S.H. Kapadia, C.J., K.S. Panicker Radhakrishnan and Swatanter Kumar, JJ

MANU/SC/0690/2010
Equivalent Citation: (2010)10SC C 744, [2010]11SC R112
IN THE SUPREME COURT OF INDIA

Civil Appeal No. 7779 of 2010 (D. No. 12247 of 2010)
Decided On: 09.09.2010
Appellants: Competition Commission of India
Vs.
Respondent: Steel Authority of India Ltd. and Ors.
Hon'ble Judges/Coram:
S.H. Kapadia, C.J., K.S. Panicker Radhakrishnan and Swatanter Kumar, JJ.
Case Category:
ORDINARY CIVIL MATTER - APPEALS U/S 53 T OF THE COMPETITION ACT, 2002
JUDGMENT
Swatanter Kumar, J.
1. The application for leave to appeal is allowed. Civil appeal is admitted.
2. The decision of the Government of India to liberalize its economy with the intention
of removing controls persuaded the Indian Parliament to enact laws providing for
checks and balances in the free economy. The laws were required to be enacted,
primarily, for the objective of taking measures to avoid anti-competitive agreements
and abuse of dominance as well as to regulate mergers and takeovers which result in
distortion of the market. The earlier Monopolies and Restrictive Trade Practices Act,
1969 was not only found to be inadequate but also obsolete in certain respects,
particularly, in the light of international economic developments relating to competition
law. Most countries in the world have enacted competition laws to protect their free
market economies- an economic system in which the allocation of resources is
determined solely by supply and demand. The rationale of free market economy is that
the competitive offers of different suppliers allow the buyers to make the best purchase.
The motivation of each participant in a free market economy is to maximize self-interest
but the result is favourable to society. As Adam Smith observed: "there is an invisible
hand at work to take care of this".
3 . As far as American law is concerned, it is said that the Sherman Act, 1890, is the
first codification of recognized common law principles of competition law. With the
progress of time, even there the competition law has attained new dimensions with the
enactment of subsequent laws, like the Clayton Act, 1914, the Federal Trade
Commission Act, 1914 and the Robinson-Patman Act, 1936. The United Kingdom, on the
other hand, introduced the considerably less stringent Restrictive Practices Act, 1956,
but later on more elaborate legislations like the Competition Act, 1998 and the
Enterprise Act, 2002 were introduced. Australia introduced its current Trade Practices
Act in 1974.
4 . The overall intention of competition law policy has not changed markedly over the
past century. Its intent is to limit the role of market power that might result from
substantial concentration in a particular industry. The major concern with monopoly and
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similar kinds of concentration is not that being big is necessarily undesirable. However,
because of the control exerted by a monopoly over price, there are economic efficiency
losses to society and product quality and diversity may also be affected. Thus, there is a
need to protect competition. The primary purpose of competition law is to remedy some
of those situations where the activities of one firm or two lead to the breakdown of the
free market system, or, to prevent such a breakdown by laying down rules by which
rival businesses can compete with each other. The model of perfect competition is the
'economic model' that usually comes to an economist's mind when thinking about the
competitive markets.
5. As far as the objectives of competition laws are concerned, they vary from country to
country and even within a country they seem to change and evolve over the time.
However, it will be useful to refer to some of the common objectives of competition
law. The main objective of competition law is to promote economic efficiency using
competition as one of the means of assisting the creation of market responsive to
consumer preferences. The advantages of perfect competition are three- fold: allocative
efficiency, which ensures the effective allocation of resources, productive efficiency,
which ensures that costs of production are kept at a minimum and dynamic efficiency,
which promotes innovative practices. These factors by and large have been accepted all
over the world as the guiding principles for effective implementation of competition law.
6. In India, a High Level Committee on Competition Policy and Law was constituted to
examine its various aspects and make suggestions keeping in view the competition
policy of India. This Committee made recommendations and submitted its report on
22nd of May, 2002. After completion of the consultation process, the Competition Act,
2002 (for short, the 'Act') as Act 12 of 2003, dated 12th December, 2003, was enacted.
