tion Act, 2000

Competit
2002 [As amended by the
The 200
2007 andAct,
Act,
the
ti
Competition
Competition
(Amendment) Act, 200911
t)Act,
Competition

mendment)
(Amen
CONTENTS
CHAPTER(Section 2) o Division of
Agreements, Abuse of Enterprise Enjoying Dominant
Definitions of Certain Position
ition and Regulation of (Section 28)
a Pronint
Proh Position egulatioeof o Procedure for Investigation
Dominant (Chapter
II- Sections to 6) 3 of Combinations
(Section 29)
Combinations
Prohibition
of Agreements
Agreements (Section 3)
o Penalty for Making False Statements or
Anti-competitive Omission to Furnish Material Information
O Anti- which Cause Adverse Effect on
Factors (Section 44)
Competition Commission
Competition of
ofAbuse Dominant Position (Section 4)
Sections 7 to17)
of India (Chapter
ll -
O Prohibition for Copyrights, Patents, Exports
Exemption o Establishment of Commission (Section 7)
etc. o Composition of Commission (Section 8)
o Term of Office of
Chairperson and other
Combinations of Combinations (Section 5)
oMeaning Members (Section 10)
Regulation
ofCombinations (Section 6) o Vacancy, etc. Not to Invalidate Proceedings of
of Commission on Certain
o Orders Commission (Section 15)
Combinations (Section 31)
O Resignation, Removal and Suspension of
o Orders by Commission after Inquiry into Chairperson and other Members (Section 11)
Agreements or Abuse of Dominant Position
o Restriction on Employment of
Chairperson and
(Section 27) other Members in Certain Cases (Section 12)

Section clauses (d), (g),G), (K),) and (n)of Section 2, Sections 8,9,
1 1,
10, 14, 16, 17 sub-section (1) of Section
63 and clauses (a), (b),(d),(e),()and (g)of sub-section (2)of Section 63 came into force on
31-3-2003, vide S.0.

2003.

2
Section exceptclauses
56,S7, $8.59 60,
Sections 64and
61, 62
)
No. 340 (E),dated 3 1St March 2003, published in the Gazette of

& Section 63except vide

65cameintoforceon
India. Extra Pt.

clauses (a),(b),d), (),

19-6-2003S.O.715
II, Sec.

(E), dated
,3(ii), dated 31st March

(),(g),),(K), and (7).Sections 7, 11, 12, 13, 15, 22,23,36,49,50,51, 52, 53,54,55,
(),()and (n) of sub-section (2),
19th June 2003, published in the Gazette
ofIndia,Extra Pt. II, Sec. 3 (i) dated 19th June 2003.

Sections 53C, 53D, 53E, 53F, 53G, 53H, 53-I, 53-J, 53K,53L and 53M came into force on 20-12-2007 vide S.0.
20th December 2007, published in the Gazette
2167), dated of India,Extra., Pt. I1, Section 3(), dated 19th June 2003.
Sections 53C, 53D, 53E, 53F, 53G, 53H, 53 I, 53J, 53K, 53L and 53M came into force on 20-12-2007 vide S.O.
dated 20th December 2007, published in the Gazette
Z67(E), ofIndia, Extra Pt, II, Sec. 3(i), dated 20th December,
2007.
Sections 3, 4, 18, 19, 21,26, 27, 28, 32,33, 35,38,39, 41,42,43,45,46,47,49,54, 55 and 56 came into force on
20-5-2009,vide S.O. 1241 (E), dated 15th May 2009, published in the Gazette of India, Extra, Pt. I1, Sec. 3 (ii), No.
771, dated 15th May 2009.

Section
66 came into force on 1-9-2009, vide S.0. 2204 (E), dated 29th August 2009, published in the Gazette of
II, Sec. 3 (i), dated 28th August 2009.
India, Extra, Pt.
 Law of
Contract
644
o Contraver
vention of Other
Powers of the Chairperson
(Section 42) rders of C Law
O Administrative
(Section 13) and other Terms
and o Compensation in Case of Commissio
Salary and Orders of the
Allowances
o and other Contra

Conditions
of Chairperson o Commission
Penalty for Failuret (Sectintiona
sion
Members (Section 14) of Commission and Complywith 42A
o Vacancy,
etc. not
to Invalidate

(Section 15)
Proceedings
o
Dir
Power to Impose irector-General recions
enalty for
( d
o
O
Commission
Appointment
of Director-General,

of
etc. (Section 16)

Secretary, Experts, o
of
Information on
Penalty for Combinations
ffences in
(
Secion 43

Non-furnishin
Sectio
Appointment other of Information Relationto 44A
and Officers and (Section 45)
Professionals
Commission
Power to
Impose Lesser
Furnishing

Employees
and
of

Functions of Commission
o Crediting sums Penalty (Serte
Realised by
Duties, Powers to Consolidated Wav c
Commission (Section 18) und of India Penalt
oDuties of

of Commission
o Contraventio by a
o
Powers and Functions
o Companies 4T (Section

o Reference by Commission (Section 21A) Competition (Section

Advocacy (Section 49 48)
o Meetings of Commission(Section 22) Finance, Accounts and Audit
Taking Place Outside
India but Having o Finance (Section
51)
(Section50-58
o Acts
an Effect on Competition in india (Section 32)
o Accounts and Audit
O Appearance before Commission(Section 35)
o Furnishing of
(Section 52)
Returns, etc. to
o Rectification of Orders (Section 38) Government (Section 53)
Central

o Execution of Orders of Commission Imposing o Competition Appellate Tribunal

to (Sections
Monetary Penalty (Section 39) 53U) 58A

Appeal to Supreme Court only if Substantial o

o Establishment of
Appellate Tribunal
Question of Law involved (Section 40) 53A) (Section

o Director General to Investigate Contravention o Miscellaneous (Sections 54 to

65)
(Section 41) o Repeal and Saving (Section 66)
Test Questions

In the of globalisation, India has

pursuit responded by opening of its economy, removing
controls and
to liberalisation.The natural
resorting corollary of this is that the Indianmarket should be
geared toface
competition from within the country and from outside.
The Monopolies and Restrictive Trade
Practices (MRTP)Act, 1969had become obsoleteand was
choking the economy. The CompetitionAct,
20022, which has replaced the MRTP Act, 1969, has the

following objectives:

() To prevent practices having adverseeffect on

(i) To promote and sustain competition;
market;
competition in
(ii) To protect the interest of
consumers; and
(iv) To ensure freedom of trade carried on
by other participants in markets in India.
The Competition Act, 2002 (hereinafter
called the Act) to the
as amended 2007 and 20y
whole ofIndia.
All the cases
in
x ends

pertaining to
MonopolisticTrade Practices
(RTP)Including such cases in which Unfair
(MTP) or Restricted Traac ractices
UTP referred Trade Practice all case
pertaining
to
to in (UTP)has
has also
also been alleged]a
been all
be transfeTed clause (X)sub-section(1) RTPAct,
1969
1969
shal
shal
to the ofsection 36A ofthe
of section 66 of the
CompetitionAppellate
Tribunalwith
M (6)and
and(
Act]. immediate effect. [SuD-se tions (6)
All
investigations or
relating to UTP proceedings, other than
those relating to
referred to in
clause
UTP and all investigatit
ations or proceeding
196
196.
2. of (X)
AsAmended sub-section (1)of section 56A the MRTPAct,
inserted by Competition
(Amendment)Act, 2007,w.e.f.
O
12.10.200
 2002 645
Act,
Compeition
The the Director General ot Investigation and
Registration [DG (I&R)]shall be transferred
g befor
beloon of Indiawith immediate
Commission
Commissio effect. [Sub-Sections(6) and
(8)of section66
Pending
Competition
to
the
Act) investigations or proceedings pertaining to UTPP defined under section 36A
ofthecases, investigatio of the MRTP
those referred to in clause (X) of sub-section
. eent (1) of Section 36A of the MRTP Act,
1969, transferred to the National Commission
4ct, constituted under the Consumers Protection
shall
1969, ith
with immediate effect. |Sub-section(4) and
im (7) of Section 66 of the Act].
1986
Act,
DEFINITIONS (SECTION 2)

)
i)
éion

shares,
(Section

voting
2 ()I. It means,
rights or assets

control over management

greement[Sectio
tion 2 (b)]. It
directly

of any enterprise; or
or control over assets of

includesany
any
or indirectly,
acquiring

enterprise.

arrangement orunderstanding or
or agreeing to acquire

action in concert
A whether or not, such arrangement, understandingor action is formal or in writing; or
Hwhether or not such arrangement, or action
understanding is intended to be enforceableby legal
proceedings.
The element of mutuality the word agreement.A mere direction or recommendation
is inherent in

by one party not warranting acceptance of any obligation (whether

legal or moral) by the other party
constitute an agreement.
cannot
Agreements contemplated under the Competition Act may be horizontal
agreements and vertical
agreements.
Horizontal agreementsare agreements among competitors engaged in the same
activity. For example,
the agreements between producers or between wholesalersor between
retailers, dealing in similar kind
of products.
agreements are agreements between non-competing
Vertical
undertakings. For example, the
agreements between manutacturers of components, manufacturers of
products, between producers
and wholesalers or between producers,wholesalersand retailers.

Case Law under MRTP Act

-
i) For the purpose of ascertaining the existence of an agreement under the
Act, what is to be seen is
whetherthere is union of thought and action
among the parties concerned [re:Delhi Automobiles
Private Ltd. and Others].

(i) Whetherunifornmity in the

actionsof thecompetitorsamounts to an
agreement? Although similar
actions
simultaneouslytaken by the suppliers may not amount to collective
agreement, where
proof exists that parallel actions of
suppliers are a conscious act to bring about uniformity or
harmonization of marketing practices, such parallel actions
may amount to collective agreement.
MRTP Commission in re: Hindustan Times Ltd. Held that, it shall
depend on the following factors:
1) How pervasive is the uniformity?
(i) How long has the uniformity continued?
(1ii) What is the time lag, if any,betweena change by one
competitor and that oftheother or others?
(iv) Is the product involved or differentiated?
homogeneous
() Can the product,no matter how uniform, be adequately explained by
independent business
justification?
On answersto
questionslike these, depend the weight to be accorded to parallel action in
case. any given
 Law of
646 Contract
also opined that.. lt does not require
The Commission, however, concert to fix the nrio
much Other
L
or have a

certain traders
combine together argument
at the same time or about t.modity
t
1.e.,

raise price
of the commodity together,
between each in the matter
metime, they
dealin
the competition
and as a group give
up they
mechanism determined by combination or ricing. The voluntari
and in its place a price and demand but ba bouoi
abjured
fixed by free forces of supply y the fiatof competitio
The price is no longer are completely ignored or not taken into
nto
consumers reactions
concert. The operatiog.
in effect and would combination
to fix price is anti-competitive
a combination
account. or
therefore, Prima
itute facie
retrictive
practice". trade

2(ba). "AppellateTribunal means the Comnot 4

Appellate Tribunal
[Section tition
(1) of Section
53A". Appellate
established undersub-section
ibuna
It includes an association of producers,
sellers, distributos
Cartel (Section 2(c)]. tors
raders or s
who, by agreement amongst themselves, limit, control, or attemp
providers
of services. the Service

or price of, or trade in goods or provision

distribution, sale producion

-
(
Consumer [Sec. 2(I.

buys any goods for a

partly promised, or under
"Consumer"means any person who
consideration which

any system
other than the person who buys such goods
of
has been paid
or
promised,or partly or partr
deffered payment and includes anyuser of paid and

of resale or for any commercialpurnoa goods

se,
a consideration which has been paid or promised or narflu wds
(ii) hires or avails of any services for
and partly promised, or under any system of deferred payment and includes any ary of
ot the services for
such services other than the person who hires or avails any commercia

purpose.
of consumer is the same as given to the expression
It is noteworthythat the definition substantialy
Act, 1986 with some variations.
of the Consumer
under Section Protection
(d)
who
person or a departmentof the Government,
or which
Enterprise [Sec. 2(h)]. It means a is, or has

been or is proposed to be, engaged in any activity, relating to the production, storage, supply,distribution,
of any kind, or in investment, or
or control of articles or goods, or the provision of services,
acquisition
or dealing with shares, debentures or other securities
in the business ofacquiring, holding, underwriting
of or one or more ofits units or divisions or subsidianes
either directly through
any other body corporate,
is located at the same place where the enterpriseis located
whether such unit or division or subsidiary
or at a different places, but does not include, currency, defence and space.

