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TMI Blog2023 (7) TMI 1537X X X X Extracts X X X X X X X X Extracts X X X X ..... on to direct the parties to publish details of the combination - modifications suggested by Respondent No.2 in its reply to Show Cause Notice, adequately addressed the AAEC as expressed in the Show Cause Notice under Section 29, sub- section (1) - non-application of mind - violation of principles of natural justice. Whether the Appellant(s) have locus to challenge the order of the Competition Commission of India dated 15.03.2023 within the meaning of Section 53B of the Competition Act, 2002? - HELD THAT:- In the Judgment of the Hon ble Supreme Court in Samir Aggarwal [ 2020 (12) TMI 621 - SUPREME COURT ] where Hon ble Supreme Court was considering the expression person aggrieved in context of the Competition Act it was categorically held by Hon ble Supreme Court that the expression person aggrieved has to be understood widely and not be constructed narrowly. The present is a case where Appellants are challenging the order passed by the Commission approving the combination of two biggest market players in container glass industry. It is contended in the Appeal that approval of the combination has been done in breach of the procedure prescribed in the Competition Act. We have noticed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t No. 3, non-issuance of notice to target entity i.e. Respondent No. 3 is not to ipso facto vitiate the order of the Commission when Respondent No. 3 has neither any objection nor grievance regarding non-service of notice to Respondent No. 3 and information regarding Respondent No. 3 are all in public domain which has been used by Respondent No. 2 in submitting the notice. By mere non-issuance of notice to Respondent No. 3, the proceedings before the CCI need not be annulled. Whether after formation of prima-facie opinion that combination is likely to cause an appreciable adverse effect on competition by the CCI under Section 29, sub-section (1), there was no occasion to form again a prima facie opinion under Section 29(2) after receipt of response to the Show Cause Notice and the CCI was required to complete the further process under Section 29(2) including direction to the parties to the combination to publish details of combination? - Whether the process as contemplated under Section 29, sub- section (2) having not been completed by the CCI before passing the order dated 15.03.2023, the order passed by the CCI is against the procedure prescribed under Section 29 and deserved to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mission of the Appellant(s) that prima facie opinion at the second stage is not required to be formed does not commend. As per the statutory provisions contained in Section 29 and the Regulations 2011, after receipt of the response to show-cause notice, the Commission has to form prima facie opinion at the second stage as required by Section 29, sub-section (2) and in cases where prima facie opinion at the second stage under Section 29, sub-section (2) has not been formed and the Commission is satisfied that the response received in the modification, if any, submitted by the Party does not meet the requirements of law, the Commission directed publication of details of combination in such cases - the Commission proceeded to approve the combination by following the statutory procedure prescribed under Section 29 as well as Regulations 2011. Further, in the facts of the present case, under sub-section (2) of Section 29, the publication of details of combination was not required to be directed, since at the second stage, the Commission did not form any prima facie opinion of AAEC - the Commission had duly considered the modification submitted by AGI in response to the show-cause notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Resolution Professional. iv) The CCI s process was compliant with the statutory procedure, and the acceptance of modifications addressed AAEC concerns, negating the need for a second prima facie opinion and publication of details. v) The CCI s process did not violate principles of natural justice, as the procedural framework did not require public participation at the stage reached. Appeal dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... sing objections against the combination for which notice was given on 27.09.2022. Again on 16.11.2022, the Appellant filed letter before the CCI raising objections to combination notice given by the AGI. The CCI by letter dated 17.11.2022 asked the Acquirer - AGI to provide certain information. The CCI vide letter dated 28.12.2022 required the Acquirer to remove certain defects and provide further information. The Acquirer submitted response to the above two letters of the CCI. (iv) The CCI held its Meeting on 09.02.2023, considered the information on record, details provided in the Notice and the responses filed by the Acquirer, and formed a prima facie opinion that the proposed combination is likely to cause an Competition Appeal (AT) Nos.07, 08, 09 & 10 of 2023 6 Appreciable Adverse Effect on Competition (hereinafter referred to as the "AAEC") in relevant market(s) in India. A show-cause notice dated 10.02.2023 under Section 29, sub-section (1) of the Act was issued to the Acquirer, wherein the Acquirer was directed to respond in writing within 30 days of the receipt of the show-cause notice, as to why investigation in respect of the proposed combination should not be conducte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on before the Adjudicating Authority, seeking intervention, which was not entertained. The UPGMS's further case is that after coming to know about the notice given by the AGI to the CCI under Form - 1, filed the objections on 07.10.2022. The Appellant pleads that proposed combination is likely to cause an AAEC inasmuch the combined entity would have a market share of around 60%, resulting in significant horizontal effect and price would increase in the container glass market in India. Respondent Nos.2 and 3 were the largest players in the container glass market and customers would have limited ability to switch to competing manufacturers. UPGMS also filed an Application before the CCI, asking for details of the notice given by the AGI and to give it a personal hearing, which was denied by the CCI on 22.02.2023. The Appellant further pleaded that AGI and HNG have the largest market share in the relevant market and the acquisition by the AGI would affect product pricing, encourage predatory pricing, encourage cartelization and severely affect the business of several industries that are dependent on the container glass industry. Smaller players like the Members of UPGMS shall be adver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Corporate Debtor, land value of which is more than Rs.250 crores excluding the structures and machineries, which puts the future of over 675 workers and employees at jeopardy. The Appellant's case is that no purpose shall be served in disposing off the Rishikesh Plant, which is functioning as a profitable Unit of the Corporate Debtor. Competition Appeal (AT) No. 10 of 2023 7. This Appeal has been filed by HNG Industries Thozialar Nala Sangam, which is a Workers Union representing the interests of the workers engaged in HNGIL, Puducherry which is sought to be merged by way of the Order dated 15.03.2023. The order dated 15.03.2023 allowed the proposed merger of the entire business of HNG Limited with AGI. The Appellant pleaded that urgent and necessary directions need to be issued with respect to the day-to-day operations of the target company HNGIL, which are of utmost concern for Appellant. The Appellant is entitled to be heard as per the principles of natural justice. The order dated 15.03.2023 passed by the CCI proposing modification which include closure of certain important productions units, would result in the loss of employment of several Members of the trade unions an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng into the order dated 15.03.2023 is vitiated and the order dated 15.03.2023 deserves to be set aside on this ground alone. 11. The CCI having formed a prima facie opinion that the combination is likely to cause an AAEC, it was required to proceed with further investigation as per Section 29, sub-section (2) of the Act. The facts of the present case required a full-fledged investigation under Section 29 sub- section (2). The two big players in the relevant market merging together, the CCI ought to have issued an order under Section 29, sub-section (1A) calling a report from the Director General. It is submitted that when the CCI has formed a prima facie opinion that combination is likely to cause an AAEC, it was required to proceed under Section 29, sub-section (2), directing parties to the combination to publish details of the combination after receipt of the reply to the show-cause notice. The scheme of Section 29, sub-section (2) does not envisage formation of any second prima facie opinion after receipt of the reply to the notice. In the present case, the CCI has not proceeded to act as per Section 29 sub-section (2), since it did not issue any direction to the parties of com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tely filed Form-I in order to delay the process of approval of the Commission. Notice in Form-II was subsequently filed after approval of the Resolution Plan by the CoC. 13. There are no two stages of formation of prima facie opinion. Section 29 sub-section (2) cannot be read to mean that prima facie opinion has to be again made by the commission after receipt of response to the show- cause notice. All steps under Section 29 have to be completed before any order under Section 31 can be passed. Stage of Section 31 comes only after entire procedure under Section 29 is exhausted. The provisions of Act cannot be diluted by Regulation 25(1A). The order passed by the Commission has effect on economy, hence, all people at large have to be heard. The facts given by Respondent No.2 were accepted as gospel truth without verification of facts by any means. 14. The learned Senior Counsel appearing for CCI refuting the submissions of learned Counsel for the Appellant(s) submits that none of the Appellant(s) have any locus to challenge the order dated 15.03.2023. The Appeal under Section 53B can only be filed by any person aggrieved by any direction, decision or order passed by the CCI. None o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 29, sub-section (2) has to be looked into in the above manner. 