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CCI orders pending filling of judicial member vacancy cannot be called into question: Delhi HC
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CCI orders pending filling of judicial member vacancy cannot be called into question: Delhi HC

Aditi Singh

The Delhi High Court has held that non-appointment of a Judicial Member does not stop the Competition Commission of India (CCI) from carrying out its adjudicatory functions.

The order was passed by a Single Judge Bench of Justice Vibhu  Bakhru in a petition by CADD Systems and Services Pvt Ltd, assailing orders passed by the CCI.

The petitioner was facing CCI proceedings for an alleged contravention of Section 3(3)(d) of the Competition Act, 2002.

Vide the two orders under challenge, the matter was listed for the final hearing, following which judgment was reserved.

It was the petitioner’s case that the orders were passed without the presence of a judicial member and were, therefore, in contravention of a decision passed by a Division Bench of the High Court in Mahindra & Mahindra Ltd. & Ors v. Competition Commission of India & Anr.

The Division Bench, in that case, had held that when adjudicatory orders are made by the CCI, the presence and participation of a judicial member was necessary.

The Court was informed that in spite of directions to the Central Government to take expeditious steps to fill all existing vacancies in the anti-trust regulator within a period of six months, no appointment with respect to “a person having the requisite qualification/experience in the field of law” was made.

Consequently, it was argued that the CCI could not hold any final hearings.

It was also submitted that the doctrine of necessity could not be invoked as the Commission could continue to discharge other functions while awaiting the appointment of a judicial member.

The CCI, on the other hand, referred to Section 15 of the Act and argued that its functioning could not be paralyzed and that it could function notwithstanding any vacancy.

It was also stated that the Centre had already issued a circular inviting applications from persons with the requisite qualifications for appointment as judicial member.

After hearing the parties, the Court remarked that the contentions advanced on behalf of the CCI were merited.

Clarifying the position in Mahindra & Mahindra, the Court stated that the judgment did not interdict the functioning of the CCI.

There is no specific direction that was issued to the aforesaid effect. The Central Government was directed to fill the vacancy within the period of six months and it cannot be assumed that the Court had interdicted the working of the CCI during this period.”

The Court also referred to Section 15 and observed that no Act or proceedings of CCI would be invalid by reason of any vacancy or any defect in its constitution.

Thus, notwithstanding, that a judicial member is required to be appointed to CCI, the orders passed by the CCI pending such appointment cannot be called into question.”

The Court noted that the petitioner had participated in the proceedings before the CCI and subsequently, orders were reserved after hearing submissions made on behalf of the parties.

In such a situation, it was clearly not open for the petitioner to now seek a rehearing of the matter after the appointment of a judicial member, the Court held.

The Court thus concluded,

Whilst, it is correct that CCI is also required to pass administrative orders as well, its principal function is to dispose of cases instituted either on an information or complaints. Plainly, interdicting CCI from passing final orders would effectively bring its functioning to a standstill.”

Accordingly, the petition was dismissed.

The petitioner was represented by Advocates Raj Shekhar Rao, Tushar Gupta, Sumit Mishra, Pramod Singh, and Siddharth H Raval.

CCI was represented by Advocates Samar Bansal, Devahuti Pathak, and Manan Shishodia.

Read the Order:

CADD-Systems-Del-HC-Judgement-17.07.2019_watermark.pdf
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