Explanation forthe purposes of this clause

(a) 'activity' includes profession or occupation;

'article' includes a new article and 'service' includes a new service
(b)
(c)'unit'or division', to an enterprise, includes n or
inrelation distribution,aca
() aplant or factory established for the production, storage, supply,
control of any article or
goods
(i7) any branch or office established for the provision of any service.
des-
1950 a
G00as Section2()]. 'Goods'means goods as defined in the Sale of Goods Act,

(a) products manufactured,processed or mined;

(b) debentures, stocks and shares after allotment; dia.
(Cin relation to goods supplied, distributed or controlled in India, goods importcu
 Act, 2002 647
etition
Competition
The stockS and shares,
oahle property, growing crops, trademarks,copyrights, patent rights,
All moveabcity, wate, gas are goods. But
water any actionableclaim and money arenot covered under
electricity,
cOodwill,

)
of goods,

themeaning 2 °Person'includes
(O1.
ISection
Person
an individual;
undivided family:
a Hindu
Ci)
a company;
(ii)
a firm;
(V
(iv) acCociation
an associatioj
of persons or a
body of individuals, whether or not, in India or
incorporated
(V)
outside India;
oration established by or under any Central, State or Provincial Act or a Government
(vi) anycorporation
as defined in Sec. 617 of the
company Companies Act, 1956;
anv body corporate incorporatedby or under the laws ofa
country outside India,
uiil aco-operative soCiety registeredunder any law torelating co-operative societies;
a local authority; and
(ix)
every artificial juridical person,not falling within any of the preceding sub-clauses.
Price ISection 2(0)]. "Price', in relation to the sale
of any goods or to the
performance of any services,
includes every valuable consideration, whether direct or indirect, or deferred. It also includes
any
eonsideration which
in effect relates to the sale of
any goods or to the of servicesperformance any
to any other matter or things
although ostensibly relating

Public Financial Institution

[Section 2(p)I. Public Financial nstitution' means a
public financial
under Section4A
institution specified oftheCompanies Act, 1956 and includes a State Financial, Industrial
or Investment Coporation.

market [Section2(r)]. It means the market which

Relevant may be determined by the Competition
Commission with reference to the relevant
product market or the relevant geographic market or with
reference to both the markets.

Relevant geographicmarket [Section2(s)]. It means amarket comprising the area in which the conditions
of competition for supply of goods or provision of services or demand of goods or services are distinctly
homogeneous and can be distinguished from the conditions prevailing in the areas. neighbouring

Relevant product market [Section2()].It means

market comprising all those
a
products or services
interchangeable by the consumer, by
which are
regarded
as or substitutable reason of characteristics of
products or their and intended use.
the services, prices

It means service of any description which is made available to potential

Service [Section 2(u)].
users.
It includes the provision of services in connectionwith business of any industrial or commercial
such as accounting,banking, communication, education, financing, insurance, chit funds,
maters
real estate, transport, storage, material treatment, processing, supply of electrical or other energy,

Doarding, lodging, entertainment, amusement, construction, repair, conveying ofnews or information

and advertising.

nares (Section 2(v)]. It means shares in the share capital of a company carrying voting rights and
includes:

any security which entitles the holder to

receive shares with voting rights;
7) stock except where a distinction between stock and share is expressed or implied.
 Law of Cont
648 ontract
means any autho OtherLa
2(w)]. "Statutory Authority
StatutoryAuthority [Section establi
blished
authority,
by or und board, Law
or any other body corporate,
council, institute, university or ofgoods or
or any C
any
production supply of goods
Provincial Act for the purposesof regulating or
Central,
provision corporaion
therewith incidental thereto
reto. of Suate
or markets there for or any matterconnected any or

trade, business,
means any profession or
industry, co. servi
Trade [Sec. 2(x)]. It
and
storage
or control of goods includesthe n. upation
production, supply, distribution, ngto
relating
orovision of
the
the
of or anys
includes value of sale goods services.
Turnover [Sec. 2()]. It services.

PROHIBITION OF CERTAIN AGREEMENTS, ABUSE OF DOMI

Do.
POSITION AND REGULATION OF COMBINATIONGNANT
(CHAPTER II- SECTIONS 3TO6)
Prohibition of Agreements

Chapter of the CompetitionAct comprising of Section3 to

II 6 constitutes the core ofs
two competion. Let us discuss the contents of these sections. law
relating

Anti-competitive Agreements (Section 3)

Section 3 ofthe
Competition Act, 2002provides that no enterprise or person shall enter into an
in respect of production, supply, distribution, storage, acquisition or control
of goodsor ment
services, which causes or is likely to cause an appreciableadverse effect on
This rule applies to association of enterprises and association or
competition u0nof
persons while entering into
anu o
agreement [Section 3(1)].

Agreement void. Any agreement entered into in contravention ot the proViSions

shall be void containedin Sectiona1
[Section 3(2)].

Adverse on competition.Any
effect
agreement entered into between
enterprises or associations af
enterprises or persons or association of persons or between
any person and enterprise or
carried on, or decision taken practice
by, any association of enterprises or association
of persons,
cartels, engaged in identical or similar trade of including
goods or provision of services, which-
(a) directly or
indirectly determinespurchase or sale
prices;
(b) limits or controls
production, supply,markets,technical
services; development, investment or provisionof
(C)shares the market or source of
production or provision of services
geographical area of by way ofallocationot
market, or type of goods or or
or any other similar services, number of customers in the
way; marke
(d)directly or indirectly results in
bid
rigging or collusive bidding, shall be presumed to e an
appreciable adverseeffect on navo
Bid competition.
rigging means any
1dentical or similar agreement,between
enterprises or persons referred to
productionor trading of aboVe tof
eliminating or goods or provision of
reducing competition services,which nas u
effect

forbids or
bidding. adversely affecting or
manipulating
u process
for

An agreement which
causes or is
includes the likely to cause an
following agreements appreciable adverse effect
also ouCompetitio
(a) tie-in
arrangement;
(b) exclusive
supply agreement,
 649
2002

agreement:
distribution
ive

deal
1o des any agreement requiring a purchaserof
maintenanc
includes.
goods,as a condition ofsuch
netisalprice For example,
goods. requiring a purchaser of scooterto
esale
some other purchase
arrGements
rchase to give gas connection unless the
buyer purchases gas stove also.
TRe-n fusing
WIse refusi es any agreement restricting in any manner the
LKe eement includes purchaser in the
also. therwise dealing in any goods other than those of the seller or
or othe
net sPplyfrom cquiring
Eehusive trade amnle,insisting that a dealer of BPL productswill not deal in Samsung or LG
ofhis Forexar
Ise erson.
her
,an
g0reement includes any agreement to limit, restrict or withhold the output or
distrib
any area ormarket for the disposal or sale ofthe goods. In ofther words,
Erclhusive oods orallocate his productsin an area other that the one allotted to him.
c ed to distribute
isnot alowed udes any agreement which restricts, or is likely to restrict,by any method the
1odeal
af persons to whom goods are sold or from whom goods are bought.
dteaker

Retusal

maintenance includes any agreement to goods on condition that the prices to be

sell

persons
Resalcrosale by the purchaser
shall be the prices stipulated by the seller unless it is clearly
on lower than
those prices may be charged |Section3(4)].
chargedhat prices

Staled
Adverse ffect on Competition
which Cause
Factors
mission, shall, while determining
whether an agreement has an appreciable adverseeffect on
Section 3, have due regard to all or any of the following factors, namely:
npetition under
barriers to new entrants in the market:
(a creation of

competitors
out of the market;
driving existing
(6)

by hindering entry into the market;

foreclosure of competition
of benefits to consumers;
accrual
(d)

in production or distribution of goods or provision of services;

(e) improvements
of technical, scientific and economic developmentby means or distribution
(0 promotion of production
of goods or provision of services [Section 19(3)].

PROHIBITION OF ABUSE OF DOMINANT POSITION (SECTION 4)

Section 4 of the Competition Act, 2002 prohibits the abuse of dominant position by any enterprise or

group [Section 4(1)]

Dominant position means a position of strength, enjoyed by an enterprise or group in the relevant
market which enables it to operate independently of competitive forces or affects its competitors
Consumers in its favour.

According to Section 4, there shall if an enterprise or group

be an abuse of dominantposition,
imposes unfair or discriminatory condition, or price in purchase or sale of goods or services; or limits
restricts
production of goods or provision of services or technical or scientific development relating
Or

or services to the of consumers; or in in denial of

gods prejudice indulges practices resulting
ess,
Such
or contracts with supplementaryobligations on the parties which have no connection

or uses its dominant position to enter one market

or protect other market.
contracts;

Exem
imption for
Copyrights,Patents,Exports etC.

