The Madras High Court has dismissed writ petitions filed by Hyundai Motor India and Nissan Motor India against the Competition Commission of India?s (CCI) directive for probing the alleged unfair trade practices of carmakers in the country.
However, the court has asked the carmakers to move the Competition Appellate Tribunal against the CCI diktat as it sees no violation of fundamental rights and denial of natural justice, which could be otherwise addressed by the court.
Observing that the CCI was well within its powers to order such a probe, Justice V Dhanapalan said: ?In the instant case, in the absence of any infringement of the fundamental rights or the principles of natural justice or the rule of law, the questions raised by the petitioners on merits, as to locus standi of the CCI in passing the April 26, 2011, impugned order, unexplained delay by director general (DG) in conducting the investigation and competency of the quorum of the CCI,
are all matters to be looked into by the Competition Appellate Tribunal.?
The court has directed the car companies to approach the tribunal within six weeks and and said that till such time, the parties to these proceedings shall maintain status quo.
Both Hyundai and Nissan in separate writ petitions had prayed for the quashing of the CCI order for probe, citing that the same was without jurisdiction, unconstitutional, without authority and against the principles of natural justice.
However, the high court observed that the impugned proceeding was only an inter-communication between the CCI and DG, and it does not specify any particular entity for the action to be taken. Therefore, it has to be concluded that the impugned proceedings are absolutely intra vires, but not ultra vires the provisions of the Act or the statute, as contended by the writ petitioners.
A person named Shamsher Kataria had filed an information with CCI, against three companies, Honda Siel Cars India, Volkswagen India and Fiat India Automobiles, alleging anti-competitive methods/agreements and abuse of dominant position.
Following this, the fair-trade watchdog in its meeting held on February 24, 2011, formed an opinion on the existence of a prima facie case as against the said three car manufacturers and asked the director general to probe it and submit his investigation report within 60 days.
As the said practices were not confined to the said three entities, the case involved a larger issue related to the prevalent conduct of players in the automobile sector and its implication on the consumers at large, it was proposed that the scope of the probe be expanded to examine the practices in the areas under consideration of all car manufacturers in India.
