HCs can’t interfere with CCI’s probe unless there is an abuse of process

Case Details: GMR Hyderabad lnternational Airport Ltd. v. Competition Commission of lndia - [2022] 144 taxmann.com 186 (HC-Telangana)

Judiciary and Counsel Details

• • K. Lakshman, J.
  • S. Niranjan Reddy & Ms Rubaina S. Khatoon for the Petitioner.
  • K. Vivek Reddy, Ms Neha Pandey, D. Prakash Reddy & P. Sriram for the Respondent.

Facts of the Case

In the instant case, a question was raised before the High Court as to whether the Court can interfere in CCI proceedings and investigations when there appears to be an abuse of law?

The High Court observed that an order passed u/s 26(1) of the Competition Act, 2002, directing investigation by the Director General is an administrative order passed only to determine whether allegations made by informant u/s 19(1), about possible violations of competition law are true.

It was further observed that once information is received u/s 19(1), CCI, based on material produced by the informant has to form a prima facie opinion regarding possible competition law violations. The High Court held that while forming a prima facie opinion, CCI has to only determine if allegations along with material produced are taken to be true, will that result in breach of competition law.

High Court Held

The High Court held that scope of interference of High Courts under Article 226 of the Constitution of India, in an order passed directing investigation under section 26(1) is extremely limited. The CCI and authorities under Act, 2002 were well equipped to conduct the investigation and possess expertise in said field.

In view of the above, it was held that the High Courts could not interfere with such investigation unless there is an abuse of process and prima-facie it appears that the investigation was marred by mala fides.

It is only after the investigation/inquiry is completed and parties are given an opportunity of hearing that the CCI can decide whether the dispute is strictly commercial and raises no competition law concerns.