(rovisions
palent'
as contained in Section3
or 'exclusive
do not apply to:
()
*copyrigh' underthe CopyrightAct, 1957,
the Patents Act, 1970;)*design'registered under the
right'granted under
 Law of
650 Contract
under the Semi-conductor Intes Other
registered
DesignsAct, 2000; (d) layout-design' ated aws
from India as to the product supply,.distributio
Design Act, 2000; export goods or Circuits
3(5)].
or provision of services for such export [Section of
control Layou

goots
cOMBINATIONS

Meaning of Combinations (Section 5)

e
or more persons or merger or amaloar
The acquisitionofone or more enterprises by one
and personsor enterprises in thok
shall be treated as 'combination' of such enterprises
-
Any acquisition where the parties to fh wing
1. Acquisitionby Large Enterprises
the acquirer and the enterprises, whose control,
shares, voting:
grightsor assets haveuisition, be
orare being acquired jointly have, (a) either in India, the assets of the value af been acqi cen
e acquired
one thousand crores; or (b) in India or outside India, in aggregate,the assets than
ofthe rupees
value of
than wo billion US dollars ,Including at least rupees fifteen hundred crores
crores in mote
India
5(a)i)] [Section
reach or cross the aforesaid 1:..
Thus, if after acquisition, the joint assets/turnover aid
limits, it
combination'.Of course, if acquireralready had those assessts or
turnover, any further willbe

will be 'combination':
-
2. Acquisition by Group Any acquisition where the group, to which the enterprise who
shares, assets or voting rights have been acquired
or are being acquired,would
belona a
er
have (a) either in India,
of the value of more
the assets the
acquisition jointly than
upees f
thousand crores or turnover more than twelve thousand crores; or (b) in India or outsidelnd
India, in
aggregate,the assets of the value of more than fwo billion US dollars, at including least r
five hundred crores in India, or turnover more than six billion US dollars, including at least Pn
rupees

rupees
fifteen hundred crores in India [Section5(a)(i)]. Thus, even if individual
enterprise issmal
wll be 'combination'
group assets exceed prescribed limit, any further acquisition if group aset
turnover is above the said limit.
3. Acquisition of Enterprise having Similar Good / Services Acquiring of control -
byaperson
over an enterprise when such person has already drect or indirect control over another enterprise

engaged in production, distribution or trading of a similaror identical or substitutable service,jif

the enterprise over which control has been acquired along with the enterprise over which he
acquirer already has direct or indirect control jointly have: (a) either in India, the assetsofthe
value of more than rupees one thousand crores or turnover more than rupees three thousand

crores; or (b) in India or outside India, in aggregate,the assets of the value ofmore thanfie
hundred million US dollars, including rupees fifteen hundred crores in Indiaj>en
at least

S(b))]. Thus, if after acquisition, the joint assets/turnover reach or cross the aforesaidimis,t
will be 'combination'. Of course, if the acquireralreadyhad those assets or turnover, any Tunuher
acquisition will be combination".
4. Acquiring Enterprise
having Similar Goods/Services by a Group Acquiring of -
ofcontrol by
a another
over an enterprise when such
person person has already direct or indirect control ovthe
enterprise engaged in production,distribution or or
trading of a similar idenuca ce. created
Service, group, or or the enterpio
if the its constituent
enterprise remaining after merger
as a result ofthe
ofthe amalgamation, as the case may be, have, (a) either in Inalä,
thousand
value of more than eestwelve
rupees four thousand crores or turnover more than nvo
rup ore
than
crores, or (6) in India or outside
India, in aggregate,the assets of the
billion US vallion USSdollars
do
dollars, including atleast rupees
five hundred crores in India, S
 651

Aet,
20
2002
ition crores in India[Section5(c)(ii)].
ffteen hundred
o iftee, Thus,if after acquisition,
least rupees reach
heCooypeiiion read r
or cross the aforesaid limits, it will be 'combination'if group
assets/turnoverthe said limit
including. is above or amalgamation which the
thejont remaining
in
urnover Any merger enterprise

ofEnterprises created as a result of the amalgamation, as the case may be, have,
the enterprise
or the value of more than rupees one thousand crores or turnover
assets ofthe
mergerndia, the utside India, in aggregate, the assets of
in crores; or (b) in Indiaor
a
after

more
either
than rupees
of more
three
th
than
thousand
five hundred
million US dollars, including at least rupeesfive hundred

more thanfijfteen hundred million US dollars, including at least rupees

r
the
value orturnover
turnover
India,
in India is 'combination' [Section 5(c)(i)1. Thus,
in if after acquisition,
ores crores
crores
hundred reach or cross the aforesaid limits, it will be 'combination'. Of course, if
fifeen ts/turnover
or turnover, any further acquisition will be 'combination".
thejo eady had those assets
after the merger or
quirer
already
roup Con Company-1he group, to which the enterprise remaining
in Group or
of the amalgamation, would belong after the merger
Merge rarise created as a result
the
either in India, the assets of
as the case may be, have or would have, (a)
amalgamation, thousand
thousand crores or turnover more than rupees twelve
of
the

value
o more
than rupeesfour
India or outside lndia, in aggregate, the assets of the value of more than
wos or (b) in
crores in India, is 'combination'
at least
rupeesfifteen hundred
crores
sa hillion US
dollars, including
TwO assets exceed prescribed
Thus, even if individual enterprise is small, group
if
5(c(ii)].
is above the said
Section
assets/ turnover
further acquisition will be 'combination' group
if
limit. any

Iimit.

of Combinations (Section 6)
Regulation
causes or is likely to
to enter into a combinationwhich
any person or enterprise
Section 6(1) prohibits
the relevant market in India and such a
an appreciable adverse effect on competition within
cause
shall be void [Section 6(1)].
Combination
means that it is regulation of combination'. Thus,
and heading of the section itself

competitionin an
The definition
be held void affects
in itself is not prohibited. It will onlyifit adversely
combination

manner.
or which proposes to enter into a combination,shall,
appreciable
who
Any person or enterprise,
Exemption. ofIndia (hereinafter referred to as CCI
at his or itsoption, give notice
to the Competition Commission
of India or just CCI or Commission) and the fee which may be determined, by regulations, disclosing
within 7 days of-
the details proposed combination,
of the
referred in Sec. 5(c), by the Board of
to merger or amalgamation
(a) approval of theproposal relating as the case may
with such merger or amalgamation,
Directors of the enterprises concerned

be;
document for acquisition referred to n Sec. 5(a) or acquiring
execution of any agreement or other
of control 5 6 (2)].
referred to in Section [Section
hundred and ten days have passed from the day
No combination comes into effect until two
shall
under sub-section (2) or the Commission has
0n
Which the notice has been given to the Commission
passed orders
under Section 31,whichever is earlier with the provisions
deal with such notice in accordance
he Commissionshall,after receipt ofnotice, 6 with (i) Procedure for
(3)]. These
Sections deal
Ontaned in Sections 29, 30 and 31 [Section
disclosures (Section 30), and Orders of the
investi of combinations (Section 29), Inquiry into
gation 5 1).
Ommissionon certain combinations (Section
 652
(Section 31) Other
on CertainCombinations Laws
Orders of Commission that combination any does not
the commission
is oftheopinion
It shall, by order, approve thar ikely to,
1. Where on competition,
adverse effect has been given under su hav
appreciable of which a notice
-section
nation
in respect ion
that the combinatic has,
or is likely (2) incud
the combination
is of theopinion
tohave, of
2. Where the Commission it shall
direct that the combination shall t take section
on competition, or is likel..
adverseeffect that the combination has, elyto apprecable
is oftheopinion have,an
3. Where the commission but such adverse effect can be eliminated
minated by suitable
adverse effect
on competition
modificationto the combino appreciabla

it may propose appropriate ation,tothe ation

to such combination,
parties
such combination. the Commission unde to
proposed by
the modifcation
4. The parties, who
accept Comm sub-genes
within the period specified by the
shall carry out such
modification Commissionsub-section(3)
who have accepted the modification under c 3),
5. If the parties to the combination,
to carry out the modification
within the period specified by
the commissio ub-section (4),
adverse effect on competition and the
,fail

shall be deemed to have an

appreciable he c oimation

in accordance with
the provisions of this Act. Commission
deal with such combination shal,

6. Ifthe parties to the combination do not accept the modification proposed by h.

such parties may, within thirty working days ofthe ommission
undersub-section (3), modificatio
submit amendment to the modification proposed by the proposed
by the Commission,
Commission under
that sub-Section

7. If the Commission agreeswith the amendment submitted by the parties under suh.con
6),it
shall, by order, approve the combination,
8. If the Commission does not accept the amendment submitted under sub-section(6)
parties shall be allowed a further period of thirty working days within which such
proposed by the Commission under sub-section (3).
shall
accept the modification
9. to
Iftheparties fail acceptmodificationproposed by theCommission within thirty workine
referred to in sub-section (6) or within a further period ofthirty working days
days referred to in cu
section (8), the combination shall be demed
to have an appreciableadverse effect
on comneti
and be accordance with provisions of this Act.
dealt with in

10. Where the Commission has directed under sub-section(2) that the combination shall nottake
effect or the combination is deemed to have an
appreciable adverse effect on competition under
sub-section than,withoutprejudice to any penalty which may be imposed or
(9),
any prosecution
which may be initiated under this Act, the Commission
may odder that:
(a) the acquisition referred to in clause
(a) of section 5; or
(6) the of control
acquiring referred to inclause (b)of section 5; or
(C)the merger or amalgamation referred to in clause (c)of section 5, shall not be
to:
given effect

Provided that the Commission

may, if it considers appropriate,frame a scheme to
its order under this sub-Section implement

1. If the Commission does

not, on the expiry of a period of
the date [two hundred and ten days iro
of notice given to the Commission under an
order or issue direction sub-section (2) of section 6,
in accordance pass a
with the provision of ction
(2) or sub-section sub-section (1) or suo-
(7), the combination
shall be deemed to have been the
Commission. approvcu
Where the Commission
has ordered a of
combination to be void, the.
control
merger
or
or Acquisition orab ies
under any other law amalgamation referred to in section 5, be dealt with
shallbe authorities
for the time
being in force asifsuch
5, shall
oy or
trol or
control
wn
acquisition or acqulrg
 653

Ae)
20
02
nat taken place and the parties to the combination shall be dealt with
has not
(Yeno7
or
ramalgamation.
hall not apply
6shal,
to sharesubscription or
financing facility or any acquisition,
eger foreign institutional
investor,bank or venturecapital fund,pursuantto
ofSection
of8 fore
econngy institution, or investment agreement [Section6(4)].
or
reement
roVISIons
ancial.
agreement long bank or venture
ofa lonnstitution, foreign institutional investor, capital fund,shall,
institution, file, in form as be
apuole inancial
tinancr he date
of the
acquisition,
may specified by regulations, with

public trom
The of the ;
of acquisition including the details of control, the circumstances for
days details
seven e consequences of default arising out of such loan agreement or investment

ComnisSION contr be [Section6(5)].

case may
ast
the OrsuCch
as the
erenSe into Agreements or
Inquiry after
nemenl,
byCommissionPosition (Sectionn2
ydeDominant
Orders findsthat any agreement referred to in section 3 or action of an
dhe Commission
the
inquiry ion, is in contraventionof section 3 or section 4, it may pass all or any of
Wherea a dominant positio
in
ise

orders, namely:
or association ot enterprise or person or involved in such agreement, or
thefollowing enterprise
direct
any to discontinue such abuse of dominant position.
(0) position,
of
or dominant
em fit which shall be not more than ten per cent of the average
abuse may as it

such penalty, or enterprises

impose the last three preceding financial years, upon each ofsuch person
for
turnover
of
the to such agreements or abuse:
are parties
into by a cartel,
any agreement referred to in section 3 has been entered
which
led that in case
[Provided trader or service provider
the Commission
may impose upon each producer, seller, distributor,
that cartel, a penalty
of up to three times of its profit for each year of the continuance
included in
of such
or ten per cent of its turnover for each year of the continuance
of such agreement,

whichever is higher].
stand modified to the extent and in the manner
agreement. as may be specified
direct that agreementsshall
the

the order by the Commission;

in
and
to abide by such other orders as the Commission may pass
direct the enterprises concerned
(d
with the direction.
comply
such other "[order or issue such directions] as it may deem fit:

(e)pass

Position (Section 28)

