Competition Monthly - Newsletter

SUPREME COURT UPHOLDS CCI PENALTIES ON KERALA FILM EXHIBITORS' FEDERATION AND ITS OFFICE BEARERS

The Supreme Court, by its order dated 26 September 2025, upheld the Competition Commission of India's (CCI) order in full, including monetary penalties and directions debarring President and General Secretary of the Kerala Film Exhibitors Federation (KFEF) from association with the federation for two years, for engaging in anti-competitive conduct. In doing so, the Court overturned the 2016 Competition Appellate Tribunal (COMPAT) decision that had set aside penalties on KFEF's office bearers.

The findings of the CCI on merits of the anti-competitive conduct was not in challenge before the Supreme Court. The only question before the Supreme Court was whether the notice issued by the CCI to the office bearers (through forwarding of investigation report to office bearers) constituted sufficient notice, or whether they were entitled to a second show cause notice specifically proposing the penalty under Section 27 of the Competition Act, 2002 (Act).

The Court rejected COMPAT's reasoning that a separate penalty notice was required, holding that forwarding the Director General's report and inviting replies sufficed to meet principles of natural justice. The judgment reinforces CCI's authority to hold both associations and their office bearers liable for anticompetitive conduct under Sections 3 and 48 of the

No second notice contemplated under the statute: Section 48 already fixes quashing the CCI's investigation into Monsanto Holdings Private Limited and others.

The High Court held that once a settlement is reached between the informant and the opposite party, the substratum of CCI proceedings is lost, and CCI has no power to continue investigation in such circumstances.

The Supreme Court noted that the original complainants/informants have nothing further to say in the matter, and, in light of the High Court's findings, there was no reason to interfere. The Court considered these as very peculiar facts and circumstances of the case.

Accordingly, the matter was dismissed keeping the questions of law in the said litigation open.

BOMBAY HIGH COURT UPHOLDS CCI's INVESTIGATION INTO ASIAN PAINTS

The Bombay High Court, by its order dated 11 September 2025, dismissed the writ petition filed by Asian Paints Limited (Asian Paints) challenging the CCI's prima facie order (July 2025 proceedings) directing the DG to investigate into the alleged abuse of dominance conduct in the relevant market for manufacture and sale of decorative paints in the organized sector in India.

Asian Paints challenged the CCI order on the grounds that (i) the CCI order was replaced by a second order uploaded on the following day, and (ii) Section 26(2A) barred re-inquiry into allegations already examined in earlier proceedings initiated by JSW Paints and Sri Balaji Traders.

The Court rejected the first allegation, holding that the first order uploaded was merely an unsigned draft and upon discovering the error, the correct signed Accordingly, the petition was dismissed, and the CCI's investigation against Asian Paints will proceed.

NCALT UPHOLDS CCI ORDER AGAINST BID RIGGING IN UP GOVERNMENT'S SOIL TESTING TENDERS

The National Company Law Appellate Tribunal (NCLAT), by its order dated 23 September 2025, dismissed the appeals filed by Austere Systems Pvt. Ltd. (Austere), Fimo Infosolutions Pvt. Ltd. (Fimo) and their directors, thereby affirming the order of the CCI dated 4 April 2022 which held the appellants guilty of contravening the provisions of Section 3(3)(c) and Section 3(3)(d) read with Section 3(1) of the Act.

The case concerned tenders floated by the Department of Agriculture, Government of Uttar Pradesh (2017–2018) for supply of soil testing services. The CCI, based on the DG's investigation, had found that Austere, Fimo, Toyfort, Delicacy, Yash Solutions and others engaged in bid rigging, cover bidding and geographic market allocation, thereby eliminating and reducing competition in the bidding process.

On collusion among Set-II bidders (Austere, Fimo, Toyfort, Delicacy):

NCLAT upheld the findings that the bidders were interconnected through common business addresses, financial transactions, and preparation/submission of bid documents on each other's behalf. Such evidence demonstrated that the bids were not independent, but were coordinated to create a façade of competition.

On collusion with Yash Solutions (Set-III):

NCLAT accepted the CCI's conclusion that Austere and Yash had indulged in allocation leveraging into the downstream LMS market.

The CCI held that while OP-1 was dominant upstream by virtue of its concessionaire agreement with the Ministry of Civil Aviation, the non-renewal of space licence did not amount to abuse. Airlines could selfhandle or engage other LMS providers, and Air Works itself continued operations through mobile units even without exclusive airside space. The CCI further noted that

liability on persons in charge of a company at the time of contravention. The Court referred to the Competition Law Review Committee Report (2019) to note that the Act provides adequate safeguards on both findings and sanctions.

