Car firm’s appeal against CCI order dismissed

A division bench comprising Justice Huluvadi G Ramesh and Justice RMT Teekaa Raman, while dismissing the appeal moved against the single judge’s order, said, “After hearing both the parties and after going through the impugned order passed, we find that the Director General, CCI, did not initiate suo motu enquiry and it was based upon the direction of CCI dated April 26, 2011, wherein, investigation was ordered against the appellant (Hyundai) herein.”

Also, noting that an amendment made in 2007 to the Competition Act passed in 2002, has ensured that the CCI can act on its own knowledge or information and not just on complaints under Section 26, said, “Considering the object of the Act, it is the duty of the CCI to investigate into the matter by giving notice to the concerned car manufacturers....hence, the contention of the counsel for the appellant that the Director General suo motu expanded the proceedings to other car manufacturers including that of the appellant is factually incorrect.”

As per the dispute, in January 2011, one Shamser Khan approached the CCI levelling allegation of anti-competitive restriction on the supply of genuine automotive spare parts against three major automobile companies-Honda, Volkswagen and Fiat India.

Following this, the CCI Director General, who took up the investigation, submitted a report in 2011 alleging that similar anti-competitive practices were being indulged in by other car manufacturers, including Hyundai and sought to expand the scope of investigation.

This led to the investigation being expanded to cover 14 car manufacturers and based on this, the DG issued a notice to Hyundai in May 2011.

Immediately thereafter, Hyundai approached the Madras High Court through two writ petitions challenging the CCI order expanding the scope of investigation.

A single judge, who heard Hyundai’s plea, dismissed it in February 2015, resulting in the appeal.