Dvislon of Enterprise Enjoying Dominant
in any other law forthe time being
1. The '[Commission] may, notwithstanding anythingcontained
to ensure
direct division of an enterprise enjoying dominant position
in force,
by order in writing,
that such enterprise does not abuse its dominant position.
the order referred to in sub-section (1) may provide for the following
n particular,
matters, namely:-
liabilities or obligations;
the transfer or vesting ofproperty, rights, or obligation or
or reduction of any liability
0)the adjustment contracts either by discharge
of

otherwise
shares, stocks or securities;
surrender or cancellation of any
tne creation, allotment, or the amendment of the memorandum of
4)the formationor winding up of an enterprise
or any other instrument regulating the business of any
association or articles of association

enterprise;
 654 .
(e) the
extent to which,

enterprise may be
and
altered
the

by the enterprise
circumstances
and the

be necessary give effect to the dii

to
in which, provisin
registration
fthe
registration thereof;
order :
Other
Laws

which may visionof affecting

)any other matter
who ceases to
hold office as such in conse. the
officer ofa company
to claim any compensation forfor. enceofenterprise
the
shall not be entitled such
an enterprise cesser. division
son
ot
of Combinations (Section 29)
Procedure forInvestigation
is the opinion that a combination is i

the Commission of
Issue of notice. Where within the relevantmarko.
adverseeffect on competition cause,
orhas
caused, an appreciable
to combination. The notice shall call unon india,it
cause to the the shall
notice to show parties issuea
tion in respect
to why investigatio parties to
of the notice, as of
within 30 days of the receipt respond
29(1)].
should not be conducted [Section combination
opinion that the combination
of the
The Commission, if it is
primafacie has, or is
an adverse effect on competition,
it shall, within workine Or islite.
like 7
have, appreciable days f to
to the direct the na.
irect the
of receipt of the response of the parties combination,
parties to the
of the combination within 10 working dav
combination to publish details such said

[Section 29(2)]. tion

directio

or member of the nuhli

Written objections.The Commission may invite any person
likely to be affected by the
said combination,to file his written objections, ifany.
affecte
affected befor, or

within 15 working days from the date on which the detail of the combination were w
published
[Section 293)1
Additional information. The Commission may, within 15 working days from theexnin..
or other information as it may deem fit fromthe
period of 15 days call forsuch additional
the combination [Section29(6)]. The information called for by the Commission shall beparties fto
by the parties within 15 days from the expiry ot the period
specified in Section 20
29(4)
[Section29(5)]
After receipt of all information and within a period of 45 working days from the expiry offho
period specified in Section29(5),the Commission shall proceed to deal with the case in accordano
ance
with the provisions contained in Section31 [Section29(6)1

Penalty for Making False Statements or Omission to

Furnish MaterialInformation (Section 44)

Ifany person,being a party to a combination-

(a) makes a statementwhich is false in any material or knowing
it to be false; or
particular,
(6) omits to state any material knowing it to be material,
particular
he shall be liable to a penaltywhich shall not be less than
Fifty lakh but which may extend toRs.
One crore, as may be determined
by the Commission.

COMPETITION COMMISSION OF INDIA

(CHAPTER II SECTIONS 7TO17)
Establishment of Commission
(Section 7)
With effect from such date as the Central rthe
Government may appoint, there shall be estabis
urposes of this Act, a Commission to be called
ofet
the Competition Commission of Inala
alled 'Commission'
or CCI) [Section7
(1)]
 , 2002

has,
in
in exercise of the aforesaid 655
powers established
mission of India having
its head

fral
Government
Cor
office at
New Delhi w.e.f. 14th October
s.nall beabody corporate by the name
Conmpetition
TheCommission
n and a common
seal. It shall have Competition
power to aquire, hold Commissionof India
and
and to contraci shall, by its
name, sue dispose of
vable, orbesued
property,
im shall be
ion
[Section 7 (2)].
pepetua
and the Commission
o of the
at such place as the
of
wrable
head
oftice
(3)] 7 Central
Governme
[Section
The to time
to at other
ime establish offices placesin India
may [Section7
e fiom
Commission. (Section 8)
(4)1.

The
Commission
of of a
consist Chairpersonand not less than 2
n shall and notmore
ganmposition
Govermment [Section 8 (1)]. than 6 other
Members
theCentral Member
TpCommussio every other shall be a
person of ability,
C
pepomed dge of and such professional integrity and
standing and
The
knowledo experienceof not less than
has special
bu mmerce, law, finance, fifteen
economics, years in,
aho trade, accountancy,
ratters i cluding competitionlaw and management, industry,
emalional or competition policy, which in the
aftiars
nyblic rnment, may

Chairperson
and
be useful
other Members shall
to the
Commission. [Section 8
be whole-time on8
Members [Section 8
(2)].
(2)1.
opinion of the

and other Member ofthe Commission shall be (3)].

appointed the by Central
TheChaiurperson
names recommended by a Selection Commission Government
apanel of consisting of:
fom
Justice of India
or his nominee...
Chief Chairperson
The in the Ministry of Corporate Affairs...
TheSecretary
(6)
Member
The Secretary
in the linistry of Law and Justice ... Member
Tun experts ofrepute who have speCial Knowledge of, and
professional experience in
international
trade. economics, business, commerce,
law, finance,
accountancy, management,industry,
afairs or competition matters, public
including competition law and
policy ... Members 9
[Section (1)1.
The term of the Selection Committee and the
manner of selection of ofnames shall be such
panel
Bmay
be prescribed [Section 9 (2)].

Tem of Office of
Chairperson and other Members
(Section10)
The
Chairperson and every other Member
shall hold office as such for a
term of 5
Omwhich he enters years from the date
upon his office and
shall be eligible for
dker Member reappointment. However, no
shall hold office
as such after he has Chairperson or
attained, the age of 65 years;
[Section 10 (1)].
AyA vacancy caused by the
resignation or removal of the
On
yOVIsions of
l or death or
by otherwise shall be filled
Chairperson or any other Member
by a fresh appointment in accordance with the
9
ima
tf
Section
the
[Section 10 (2)].
occurrence of a vacancy in the
office ofthe Chairperson by reason of his death,
gation or
2new otherwise,the senio
nior-most Member shall act as the Chairperson, until the date on which
Chair
rperson,
on appointed in accordance with the provisions of this Act to fill such vacancy, enters
hisoffice
When the Section10 (A)1
CAse,the Chairperson is unableto discharg his functions owing to absence, illness or any other
senior-most
Member shall disc the functions of the Chairperson the date on
Son resumes ischarge until

the charge of his functions

[Section 10 (5)].
 656
Lawof
Proceedings of
Vacancy, etc. Not to Invalidate Commission
ion (Se
(Section15)
ContractO1.
No act or proceeding Commission shall invalid
of the be merely bv
y reason
(a) any vacancy in, or any defect in the constitution of
(b) any defect appointmentof a person acting as a Chairnera
in the Commission; or
rson or
(c)any irregularity in the procedure ofthe Commission not asa
affecti
the Member,
merits
Resignation, Removal and Suspension of Chairperson and otherAs oftheOT
her
Resignation. The any other Member may, by notice in Members
Chairperson or

to the Central Government,resign his office. However, the (Section

under 11)
e case

1
Chairperson
his
permitted by the Central Government to relinquish his office sooner hand
expiry of3 months from the date
of receipt of such notice or until a hall,
old addressA
successor enters upon his office or until the expiry of his unlessh
term of offco office

[Section 11
(1)].
office, unil
the
whichever
appointed
isthe ash
Removal. Notwithstanding anything contained in Section 11 (1), the Cenfr. eaxliest
order, remove the Chairperson or any
other Member from his office
may be -
if such
the case Chairp
Governmentma
onor
(a) is, or
any time has been, adjudged as an insolvent; or
at Dy
Member
ber,
(b) has engaged at any time, as
during his term of office, in
any paid emplovment
(c) has been convicted of an offence
moral turpitude; or
(d) has acquired
which, in the opinion of the
Central o or

nment,
such financial or other interest as is involv
likely to affect olves
Member; or prejudicially
(e) has so abused his
position as to render his continuancein office
functions:
asa
or prejudicial to the
nuhi:.
)hasbecome physically or mentally
incapableof acting asa
blic
interest,
Member
Restriction on Employment of 11 (2)
[Section
Chairperson and other Members in
CertainCases
(Section12)
The and other
Chairperson Members shall not,
for a period of two
cease to hold
office, acceptany
years'from the date on which
employment in, or connected with the dh.
ey
of, any enterprise which has been a management or
party to a proceeding before administration
the Commission
However, the aforesaid restriction will not underthis Act
apply to
State Government or any employment under the
local Central
authority or in any statutory Government ora
under any authority or any
Central, State or Provincial Act or corporation establishedbyo
Government
Companies Act, 1956. company as defined in Section 617
of the

Administrative Powers of the

Chairperson (Section 13)
The
Chairperson shall have the
powers ofgeneral
administrative ofthe Commission.
matters superintendence,direction and control in tofall

resp
relating to administrative However, the
matters ofthe
Chairperson may delegate such of hs powers
ofthe Commission. Commission, as he may thinkfit, to any other
ML
ficer

Vide
competition
(Amendment) Act, 2007
 200
2002 657
Act,
ion Act,
and Conditions of
ancesand otherTerms
Conpetion
Te
otherMaMembers (Section 14)
andand
Allowances
and other
Salary
chairperson
term
the other
.
ae terms and conditions of service
oftheChairpersonand other Members including
and be equal to that of a Judge ofthe Supreme Court and Judge of a High Court,
salary
The
expensess 14 (1)].
welling
Section and conditions of serviceincluding travelling expenses,house rent allowance and
terms
and conditi
ReYpectively
other allowance and medical facilities shall be such as may be
a
prescribed.
facilities, sumptuary

Conveyance

.
Thesalary,
allowances
keVaried
notbe
shall
allow

varied
to
to his
and other terms and conditions of service ofthe Chairpersonor a Member
hisdisadvantage after appointment [Section14 (2)].

to Invalidate Proceedings
of Commission (Section15)
etc.not
Vacancy,
of the Commission shall be invalid merely by reason of-
st or proceeding
or proceedin
Noact
or any defect in the constitution of, the Commission; or
any vacancy in,
(a)a
in the appointment
of a person acting as a Chairperson or as a Member; or
anv defect
b)
in the procedure of the Commission not affecting the merits of the case.
d anv irregularity

etc. (Section 16)

of Director-General,
Appointment
a Director-General for the purpose of assisting
The Central
Governmentmay by notification, appoint
of any of the provisions of this Act and for
the Commission in conducting inquiry into contravention

such other functions as are, or provided by or under this Act [Section 16(1)].
may be
performing
Directors-General or such officers or
The number of other Additional, Joint, Deputy or Assistant

in the office of Director-General and the manner of appointment such Additional

of
other employees
Directors-General or such ofiicers or other employees shall be such as may
Joint, Deputy or Assistant
be
prescribed [Section 16(1A)]. or such other officers or other
Directors-General
Every Additional, Joint, Deputy and Assistant
his functions, subject to the general control,
employees shall exercise his powers, and discharge
16 (2)].
Supervision and direction of the Director-General [Section

he
AGTtional,
salary, allowances and other terms and

Joint, Deputy and Assistant

conditions of service of the Director-General

Directors-General,
and
etc shall be such as may be prescribed [Section

16
(3)].
and Additional, Joint,
from persons of and ability. The Directors-General,shall be
ppoin' integrity and employees appointed from
and other officers and
yand Assistant Directors-General ability and
who have experience in investigation,

persons of integrity and outstanding

among inter-national trade, law or
business, public administration,
of
accountancy, management, 16
Po
as may be prescribed |Section (4)|.

