A.

SCOPE OF POWERS OF DG

The investigative wing of the CCI, i.e., the Director General, assists it in investigations into
anti-competitive practices of enterprises. Any person aggrieved by the anti-competitive
conduct of an enterprise can provide information to the CCI requesting investigation. If the
CCI is of the prima facie view that an investigation is warranted, it passes an order
under Section 26(1) of the Competition Act, directing the DG to conduct the
investigation [“Prima Facie Order”].

A Prima Facie Order sets out (a) facts, based on which the CCI comes to the prima facie view
of contravention of the provisions of the Competition Act;

(b) the relevant provisions (i.e., Section 3 and/or Section 4 of the Competition Act) whose
contraventions are prima facie established;

(c) enterprises that have indulged in anti-competitive practices and whose conduct need to be
investigated.

The Director General (DG) of the Competition Law Review Committee (CCI) is the
investigative arm of the CCI. The DG has the power to:

1. Review all information on record with the CCI

2. Collect further information and evidence
3. Search and seize documents
4. Collect evidence through dawn raids
5. Establish the existence of a cartel
6. The DG and the CCI also have wide powers to collect evidence.
7. Further, the DG has the power to conduct unannounced search and seizure exercises
(“dawn raid”).

B. COMMON ISSUES INVESTIGATED BY CCI

1. collusive bidding
2. pricing of goods and services,
3. exclusivity arrangements,
4. price determination agreements, and refusal to supply.
5. cases involving bundling or tying-in arrangements
 6. exploiting market dominance in one sector to gain entry into another.
7. innovative anticompetitive structures, related to market-dominating structures and
8. the misuse of bad faith litigation to stifle competitors.

C. POWERS OF THE DIRECTOR GENERAL

Section 41 of the Competition Act empowers the Director General (DG) to investigate into
any contravention of the provisions of the Competition Act or any rules and regulations
made thereunder.

Under Section 41(2) of the Competition Act, the DG, while carrying out the investigation,
has powers of a "Civil Court" under as per CPC conferred upon CCI under Section 36(2) of
the Competition Act.

D. POWERS:

1. The duty of party being investigated is to render cooperation/ assistance, preserve, and
produce requisite information.

Section 41(3)

i. the duty to preserve and furnish to the DG, or any person authorised on this behalf, all
information, books, papers, and other documents/ records of, or relating to, the party in
their custody or power.

ii. the duty to render all possible assistance in connection with the ongoing investigation to
the DG.

Section 41(4):

DG may require any person other than a party referred to in Section 41(3) to furnish
additional information before the DG or any other authorised person if deemed relevant or
necessary for the purposes of the investigation.
2. Retention of the documents

Section 41(5): the DG is empowered to retain any information, books, papers, other
documents, or records produced under Section 41(3) or Section 41(4) for a period of 180
days.

3. Search and seizure of Documents

Section 41(8): when the DG in course of investigation has "reasonable grounds to believe"
that information or documents may be destroyed, mutilated, altered, falsified or secreted, the
DG may make an application to the Chief Metropolitan Magistrate, Delhi for an order for
seizure of such information, books, papers, other documents or records.

The documents obtained from the search and seizure operation conducted by the DG shall be
retained only until the conclusion of the investigation and thereafter, the same shall be
returned to the party or person from whose custody they were seized. However, the DG is
permitted to takecopies of the documents before returning the same.

4. Procedure for conducting search and seizure

Every search or seizure made under Section 41 of the Competition Act shall be conducted
and carried out in accordance with the provisions of the Code of Criminal Procedure, 1973
relating to search or seizure.

CASE LAWS:

1. Excel Crop Care Limited v Competition Commission of India & Others 1 [“Excel
Crop”] 12017 8 SCC 47 (SC).
In the Excel Crop case, the CCI directed the DG to investigate allegations of cartelization
among ALP tablet manufacturers in response to a 2009 tender. The DG's investigation
found cartel behavior in both the 2009 and 2011 tenders. ALP manufacturers contested
the DG's authority to investigate the 2011 tender, but both COMPAT and the SC upheld
the DG's power, emphasizing the need for a comprehensive investigation to uncover all
relevant facts. The SC stressed that the purpose of the DG's inquiry is to probe all
 necessary evidence, even beyond initial allegations, to uphold the Competition Act's
objectives.

2. Cadila Health Care Limited & Others v Competition Commission of India & Others,
2018 252 DLT 647 (DHC).
In the Cadila case, the Delhi High Court upheld the DG's authority to investigate
beyond the specifics outlined in the Prima Facie Order. Cadila Ltd., not initially
named in the order, contested the DG's investigation, but the court ruled that the DG's
inquiry isn't confined to the initial allegations. It emphasized that the DG's
investigation might uncover additional entities violating competition laws. Cadila Ltd.
has appealed this decision to the Supreme Court, awaiting further adjudication.