As per the statement of objects and reasons, this enactment is India's response to the
opening up of its economy, removing controls and resorting to liberalization. The
natural corollary of this is that the Indian market should be geared to face competition
from within the country and outside. The Bill sought to ensure fair competition in India
by prohibiting trade practices which cause appreciable adverse effect on the competition
in market within India and for this purpose establishment of a quasi judicial body was
considered essential. The other object was to curb the negative aspects of competition
through such a body namely, the 'Competition Commission of India' (for short, the
'Commission') which has the power to perform different kinds of functions, including
passing of interim orders and even awarding compensation and imposing penalty. The
Director General appointed under Section 16(1) of the Act is a specialized investigating
wing of the Commission. In short, the establishment of the Commission and enactment
of the Act was aimed at preventing practices having adverse effect on competition, to
protect the interest of the consumer and to ensure fair trade carried out by other
participants in the market in India and for matters connected therewith or incidental
thereto.
7. The various provisions of the Act deal with the establishment, powers and functions
as well as discharge of adjudicatory functions by the Commission. Under the scheme of
the Act, this Commission is vested with inquisitorial, investigative, regulatory,
adjudicatory and to a limited extent even advisory jurisdiction. Vast powers have been
given to the Commission to deal with the complaints or information leading to
invocation of the provisions of Sections 3 and 4 read with Section 19 of the Act. In
exercise of the powers vested in it under Section 64, the Commission has framed
Regulations called The Competition Commission of India (General) Regulations, 2009
(for short, the 'Regulations'). The Act and the Regulations framed thereunder clearly
indicate the legislative intent of dealing with the matters related to contravention of the

Act, expeditiously and even in a time bound programme. Keeping in view the nature of
the controversies arising under the provisions of the Act and larger public interest, the
matters should be dealt with and taken to the logical end of pronouncement of final
orders without any undue delay. In the event of delay, the very purpose and object of
the Act is likely to be frustrated and the possibility of great damage to the open market
and resultantly, country's economy cannot be ruled out.
The present Act is quite contemporary to the laws presently in force in the United States
of America as well as in the United Kingdom. In other words, the provisions of the
present Act and Clayton Act, 1914 of the United States of America, The Competition Act,
1988 and Enterprise Act, 2002 of the United Kingdom have somewhat similar legislative
intent and scheme of enforcement. However, the provisions of these Acts are not quite
pari materia to the Indian legislation. In United Kingdom, the Office of Fair Trading is
primarily regulatory and adjudicatory functions are performed by the Competition
Commission and the Competition Appellate Tribunal. The U.S. Department of Justice
Antitrust Division in United States, deals with all jurisdictions in the field. The
competition laws and their enforcement in those two countries is progressive, applied
rigorously and more effectively. The deterrence objective in these anti-trust legislations
is clear from the provisions relating to criminal sanctions for individual violations, high
upper limit for imposition of fines on corporate entities as well as extradition of
individuals found guilty of formation of cartels. This is so, despite the fact that there are
much larger violations of the provisions in India in comparison to the other two
countries, where at the very threshold, greater numbers of cases invite the attention of
the regulatory/adjudicatory bodies. Primarily, there are three main elements which are
intended to be controlled by implementation of the provisions of the Act, which have
been specifically dealt with under Sections 3, 4 and 6 read with Sections 19 and 26 to
29 of the Act. They are anti- competitive agreements, abuse of dominant position and
regulation of combinations which are likely to have an appreciable adverse effect on
competition. Thus, while dealing with respective contentions raised in the present
appeal and determining the impact of the findings recorded by the Tribunal, it is
necessary for us to keep these objects and background in mind.
8 . Jindal Steel & Powers Ltd. (for short the 'informant') invoked the provisions of
Section 19 read with Section 26(1) of the Act by providing information to the
Commission alleging that M/s. Steel Authority of India Ltd. (for short 'SAIL') had, inter
alia, entered into an exclusive supply agreement with Indian Railways for supply of
rails. The SAIL, thus, was alleged to have abused its dominant position in the market
and deprived others of fair competition and therefore, acted contrary to Section 3(4)
(Anti-competitive Agreements) and Section 4(1) (Abuse of dominant position) of the
Act. This information was registered by the Commission and was considered in its
meeting held on 27th October, 2008 on which date the matter was deferred at the
request of the informant for furnishing additional information. During the course of
hearing, it was also brought to the notice of the Commission that a petition being Writ
Petition (C) No. 8531 of 2009, filed by the informant against the Ministry of Railways,
was also pending in the High Court of Delhi at New Delhi. Vide order dated 10th
November, 2009 the Commission directed the informant to file an affidavit with respect
to the information furnished by it. The Commission also directed SAIL to submit its
comments in respect of the information received by the Commission within two weeks
from the date of the said meeting and the matter was adjourned till 8th December,
2009. On 19th November, 2009 a notice was issued to SAIL enclosing all information
submitted by the informant. When the matter was taken up for consideration by the
Commission on 8th December, 2009, the Commission took on record the affidavit filed
by the informant on 30th November, 2009 in terms of the earlier order of the

Commission, but SAIL requested extension of six weeks time to file its comments.