17. It is submitted that divestiture of the Rishikesh Plan as suggested by the modification adequately addresses the AAEC concern. The Commission has in detailed considered all materials information given in the notice and other relevant materials on record and in accordance with Section 20, sub-section (4) has considered the matter. The decision of the Commission on notice under Section 6, sub-section (2) has to be taken within a time line and the submission of the Appellant that the Commission hurriedly passed the order under Section 31, sub-section (1) is not correct. The commission after the AGI on 03.11.2022 filed a detailed application and after considering all relevant documents has passed the impugned order. The Commission is an Expert Body, which has been entrusted with inquisitorial jurisdiction in approving the combinations. At the stage when Commission approves the combination, the Appellant(s) had no right to be heard or permitted to participate in the proceedings. The approval of Resolution Plan by the CoC on 28.10.2022, does not affect the jurisdiction of the CCI to examine the notice under Section 6, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent No.2 is compliant of Insolvency and Bankruptcy Code, 2016 has placed the same before the CoC. The RP can have no objection, he having himself placed the Plan for approval, to the order dated 15.03.2023 passed by the CCI. The RP has placed the said order before the Adjudicating Authority in the insolvency proceedings of Respondent No.3. The RP is not in any manner objecting to the order of the CCI dated 15.03.2023. The RP further submitted that at present the Corporate Debtor is functioning with only 50% capacity, hence, remedial actions are urgently required. 20. We have heard the submission of learned Counsel for the parties and have perused the record. 21. From the submission of learned Counsel for the parties and material on record, following points arose for consideration in these Appeal(s): (I) Whether the Appellant(s) have locus to challenge the order of the Competition Commission of India dated 15.03.2023 within the meaning of Section 53B of the Competition Act, 2002? (II) Whether Section 29, sub-section (1) contemplates that a Show Cause Notice to be issued to the parties to combination, i.e., both acquirer and the target entity or word 'parties' occurring i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave refuted the submissions of the Respondents and contends that ambit and scope of "any person aggrieved" under Section 53B has to be widely interpreted looking to the nature and purpose of the Competition Act, 2002. The object of the Competition Act is to eliminate practices having adverse effect on the competition. The Order impugned adversely affects the competition in the relevant market which shall affect the Appellant hence it cannot be said that Appellant has no locus to file the Appeal. For considering the above objection taken by Respondents, we may first examine the locus of the Appellant who has filed Competition Appeal No. 07 of 2023 i.e. UP Glass Manufacturer Syndicate. Whether the Appellant, UP Glass Manufacturer Syndicate has any locus to challenge the Impugned Order needs to be considered first. 23. We may notice the credentials of the Appellants and pleadings in the Appeal. For considering the objections raised by the Respondents, in paragraph 7 of the Appeal, under heading: facts of the case, in sub- paragraph (iv), following has been pleaded: "(iv) As prefaced above, the Appellant herein is an industry body of micro, small and medium scale manufacturers of gl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show later, do violence to the context in which the phrase occurs in the Advocates' Act. Although I am aware that in Seven Oaks Urban District Council v. Twynham Lord Hewart C.J., uttered words of caution, again emphasised by Lord Parker C.J., in Ealing Corporation v. Jones, in applying too readily the definitions given in relation to other statutes but I do not think I am going beyond what Lord Hewart C.J., said and what Lord Parker C.J., did in the case. Lord Parker observed: ".... As Lord Hewart C.J. pointed out in Seven Oaks Urban District Council v. Twynam: 'But as has been said again and again there is often little utility in seeking to interpret particular expressions in one statute by reference to decisions given upon similar expressions in different statutes which have been enacted alio intuitu. The problem with which we are concerned is not, what is the meaning of the expression 'aggrieved' in any one of a dozen other statutes, but what is its meaning in this part of this statute?' Accordingly, I only look at the cases to which we have been referred to see if there are general-principles which can be extracted which will guide the court in approaching the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the complainant. Section 494 does not restrict right of filing complaint to the first wife and and there is no reason to read the said Section in a restricted manner as is suggested by the learned Counsel for the appellant. Section 494 does not say that the complaint for commission of offence under the said section can be