UNIVERSITY INSTITUTE OF LEGAL STUDIES

PANJAB UNIVERSITY, CHANDIGARH

SUBJECT - BUSINESS LAWS

TOPIC – CONSTITUTION POWERS , AND
JURISDICTION OF CCI ALONG WITH ROLE OF DGI
under COMPETITION ACT ,2002

SUBMITTED TO -

MS.SHEFALI

ASSISTANT PROFESSOR

SUBMITTED BY –

RAMYA JIT KAUR

 ROLLNO -156/19

ACKNOWLEDGEMENT
I would like to express my special thanks of gratitude to my teacher MS SHEFALI for HER
able guidance and support in completing my project within the time limit as assigned. I would
also like to extend my gratitude to the director of the department Dr. Rajinder Kaur for providing
me with all the facility that was required. I would like to thank them for providing me this
wonderful opportunity of making this project on– CONSTITUTION POWERS ,FUNCTIONS
AND JURISDICTION OF CCI ALONG WITH ROLE OF DGI . This project has helped me a
lot to learn new things and research on the topic allotted to me.

RAMYA JIT KAUR

BALLB( HONS )

4 YH YEAR

SECTION –C

156/19
INTRODUCTION –
The CCI acts as the competition regulator in India. The Commission was established in 2003,
although it became fully functional only by 2009. It aims at establishing a competitive
environment in the Indian economy through proactive engagement with all the stakeholders, the
government, and international jurisdiction. The objectives of the Commission are:

1. To prevent practices that harm the competition.

2. To promote and sustain competition in markets.
3. To protect the interests of consumers.
4. To ensure freedom of trade.

HISTORY OF THE ACT AND NEW CHANGES

“The CCI was established by the Vajpayee government, under the provisions of the Competition
Act 2002.
1. In the Pre-1991 Reforms period, India’s planned strategic and economic development stressed
the broad policy objectives of
2. The development of an industrial base with a view to achieving self reliance and The
promotion of social justice The MRTP Act has become obsolete in certain areas in the light
of international economic developments relating to competition laws and hence focus was
shifted from curbing monopolies to promoting competition
3 .In October, Central government appointed high level committee under the chairmanship of
Mr. Raghavan, the aim of the committee was to formulate the competition law in tune with
economic reforms and international development. The committee presented its report on May
2000, The draft competition law was presented on November 2000. After certain amendments
the parliament passed the new law, called completion Act 2002. The act came into force on
January 2003
4.The Competition (Amendment) Act, 2007 was enacted to amend the Competition Act,
2002.This led to the establishment of the CCI and the Competition Appellate
Tribunal.The Competition Appellate Tribunal has been established by the Central Government
to hear and dispose of appeals against any direction issued or decision made or order passed by
the CCI. The government replaced the Competition Appellate Tribunal (COMPAT) with
the National Company Law Appellate Tribunal (NCLAT) in 2017.”1

1
HISTORY AND AMENDMENTS AVAILABLE AT https://byjus.com/free-ias-prep/the-competition-
commission-of-india/#:~:text=CCI%20consists%20of%20a%20Chairperson,in%20the%20markets%20of%20India.
NEED FOR COMPETITION LAWS –

Competition laws perform three main functions in society

“To uphold free-enterprise: the competition laws have been called the Magna Carta of free
enterprise.

Security against market distortions: there is a constant risk of various people resorting to
market distortions and abusing their dominant positions to resort to anti-competitive activities,
thus competition laws are required to ensure that the market is safe from the various distortions.

They also aid in the promotion of domestic industries: Competition laws are required to
ensure that the domestic industries do not get suppressed with an increase in globalization. They
play a quintessential role in determining the viability of the domestic industries. However, to
keep the Indian competition laws updated with the businesses of the digital world which include
not many assets, the Indian government has established a Competition Law Review
Committee.”2

SCHEME OF THE ACT –

The Framework of Competition Act 2002 has essentially four compartments:

1. Anti- Competitive Agreements [ Section 3]

2. Abuse of Dominance [ Section 4]

3. Combination Regulation [ Section 5 & 6

4. Competition Advocacy [ Section 49]

2
https://byjus.com/free-ias-prep/the-competition-commission-of-india/#:~:text=CCI%20consists%20of%20a
%20Chairperson,in%20the%20markets%20of%20India., Last visited on 13 th feb ,2023 .
ESTABLISHMENT OF COMMISSION SECTION 7
“7. (1) With effect from such date as the Central Government may, by notification, appoint, there
shall be established, for the purposes of this Act, a Commission to be called the “Competition
Commission of India”.

