No probe by CCI in cartelisation complaint against Telecom Companies: Supreme Court

No probe by CCI in cartelisation complaint against Telecom Companies: Supreme Court

Shruti Mahajan

The Supreme Court today dismissed the petition filed by the Competition Commission of India (CCI) challenging the Bombay High Court order in the case relating to the complaint of cartelisation against telecom companies Airtel, Vodafone and Idea.

The judgment was delivered by a Bench of Justices AK Sikri and Ashok Bhushan.

The Court examined the specific question of jurisdiction of Competition Commission of India to initiate a probe against telecom companies in detail noting that this question is the main bone of contention in the instant case.

The Court observed that while the Competition Commission of India is set up under the Competition Act to prevent anti-competitive activities in a market, the telecom market is also governed by the Telecom Regulatory Authority of India as well as the licence agreements entered into with the Central government.

“An interesting feature is that this telecom market is also regulated by the statutory regime contained in the TRAI Act. Under the said Act, TRAI is established as a regulator which exercises control/supervision and also provides guidance to the telecom/mobile market. This statutory body is required to function as per the provisions of the TRAI Act as well as the Rules and Regulations framed thereunder.

Additionally, the telecom companies are also governed by licence agreements entered into between the Central Government and such service providers, for providing telephone/telecommunication services to the customers/subscribers.” 

The CCI had moved the Supreme Court against the Bombay High Court judgment which had set aside the probe against Bharti Airtel Ltd., Vodafone India Ltd., and Idea Cellular Ltd. The Commission had ordered the Director-General to investigate the complaint of cartelization filed by the informant, Reliance Jio Infocomm Ltd.

In September last year, the Bombay High Court had ruled that the Commission did not have jurisdiction to interpret policies relating to the telecom sector, given that this sector is governed by the Telecom Regulatory Authority of India (TRAI). It had, therefore, set aside the CCI order directing the probe into the alleged cartelization.

After the Bombay High Court ruling, the Commission approached the Supreme Court in January this year, challenging the decision.

Today, the Supreme Court dismissed the petition, noting that the questions of jurisdiction will have to be decided by the Telecom Regulatory Authority of India (TRAI) and that the CCI will be able to intervene only after that. The Court held,

“the CCI could exercise jurisdiction only after proceedings under the TRAI Act had concluded/attained finality, i.e. only after the TRAI returns its findings on the jurisdictional aspects which are mentioned above by us, the ultimate direction given by the High Court quashing the order passed by the CCI is not liable to be interfered with as such an exercise carried out by the CCI was  premature.” 

Trilegal Partner Jafar Alam and Associate Vipul Wadhwa advised and Senior Advocate P Chidambaram argued for Cellular Operations Association of India (COAI) while Senior Advocates  Harish Salve, Dr. A.M. Singhvi, Ramji Srinivasan, and Amit Sibal appeared for Reliance Jio Infocomm Limited (RJIL). CCI was represented by Additional Solicitor General PS Narasimha.

For the Telecom companies, Senior Advocate Darius J. Khambata appeared for Idea Cellular and Senior Advocates Gopal Jain and Navroz Seervai with Advocate Harsh Kaushik for Bharti Airtel. Vodafone was represented by Senior Counsels Ranjit Kumar, Arvind Datar, and Siddharth Luthra.

Read the Judgment:

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