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TMI Blog2014 (11) TMI 1269X X X X Extracts X X X X X X X X Extracts X X X X ..... s (4) to (8) of S.26 of the Act. Annexure-A having made reference to certain aspects, cannot be said to be perverse or is without any basis and thus, arbitrary to warrant interference under Article 226 of the Constitution. Non providing of opportunity of hearing while issuing the direction - Principles of natural justice - HELD THAT:- The points raised for consideration has no merit and should fail. Since the petitioner has further opportunity to raise its objections as against the said report before the Commission, order passed on 23.09.2014, on the memo filed and submissions made by Sri Krishna S.Dixit, that the report dated 30.04.2013 of respondent No.9 shall be kept in abeyance and not to act upon the same, until further orders, is hereby recalled. Both the legal points raised by the petitioner are covered by the Judgment referred to hereinbefore, this writ petition being devoid of merit is dismissed. Liberty is reserved to the petitioner to file its objections to the report dated 26.04.2013, in view of Sub-section(6) of S.26 of the Act. - THE HON BLE MR. JUSTICE A.N. VENUGOPALA GOWDA FOR THE PETITIONER : SRI R. ANIL KUMAR, ADV. FOR SRI SHANMUKHAPPA, ADV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hed the information under Sub-section (1) of S.19 of the Act, vide Annexure-C, to the Commission and the same was registered as Case No.58/2012 against the petitioner and the respondent Nos.3 to 7 and the Order as at Annexure-A was issued. 5. Sri R.Anil Kumar, learned advocate, contended that the complaint filed by respondent Nos.1 and 2 being vague and there being no specific plea as to which action of the petitioner and respondent Nos.3 to 7 was in violation of the provisions of Ss.3 and 4 of the Act and there being no prima facie case and the impugned direction being in violation of principles of natural justice i.e., Audi alteram partem, is arbitrary and illegal. He submitted that the writ petition was filed on 24.04.2013 and an interim order of stay of Annexure-A having been passed on 25.04.2013, the report in pursuance of the impugned direction, prepared on 26.04.2013, having been submitted on 30.04.2013, the same being illegal, be ordered to be discarded and action taken against respondent Nos.8 and 9 for the disobedience. 6. Sri Krishna S.Dixit, learned Assistant Solicitor General of India, appearing for respondent Nos.8 and 9, on the other hand, referred to the scope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atter of an information received is, in the opinion of the Commission, substantially the same as or has been covered by any previous information received, then the new information may be clubbed with the previous information. (2) Where on receipt of a reference from the Central Government or a State Government or a statutory authority or information received under section 19, the Commission is of the opinion that there exists no prima facie case, it shall close the matter forthwith and pass such orders as it deems fit and send a copy of its order to the Central Government or the State Government or the statutory authority or the parties concerned, as the case may be. (3) The Director-General shall, on receipt of direction under sub-section (1), submit a report on his findings within such period as may be specified by the Commission. (4) The Commission may forward a copy of the report referred to in sub-section (3) to the parties concerned: Provided that in case the investigation is caused to be made based on a reference received from the Central Government or the State Government or the statutory authority, the Commission shall forward a copy of the report referre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Commission. In short, the establishment of the Commission and enactment of the Act was aimed at preventing practices having adverse effect on competition, to protect the interest of the consumer and to ensure fair trade carried out by other participants in the market in India and for matters connected therewith or incidental thereto. 9. The various provisions of the Act deal with the establishment, powers and functions as well as discharge of adjudicatory functions by the Commission. Under the scheme of the Act, this Commission is vested with inquisitorial, investigative, regulatory, adjudicatory and to a limited extent even advisory jurisdiction. Vast powers have been given to the Commission to deal with the complaints or information leading to invocation of the provisions of Sections 3 and 4 read with Section 19 of the Act. In exercise of the powers vested in it under Section 64, the Commission has framed regulations called The Competition Commission of India (General) Regulations, 2009 (for short, the Regulations ). 