filed only by wife living and not by the woman with whom subsequent marriage takes place during the life time of the wife living and which marriage is void by reason of its taking place during the life of such wife. The complaint can also be filed by the person with whom second marriage takes place which is void by reason of its taking place during the life of first wife." 29. Respondents have also placed reliance on Judgment of the Supreme Court in "Northern Plastics Limited Vs. Hindustan Photo Films Mfg. Co. Ltd. and Ors". (1997) 4 SCC 452, where Hon'ble Supreme Court while considering the provisions of the Customs Act, 1962 to file an Appeal to CEGAT, Supreme Court while dealing with Section 129A made following observations: "In the light of this statutory scheme, therefore, it is not possible to agree with the contention of learned counsel for the conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondents before us." 30. Another Judgment relied upon by Respondent is "Ayaaubkhan Noorkhan Pathan Vs. State of Maharashtra", AIR 2013 SC 58, wherein paragraph 9 dealing with "person aggrieved" following has been laid down; " Person aggrieved 9. It is a settled legal proposition that a stranger cannot be permitted to meddle in any proceeding, unless he satisfies the Authority/Court, that he falls within the category of aggrieved persons. Only a person who has suffered, or suffers from legal injury can challenge the act/action/order etc. in a court of law. A writ petition under Article 226 of the Constitution is maintainable either for the purpose of enforcing a statutory or legal right, or when there is a complaint by the appellant that there has been a breach of statutory duty on the part of the Authorities. Therefore, there must be a judicially enforceable right available for enforcement, on the basis of which writ jurisdiction is resorted to. The Court can of course, enforce the performance of a statutory duty by a public body, using its writ jurisdiction at the behest of a person, provided that such person satisfies the Court that he has a legal right to insist on such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 26, section 27, section 28, section 31, section 32, section 33, section 38, section 39, section 43, section 43A, section 44, section 45 or section 46 of this Act. b) to adjudicate on claim for compensation that may arise from the findings of the Commission or the orders of the Appellate Tribunal etc. 11. It is therefore axiomatic that in order to be able to file an appeal by any person he has to be an aggrieved person. Inspite of lengthy arguments we are not convinced that Shri Jitender Bhargava, the Appellant can be in any manner be an aggrieved person, particularly, by the approval of the combination. 12. Learned Senior Counsel very seriously argued that as the Combination has been approved of on an incorrect appreciation of facts and law, the Appellant feels aggrieved. We do not see any reason firstly to discuss the merit or demerits of the logic and rational in the order of CCI, particularly because that could have been questioned by the person really aggrieved. Since we do not see the Appellant as an aggrieved person we do not wish to go into that aspect. Shri Ramji Srinivasan also did not press this point further." 33. Refuting the submissions of the Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23. Obviously, 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." 34. In the Judgment of the Hon'ble Supreme Court in Samir Aggarwal where Hon'ble Supreme Court was considering the expression 'person aggrieved' in context of the Competition Act it was categorically held by Hon'ble Supreme Court that the expression person aggrieved has to be understood widely and not be constructed narrowly. The construction of the "person aggrieved" in Adi Pherozshah Gandhi was clearly departed. 35. In this context, we may also notice duties and function entrusted to the Commission. Section 18 of the Act provides as follows: "18. Duties and functions of Commission.--Subject to the provisions of this Act, 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 markets in India: Provided that the Commission may, for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tes elastic and elusive concept which cannot be confined within the bounds of a rigid, exact and comprehensive definition. It was held that "its scope and meaning depends on diverse, variable factors such as the content and intent of the statute of which contravention is alleged". The emphasis by the Hon'ble Supreme Court is that while considering the concept of aggrieved person, content and intent of the statute has to be looked into. Thus while considering the locus of the Appellant, we have to consider the content and intent of the Competition Act, 2002 while answering the issue. 