CSand such other qualifications

and
Appointm Professionals
of Secretary,Experts,
ficersand
other mployees of Commission
as it considers necessary
The and such officers ana otner employees
Commission may appoint a Secretary
s1on t Act [Se
Section 17()].
for under this
the
efficient nce of its functions terms and conditions of service ofthe Secretary
perfo d other
to and
oth and other
The salaries and vancespayable nission
and the number of such officers
andofficers and of the
other employees 17(2)1
[Section such
nployees shallbe such as may be prescribed wit the procedure specified by regulations,
with
he Commission may ngage, in accordance who have special knowledgeof
and outstandng ability,
number of I ofintegrity
experts and professionals
exper
 658 Law of
Contract
Other
such other disCiplines related to co Laws
and experience in, economics,law, business or
to assist the Commission in the discharge of
its functions underthis Actr
nis Act as
ition,asitd.
it
deer
necessary
[Section

DUTIES, POWERS AND FUNCTIONS OF COMMIssioM 17(3)].

Duties of Commission (Section18)

Under section 18, Competition Commission has been charged with the
following dutiec.
ies:

eliminate practices having adverse effect

on competition,
(a)
(b) promote and sustain competition,
(c) protect the interests
of consumers,and
ensure freedom of trade carried by other participants, in markets in India,
(d)

Powers and Funetions of Commission

under Section 18, the Commission has been charnod.
With a view to perform the duties enumerated
certain obligations and conferred with certain powers.These obligations and powersare as fall
bllows

1. Inquiry into certain agreements (Section 19). T he Commission may inquire into any alleged
of the contained in Section 3(1) or 4 (1) either on its own motion or on:
contravention provisions

(a) Receipt of any information from any person, consumer or their assoCiation or trade association

or
made to it by the Central Government or State Government or a statutory authonitv
(b) a reference
[Section 19 (1)].

enjoys dominant position. The Commission while inquiring

2. Inquiry whether an enterprise shall,

or not under Section 4, have due regard to all orany of

whetheran enterprise enjoys a dominantposition
share of the enterprise; (b) size and resources of the enterprise
the following factors, namely:(a) market
of the competitors; (d) economic power of the enterprise including
commercial
(c) size and importance
sale or service network of
vertical integration of the enterprises or
advantagesover competitors; (e) or dominant postion
such enterprises; () dependence of consumers on the enterprise; (g) monopoly
of being a Government company or a publie
whether acquired as a result of any statute or by virtue
as regulatory baries,
sector undertaking or otherwise; (h) entry barriers including barriers such
technical entry barriers, economiesor
financial risk, high capital cost of entry, marketing entry barriers,

Scale, high cost of substitutable goods

or services for consumers; (i) countervailing buyng Power
relative advantage
market structure and size of market; (k) social obligations and social costs; ()
way ofcontribution economic development, by the enterprise enjoying a dominant posiuo ISsion
to the
which the cou
or likely to have appreciable adverse effect on competition; and (m)any other factor

may for the inquiry [Section 19(4)].

consider relevant

3. Inquiry Combination by Commission (Section 20). Inquiry into acquisil01, isition

into

combination. The Commission may, upon its own knowledge or information relaung ection5

rererco
referred to in Section 5 (a), or acquiring of control or merger or amalgamation Iverse

to cause an
(b), inquire into whether such a combinationhas caused or is likely

(
appic

effect on competition in India. year

the expuy
The Commission shall not initiate any inquiry under this sub-section after

from the date on which such combination has taken effect [Section20 (1)J 6(2)
Section
ction
under
The Commission shall, on receiptofa notice or upon receip CIerence to causean
or 13 likely
inquire whether a combinationreferred to in that notice or reference has caused
appreciable
adverseeffect on competition in India [Section 20 (2)].
 Act, 2002 659
Competition
The
, on combination.For the purposes
effect
of determining whether a combination
Factorsfoct ofor is likely to have an appreciableadverseeffect on
the competitionin the relevant
have l have due regard to all or of the
would theCommission shall any followingfactors, namely,
market,
potential leve of competitionthrough importsin the
level
ual and potential market;
(a) to entry to the market;
ofbarriers
() extent
in the market;
ofcombination
()level the market; power in
degree of countervailing
0 haod that the combination would result in the
parties to the combination being able to
(e)
and
stainably increase prices or profit
ignificantly margins;
of effective competition likely to sustain in a
of market;
extent
wfent to which substitutes are available or are likely to be available in the
market;
market share, in the relevant market,ofthepersons or enterprise in a
combination,individually
and as a combination;

a ikelihood that the combinationwould result in the removal ofa vigorousand effective
competitor
or competitors in the market;

() nature and extent of vertical integration in the market;

() possibility of a failing business;

() nature and extent of innovation;

(m) relative advantage by way of contribution to the economic
development,by way of combination
or likely to have
having appreciable adverseeffect on competition;
(n) whether the benefits of the combination
outweigh the adverseimpact of the
20 (4)]. combination,if any
Section

Referenceby Commission (Section21A)

1. Where in the course
of a proceedingbefore the Commission an issue
is raised by
decision any party that
any
which, the Commission has takenduring such
proceeding or proposes to take, is or
Would be
contrary to any provisions of this Act whose
implementationis entrusted to a statutory
then the Commission
authority,
may make a reference in respect of such issue to the
authority.
statutory

However, the Commission, may, suo motu, make uch a reference to the
authority. statutory

4On receipt of a reference under sub-section (1), the

statutory authority shall give its
Within sixty days of receipt of such reference, to the Commission which
opinion,
of the shall consider the
pinion statutory authority, and thereafter
the
issues
give its findings recording reasons therefore on
referred to in the said
opinion.
Meetingsof
Commission
1.
(Section22)
The
Commissionshall meet as such times and such
places, and shall observe such rules of
the procedure
2. TLrd to transaction of business at its
meetings as may be provided by regulations.
rpCrson, of for any reason, is unable to attend a meeting of the Commission, the senior-
EMember present at the meeting,shall
preside at the meeting
nf uons which come up before any meeting ofthe Commission shall be decided
a
in mbers present and voting, and in the event of an equality of votes, the by majorityor
absence, the Member Chairperson
residing, shall have a second or casting vote.
The he
quorum for ch
meeting shall be three Members.
660 Law of
Contract
Other
Procedure for Inquiry Under Section 19 (Section 26). On receipt of a referes
Government or a State Government or a statutory authority or on its own
own know athe
receives under section if the Commission is thof the
that there knowledgeor
opinion
19, exists info Contsa a
shall direct the Director-General to cause be made into the mat
prima t
an investigation to
Providedthat ifthe subject matter of an information received is, in the opinion
mion ofthe
facie
case
a t
substantially the same as or has
been covered by any previous information receiv.
eceived,Commission,
information may be clubbed with the previous information. [Section 26(1)1. then
the
new
Where on receipt of reference from the Central Government or a State
a Goverimens
Or
authority or information
received under Section 19,the Commission is
ofthe opinion a
and pass such orders that nerestatutory t
prima facie case, it shall close the matter forthwith ders as iit deems fit
and sen
existsa

Government or the State Government or a

of its order to the Central the stat
statutory copy
thority or the
concerned, as the case may be [Section 26(2)]. parti
arties

The Director-General shall, on receipt of direction under sub-section (1), submit awo
findings within such period as may be specified by the Commission
[Section 263)1.
onhis
The Commission may forward a copy of the report referred to in sub-section
on (3)
(3)to
to the
parties
concerned:

Providedthat in case the investigation is caused to made based on a reference received frow
the Central Government or the State Government or the statutory the
authority,
mission
shall forwarda copy of the report referred to in sub-section (3) to the Central
Gove
the State Government or the statutory authority, as the case may be [Section
26(41
If the report of the Director-General (3) recommends that there is no
referred to in sub-section

contravention ofthe of this Act, the Commission shall invite objections or suggestions from
provisions
the Central Government or the State Government or the statutory authority or the paties concened,a
the case may be, on such report of the Director General [Section 26(5)]
If, after consideration of the objections or suggestions referred to in sub-section (5), ifany
the

Commission agrees with the recommendation of the Director-General, it shall close the mater fortiwih

and pass such orders as it deems fit and communicate its order to the Central Government or the
Sie
be
Government or the statutory authority or the parties concerned, as the case may

[Section 26(6)]
lf after consideration of the objections or suggestions referred to in sub-section (5),
if any, t
Commission agrees with the recommendationsof the Director-General, it shall close the matter 1ormwu

and pass such orders as it deems fit and communicate its order to the Central Government or the du

Government or the statutory authority or the parties concerned, as the case may be [Secton u
If after consideration of the objections or suggestionssub-section referred
gation
to in
in ( the

Commission ofthe

1
direct further
is
opinion that further investigatiorn is called for, îfmay inveao
the matter by the Director-General or cause further inquiry to be made in the matter or

inquiry in the matter in accordancewith the provisions of this Act [Section

with further 26(1)J is
here
that
If the report of the Director-General referred to in sub-section (3) recommends further
that
contravention of any of the provisions of the Act, and the nission is of the opinion
Act
visions ofthis
inquiry is called for,it shall, inquire into such contravention in accordancewith the provie
Section 26(8)].

Acts Taking Place Outside Indiabut Having an

Effect on Competition in India (Section32)

The Commission shall, notwithstanding that -

 Act,
2002 661
Conpetifion
The referred to in Section 3 has been entered into outside India; or

)
Anagreement
to such
is outside India; or
(a) agreeme
party
using the dominant position is outside
India; or
Anyenterprise has taken
place outside India; or
combination
(d) mbination is outside India; or
to combi
Anyparty or practic
(e)
er matter practice or action arising out of such
) Aotion agreement or dominant position or
is outside India have to
power inquire [in accordancewith the
29 and 30 of the Act] into such provisions contained
ections 19, 20,26,
6,
or abuse of dominant
agreement
ambination if such
agreement or dominant position or position
rcom combinationhas, or is likely to have, an
enecjable adverse effect on competition in the relevant
ap market in India
fit in accordancewith the [and pass such orders as
it may deem
provisions of this Act.

or fo Grant Interim Relief

(Section 33). Section 33
the Commission
of temporary empowers to
interim relief by way injunctions. grant

Where an inquiry before the

during Commission, it is
proved to the satisfaction of the
ofidavit or otherwise, that an act in
contravention of Section3 Commission, by
(1) or Section 4 (1)or Section5 has
heen committed and continues to be committed or
that such act is about
to be
may grant a temporary injunction committed,the Commission
restraining any party from
carrying on such act until the
Such inquiry or until further orders, without conclusionof
giving notice to the
necessary [Section 33 (1)]. opposite party, where it deems it