10. The Act and the Regulations framed thereunder clearly indicate the legislative intent of dealing with the matters related to contravention of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olicy, which in the opinion of the Central Government, may be useful to the Commission, shall be appointed by the Central Government by issue of a notification, to be called as Competition Commission of India . The Chairperson and the Members of the Commission, thus, are persons of abundant expertise, experience, special skill required to deal with cases that come before the Commission. Their opinion with regard to the existence of a prima facie case, on the information received etc., which find reference in S.19 of the Act, would be that of an expert body and should not be lightly interfered with, as was held by the Apex Court, in B.C.MYLARAPPA ALIAS Dr. CHIKKAMYLARAPPA Vs. Dr. R. VENKATASUBBAIAH AND OTHERS, (2008) 14 SCC 306. 12. Prima-facie case with reference to subsection (1) of S.26 of the Act, means no more than that the Commission is satisfied that the case is not frivolous or vexatious and that there is a serious question to be investigated. In AMERICAN CYANAMID CO., VS. ETHICON LTD., reported in ILR 1976(1) KAR 426, with regard to the use of expression prima faice case , in the context of exercise of discretionary power to grant an interlocutory injunction, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter of investigation, although abuse of the strength of Opposite Parties seems to be obvious as the Opposite Parties being Associations of Producers/Directors, etc. had been giving directions to the Members against exhibiting dubbed programmes and dubbed films. Prima facie, the Opposite Parties being Associations in these two markets have hold over the Members .. 8. In view of the above discussion, the Commission finds that prima facie, Opposite Parties seem to be indulging in violation of sections 3 4 and it is a fit case for investigation by the DG. The Commission, therefore, hereby directs to initiate investigation into the allegations made by the informant and submit a report to this Commission within 60 days. From the above, it is clear that the Commission having deliberated, found that there exits a prima facie case and directed the investigation by the Director- General. The finding in Annexure-A being only for the limited purpose of directing investigation into the allegations made in Annexure-C, by the Director-General, shall have no bearing either on the investigator or even on the Commission, at a subsequent stage. When once report of investigation is r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l justice. Furthermore, that non-compliance therewith, would always result in violation of fundamental requirements vitiating the entire proceedings. Different laws have provided for exclusion of principles of natural justice at different stages, particularly, at the initial stage of the proceedings and such laws have been upheld by this Court. Wherever, such exclusion is founded on larger public interest and is for compelling and valid reasons, the courts have declined to entertain such a challenge. It will always depend upon the nature of the proceedings, the grounds for invocation of such law and the requirement of compliance to the principles of natural justice in light of the above-noticed principles. ***** ***** ***** 83. The provisions of Section 26(1) clearly indicate exclusion of principles of natural justice, at least at the initial stages, by necessary implication. In cases where the conduct of an enterprise, association of enterprises, person or association of persons or any other legal entity, is such that it would cause serious prejudice to the public interest and also violates the provisions of the Act, the Commission will be well within its jurisdiction to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this writ petition was filed on 24.04.2013. Respondent No.9 has submitted a report dated 26.04.2013 on 30.04.2013, to the Commission. Copy of the said report was circulated to the petitioner and others concerned. The petitioner and other aggrieved persons, have got a statutory right of appeal under Chapter VIII-A under S.53-B of the Act, if at all, the said report is accepted by the Commission. On the said aspect, in the case of SAIL (supra), Apex Court has held as follows: 37. As already noticed, in exercise of its powers, the Commission is expected to form its opinion as to the existence of a prima facie case for contravention of certain provisions of the Act and then pass a direction to the Director General to cause an investigation into the matter. These proceedings are initiated by the intimation or reference received by the Commission in any of the manners specified under Section 19 of the Act. At the very threshold, the Commission is to exercise its powers in passing the direction for investigation; or where it finds that there exists no prima facie case justifying passing of such a direction to the Director General, it can close the matter and/or pass such orders as i ..... 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