Time is of essence – no notice needed of proposed penalty: The Court stressed that competition cases require timely disposal. Prolonged exchanges over penalties could undermine enforcement. CCI has discretion to impose behavioural and structural remedies under Section 27, provided they are proportionate and act as effective deterrent.

Notice is to answer contravention – not proposed penalty: The statutory requirement is for notice of contravention, not pre-intimation of penalty quantum.

Commission can differ with the Director General (DG): CCI is not bound by the DG's report, but where it concurs with it, forwarding the report and calling for objections suffices as notice. In this case, the forwarding of DG Report was held to be adequate compliance with the Act and relevant regulations.

On behavioural remedies: The Court upheld behavioural directions like debarment of office bearers for two years and mandatory competition compliance programmes, stressing that these are legitimate tools to deter repeat violations.

SUPREME COURT DECLINES TO INTERFERE IN CCIMONSANTO LITIGATION

The Supreme Court, by its common order dated 2 September 2025, dismissed the batch of multiple Special Leave Petitions (SLPs) filed by the CCI against a Delhi High Court judgment dated 13 July 2023 order was uploaded on 2 July 2025.

With respect to the second allegation, the court observed that the allegations in JSW Paints proceedings were different from present July 2025 proceedings. Further, the court observed that depending on the facts and circumstances of each case, new representations on a complaint dismissed earlier can be entertained.

Court held that Section 26(2A) of the Act does not create any embargo on the CCI to entertain a representation, if the representation is found distinct or different from an earlier one.

The Court held that Section 26(2A) is an enabling and clarificatory provision, designed to avoid repetition and ensure expedience. It empowers the CCI to close a case if the same or substantially the same facts and issues have already been decided, but it does not create any jurisdictional bar against entertaining fresh or distinct complaints. The provision clarifies what was implicit in Section 26(2) and expressly enables closure of repetitive cases.

The Court noted that Section 26(2A) operates only where CCI chooses to close a matter, not where it proceeds to direct investigation. In such cases, CCI is not required to explain why Section 26(2A) is inapplicable. This interpretation, reinforced by the 2019 Competition Law Review Committee report, ensures balance between avoiding duplication and preserving the right to raise new competition concerns.

The Court further emphasised that orders under Section 26(1) are administrative and preparatory, with no vested right of hearing at the prima facie stage. Judicial review at such a stage is limited, and the High Court will not examine the merits of CCI's opinion to direct an investigation.

of markets by geography, with each party abstaining or placing non-serious/highpriced bids in certain districts, amounting to contravention of Section 3(3)(c).

On penalty determination:

NCLAT rejected the contention that “nil revenue” from the impugned tenders required “nil penalty.” It held that for bidrigging/cartelization cases, overall average turnover of the enterprise (as per Excel Crop Care) is an appropriate base for penalty to achieve deterrence. Accordingly, the penalty of 5% of average turnover for FY 2017–20 was imposed by the CCI.

CCI DISMISSES ABUSE OF DOMINANCE CASE AGAINST GMR HYDRABAD AIRPORT

The CCI, by its order dated 15 September 2025, dismissed allegations of abuse of dominance against GMR Hyderabad International Airport Limited (OP-1) and its subsidiary GMR Aero Technic Limited (OP2). The case was initiated on information filed by Air Works India (Engineering) Pvt. Ltd., a leading provider of maintenance, repair and overhaul (MRO) services.

The Informant alleged that OP-1 had arbitrarily refused to renew its licence for airside space at RGIA in March 2019, thereby denying market access in violation of Sections 4(2)(b), 4(2)(c), and 4(2)(e) of the Act. It was contended that the refusal was intended to exclude Air Works from the market for Line Maintenance Services (LMS) at Rajiv Gandhi International Airport (RGIA), and divert business to OP-2.

The DG's investigation had noted OP-1's dominance in the upstream market for access to airport facilities/premises at RGIA, and prima facie found possible space was reallocated to airlines and not exclusively to OP-2, undermining claims of preferential treatment.

Accordingly, the CCI found no evidence of denial of market access, or leveraging, and held that the refusal to renew the Informant's licence fell within OP-1's commercial discretion. The matter was therefore closed under Section 26 of the Act.

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