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TMI Blog2010 (8) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... l Government from a panel of persons recommended by a Selection Committee headed by the Chief Justice of India or his nominee. We are inclined to dismiss the petitions only on the ground that the petitions challenge show-cause notices and that it is open to the petitioners to raise all available contentions, including preliminary objection against legality or otherwise of initiation of the proceedings against the petitioners X X X X Extracts X X X X X X X X Extracts X X X X ..... rmation have been found to be substantiated against you. In these reports, the DG has concluded that you along with other persons named in the report of DG have acted in concert by forming a cartel with a view to extracting higher revenue sharing ratio for the supply of films to the Multiplexes and for achieving your object, you indulged in limiting/controlling supply of films in the market by refusing to release films to Multiplexes for exhibition and succeeded in achieving your objective by raising your revenue sharing ratio and have thus by your conduct and activities contravened the provisions of section 3(3) of the Competition Act, 2002. After considering the reports of DG, the Commission has decided to proceed further in the matter in accordance with the provisions of the Competition Act and the regulations framed thereunder. In view of the above and in compliance to the directions of the Commission, the copies of reports of the DG are being furnished to you for inviting your replies/objections, if any. You are, therefore, directed to submit your objections/replies within a period of 15 days from the date of receipt of this notice. If you wish, you may also make request f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered body nor did it represent all the film producers. (v)The disputes that had arisen between the multiplex owners and producers of Hindi feature films were resolved in or about June, 2009 and thereafter agreements are being signed between each individual producer for its respective films with each individual multiplex and films are being released through multiplexes by Hindi film producers and hence the allegations and the impugned show-cause notices have become academic and stale as no grievance remains to investigate. (vi)The information received by the respondents from FICCI-Multiplex Association of India, on the basis of which the case was filed against the petitioners, was not disclosed to the petitioners. The petitioners further state that after the petitioners received letter dated 11-8-2009 indicating the information about the alleged violation of the provisions of section 3(3) of the Competition Act, the petitioners had responded by writing letters dated 17-8-2009 and 1-9-2009 in Writ Petition No. 358 of 2010 and letter dated 17-8-2009 in Writ Petition No. 526 of 2010. The Director General of Investigation held a hearing on 23-11-2009. Even thereafter the Compet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d has granted interest in the right by licence any right to a third party, the only other permissible mode or method for any person to acquire any right in respect of such copyright is by making a complaint to the Copyright Board under section 31 and satisfy the Copyright Board that the necessary conditions stipulated in section 31 are satisfied. Section 31 provides that if a complaint is made to the Copyright Board that the owner of the copyright in the film has refused to allow the performance in the public of the work and by reason of such refusal, the work is withheld from the public or has refused to allow the communication to the public, such work on terms which the complainant considers reasonable, after giving to the owner of the copyright in the work a reasonable opportunity of being heard and after holding inquiry, if it is satisfied that the grounds for such refusal are not reasonable, the Copyright Board may direct the Registrar of Copyright to grant to the complainant a licence to republish the work, perform the work in public or communicate the work to the public subject to payment to the owner of the copyright of such compensation and subject to such terms and condit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. Ltd. v. ITO AIR 1961 SC 372, Whirlpool Corpn. v. Registrar of Trade Marks [1998] 8 SCC 1 and Siemens Ltd.'s case (supra) in support of the above contentions. 9. Mr. Janak Dwarkadas, the learned counsel for the petitioners has also placed reliance on the following decisions : (a) Ramesh Chandra Sankla v. Vikram Cement [2008] 14 SCC 58, is relied upon in support of the contention that if the jurisdictional fact does not exist, the Tribunal cannot act. If an authority or Tribunal wrongly assumes the existence of such facts, a writ of certiorari lies, because by erroneously assuming existence of jurisdictional fact, a subordinate Tribunal cannot confer upon itself jurisdiction which it otherwise does not possess. (b) Entertainment Network (India) Ltd. v. Super Cassette Industries Ltd. [2008] 13 SCC 30, is relied upon for the purpose of analyzing the scheme of the Copyright Act and particularly sections 14, 30 and 31 of the said Act. Relying on the principles laid down in paragraphs 92 to 96 of the above judgment, it is vehemently submitted that a copyright owner has complete freedom to enjoy the fruits of his labour by assigning the copyright for an agreed royalty through the iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 963 SC 569. 