Finding no justification in the request of the SAIL, the Commission, vide its order dated
8th December, 2009, declined the prayer for extension of time. In this order, it also
formed the opinion that prima facie case existed against SAIL, and resultantly, directed
the Director General, appointed under Section 16(1) of the Act, to make investigation
into the matter in terms of Section 26(1) of the Act. It also granted liberty to SAIL to
file its views and comments before the Director General during the course of
investigation. Despite these orders, SAIL filed an interim reply before the Commission
along with an application that it may be heard before any interim order is passed by the
Commission in the proceedings. On 22nd December, 2009 the Commission only
reiterated its earlier directions made to the Director General for investigation and
granted liberty to SAIL to file its reply before the Director General. The correctness of
the directions contained in the order dated 8th December, 2009 was challenged by SAIL
before the Competition Appellate Tribunal (for short, the 'Tribunal'). The Commission
filed an application on 28th January, 2010 before the Tribunal seeking impleadment in
the appeal filed by SAIL. It also filed an application for vacation of interim orders which
had been issued by the Tribunal on 11th January, 2010, staying further proceedings
before the Director General in furtherance of the directions of the Commission dated 8th
December, 2009. It will be useful to refer to the order passed by the Commission on 8th
December, 2009 at this stage itself which reads as under:
The meeting was held under the chairmanship of Sh. H.C. Gupta, Member.
2. The case was earlier considered by the Commission in its meetings held on
4.11.2009 and 10.11.2009. In the meeting of the Commission held on
10.11.2009, Mr. Suman Kr. Dey, VP and Head Legal and Mrs. Pallavi Shroff,
Advocate (along with their fellow advocates) appeared before the Commission
on behalf of the informant and made detailed admissions. As per decision taken
during the meeting held on 10.11.2009, informant/his counsel was directed to
file an affidavit regarding the current status of the writ petition filed in the Delhi
high Court, particular indicating its admission or otherwise and as to whether
any other order has been passed by the Hon'ble High Court, in the matter so
far. SAIL was also requested to furnish their views/comments in the matter
within 2 weeks time.
3. In the meeting of the Commission held on 08.12.2009, the Commission took
on record the affidavit filed by the informant on 30.11.2009 regarding the
current status of the writ petition filed in the Delhi High Court and certified
copies of all the orders passed by the Hon'ble High Court, in the matter, till
date. However, SAIL did not file its reply within the stipulated time and
requested to allow extension of time from 3.12.2009 for a further period of six
weeks. The Commission considered the above request of SAIL. However, the
Commission did not allow any further extension.
4 . The case was discussed in detail. After considering the details filed by the
informant with the information and the entire relevant material/record available
in this context as well as detailed submission made by the advocates of the
informant before the Commission on 10.11.2009. Commission is of the opinion
that there exists a prima facie case. Therefore, the Commission decided that the
case be referred to Director General for investigation in the matter.
5. Secretary was accordingly directed to refer the case to DG for investigation
and submission of the report within 45 days of the receipt of orders of the

Commission. SAIL informed that they may furnish their views/comments in the
matter to the DG.
9. As already noticed, the legality of this order was questioned before the Tribunal by
SAIL on one hand, while, on the other hand the Commission had pressed its application
for impleadment. In the application for impleadment it was averred by the Commission
that it is a necessary and proper party for adjudication of the matter before the Tribunal
and therefore, it should be impleaded as a party and be heard in accordance with law.
Emphasis was also placed on Section 18 of the Act to contend that powers, functions
and duties of the Commission were such that it would always be appropriate for the
Commission to be impleaded as a party in appeals filed before the Tribunal. It was also
averred in the application that intervention of the Commission at the appellate
proceedings would not prejudice anybody. The very maintainability of the appeal before
the Tribunal was also questioned by the Commission on the ground that the order under
appeal before the Tribunal was a direction simpliciter to conduct investigation and thus
was not an order appealable within the meaning of Section 53A of the Act. The Tribunal
in its order dated 15th February, 2010, inter alia, but significantly held as under:
(a) The application of the Commission for impleadment was dismissed, as in
the opinion of the Tribunal the Commission was neither a necessary nor a
proper party in the appellate proceedings before the Tribunal. Resultantly, the
application for vacation of stay also came to be dismissed.