5. Power to Award Compensation

(Section34). Without
in this prejudice to any other
Act,any person may make an provisions contained
application to the Commission for an
from any order for the
compensation
enterprise for any loss or damage shown to have recovery of
as a result of been suffered,
any contravention of the by such person
provisions of ChapterII
by such (Sections 3 to 6), been
enterprise [Section 34 (1)]. having committed
The
Commissionmay, after an
inquiry made into the
under
Sub-section (1), allegations mentioned in the
pass an order directing the application made
amount determined enterprise to make payment to the
by it as realisable from the applicant, ofthe
caused to the enterprise as
applicant as a result of compensation for the loss or
committed any contravention of the damage
by such provisions of Chapter II
enterprise [Section34 (2)]. having been
Where any 1loss or
Same
damage referred to in
Sub-section (1)is caused to
interest, one or numerous persons
more of such
application for and on
persons may, with the permission of the having the
behalf of, or for Commission, make an
the benefit of, the
PrOVISIONS of Rule 8 of
Order 1 of the First persons so interested.
to the Schedule to the Code of Civil Thereupon, the
SuDject
modification that
every reference therein to a suit Procedure, 1908, shall
rence to the application before or decree shall be apply
Section 34 the Commission and the order of construed as a
(3) the Commission
thereon
APpearance before
Commission (Section35)
lainant or
defendant or
i Ocers
its acCountants or
company
Director-General may either appear in
person or authorise
to secretaries or cost one or more
present his or its accountantsor legal
case before the practitioners or
Commission. any of his or
a)cost
accountant
a cost means
the Cost and Works Accountants
accountantas defined in
clause (b) of sub-section
0 practice under Act, 1959 (23 of (1)of section
1959) and who has obtained a
sub-section of
(1) section 6 of that certificate
Act,
662
Law of
Contract
means an advocate, vakil or an Othos
(b) "legal practitioner" attorney of any
any L:. ther
pleader in practice. High Court, Laws
and
6. Power Regulate its Own Procedure (Section
to
of Commission ion
includes,a

procedure- The Commission shall not be bound by the procedure laid dou 36).
Procedure, 1908.But it shall be guided by the principles of natural justice andne
Regulation
Code of

provisions of this Act and of any rules made by the Central

Government, the subject tothe C
powers to regulate its own procedure including the places at which they shall
have fheon shall
of oral hearings when granted, and times of its inquiry [Sec.36 have
(1)]. ings,
duration
7. The Commission shall have, for the purposes of
discharging its functions
under fhio
powers as are vested in a civil court under the Code of Civil Act, the
Procedure, 1908
sarme
respect of the following matters, namely,
suit,in

(a) summoning and enforcing the attendance of any person and

examininghim on
(6) requiring the discovery and production of documents; oath;

(c) receiving evidence on affidavits;

(d) issuing commissions for the examination of witnesses or documents:
(e) subject to the provisions of Secs. 123 and 124 of the Indian Evidence
Act, 1872.reau:
any public record or document copy of such record or document from any
or
ofice
) dismissing an application in default or deciding it exparte;

(g) any other matter which may be prescribed [Sec. 36

(2)].

8. Power to review its own orders (Section 37).Any person

aggrieved by an order of the Commisgion
from which an appeal is allowed by this Act but no appeal has been
preferred, may,within 30days from
the date of the order,
apply to the Commission for review of its order and the
Commission may make
such order thereon as it thinks fit.

Rectification of Orders (Section38)

With a view to rectifying any mistake apparent from the record, the Commission may amend anyorder
passed by it under provisions ofthis Act.

Execution of Orders of Commission Imposing Monetary

Penalty (Section39)
fa person fails to pay any
monetarypenalty imposed on him under this Act, the Commission shall
proceed to recover such penalty in such manner as may be specified by the regulations [Section 39(0)
In a case where the Commission is of the
opinion that it would be expedient to recover the penaly
imposed underthis Act in accordance with the provisions of the Income-taxAct 1961, it maymake
reference
to this effect to the concerned income-tax
Authority under that for recovery of the penduy
as tax due under the said Act
[Section 39(2)].
of
Where a reference has been made the Commission under sub-section (2) for recov
by In

penalty, the person upon

whom the penalty has been imposed shall be deemed to be the asse
default under the Income-tax Act, 1961.

Appeal to Supreme Court only if SubstantialQuestion of Law involved(Secuo 40)

to the Supreme
Any person aggrieved by any decision or order ofthe Commission may file an appeal
ppeal to
within 60 days from the date of or order ofthes
Court communication of the decision 1908.
to him on one or more of the grounds
specified 100 of the Code of Civil Procedure, from
in Sec.
is satisfied cause 60
The Supreme Court may, if it that the appellant was prevented by sufice
Xceeding
filing the appeal within the said period, allow itto be filed within a further period no
 663
Act, 2002

TeCompetiton eal shall lie against any decision or order of the Commission made with the
n0 appeal
However arties [Section 40]
days theparti
of
zsent
Investigate Contravention (Section 41)
neral toInves
to
rGeneral
Director
Dire
e ieneral shall, when so directed by the Commission, assist the Commission in

of the provisions ofthis Act or any rules or made

1.The stigating
I. into any contravention regulations

thereunder have all the powers as are conferred upon the Commission under sub-
Director
General shall
2 The
of Section36.
section
(2)

of Orders of Commission (Section 42)

Contravention
cause an inquiry to be made into complianceof its orders or directions made in
may
The Commissio
of its powers
under the Act [Section 42(1)].
exercise without reasonable cause, fails to comply with the orders or directions of the
1f the person,
with
under Sections 27,28, 31, 32, 33, 42A and 43A of theAct, he shall be punishable
Commission

may extend to one day during which such non-complianceoccurs, subject

lakh for each
finewhich
as the Commission may determine [Section 42(2)].
to maximum of 7 Ten crore,
a

or fails to pay the fine imposed

does not comply with the orders or directions issued,
If the person
to any proceeding under Section 39, be punishable
under sub-section
(2), he shall, without prejudice
extend to three years, or with fine which may
extend to
for a term which may
with imprisonment
or with both, as the ChiefMetropolitan Magistrate, Delhi, may deem fit:

rupees. Twenty-five crore,

shall not take cognizance of any offence
Provided that the ChiefMetropolitan Magistrate, Delhi,
Commission or any of its officers authorised by it

under this Section save on a complaintfiled by the

[Section 42(3)1

of Orders of the
Compensation in Case of Contravention
Commission (Section42A)"*
an application to the Appellate
of this Act, any person may make
Without prejudice to the provisions
for any loss or damage
ribunal for an order for the recovery of compensationfrom any enterprise
directions
as a result of the said enterprise violating
SOWn
to have been suffered, by such person
decision or order of the
or without any reasonable ground,any
Commission
by the contravening,
5Sucd
32 and 33 or any condition or restriction subject to
under Sections 27, 28, 31,
Ommission issued has been accorded, given,
in relation to any matter
direction or exemption
waCh any approval, sanction, orders or directions ofthe Commission.
out such
rgranted under this Act or delaying in carrying
enalty for Failure to Comply with Directionsor
ommissionand Director-General(Section43)
a direction given by:
lfthe person cause, with
fails to comply, withoutreasonableand (4) 36; or
a) (2) ofSection
sub-section
Commission under powers
referred to in sub-section (2) of Section
41. Such
he while
Director-General exercising
one for each
extend to rupees lakh day during
a
be with fine which may
person shall punishable ot rupees one crore, as may be determined
to a maximum
w ch such failure continues subject
by the Commission.

* As Act, 2007, w.e.f. 12.10.2007.

amended by Competition (Amendment)
by
 664 Law of
Contract
Other
Power to Impose PenaltyforNon-furnishingof Laws
Informationon Combinations (Section44A)

Ifany person or enterprise fails to givenotice to the Commission under Sub-section

Sub-section
Commission shall impose on such person or enterprise a penalty which may evto (2) of Se
tend o stion 6,
cent of the total turnover or the assets, whichever iS higher, ot such he a combination rupees
Further Section 45, as amended by the Competition (Amendment) Act. 200 onep
per
penalty of up to F 1 crore, upon any person who:
for a
(a) makes any statement or furnishes any document which he knows
or has reac
reason to
false in any material particular; or believe to
be
(b) omits to state any material fact knowing it to be material; or
(c) Willfully or destroys any document which
aforesaid.
alters, suppresses is
required to be fr
as
Penalty for Offences in Relation to Furnishing of Information (Section45)
Withoutprejudice to the provisions of Section 44,a person, who fumishesor is
required tofurnish s
this Act any particulars, documents or under
any information,-
(a) makes any statement or furnishes any document which he knows or has
reason to believe to
false in
any material particular; or be

(b) omits to stat

any material knowing it to be material; or
fact

(c) Willfully alters, suppresses or destroys any document which is required to be furnished as
aforesaid
Such person shall be punishable with fine may extend to rupees one crore as may be determined
by the commission.

Power to Impose Lesser Penalty(Section46)

The Commission may, if it is satisfied that any
producer, seller, distributor, trader or service provider
included in any cartel, which is alleged to have violated section
3,has made a full and true disclosre in
respect ofthe alleged violations and such disclosure is vital, impose
upon such producer, seller distributor,
trader or service provider a lesser deem
penalty as it may fit, than leviable underthis Act orthe
rules or
the regulations.

CreditingsumsRealised by Way of Penalties to

Consolidated Fund of India (Section47)

All sums realized by way

ofpenalties under this Act shall be credited to the Consolidated Fund of India

Contravention by Companies (Section48)

a of any of the provisions ofthis Act or ofanyrule,regulatoution,

Where person committing contravention
direction or order made thereunder is a was
company, every person who, at the time the cona ntion of
committed,was in charge of,
and was responsible to the company for the conductof s
the uahle
the company, aswell asthe
company, shall be deemed to be guilty ofthecontravention an
be
to proceededagainst and punished accordingly.

Competition Advocacy (Section49)

The Central Government may, in a policy
elated
formulating on competition (including revi
to competition) or on any other matter, and a State competiti
Government may, in formulating aponey
* As amended
by Competition (Amendment)Act, 2007,w.e.f. 12.10.2007.
 665

Act,
20
2002
a reference to the Commission for its
ition
case may be, mak opinion on
s the
h Conpeitd
matter
other suchpolicy
competition
such
and on the receipt

reference, give
ofsuch a reference, the Commission

its opinion to the Central

Government,orthe
of making
anany mai
effect ys
days
of
of av be, which may thereafter take further action as it deems fit
[sub-
sLXTY
asthe case
hallwithin
Governmeni, by the Commission under sub-section (1) shall not be binding upon the
Cate a aiven
such policy sub-section (2)].
seton( the opinion in formulating
However, vernment as may be prescribed, for the promotionof competition
orSta suitable measures,
take suitable
take
shall
on shall about competition issues [sub-section (3)].
Central and imparting training
C.
Commission awareness
lhe
creating
AND AUDIT (SECTION 50-53)
INANCE, ACCOUNT
advocacy,
FIN
51)
(Section Government has been
Finance of Competition Commission, Central
financial requirements
m the
he
51 to constitute Competition Fund'. To this Fund'shall be credited:
To Section
under
under.
empowered under ection 50 received by the Commission;
grants
all Government
(a)
received underthis Act;
fees
0) the to in clauses (a) and (b).
accrued on the amount
referred
the
interest

for meeting:
TheFund
shall Applied
and other Member and the administrative
the salaries and allowances payable to the Chairperson
(a
the and pension payable to the Director General, Additional,
allowances
salaries,
expenses including
other employeesof
Assistant Directors-General, the Registrar and officers and
Joint, Deputy or
the Commission;
with the discharge of its functions and for
Commission in connection
6) The other expenses of the
the purposes of this Act.
as may be
such Members of the Commission
The Fund shall be administered by a committee of
of the Fund for carrying out the
0Etemined by the Chairperson. The committee shall spend monies out
oijects for which the Fund has been constituted.