(2) The Commission shall be a body corporate by the name aforesaid having perpetual
succession and a common seal with power, subject to the provisions of this Act, to acquire, hold
and dispose of property, both movable and immovable, and to contract and shall, by the said
name, sue or be sued.

(3) The head office of the Commission shall be at such place as the Government may decide
from time to time.

(4) The Commission may establish offices at other places in India. Composition of
Commission”3

COMPOSITION OF MEMBERS – SECTION 8

“8.(1) The Commission shall consist of a Chairperson and not less than two and not more than
six other Members to be appointed by the Central Government.

(2) The Chairperson and every other Member shall be a person of ability, integrity and standing
and who has special knowledge of, and such professional experience of not less than fifteen
years in, international trade, economics, business, commerce, law, finance, accountancy,
management, industry, public affairs or competition matters, including competition law and
policy, which in the opinion of the Central Government, may be useful to the Commission.

(3) The Chairperson and other Members shall be whole-time Members.]”4

[Selection Committee for Chairperson and Members of Commission] SECTION 9

SECTION -9. (1) The Chairperson and other Members of the Commission shall be appointed by
the Central Government from a panel of names recommended by a Selection Committee
consisting of –

a) the Chief Justice of India or his nominee - Chairperson

b) the Secretary in the Ministry of Corporate Affairs – Member

3
https://www.indiacode.nic.in/handle/123456789/2010?sam_handle=123456789/1362 section 7 of competion act

4
Subs. by Act 39 of 2007, s. 6, for s. 8 (w.e.f. 12-10-2007).
 c) the Secretary in the Ministry of Law and Justice - Member

d) two experts of repute who have special knowledge of, and professional experience in
international trade, economics, business, commerce, law, finance, accountancy, management,
industry, public affairs or competition matters including competition law and policy

(2) The term of the Selection Committee and the manner of selection of panel of names shall be
such as may be prescribed.] Term of office of Chairperson and other Members

SECTION -10.

“ (1) The Chairperson and every other Member shall hold office as such for a term of five years
from the date on which he enters upon his office and shall be eligible for re-appointment:
19[Provided that the Chairperson or other Members shall not hold office as such after he has
attained the age of sixty-five years]

(2) A vacancy caused by the resignation or removal of the Chairperson or any other Member
under section 11 or by death or otherwise shall be filled by fresh appointment in accordance with
the provisions of sections 9.

(3) The Chairperson and every other Member shall, before entering upon his office, make and
subscribe to an oath of office and of secrecy in such form, manner and before such authority, as
may be prescribed.

(4) In the event of the occurrence of a vacancy in the office of the Chairperson by reason of his
death, resignation or otherwise, the senior- most Member shall act as the Chairperson, until the
date on which a new Chairperson, appointed in accordance with the provisions of this Act to fill
such vacancy, enters upon his office.

(5) When the Chairperson is unable to discharge his functions owing to absence, illness or any
other cause, the senior-most Member shall discharge the functions of the Chairperson until the
date on which the Chairperson resumes the charge of his functions”5.

RESIGNATION, REMOVAL AND SUSPENSION OF CHAIRPERSON

AND OTHER MEMBERS- SECTION 11
“ 11. (1) The Chairperson or any other Member may, by notice in writing under his hand
addressed to the Central Government, resign his office: Provided that the Chairperson or a
Member shall, unless he is permitted by the Central Government to relinquish his office sooner,
continue to hold office until the expiry of three months from the date of receipt of such notice
or until a person duly appointed as his successor enters upon his office or until the expiry of his
term of office, whichever is the earliest.
5
https://www.indiacode.nic.in/handle/123456789/2010?sam_handle=123456789/1362 section 10 of competition
Act , 2002 .
(2) Not with standing anything contained in sub-section (1), the Central Government may, by
order, remove the Chairperson or any other Member from his office if such Chairperson or
Member, as the case may be,— (a) is, or at any time has been, adjudged as an insolvent; or

(b) has engaged at any time, during his term of office, in any paid employment; or

(c) has been convicted of an offence which, in the opinion of the Central Government, involves
moral turpitude; or

(d) has acquired such financial or other interest as is likely to affect prejudicially his functions as
a Member; or

(e) has so abused his position as to render his continuance in office prejudicial to the public
interest; or

(f) has become physically or mentally incapable of acting as a Member.