(b) It was held that giving of reasons is an essential element of administration
of justice. A right to reason is, therefore, an indispensable part of sound system
of judicial review. Thus, the Commission is directed to give reasons while
passing any order, direction or taking any decision.
(c) The appeal against the order dated 8th December, 2009 was held to be
maintainable in terms of Section 53A of the Act. While setting aside the said
order of the Commission and recording a finding that there was violation of
principles of natural justice, the Tribunal granted further time to SAIL to file
reply by 22nd February, 2010 in addition to the reply already filed by SAIL.
10. This order of the Tribunal dated 15th February, 2010 is impugned in the present
appeal.
1 1 . The informant, i.e. the person who wishes to complain to the Commission
constituted under Section 7 of the Act, would make such information available in writing
to the Commission. Of course, such information could also be received from the Central
Government, State Government, Statutory authority or on its own knowledge as
provided under Section 19(1)(a) of the Act. When such information is received, the
Commission is expected to satisfy itself and express its opinion that a prima facie case
exists, from the record produced before it and then to pass a direction to the Director
General to cause an investigation to be made into the matter. This direction, normally,
could be issued by the Commission with or without assistance from other quarters
including experts of eminence. The provisions of Section 19 do not suggest that any
notice is required to be given to the informant, affected party or any other person at
that stage. Such parties cannot claim the right to notice or hearing but it is always open
to the Commission to call any 'such person', for rendering assistance or produce such
records, as the Commission may consider appropriate.
1 2 . The Commission, wherever, is of the opinion that no prima facie case exists
justifying issuance of a direction under Section 26(1) of the Act, can close the case and

send a copy of that order to the Central Government, State Government, Statutory
Authority or the parties concerned in terms of Section 26(2) of the Act. It may be
noticed that this course of action can be adopted by the Commission in cases of receipt
of reference from sources other than of its own knowledge and without calling for the
report from Director General.
1 3 . In terms of Section 26(3), the Director General is supposed to take up the
investigation and submit the report in accordance with law and within the time stated by
the Commission in the directive issued under Section 26(1). After the report is
submitted, there is a requirement and in fact specific duty on the Commission to issue
notice to the affected parties to reply with regard to the details of the information and
the report submitted by the Director General and thereafter permit the parties to submit
objections and suggestions to such documents. After consideration of objections and
suggestions, if the Commission agrees with the recommendations of the Director
General that there is no offence disclosed, it shall close the matter forthwith,
communicating the said order to the person/authority as specified in terms of Section
26(6) of the Act. If there is contravention of any of the provisions of the Act and in the
opinion of the Commission, further inquiry is needed, then it shall conduct such further
inquiry into the matter itself or direct the Director General to do so in accordance with
the provisions of the Act.
14. In terms of Section 26(7), the Commission is vested with the power to refer the
matter to the Director General for further investigation, or even conduct further inquiry
itself, if it so chooses. The Commission, depending upon the nature of the
contravention, shall, after inquiry, adopt the course specified under Sections 27 and 28
of the Act in the case of abuse of dominant position and the procedure under Sections
29 to 31 of the Act in the case of combinations. The Commission is vested with powers
of wide magnitude and serious repercussions as is evident from the provisions of
Sections 27(d), 28 and 31(3) of the Act. The Commission is empowered to direct
modification of agreements insofar as they are in contravention of Section 3, division of
an enterprise enjoying dominant position, modification of combinations wherever it
deems necessary and to ensure that there is no abuse or contravention of the statutory
provisions. We may notice that the provisions relating to combinations have been duly
notified vide Notifications dated 12th October 2007 and 15th May, 2009 respectively.
However, in the facts of the present case, these provisions do not fall for consideration
of the Court.
15. For conducting inquiry and passing orders, as contemplated under the provisions of
the Act, the Commission is entitled to evolve its own procedure under Section 36(1) of
the Act. However, the Commission is also vested with the powers of a Civil Court in
terms of Section 36(2) of the Act, though for a limited purpose. After completing the
inquiry in accordance with law, the Commission is required to pass such orders as it
may deem appropriate in the facts and circumstances of a given case in terms of
Sections 26 to 31 of the Act.