38. Hon'ble Supreme Court in 'Samir Aggarwal vs CCI' as noted above has categorically held that expression "an aggrieved person" must in the context of the Competition Act be understood widely and not be constructed narrowly. It is further observed that 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. The Judgment of the Hon'ble Court in 'Samir Aggarwal' was delivered in context of Competition Act, 2002 and in vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n' itself contemplates combination of two entities or more. Section 29(1) contemplates that show cause notice has to be issued to the parties to combination. The expression has to be read to mean that notice has to be issued to parties to the combination. Parties to the combination clearly means the acquirer and the target entity. It may so happen that notice under Regulation 5 of 2011 has been given by only one party but Section 29(1) contemplates notice to parties to the combination. There is purpose and object in Section 29(1) for providing show cause notice to parties to the combination calling upon them to response. The use of the expression "them" itself indicate that both the parties to the combination have to be noticed. 42. Learned Counsel for the Competition Commission of India has relied on General Clauses Act, Section 13 which provides as follows: "13. Gender and number.--In all 2 [Central Acts] and Regulations, unless there is anything repugnant in the subject or context,-- (1) words importing the masculine gender shall be taken to include females; and (2) words in the singular shall include the plural, and vice versa." 43. It is true that as per General Clauses A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore notice in Form II was submitted by the Respondent No. 2 before the CCI. The Resolution Professional has also appeared in these Appeals and submitted that Resolution Professional does not have any objection against the Order dated 15th March, 2023 passed by the Competition Commission of India and accepting the said order, Resolution Professional has also filed an Application before the Adjudicating Authority to take the order on record as compliance of the provision of Section 31(4) of I&B Code, 2016. In the facts of the present case, especially that Respondent No. 3 is in insolvency and the Resolution Professional himself has placed proposal for acquisition of Respondent No. 2 which has been approved by the Committee of Creditors and all details and information have been given by Respondent No. 2 in its notice under Section 6(2) of Competition Act which relate both to Respondent No. 2 and Respondent No. 3, non-issuance of notice to target entity i.e. Respondent No. 3 is not to ipso facto vitiate the order of the Commission when Respondent No. 3 has neither any objection nor grievance regarding non-service of notice to Respondent No. 3 and information regarding Respondent No. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c, affected or likely to be affected by the said combination, to file his written objections, if any, before the Commission within fifteen working days from the date on which the details of the combination were published under sub-section (2). (4) The Commission may, within fifteen working days from the expiry of the period specified in sub-section (3), call for such additional or other information as it may deem fit from the parties to the said combination. (5) The additional or other information called for by the Commission shall be furnished by the parties referred to in sub-section (4) within fifteen days from the expiry of the period specified in sub-section (4). (6) After receipt of all information and within a period of forty-five working days from the expiry of the period specified in sub-section (5), the Commission shall proceed to deal with the case in accordance with the provisions contained in section 31." 48. Section 30 deals with 'Procedure in case of notice under sub-section (2) of section 6, which is to the following effect: "Procedure in case of notice under sub-section (2) of section 6 30. Where any person or enterprises has given a notice under su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion under sub- section (3). (9) If the parties fail to accept the modification proposed by the Commission within thirty working days referred to in sub-section (6) or within a further period of thirty working days referred to in sub-section (8), the combination shall be deemed to have an appreciable adverse effect on competition and be dealt with in accordance with the provisions of this Act. (10) Where the Commission has directed under sub-section (2) that the combination shall not take effect or the combination is deemed to have an appreciable adverse effect on competition under sub-section (9), then, without prejudice to any penalty which may be imposed or any prosecution which may be initiated under this Act, the Commission may order that - (a) the acquisition referred to in clause (a) of section 5; or (b) the acquiring of control referred to in clause (b) of section 5; or (c) the merger or amalgamation referred to in clause (c) of section 5, shall not be given effect to: Provided that the Commission may, if it considers appropriate, frame a scheme to implement its order under this sub-section. (11) If the Commission does not, on the expiry of a period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eeding fifteen days, needed for evaluation of the offered modification, shall be excluded from the period provided in sub-regulation (1) of this regulation, sub- section (2A) of section 6 of the Act and sub-section (11) of section 31 of the Act.] (3) Where the Commission deems it necessary, it may call for information from any other enterprise while inquiring as to whether a combination has caused or is likely to cause an appreciable adverse effect on competition in India. Provided that the time taken in obtaining the information from such enterprise(s) shall be excluded from the time, not exceeding fifteen working days, provided in sub-regulation (1) of this regulation." 