(3) Not with standing anything contained in sub-section (2), no Member shall be removed from
his office on the ground specified in clause (d) or clause (e) of that subsection unless the
Supreme Court, on a reference being made to it in this behalf by the Central Government, has, on
an inquiry, held by it in accordance with such procedure as may be prescribed in this behalf by
the Supreme Court, reported that the Member, ought on such ground or grounds to be removed”.6

VACANCY, IRREGULARITY IN APPOINTMENT ETC. NOT TO

INVALIDATE PROCEEDINGS OF COMMISSION
15. No act or proceeding of the Commission shall be invalid merely by reason of—

(a) any vacancy in, or any defect in the constitution of, the Commission; or

(b) any defect in the appointment of a person acting as a Chairperson or as a Member; or

(c) any irregularity in the procedure of the Commission not affecting the merits of the case.

POWERS -

The CCI can exercise power subject to the Act and the Rules. It should be guided by the
principles of natural justice and provisions of the act

1. The Commission shall have the powers to regulate its own procedure. [Section 36 (1)] 2.
Commission has a power of civil court [ Section 36 7

6
Section 11 of competition Act ,2002,https://www.indiacode.nic.in/show-data?
actid=AC_CEN_22_29_00005_200312_1517807324781&sectionId=648&sectionno=11&orderno=11

7
Section 36 of competition act ,2002 https://www.indiacode.nic.in/show-data?
actid=AC_CEN_22_29_00005_200312_1517807324781&sectionId=1166&sectionno=36&orderno=37
(2) ] “:A. Summon & Enforcing Attendance of any person on oath

B. Requiring the Discovery and production of Document

C. Receiving evidence as affidavit

D. Issue commission for examination of witness or documents

E. Requisitioning any public record on document or copy of such document form any office

F. Power to conduct enquiry-Inquiry into certain agreements and dominant position of enterprise
section 19. (1) The Commission may inquire into any alleged contravention of the provisions
contained in subsection (1) of section 3 or sub-section (1) of section 4 either on its own motion
or on—

(a) [receipt of any information, in such manner and] accompanied by such fee as may be
determined by regulations, from any person, consumer or their association or trade association;
or

(b) a reference made to it by the Central Government or a State Government or a statutory

authority.

G. Inquiry on combination –section 20 The Commission shall, on receipt of a notice under sub-
section (2) of section 6 , inquire whether a combination of enterprises referred to in that notice
or reference has caused or is likely to cause an appreciable adverse effect on competition in
India”.8

3. Commission may call the experts on respective field i.e Economics’, Commerce, Accountancy
which may be necessary [ Section 36 (3)]

4. Direct any person [ Section 36 (4)] I. Produce Book , Accounts or other documents II. Furnish
information about trade in procession of such persons

5.Issue cease and desist orders-direct any enterprise or association of enterprises or person
or association of persons, as the case may be, involved in such agreement, or abuse of dominant
position, to discontinue and not to re-enter such agreement or discontinue such abuse of
dominant position9

8
https://aliah.ac.in/upload/media/12-04-20_1586639430.pdf

9
Section 26 of competition Act ,2002 available at https://www.indiacode.nic.in/show-data?
actid=AC_CEN_22_29_00005_200312_1517807324781&sectionId=1156&sectionno=26&orderno=27
 6. Impose fines and penalties (Section 27)- which shall be not more than ten percent of the
average of the turnover for the last three preceding financial years, upon each of such person
or enterprises which are parties to such agreements or abuse:10

7. Declare agreement having Appreciable adverse effect on competition (AAEC) void

8. Pass orders modifying agreement In case of abuse of dominance

9. order for division of dominant enterprise (Section 28) In case of combinations: (Section 31)