10. On the other hand, the petitions are opposed by Mr. Khambatta, learned Additional Solicitor General appearing for the Union of India and the Competition Commission. It is submitted that the matter is still at the show-cause notice stage and, therefore, the petitions are premature. All the issues raised in the petitions and the correspondence addressed on behalf of the petitioners can and must be decided by the Competition Commission. The petitioners have participated in the proceedings before the Competition Commission and they have already indicated that they would be filing a reply to the show-cause notices and they have also sought a hearing from the Competition Commission. Having accepted the jurisdiction and authority of the Competition Commission to proceed in the matter pursuant to the said notices and having unequivocally appeared before the Commission, the petitioners are now estopped from raising any objection to the said proceedings. 11. Without prejudice to the above submissions, it is further submitted by the learned Additional Solicitor General as under :-- (a)The Competition Commission can decide constitutional, legal and even jurisdictional issues ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1957. All that sub-section (5) of section 3 provides is that sub-section (1) of section 3 shall not take away or restrict the right of any person to restrain any infringement of copyright or the right of any person to impose reasonable conditions for protecting his rights under the Copyright Act. Hence all the defences which can be raised before the Copyright Board can be also raised before the Competition Commission. In support of this submission, reference is made to the provisions of sections 60, 61 and 62 of the Competition Act, 2002. Section 61 provides for exclusion of jurisdiction of civil Courts in respect of any matters which the Commission or the Appellate Tribunal is empowered by the Competition Act to determine. Section 60 gives the Act overriding effect over other laws. Section 62 of the Competition Act, 2002, reads as under :- "62. Application of other laws not barred.--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." [Emphasis supplied] Relying on the preamble of the Competition Act that the Act has been enacted to provide "for the establishment of a Commission to prevent p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the jurisdiction on finding that it does exist, to proceed further or do something more. When the Legislature are establishing such a Tribunal or body with limited jurisdiction they give them, whether there shall be any appeal from their decision, or there will be none. In the second of two cases I have mentioned it is an erroneous application of the formula to say that the Tribunal cannot give themselves jurisdiction by wrongly deciding certain facts to exist, because the Legislature gave them jurisdiction to determine all the facts, including the existence of the preliminary facts on which the further exercise of their jurisdiction depends; and if they were given jurisdiction so to decide, without any appeal being given, there is no appeal from such exercise of their jurisdiction." The Apex Court then stated as under : "These observations which relate to inferior Courts or Tribunals with limited jurisdiction show that there are two classes of cases dealing with the power of such a Tribunal (1) where the Legislature entrusts a Tribunal with the jurisdiction including the jurisdiction to determine whether the preliminary state of facts on which the exercise of its jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... executive authority from acting without jurisdiction. Where such action of an executive authority acting without jurisdiction subjects or is likely to subject a person to lengthy proceedings and unnecessary harassment, the High Courts, it is well-settled, will issue appropriate orders or directions to prevent such consequences." [Emphasis supplied] 17. In the facts of the instant case, it cannot be said that requiring the petitioners to appear before the Competition Commission will subject the petitioners to lengthy proceedings and unnecessary harassment. Sections 8 and 9 of the Competition Act provides that the Commission shall consist of a Chairperson and two to six Members having special knowledge of, and professional experience of at least fifteen years in international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs or competition matters, including competition law and policy. The Chairperson and Members of the Commission are to be appointed by the Central Government from a panel of persons recommended by a Selection Committee headed by the Chief Justice of India or his nominee. In case the final decision of the Competiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for. Hence all that the Commission is doing is to hold an inquiry into such contravention as reported by the Director General. All the authorities including disciplinary authority in service matters initiate departmental inquiries upon receiving preliminary inquiry report of subordinate officer indicating misconduct having been committed, but once the inquiry is held by observing the applicable statutory provisions and the principles of natural justice, the concerned disciplinary authority takes a final decision in the matter in accordance with law. Hence, mere issuance of a show-cause notice under section 26(8)/section 27, like issuance of a charge-sheet in a departmental inquiry, cannot be treated as pre-judging the issue, merely because the petitioners had raised some of the legal contentions in the replies to the notice issued by the Director General of Investigation and thereafter also the Commission has issued show-cause notices. That can never mean that the Competition Commission will not consider the petitioners' objections against maintainability of the proceedings. 19. Since we are inclined to dismiss the petitions only on the ground that the petitions challenge show-cau ..... X X X X Extracts X X X X X X X X Extracts X X X X
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