51. Regulation 25 deals with 'Modification to the proposed combination', which also contains an amendment inserted by the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Amendment Regulations, 2018, w.e.f. 09.10.2018. Regulation 25 as amended is as follows: "25. Modification to the proposed combination.- (1) Where the Commission is of the opinion that combination has or is likely to have appreciable adverse effect on competition but such adver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on formation of such opinion, the Commission is to issue a show cause notice to the parties to combination calling upon them to respond within thirty days from the receipt of the notice. In the present case, it is on the record that in the Meeting dated 09.02.2023, the Commission deliberated over the notice given under Section 29, sub-section (1) and other information and documents submitted by Respondent No.2 subsequently. After considering the entire materials on record, the Commission formed a prima facie opinion that combination is likely to cause an AAEC. Consequently, notice under Section 29, sub-section (1) was issued on 10.02.2023. The bone of contention of the parties is as to whether after formation of prima facie opinion under Section 29(1), whether there was any requirement of formation of prima facie opinion at the second time under sub-section (2) of Section 29. Whereas the Appellant(s) pleads that there is no requirement of formation of prima facie opinion at the second time and when notice under Section 29, sub-section (1) has been issued, even after response to the notice, the Commission is required to direct the parties to the combination to publish the details ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... econd stage is not required to be formed does not commend us. 54. Regulation 19 of Combination Regulations, 2011 deals with formation of prima facie opinion under sub-section (1) of Section 29. Sub-regulation (2) of Regulation 19 also contains a provision that before the Commission forming an opinion under sub-section (1) of Section 29, the parties to the combination may offer modification to the combination and on that basis, the Commission may approve the proposed combination under sub-section (1) of Section 31 of the Act. The above Regulation clearly contemplates that even before forming opinion under Section 29, sub-section (1), if the parties submit a modification and the Commission is satisfied, combination can be approved under Section 31, sub-section (1), without proceeding any further. 55. We have looked into the cases decided by the Competition Commission of India to find out the procedure, which was adopted by the Commission to decide cases by the Competition Commission of India, which indicate that after issuance of show-cause notice under Section 29, sub- section (1), the Commission has proceeded to form a prima facie opinion at the second stage as contemplated under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l relevant markets in India. Accordingly, in terms of Section 29(1) of the Act, a show cause notice dated 11.04.2018 ("SCN") was issued to the Parties wherein the Parties were directed to respond, in writing, within thirty days of the receipt of the SCN, as to why investigation in respect of the Proposed Combination should not be conducted. 12. The Commission, in its meeting held on 17.05.2018, considered and assessed the Response to SCN, third party responses received in terms of communication under Regulation 19(3) of the Combination Regulations and noted that submissions of the Parties, contesting the AAEC concerns expressed by the Commission in SCN, do not allay the said concerns. The Parties also proposed certain divestments in relation to helium and bulk markets along with the Response to SCN and submitted that the same would eliminate all the primary concerns raised by the Commission. In this regard, the Commission noted that the divestments relating to helium market were offered by the Parties in other jurisdictions and the same were yet to be accepted by said authorities. The divestment related to the bulk markets, prima facie, did not address all the AAEC concerns rais ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion under Section 29(2) of the Act. Section 29(3) of the Act provides for Commission calling the public to file their written objections, regarding the proposed combination. After receipt of such objections, the Commission may ask the parties to furnish such information as may be required by the Commission under Section 29(4) of the Act. After this stage, the Commission has been provided a period of 45 days under Section 29(6) of the Act to deal with the case in accordance with Section 31 of the Act. 71. A combined reading of the procedure under Section 29 of the Act, the orders and modifications that could be ordered / accepted under Section 31 of the Act and