Accounts and Audit (Section52)

an annual
records and prepare
Com andother relevant
S1On shall maintain proper accounts

be prescribed by the
Central Government
in consultation
ccounts in such form as may
wihdi
ne Comptroller and Auditor-General of India.

al suchh ns
The a

intervals as
of

may
4smay
the Commission shall be audited by the Comptroller
be specified by him and any expenditure
and Auditor-General of India

incurred in connection
of India.
with such

epayable by the Commiss to the Comptroller

andAuditor-General
The by him in connection
person appointed
Wiuththe
Comp
audit of the
nd
accou
Auditor-General

ofthe
ofIndia
Commission
and any
shall have
other
the same rights, privileges
and authority in
has, in connection
Conmection
with suchaCOunts and Auditor-General ofIndia generally
with
the ddit as the Comptroller
shall have the right to demand the
audit of in particular,
papers and to inspect
the accounts and,
Governn
Government
and other documents and
productic of
books, ac vouchers
atny of
the accounts, connected
offices of the t
Commission. and Auditor-General ofIndia
or
The
accounts the Comptroller
any of the as certified by shall be forwarded
other
person a
ommission with the
audit reportthereon
Onted by him in this behalf together
666 Law of
Contra

Government and that Government shall se the

cause the sam.
Other
annually to the Central same Laws
to be
House of Parliament. laid
beforeca
Central Government (Section 53)
Furnishing of Returns, etc. to
at such time and
The Commission shall furnish to the Central
Government in such fon
Government such form and
may be prescribed or as the Central may direct, returns and.
And manneras
in to any proposed or existing measures promotion statements and
particulars regard forthe such

creating awarenessand imparting training about competition issues, as the Central

from time to time, require. Government
may,
The Commission shall prepare once every such form and
year, in at such time ac
scribed, an annual report giving
a true and full accountof its activities during the nre: pre
ous
copies of the report shall be forwarded to the Central Government. year and

A copy of the report, as aforesaid, shall

be laid, as soon as may be after it is received. he

House ofParliament. each

Competition AppellateTribunal (Sections53A to 53U)

Competition(Amendment) Act, 2007 has introduced a new chapter, viz., ChapterVII A

establishment and functioning of the CompetitionAppellate Tribunal. The Chaptercommri
of
establishment and functioning ofthe Competition Appellate Tribunal. The Chapter comprises ofSectis
53A 53U. Sections 53C, 53D,53E, 53F,53G, 53H, 531I,
to $3J, 53K, 53L and 53M of,the Comnefii
ettion

(Amendment) Act, 2007 came into effect w.e.f. 20. 12.2007.

Establishment of AppellateTribunal (Section53A)

1. The Central Government shall, by notification, establish an Appellate Tribunal to

be known a
Competition Appellate Tribunal:

(a) to hear and dispose of appeals against any direction issued or decisions
made ororder
passed by the Commission under sub-sections (2) and (6) of Section 26,Sections 27,28,
31, 32,33, 38, 39, 43, 43A, 44, 45 or Section 46 ofthisAct;
(b) to adjudicate on claim for compensationthat may arise from the findings
of the Commision
or the orders of the Appellate Tribunal in an appeal against any finding ofthe Commissionor
under Section 42A or under sub-section (2) of Section 53Q ofthis Act and pass orders tor
the recovery of compensation under Section 53N of this Act.

2. The Headquarter of the Appellate Tribunal shall be at such place as the Central Government may

by notification, specify.

Miscellaneous (Sections54 to 65)

A. Powers of the Central Government

n the
1. Powers of Exempt [Section 54]. The Central Government is empowered to exeu in such
application of this Act, or any provision thereof, and for such period
as it may
spro
notification-
of securi
of the
(a)any class ofenterprises ifsuch exemption is necessary in the interest o
state or public interest; by
as
assumed
(6) any practice or agreementarising out of and in accordand
rdance with any obligation ries
India under any reaty, agreementor convention with any othercountryo
 667
2002
Act
function on
Conp
petition
ihich performsa sovereign behalfofthe Central Government or
Th which
enterprise
any
Government is ens
is engaged in any activity including the activity relatable
a State case an enterprise
n nterprise
However, ofthe Government, the Central Government may grant exemption
functions
sovereign to the
latable sovereign functions.
of activity
respect
only. [Section551. The Central Government
empowered underSection is
Directions
to issue
of bo
being heard, to issue directions to the
Competition Commission
2.Powers giving opportunity cannot, however, issue directions on technical and administrative
Itt c
5,after policymatters.
with respect
on is one of policy or not, the decision ofthe Central Government
a question
to whether
As
matters.
be final.
shall Commission [Section56]. If at any time the Central Government is ofthe
Pawer to supersede

opinion:
on account of circumstances beyond the control of the Commission
it is unable to
(a) the functions or pertornm the duties imposed on it by or under the provisions of
discharge

this Act; or
(h that
Commission has persistently made default in complying with any direction given by
the

the Central
Government under this Act or in the discharge of the functions or performance
of the duties imposed on it by or under the provisions of this Act and as a result of such
default the financial position of the Commission or the administration of the Commission
has suffered; or

(c)that
circumstances exist which render it necessary in the public interest so to do;
The Central Government may, by notification and for reasons to be specified therein, supersede
the Commission for such period, not exceeding six months, as may be specified in the notification.

However, before issuing such notification, the Central Government shall

give a reasonable
opportunity to the Commission to make representations against the proposed supersession and
shall consider representations, if any, of the Commission.
Consequences of
Supersession
Upon the publication of a notification of supersession, Commission,:

(a)
the Chairperson and other Members shall, as from the date of supersession, vacate their
offices as such;

al the powers, and duties which may, by or under the provisions ofthis Act, be
functions
the Commission shall, until the
discharged by or on behalf of provisions of
or
exercised
is reconstituted under sub-section (3), be exercised by or discharged by the
Ommission
Central
Govermment or such authority asthe Central Governmentmay specify in this behalf,
All properties owned or controlled by the Commission shall, until the Commission is

under sub-section (3), vest in the Central Government.

constituted

Or before the
oftheperiod of supersession specified the notification issued
expiration
in

Sub-section (1), the Central Government shall reconstitute the Commission by a

ppointment ofits Chairperson and other Members and in such case any person who
Vacated his office under clause (a)of sub-section (2) shall not be deemed to be disqualified
for
reappointment.
TheCentral
Teport of
any
Government shall cause a notification issued under sub-section (1) full and a
action taken under this section and the circumstances leading to such action to be
before each
House ofParliament at the earliest.
668 Law of
Contract
Other
4. Power to make Rules (Section 63). The Central Government may, by notifn. Laws
to carry out the provisions of this Act. In particular, such rules may providefor cation,
make
all orany nules
following matters,

(a) The term of the

sub-section
namely:

(2)
Selection

of Section
Committee and the manner of selection ofna
9;
.
anel of
names
ofthe

under
(b) The form and manner in which and the authority before whom the ath o
secrecy shall be made and subscribed
to under office

The and the other terms and conditions

sub-section
of service
(3)of
Section
and o
(c) salary including traa
house rent allowanceand conveyance sumptuary allowanceand mea
facilities, xpenses,
to be provided to the Chairperson and other Members under facilities
sub-sectio
Section 14; (1)of
(dThenumber ofAdditional, Joint, Deputy or Assistant
Directors-General or sucho
other employeesin the office ofthe Director-General and the manner in
which such Adas
Joint, Deputy or Assistant Directors-General or such officers or
other emploves
appointed (1A)of Section 16;
under sub-section be
(e) The and other terms and condition of service of
salaries,allowances
the Director-Gena
Additional Joint, Deputy or Assistant Directors General or such other
officers or
other
employees under sub-section (3) of Section 16;
The qualifications for appointmentof the Directors General, Additional, Joint,Denutyor
Assistant Directors-General or such other officers or other
employees under sub-section
4) of Section 16;

(g) The salaries and allowances and other terms and conditions of service of
the Secretary and
officers and other employees payable, and the number of such officers
and employees
under sub-section (2) of Section 17;
(h) The form which the annual statement of accounts shall be prepared under sub-section (1)
of Section 52;
) The which and the form and manner in which the Commission
time within
may funmish
and such particulars as the Central Government may requireundersub-
returns, statements
section (1) of Section 53;

G) The form in which an appeal may be filed before the Appellate Tribunal under sub-section
(2) of Section 53Band the fees payable in respect of such
appeal
of Committee and the manner of selection of panel of
()The term the Selection namesunder
sub-section (2) of Section 53E;
() The and allowances and other terms and conditions of service ofthe Chairperson
Salaries
of the Appellate Tribunal under sub-section (1) of
and other Members Section 556,
m) The salaries and allowances and other conditions of service of the officers and o
the Appellate Tribunal under sub-section
employeesof (3) of Section 53M of
(2)
(n)
The fee which
shall be accompaniedwith every application made under sub-section
Section 53N;
th
(o)
The other
matters under clause
shall have
of sub-section (2) of Section 530 in respect
(i)
gasuit,
oi hich

Appellate Tribunal powers under the Code ofCivil Procedure, 1908 while tyt tin 0
of.
India
(p) The manner in which the moneys transferred to the
petition Commission as
the Appellate Tribunal shall be dealt te bunal,
with the Commission or
by theAppe
the case
may be, under the fourth proviso to sub-section (2) of Section 66 is
ision
g) Any other matter which is to be, or may be, prescribed, or in respect of whicn
to be, or may be, made by rules.
 669
902
200
A, shall be laid before each
House of Parliament for a period of 30
nder the Act
Comypemion ament suggestany modification or that the rule should be
made underHouses of Parliame

,
rule
Erery
In casehall

made,
the rule
shal
be of no
e
effect or will have effect only in the modified form. However,

not be affected.
shall
oneshal
already
thingDifficulties (Section 65). If any difficulty arises in giving effect to the
Dif
Remove Central Govenment may, by
order publishing in the Official
to
to Act, the
Gazette,
Power oft with the provisions of this Act as may appearto it to be
not inconsistent
Provisions
es
make
such proviSIons,
the difficulty
for removing of a period of two
shall be made under this Section after the expiry
no such order
nacessary

However, of thi
this Act.
the commencement
from Section shall be as so after it is made, before
years
order
made under this laid,

Every

each
House ofParliament.

on Disclosure
of (Section57)
Information
Restriction
h Res an ormationwhich has been obtained by or on behalf
to any enterprise, being
relating
Noinformation
or the 1ribunal for the purposes of this Act, shall, without the previous
Appellate
he Commission

in writing
of the enterprise, be disclosed otherwise than in
compliance with or for the
wmission

Act or any other law for the time being in force.

pemnissio
of this
uDses

Member, Director-General, Secretary, Officers and other Employees, etc. to

c.Chairperson,

he Public Servants (Section 58)

The Chairperson
Members and the Director-General, Additional, Joint, Deputy or Assistant
and other

Dictrs- General
and Secretary and officers and other employeesofthe Commissionand the Chairperson,
Mamibers, Officers and other
employeesof Appellate Tribunal shall be deemed,while acting or purporting
b
a in
pursuance of any of the provisions of this Act, to be public servants within the meaning of
Secion 21 of the Indian Penal Code.
Proteetion of Action Taken in Good Faith (Section 59)
sl,prosecution or other legal proceedings shall lie against the Central Government or Commission
LCer of Government or the Chairperson or any Member or the Director-General,
the Central

Jnt, Deputy or Assistant Directors-General or the Secretary or officers or other employees

,
dfita
or the of the Commission or
the
the ion Chairperson, Members, Officers and other employees
Chairperso for
Members, Officers and other employees of the Appellate Tribunal anything which
one or intended to be done underthis Act or the rules or regulations made thereunder.