10. Approve Combination of enterprises

11. Approve with modifications

12. Direct that combinations shall not take effect

13. To order demerger

Other Powers

14. In case of companies, individuals may also be held liable if consent, connivance or neglect is
proved 15. CCI has extra-territorial reach

16. To order cost for frivolous complaint

JURISDICTION OF CCI – CONFLICT OF JURISDICTION BETWEEN

CCI AND OTHER SPECIFIC REGULATORS
Sections 18, 21, 21A, 60 and 62 of the Competition Act have the scope of creating a conflict of
jurisdiction between Competition Commission of India and other sectoral regulators. Before the
enactment of the Competition Act, various sectoral regulators have delegated the duty of
protecting the interests of the players in the market. The Competition Act was formulated with a
similar purpose. More sectoral regulators were introduced to conduct competition functions. So it
is evident that although the Act bestows the power to regulate competition in the market on the
Competition Commission, the sector laws present similar responsibility to several other

10
https://www.studocu.com/in/document/university-of-delhi/competition-law/powersduties-functions-of-cci/
32899836
authorities. This becomes one of the reasons for a conflict of jurisdiction between them. 11 Some
of the regulators who have the potential of having a conflict of jurisdiction are mentioned below:

 “1.The Securities and Exchange Board in India (SEBI): Various provisions of

the SEBI Act, 1992 direct it to prohibit unfair and fraudulent trade practises. It
also regulates the acquisitions of shares and mergers. Thus, there is a clear overlap of
jurisdiction since the Competition Commission has also been bestowed with similar
responsibilities.

 2.Insurance Regulatory and Development Authority (IRDA): IRDA Regulations,

2016, authorises IRDA to regulate combinations in the insurance sector. This is
again an overlap of jurisdiction with the Competition Commission of India.
 3.Telecom Regulatory Authority of India (TRAI): Section 11(1)(h) of TRAI Act,
1997 empowers TRAI to facilitate efficiency in providing telecommunications
services to promote fair competition and establish a level playing field. This is
also one of the objectives of the CCI and hence, potential for overlap in jurisdiction.
 4.Section 60 of the Electricity Ac 12t confers powers over market dominance issues
with the sector regulator; the practice has often been inconsistent with the law as well
as varied from case to case.
 5.Section 44 of the Banking Regulations Act, 1949 provides for the provisions of
merging banking companies and also authorises the RBI to approve various
mergers. This provision encroaches upon the jurisdiction of CCI.”13

The take of courts in a conflict of jurisdiction

“Courts, from time to time, have taken various stances to resolve the disputes relating to
jurisdiction. In the Competition Commission of India v. Bharti Airtel 14 case, Reliance Jio
Infocomm Limited (hereinafter referred to as 'RJIL') has filed information under Section 19(1) of
the Competition Act, 2002 (hereinafter referred to as the 'Competition Act') before the
Competition Commission of India (for short, 'CCI') alleging anti- competitive agreement/cartel

11
.ARTICLE ON Jurisdiction Of The CCI: Navigating Through Muddy Waters PUBLISHED ON 28 April 2015
by Kanika Chaudhary Nayar , AVAILABLE AT
https://www.mondaq.com/india/antitrust-eu-competition-/392738/jurisdiction-of-the-cci-navigating-through-muddy-
waters

12
https://blog.ipleaders.in/conflict-cci-sectoral-regulators/
13
https://www.legalserviceindia.com/legal/article-2215-cci-and-sectoral-regulator-the-take-on-conflicting-
jurisdiction.html
14
CIVIL APPEAL NO(S). 11843 OF 2018
(ARISING OUT OF SLP (C) NO. 35574 OF 2017)
having been formed by three major telecom operators, namely, Bharti Airtel Limited, Vodafone
India Limited and Idea Cellular Limited (Incumbent Dominant Operators) (hereinafter referred
to as the ‘IDOs’). the Supreme Court has ruled on the specific responsibilities of TRAI and the
Competition Commission. The CCI has itself contended that although there are various sectoral
regulators in existence, the power to investigate the cases relating to anti-competition conduct
solely rests with the Competition Commission.”15

15
CASE AVAILABLE AT ,https://indiankanoon.org/doc/130504148/