the statutory time period provided for inquiry, suggest that it would not be appropriate for the parties to the combination to submit new evidences after the stage contemplated under Section 29(5) of the Act, particularly after the issuance of proposal for modifications under Section 31(3) of the Act. The period of 45 days provided under Section 29(6) of the Act, is to assess the material on record including the submissions already given by parties, competitors and other stakeholders regarding the proposed combination. If ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipment business to a suitable buyer, thereby preserving the competition. Thus, the Commission considers such divestment to be proportional to address the competition concerns that would result otherwise from the Proposed Combination. (Hereinafter, 'India SG IOP capital equipment business' and 'Indian Divestment Business' is used interchangeably)." 62. The Commission thereafter proceeded to approve the combination. 63. Another judgment in this context is - Combination Registration No.C- 2016/08/424 decided on 16.05.2017, where a show-cause notice was issued on 14.04.2017. Along with response, the Acquirer filed a voluntary remedy proposal and after considering the remedy addressed by the notice, the Commission approved the combination without proceeding any further under Section 29, sub-section (2). In paragraph 9, the facts have been noted to the following effect: "9. Based on assessment of information available on record, the Commission, in its meeting held on 21st April, 2017, observed that there are prima facie competition concerns, as discussed in subsequent paragraphs, in relation to the Proposed Combination and therefore, decided to issue a show cause notice ("SCN"), und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the combination by following the statutory procedure prescribed under Section 29 as well as Regulations 2011. Further, in the facts of the present case, under sub-section (2) of Section 29, the publication of details of combination was not required to be directed, since at the second stage, the Commission did not form any prima facie opinion of AAEC. 66. The learned Counsel for the Respondent, relying on Section 30 of the act contended that Section 30 requires that after any person or enterprise has given a notice under sub-section (2) of Section 6, the Commission shall examine such notice and form its prima facie opinion as provided in sub- section (1) of 29, the Commission is to proceed as per the provisions contained in Section 30. It cannot be read to mean that after forming prima facie opinion under Section 29, sub-section (1), the Commission has to necessarily complete all process required under Section 29, i.e., under Section 29, sub-section (2) and other sub-sections. Section 30 and Section 29 have to be read harmoniously to give effect the provisions of the Act. Section 30 cannot be read to mean that even if, prima facie opinion at the second stage is not formed by the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 70. Shri Mukul Rohatgi, learned Senior Counsel appearing for Respondent No.2 has drawn attention of this Appellate Tribunal to large number of cases of Hon'ble Supreme Court, where Hon'ble Supreme Court has taken the view that decision of Expert Bodies are not to be readily interfered with by the Courts, in exercise of judicial review and appellate jurisdiction. The Commission is a Statutory Body, which in the present case is performing not an adjudicatory function, rather, is exercising inquisitorial function. The Hon'ble Supreme Court in Competition Commission of India vs. Steel Authority of India Limited and Anr. has held that the Competition Commission of India performs various functions including regulatory, inquisitorial and adjudicatory. The functions, which have been exercised by the Commission in the present case are clearly inquisitorial functions. The decision of the Expert Body is not lightly to be interfered by the Courts and the Appellate Authorities is a well-established principle. We may refer to the judgment of the Hon'ble Supreme Court in (2017) 5 SCC 262 - Union of India and Ors. vs. Cipla Limited and Ors., where the Hon'ble Supreme Court relied on the conclus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the judicial function is exhausted when it is found to have "warrant in the record" and a rational basis in law (see Rochester Telephone Corpn. v. United States [Rochester Telephone Corpn. v. United States, 307 US 125 (1939) : 83 L Ed 1147 : 1939 SCC OnLine US SC 79] ). (See also Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn. [Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn., (1948) 1 KB 223 : (1947) 2 All ER 680 (CA)] )" (emphasis supplied) This view was reaffirmed in para 58 of the Report in the following words: (SCC p. 256) "58. Price fixation is not within the province of the courts. Judicial function in respect of such matters is Competition Appeal (AT) Nos.07, 08, 09 & 10 of 2023 66 exhausted when there is found to be a rational basis for the conclusions reached by the authority concerned. As stated by Justice Cardozo in Mississippi Valley Barge Line Co. v. United States [Mississippi Valley Barge Line Co. v. United States, 292 US 282 