At have Overriding
to
Effect 60)
The (Section
pyr
ay other ffect notwithstanding inconsistent therewith contained in
law for anything
the time
being in force.
elusion of f
jurisdiction Civil Courts (Section 61)
vil court
Ihe shall
have j
Cuon any suit or proceedings in Respect ofany
to entertain matter which
ayCommissionis
empo
powered by or under this Act to determine and no injunction shall be granted by
court
or
Dy or other auti
respect of any action take or to be taken in pursuance of power conferred
in
under
this Acty
Act.
Applica
lication
The of
aNprOvisions of
for
the
time
this !
otherlaws not Barred

shall be in addition
being inforce.
(Section

to,
62)
and not in derogation of,
the provisions of any other

ford
670 Law of
Contract
to make Regulations (Section 64) Other
H. Power of the Commission Laws
make regulations consistent with this Act and tha.
The Commission may, notification,
Act.
to carry out the purposes of this
to the generality thereunder
In particular, and without prejudice of the foregoing provisions
ions,such
made provide for all or any of the following matters, namely:
regulations

(a) the cost of production to be determined under clause (b) of the Explanation. to
(6) the form of notice as may be specified and the fee which may be determined .on4:
ction
4;

(2) of Section 6;
of the shall be filed undersub-section
(c) the from in which details acquisition (s
(d) the procedures to be followed
for engaging the experts and professionals
under on6
of Section 17;

may be under clause of sub-section

(e) the fee which determined (a) (1)of Section10.
) the rules ofprocedure in regard to the transaction of business at the
meetings ofthe Con
ommission
under sub-section (1) of Section 22;
(g) the manner in which penalty shall be recovered under sub-section (1) of Section 39.
(h) any other matter in respect of which provision is to be, or may be made by regulation1ons.

Everyregulation made under the Act shallbe laid before each House ofParliament
for a period of30

days.In case both the Houses of Parliament suggest any modification or that the regulation should he
made, the regulation shall be of no effect or will have effect only in the modified form.
However, anything already done shall not be affected.

Repeal and Saving (Section66)

1. The Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969) is hereby repealed and
Monopolies and Restrictive Trade Practices Commission established under sub-section(1) of
Section 5 of the said Act (hereafter referred to as the repealed Act) shall stand

(1A) The repeal of the Monopolies and Restrictive Trade Practices Act, 1968 (54
dissolved :
of1969) shall,
however, not affect
(a) the previous operation of the Actsorepealed or anything duly done or sufiered thereunder, or
the Act s0
6) any right, privilege, obligation or liability acquired, accrued or incurred under

repealed; or
ne
C)any penalty, confiscation or punishmentincurred in respect of any contravention under
act so repealed; or

(d) any proceeding or remedy in respect of any such right, privilege, obligation,liability,
confiscation or punishment as aforesaid, and
continued or enforced, and any such
any such proceeding or remedy may oe
may mposed
ted
penalty, confiscation or punishment o
or made as if that Act has not been repealed.
2. On dissolution of the
the Monopolies and Restrictive Trade Practices Commission
as the Chairmanof the
e person

appointed Monopoliesand Restrictive Trade Practices person oher

every other person appointed as Restrictive Trade Practices Commission andevey
Joint,
appointed as Member and Director General of Investigation and Reg Additional, the
egistration, oyee of
Deputy, or Assistant Director General of Investigation and any officer and other emp their
commissionandholding office as such before such dissolution shall
vacate not
immediately
respective offices and such chairman and other shal entitled to claim
comppensation
members office
oftheir
three months'pay and allowance termination or
ti
Cxceeding for the premature
or of any contract of service.
 671
2002
Act trade practices or strictive trade practices pending(including
to mono
tomonopolistic practice has also been alleged),before the Monopolies and
trade
CyemOM aining any nfair shall, [on the commencement of the
which ommission
Cos Competition
in
cIsespertain
to the Appellate Iribunal and shall be adjudicated
All Practice d transferred by
1rade2009], stand isions of the repealed Act asifthat Act hasnot
wi
Restrictive
Act,. m accordance
nendment)
heappellate
1r7bunal
af sub-section (3), all cases pertaining to unfair trade
practices other
of (1) of Section 36A of the Monopolies and
been clause (x)
theproVIsions
repealed.]
clau sub-section
t to to in
to in
referred 1969 (54 of 1969) and pending before the Monopolies and
Practices Act,
Suiyect.
ose
than
those Trade Commission [immediately before the commencement of the
Practices
Restrict Trade shall, on such commencement), stand transferred to the
strictive
Mestr constituted under the Consumer protection Act 1986 (68 of 1986) and the
con:
Compe Commission of such cases as if they were cases filed under that Act.]
c
shall dispose
National ommission
practices referred to in clause (x) of sub-section (1) of section
National to
trade Restrictive Trade Practices Act, 1969 (54 of 1969) and pending
All
case pertaining and tra
Monopoliesictive Trade Practices Commission shall, 1 [onthe commencement
Aofthe and Restrici
e N
the Monopolies Act, 2009],stan transferred to the Appellate Tribunal and the
Amendment)
before
(An
ofsuch cases as if they were cases filed under that Act.]
oftheCompetition
bunal shall dispose
other than those relating to unfair trade practices, pending
Appellate or proceedings,
investigations
of Investigation and Registration on or before the commencement
of
ofI
Director General
I
the
before stand transferred to the Competition Commission of
on such commencement,
hic Act shal, of such
of lndia may conduct or order for conduct
ia and the Competition Commission
or proceedings in the manner
as it deems fit.
investigation
to unfair trade practices other than those referred to in
7Al investigations or proceedings, relating
of Section 36A of the Monopolies and Restrictive Trade Practices
clause (x)
of sub-section (1)
the Director-General of Investigation and Registration
Act, 1969 (54
of 1969) and pending before
transferred to
On or before the
commencement of this Act shall, on such commencement, stand
Commission constituted underthe Consumer protection Act,
1986 (68of 1986) and
the National

the National Commissionmay conductor order for conduct of such investigation or proceedings
in the manner as it deems fit:

to unfair trade practices pending before

Provide investigations or proceedings, relating
that all

the National
Commission, on or before the date on which the Competition (amendment) Bill,
2009 receives the assent of the President, shall, on and from that date, stand transferred to the

Appellate Tribunal and the Appellate Tribunal may conduct or order for conduct ofsuch investigation
Or
proceedings in the manner as it deems fit.]
to in clause (x) of
or proceedings relating to unfair trade practices referred
o nvestigations
and Restrictive Trade practices Act, 1969 954
on() of section 36A
of the Monopolies
and Registration on or before
0, and
pending before the Director-General of Investigation
transferred to the Competition
of this Act shal1, on such commencement, stand
encement or order for conduct
SIonof India and the Competition Commission of India may conduct
Such
investigation in the manner as it deems iit.

TEST QUESTIONS
State e Teasons and (c) Service.
for
the Competition ACL, (6) Consumer;
2002 passing (a) Acquisition;
3. Write short notes on:
LDefine the
following terms
terms as used in the (a) Anti-competitive agreements;
Competition
Act, 2002 Abuse of dominant position
(b)
 672
Law of
ontract
(c) Combination;
Commission under Other
() Competition Commission of India; and
the OWS
Advocacy Agency. Competition Act, provis
(e)
2007. 2002in the
ons
4. What are the functions of the Competition (b) Life month of
Insurance of the
of ? What are ?

Fe
Commission India its powers You are Corporationof February
required to state India
5. What are the duties of Director-General ? What is of the with
Mr.Competition
relevant
the procedure of inquiry under Section 19? to
MKP in Act,2002, 02,the
respectof option
prOvisions
6. Examine with reference to
provisions
the relevant
accepting the vailadle
of the Competition Act, 2002, the [Hint:Please see
following: Sec.12]
11. The
Whether a person purchasing goods not for Competition [C.A.(Final))
received a Commission of
personal use, but for resale can be considered as complaint that M/s. Ind.
been XYZ CO
abusing its domina has
'consumer C.A. (Final)] any
processing industry. position in has
[Hint: Yes, such a
person is also a consumer will be Explain the
briefly the fac food
considered by the
Section 2()]
whether M/s. XYZ Commission to
7. Examine with reference to the relevant provisions
position in the
Company enjoys a ascertain
industry. dominan
of the Competition nant
Act, 2002, the following: [Hint: SeeSec. 19 (4)] [C.A.
Whether a Government Department 12. How will (Final]
supplying
water for Chairperson and other
to the member
irrigation agriculturists after Competition Commissionof of the
India be
levying charges for water supplied (and not a
State whether the appointed?
Chairperson shall be
water tax) can be considered as an person, who has been or is only a
Enterprise qualified to be,
of a High Court. Judoe
[C.A. (Final)]
[Hint: Simple question based [C.A.
Hint: Yes. It is an enterprise. (Sec.2 (h)] on Section 8 (Final)]
of the
8. Hon'justice Mr. HCJ, a Competition Act, 2002.As Per Section 8
retired High Court Judge, (2),the
attained the age of 61 years on December Chairperson and every other Member
shall be
31, of ability, person
integrity and standing and who has
2004. The Central Government been,or
appointed him as is
qualified to a
be, Judge of High Court or has
the Chairperson of the special
Competition Commission knowledge of, and professional
of experience ofnot lass
India with from January 1, 2005. You are
effect then fifteen years in international
trade, economics,
required towith reference to the
state, business, commerce, law, finance,
provisions accountancy,
of the Competition Act,
2002, the tern for which management, industry, public affairs, administration or
he may be appointed as in
any other matter, which in the opinion of the Central
Chairperson of the
Competition Commission of India. Whether he can Government, may be useful to the Commission.
be appointed as such and when he Thus, a chairperson neednot necessarily be a person
till can remain
as Chairperson of the who has been or is qualified to be a Judge of a High
Competition Commission of
India?
Court.However, Supreme Court in one ofits recent
C.A. (Final)] in view
9. The Central
Judgment on a public litigation observed that of

Government
has formed an Commission,it
opinion the judicial
functions of the Competition
that Mr. CBM
(a member of the must be headed by a person from judiciary.|
Competition
Commission of India) has
interest that
acquired such financial 13. An understanding has been reaC the
rice of o
it
may affect prejudicially his manufacturers of cement to control the price

functions as a member of the Competition is not in

cement, but the understanding
writing

Commission and wants enforced by legai

and it is also not intended to be
it to remove him from his
office. You are required to state with reference to proceedings.
the
provision of the Competition Act, 2002, Examine whether the above understanding cau

whether the Central Government within the means

can do so and if considered as an Agreement'
Act, Z004
yes, how? of Section 2(b) of the Competition
C.A. (Final)] /CA. (Fmal
[Hint: See under (Sec.11)] Act
After ceasing to be a [Hint: As per 2(b) of the Competitionrunder-
10. ection
member of the
Commission of India with effect Competition
2002 Agreement' includes any arrangement or
from March 31,
2007, Mr. MKP was offered the standing or action in concert,
post of Executive unuc
Director with ()Whether or not, such arrangement, or
appropriate remuneration and in
perquisites in the following or action is format or writing;
organizations with understanding
effect from
April 1, 2007 (7) whether or not, such arrangement,
HLLLtd.a private be enforceabie
(a) sector or action is intended to
public limited Company,
whose case was disposed off proceedings.
by the Competition