fresh consideration.<\/p>\n

Factual Matrix<\/b><\/p>\n

In the instant matter, the respondent group i.e., DLF Ltd. and DLF Home Developers Ltd. (respondent no. 1 and 2 respectively) launched a residential township, \u2018Regal Garden\u2019, in Sector 90, DLF Garden City, Gurgaon consisting of 3 and 4 BHK apartment units. The appellant was allotted an apartment in the Project. The buyer-seller agreement was executed on 01-09-2012 but, the appellant found several clauses reflecting abuse of dominance position by the respondent which was \u201chighly unfair and discriminatory\u201d<\/i> to the appellant.<\/p>\n

The appellant filed an information application under S. 19<\/a> of the Competition Act, 2002<\/a> (the Act) to the CCI alleging that several clauses of the agreement were violative of provisions of S. 4(2)(a)(i) of the Act. A case was registered on such information petition and after forming prima facie opinion, DG was directed by the CCI to conduct investigation. The DG’s report stated the violation of provision under S. 4 of the Act by respondent no.1 and 2 and CCI exercising jurisdiction under Regulation 20(6) of Competition Commission of India (General) Regulations, 2009<\/a> directed the DG to further investigate and submit report. CCI after submission of supplementary\/further investigation report vide impugned order dated 31-08-2018 held that \u201c\u2026the contravention of the provisions of Section 4 of the Act is not established in the instant matter. Hence, the case is ordered to be closed under Section 26(6) of the Act.\u201d<\/i><\/p>\n

The appellant preferred the present appeal under S. 53(B) of the Act, challenging the impugned order dated 31-08-2018 passed by CCI.<\/p>\n

Parties\u2019 Contentions<\/b><\/p>\n

The appellant contended that DG’s initial report concluded that there was violation of S. 4 of the Act by respondents and though the DG noted the involvement of the respondents in the supplementary investigation report but taking U-Turn concluded that \u201cOps as a group was found to be having financial strength, however, the same does not appear to bestow a position of strength to the OP group\u201d.<\/p>\n

The appellant contended that CCI is not authorised under the provisions of the Act to direct further investigation therefore the order impugned which is based on its supplementary investigation report is liable to be set aside.<\/p>\n

The CCI contended that there was no infirmity in the impugned order and the violation of provisions under the Act by the respondents was not established. The CCI further contended that the appeal is liable to be rejected as the appellant did not come before the Tribunal with clean hands and suppressed the material fact that the appellant entered into settlement\/agreement with the respondents therefore forfeited his right to file appeal.<\/p>\n

Tribunal’s Observation<\/b><\/p>\n

The Tribunal observed that DG’s report showed a violation of S.4 of the Act by DLF and its subsidiary and after receipt of the supplementary DG report, the CCI passed the impugned order concluding that \\ no contravention of the provisions under S. 4 of the Act is established. The Tribunal stated, \u201cEven though DG in its investigation report dated March 2016 noticed the violation committed by Respondents under Section 4 of the Act, by its order dated November 9, 2016 the CCI directed the DG to conduct further investigation\u201d<\/i>.<\/p>\n

The Tribunal observed that the CCI can only order a further investigation in cases of closure and not in situations where the DG has already submitted a report indicating a party’s violation under the Competition Act of 2002<\/a>.<\/p>\n

The Tribunal further opined that the CCI has very little authority to order additional investigation under S. 26 of the Act and the CCI hid behind Regulation 20(6) of the CCI (General) Regulations, 2009<\/a> despite DLF having violated S. 4 of the Act and ordered the DG to further investigate. The Tribunal stated<\/p>\n

\u201cThe aforesaid Regulation 20 describes procedure about the investigation by the DG, whereas Regulation 20(6) empowers the CCI to direct DG for further investigation. However, in view of Section 26 of the Act it can be concluded that Regulation 20 (6) of CCI (General) Regulations, 2009<\/a> can be used in furtherance of exercise of jurisdiction under Section 26(7) of the Act which is required to be invoked in a case where DG under Section 26(5) submits report regarding non-contravention of the provisions of the Act. In any event taking shelter of Regulation 20(6) of Regulation 2009 CCI was not authorised to pass an order for further investigation and the same cannot be justified.\u201d<\/b><\/i><\/p>\n

Tribunal’s Decision<\/b><\/p>\n

The Tribunal held that the CCI was not authorised to pass an order for further investigation if once the DG has already noticed the violation in its first report and the same cannot be held justified.<\/p>\n

Without going into further detail or delving into the merit of the case, the Tribunal held that the impugned order is liable to be set aside since the order is primarily passed on the supplementary investigation report which was conducted on a void order of the CCI.<\/p>\n

The Tribunal remand back the case to CCI to investigate the same within three months and provide a decision that is legal and reasonable after giving both the parities and opportunity of being heard.<\/p>\n

[Amit Mittal v. DLF Ltd., 2022 SCC OnLine NCLAT 1621<\/a>, decided on 21-12-2022<\/span>]<\/p>\n

*Judgment by: Justice Rakesh Kumar<\/span><\/strong><\/p>\n

\n

Advocates who appeared in this case :<\/p>\n

Mr. Jitendra Malkan and Mr. R.P. Sharma, Counsel for the Appellant;<\/p>\n

Mr. Pravin Bahadur, Ms. Kanika Sharma, Mr. Rohan Arora, Ms. Chandni Anand and Mr. Aakash Kumbhat, Counsel for the Respondent No. 1 and 2;<\/p>\n

Mr. Avishkar Singhvi, Mr. Nipun Katyal and Mr. Vivek Kumar, Counsel for the Respondent No. 3;<\/p>\n