at pp. 286-87 (1934) : 78 L Ed 1260 : 1934 SCC OnLine US SC 103] : (SCC OnLine US SC para 6) '6. … The structure of a rate schedule calls in peculiar measure for the use of that enlightened jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missions of learned Counsel for the parties and have perused the record. The principles of natural justice are generally to be followed when a decision is taken, which has civil consequence on any person or entity. The Competition Act, 2002 and the Regulations framed thereunder, specially Combination Regulations 2011 provides a detailed procedure and manner in which participation of others including Members of the pubic and other parties have to be allowed. We have noticed that Regulation 19, sub-regulation (3) empowers the Commission to call for information from any other enterprise while inquiring as to whether a combination has caused or is likely to cause an appreciable adverse effect on competition in India. Thus, although the Commission is empowered to invite information, the scheme does not entitle any other person other than those who have given notice to participate in the proceedings. The right of participation of public in general and other entities arises when under Section 29, sub-section (2) of the Act, the Commission directed the parties to the combination to publish the details of the combination within seven days from of such direction, for bringing the combination ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osure of which to third parties may harm their competitive position. Given the foregoing, UPGMS's submissions for access to the notice filed by the AGI do not warrant a grant of its request. Further, considering that the concerns pointed out by Competition Appeal (AT) Nos.07, 08, 09 & 10 of 2023 70 UPGMS have already been noted, the Commission is of the opinion that no hearing may be required in the matter. 8. As regards the request to not consider, deliberate, accept, and admit any application or notice or documents filed by AGI until adjudication of the applications filed in the Hon'ble NCLT/Appellate Tribunal, it is noted that the subject matter of the references filed with the Hon'ble NCLT/ Appellate Tribunal relate to resolution proceedings and do not have any bearing on competition assessment. Further, as stated above, the review of combinations is strictly time bound exercise and accordingly no matter can be kept in abeyance for reasons of any parallel proceedings before other authorities. Accordingly, this request of UPGMS cannot be acceded to. 9. As regards the request to initiate Section 39 proceedings against AGI and afford an opportunity to UPGMS to file objection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noted the scheme of Section 26 and the Regulations and noticed the stage when notice is to be issued. In paragraph 72 and 78, following has been laid down: "72. Some of the Regulations also throw light as to when and how notice is required to be served upon the parties including the affected party. Regulation 14(7) states the powers and functions, which are vested with the Secretary of the Commission to ensure timely and efficient disposal of the matter and for achieving the objectives of the Act. Under Regulation 14(7)(f) the Secretary of the Commission is required to serve notice of the date of ordinary meeting of the Commission to consider the information or reference or document to decide if there exists a prima facie case and to convey the directions of the Commission for investigation, or to issue notice of an inquiry after receipt and consideration of the report of the Director General. In other words, this provision talks of issuing a notice for holding an ordinary meeting of the Commission. This notice is intended to be issued only to the members of the Commission who constitute "preliminary conference" as they alone have to decide about the existence of a prima facie c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich is to the following effect: "2. In this regard, the Commission noted that previously also, UPGMS filed various letters with the Commission in respect of the Proposed Combination, which were considered by the Commission and disposed of by Order dated 22 February 2023. Vide the said order, the Commission, while considering the request of UPGMS seeking access to combination notice filed by AGI, noted that by virtue of the provisions contained in Regulation 47 of the General Regulations, the proceedings before the Commission are not open to public. It was also highlighted therein that the information provided in the combination notice by the parties include competitively sensitive information, the disclosure thereof to third parties may harm their competitive position. Accordingly, the request of UPGMS for seeking access to the combination notice filed by AGI, was not acceded to by the Commission. The Commission also noted the concerns highlighted by UPGMS relating to the competition assessment of the Proposed Combination and opined that the same would be duly considered while assessing the effect or likely effect of the Proposed Combination on competition, in accordance with law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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