3. Mahindra & Mahindra v Competition Commission of India & Others 6 [“Mahindra

Order”] WP(C) 6610 of 2014 (DHC).
In the Mahindra & Mahindra case, the Delhi High Court clarified the DG's
investigative power. Although the original information and Prima Facie Order were
against specific car manufacturers, the DG expanded the investigation to include
others based on similar practices observed. The court upheld the DG's authority,
emphasizing that Section 26(1) of the Competition Act allows for investigation into
"the matter" as a whole, not just the initially named parties. Car manufacturers have
appealed this decision to the Supreme Court, awaiting further adjudication.

4. Competition Commission of India v Grasim Industries, [2019] 265 DLT 535 (DHC).
In the Grasim Industries case, the Delhi High Court initially disagreed with the CCI's
decision to allow the DG to expand the investigation beyond the scope outlined in the
Prima Facie Order. The single-judge bench ruled that the DG couldn't investigate
conduct beyond what was specified in the order. However, the division bench
overturned this decision, citing precedent from Excel Crop and Cadila cases,
emphasizing the DG's authority to investigate beyond initial allegations to uncover all
relevant facts.
5. Competition Commission of India v Steel Authority of India Limited, 2010 10 SCC 744
(SC).
The Delhi High Court, relying on the Supreme Court's decision in the Steel Authority
of India case, emphasized that the Prima Facie Order does not limit the DG's
investigative scope. The DG is tasked with probing "the matter" comprehensively,
including all related violations under the Competition Act, regardless of whether they
were initially specified in the order. Grasim Industries has appealed this judgment to
the Supreme Court, along with Cadila Ltd.'s similar case. This highlights the broad
investigative powers of the DG, allowing for the inclusion of additional enterprises,
facts, events, and allegations beyond the original order.

EFFECTS OF THE AMENDMENT ACT 2023

1. Dawn Raids 41: The Bill explicitly grants the DG the power to conduct "Dawn
Raids," including entering premises, conducting searches, and seizing relevant
material.

2. Direct Exercise of Powers 41(2): The DG will have direct authority to exercise
investigative powers, rather than through extension from the Competition
Commission of India (CCI).

3. Examination Under Oath 41(2): The DG can examine officers, employees, and agents
of the party being investigated, including past and present personnel.

4. Production of Documents 36(4): authority to require officers, employees, and agents

of the party being investigated, or any other person to “produce books, papers, other
documents, records, and information in their possession”

5. Enhanced Penalties 43(b): Non-compliance with the DG's directions may result in
imprisonment for up to six months, a fine of up to one crore rupees, or both, with
additional fines for each day of non-compliance.
WHAT ARE BIDDING METRICS

Bidding metrics are quantitative measures that evaluate the bidding process. They can be
used to assess an organization's competitiveness and track record in securing contracts
I. Expansive Investigative Authority of the Director General

The Competition Act endows the DG with broad investigative powers to probe potential
violations of competition laws. Section 41 empowers the DG to investigate contraventions of
the Act or any related regulations, with authority akin to a civil court as per Section 36(2).
These powers encompass collecting evidence, conducting dawn raids, and establishing the
existence of cartels, among others.

This expansive authority of the DG to investigate is supported by judicial precedents. In the

case of Excel Crop Care Limited v Competition Commission of India & Others, the
Supreme Court upheld the DG's power to investigate allegations of cartelization, emphasizing
the need for a comprehensive inquiry to uncover all relevant facts beyond initial allegations.
Similarly, in Cadila Health Care Limited & Others v Competition Commission of India &
Others, the Delhi High Court affirmed the DG's authority to investigate beyond the specifics
outlined in the Prima Facie Order, highlighting the need for a broad inquiry to uncover
additional entities violating competition laws.

II. Relevance of Bidding Metrics in Anti-Competitive Practices

Bidding metrics serve as quantitative measures that evaluate the competitiveness and
integrity of the bidding process. They play a pivotal role in uncovering bid rigging, collusion,
or other anti-competitive behaviors that undermine fair market competition. As such,
investigating bidding metrics is integral to identifying and addressing anti-competitive
practices.

III. Consistency with the Mandate of the DG

Examining bidding metrics falls squarely within the mandate of the DG to investigate anti-
competitive practices and ensure market integrity. By scrutinizing bidding metrics, the DG
can ascertain the fairness and transparency of the bidding process, thereby safeguarding the
interests of consumers and promoting market efficiency.

In the case of Mahindra & Mahindra v Competition Commission of India & Others, the
Delhi High Court upheld the DG's authority to expand the investigation beyond the original
parties named in the Prima Facie Order, emphasizing the need for a comprehensive inquiry
into the matter as a whole. Similarly, in Competition Commission of India v Grasim
Industries, the Delhi High Court overturned a decision limiting the scope of the DG's
investigation, highlighting the DG's authority to probe all related violations under the
Competition Act.