Ms. Shama Nargis, Counsel for the CCI.<\/p>\n

\n

*Ritu Singh, Editorial Assistant has put this report together.<\/span><\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

In the case at hand, a buyer of an apartment in a DLF Project had allegedly found several clauses of the buyer-seller agreement reflecting abuse of dominance position by DLF which was “highly unfair and discriminatory”<\/i> to the buyer.<\/p>\n","protected":false},"author":67011,"featured_media":279124,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,11],"tags":[5461,31537,2612,30182,22014,30440],"class_list":["post-280943","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-tribunals_commissions_regulatorybodies","tag-cci","tag-competition-act-2002","tag-DLF","tag-national-company-law-appellate-tribunal","tag-nclat","tag-trade"],"yoast_head":"\nNCLAT sets aside clean chit to DLF in allegations of abuse of dominant position case; CCI to hear matter afresh | SCC Times<\/title>\n<meta name=\"description\" content=\"A bench comprising of Rakesh Kumar*, J., and Dr. Ashok Kumar Mishra (Technical Member) set aside the impugned order passed by Competition\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scconline.com\/blog\/post\/2023\/01\/04\/nclat-cci-competition-act-2002-competition-commission-india-dlf-trade-legal-research-news-updates-buyer-seller-dlf\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"NCLAT sets aside clean chit to DLF in allegations of abuse of dominant position case; 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Instant information was filed under Section 19(1)(a)\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":6765,"url":"https:\/\/www.scconline.com\/blog\/post\/2015\/08\/27\/dlf-is-not-in-dominant-position-in-delhi-no-prima-facia-case-of-abuse-arise\/","url_meta":{"origin":280943,"position":1},"title":"DLF is not in dominant position in Delhi, no prima facia case of abuse arise","author":"Sucheta","date":"August 27, 2015","format":false,"excerpt":"Competition Commission of India: \u00a0In a sigh of relief to DLF, a building giant already facing fair play litigations, the market competition regulator CCI closed a case alleging abuse of dominant position. The informants in the present case alleged that DLF compelled them to enter into one-sided and unfair Apartment\u2026","rel":"","context":"In "Tribunals\/Commissions\/Regulatory Bodies"","block_context":{"text":"Tribunals\/Commissions\/Regulatory Bodies","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/tribunals_commissions_regulatorybodies\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/Competition-Commission.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":284802,"url":"https:\/\/www.scconline.com\/blog\/post\/2023\/02\/26\/whether-cci-has-the-authority-to-issue-an-order-for-additional-inquiry\/","url_meta":{"origin":280943,"position":2},"title":"Whether CCI has the Authority to Issue an Order for Additional Inquiry","author":"Bhumika Indulia","date":"February 26, 2023","format":false,"excerpt":"by Prashant Kumar\u2020","rel":"","context":"In "Op Eds"","block_context":{"text":"Op Eds","link":"https:\/\/www.scconline.com\/blog\/post\/category\/op-ed\/legal-analysis\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-540.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-540.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-540.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-540.jpg?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":282971,"url":"https:\/\/www.scconline.com\/blog\/post\/2023\/02\/02\/tribunal-regulatory-bodies-and-commissions-monthly-roundup-january-2023-25-legal-stories-including-no-relief-in-cci-penalty-on-google-tds-deduction-and-interest-on-securities-high-level-commit\/","url_meta":{"origin":280943,"position":3},"title":"Tribunal, Regulatory Bodies and Commissions Monthly Roundup | January 2023 | 25+ Legal Stories including no relief in CCI penalty on Google, TDS deduction and interest on securities, high-level committee for Yamuna pollution, no clean chit to DLF, and more","author":"Editor","date":"February 2, 2023","format":false,"excerpt":"APPELLATE TRIBUNAL FOR ELECTRICITY (ATE) Bureau of Energy Efficiency takes suo motu verification test on a sample refrigerator of Whirlpool India and found quality non-compliance; Appellate Tribunal for Electricity sets aside the order A division bench of Ramesh Ranganathan (Chairperson) and Sandesh Kumar Sharma (Technical Member) set aside the order\u2026","rel":"","context":"In "Legal RoundUp"","block_context":{"text":"Legal RoundUp","link":"https:\/\/www.scconline.com\/blog\/post\/category\/columns-for-roundup\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-258.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":6628,"url":"https:\/\/www.scconline.com\/blog\/post\/2015\/04\/29\/charges-against-real-estate-firm-vatika-group-alleging-abuse-of-dominant-market-position-dismissed\/","url_meta":{"origin":280943,"position":4},"title":"Charges against real estate firm Vatika Group alleging abuse of dominant market position, dismissed","author":"Sucheta","date":"April 29, 2015","format":false,"excerpt":"Competition Commission of India (CCI): While observing that real estate developer Vatika Group does not appear to be in a dominant position in the relevant market, CCI rejected charges against the Company alleging abuse of dominant market position in market of services for development and sale of its commercial units\u2026","rel":"","context":"In "Tribunals\/Commissions\/Regulatory Bodies"","block_context":{"text":"Tribunals\/Commissions\/Regulatory Bodies","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/tribunals_commissions_regulatorybodies\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/10\/scc-blog_Page_9.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/10\/scc-blog_Page_9.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/10\/scc-blog_Page_9.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/10\/scc-blog_Page_9.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2015\/10\/scc-blog_Page_9.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":281470,"url":"https:\/\/www.scconline.com\/blog\/post\/2023\/01\/11\/cci-abuse-dominant-position-play-store-policies-penalty-google-appeal-nclat-interim-relief-refused\/","url_meta":{"origin":280943,"position":5},"title":"NCLAT refuses to grant interim relief to Google; 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