16. Having referred to the background leading to the enactment of competition law in
India and the procedure that the Commission is expected to follow while deciding the
matters before it and facts of the case, now it will be appropriate for this Court to refer
to the submissions made in light of the facts of this case. According to the Commission
(the appellant herein), the directions passed in the order dated 8th December, 2009
under Section 26(1) of the Act are not appealable and further there is no requirement in
law to afford an opportunity of hearing to the parties at the stage of formulating an
opinion as to the existence of a prima facie case. It is also the contention of the

Commission that in an appeal before the Tribunal it is the necessary party and that the
Commission is not expected to state reasons for forming an opinion at the prima facie
stage.
1 7 . On the contrary, according to SAIL (the respondent herein), the principles of
natural justice have been violated by the Commission while declining to grant extension
of time to file its reply and that the direction in referring the matter to Director General
was passed in undue haste.
1 8 . The informant placed reliance upon Regulation 30(2) of the Regulations which
empowers the Commission to pass such orders as it may deem fit on the basis of the
facts available, where a party refuses to assist or otherwise does not provide necessary
information within the stipulated time. Further, according to the informant there was no
valid reason submitted by the SAIL which would justify grant of extension and as such
the order passed by the Commission on merits was not liable to be interfered.
19. We may also notice that learned Counsel appearing for the parties had addressed
the Court on certain allied issues which may not have strictly arisen from the
memorandum of appeal, but the questions raised were of public importance and are
bound to arise before the Commission, as well as the Tribunal in all matters in which
the proceedings are initiated before the Commission. Thus, we had permitted the parties
to argue those allied issues and, therefore, we would proceed to record the reasons
while dealing with such arguments as well.
2 0 . In order to examine the merit or otherwise of the contentions raised by the
respective parties, it will be appropriate for us to formulate the following points for
determination:
(1) Whether the directions passed by the Commission in exercise of its powers
under Section 26(1) of the Act forming a prima facie opinion would be
appealable in terms of Section 53A(1) of the Act?
(2) What is the ambit and scope of power vested with the Commission under
Section 26(1) of the Act and whether the parties, including the informant or the
affected party, are entitled to notice or hearing, as a matter of right, at the
preliminary stage of formulating an opinion as to the existence of the prima
facie case?
(3) Whether the Commission would be a necessary, or at least a proper, party
in the proceedings before the Tribunal in an appeal preferred by any party?
(4) At what stage and in what manner the Commission can exercise powers
vested in it under Section 33 of the Act to pass temporary restraint orders?
(5) Whether it is obligatory for the Commission to record reasons for formation
of a prima facie opinion in terms of Section 26(1) of the Act?
(6) What directions, if any, need to be issued by the Court to ensure proper
compliance in regard to procedural requirements while keeping in mind the
scheme of the Act and the legislative intent? Also to ensure that the procedural
intricacies do not hamper in achieving the object of the Act, i.e., free market
and competition.
21. We would prefer to state our answers to the points of law argued before us at the

very threshold. Upon pervasive analysis of the submissions made before us by the
learned Counsel appearing for the parties, we would provide our conclusions on the
points noticed supra as follows:
(1) In terms of Section 53A(1)(a) of the Act appeal shall lie only against such
directions, decisions or orders passed by the Commission before the Tribunal
which have been specifically stated under the provisions of Section 53A(1)(a).
The orders, which have not been specifically made appealable, cannot be
treated appealable by implication. For example taking a prima facie view and
issuing a direction to the Director General for investigation would not be an
order appealable under Section 53A.
(2) Neither any statutory duty is cast on the Commission to issue notice or
grant hearing, nor any party can claim, as a matter of right, notice and/or
hearing at the stage of formation of opinion by the Commission, in terms of
Section 26(1) of the Act that a prima facie case exists for issuance of a
direction to the Director General to cause an investigation to be made into the
matter.
22. However, the Commission, being a statutory body exercising, inter alia, regulatory
jurisdiction, even at that stage, in its discretion and in appropriate cases may call upon
the concerned party(s) to render required assistance or produce requisite information,
as per its directive.
23. The Commission is expected to form such prima facie view without entering upon
any adjudicatory or determinative process. The Commission is entitled to form its
opinion without any assistance from any quarter or even with assistance of experts or
others. The Commission has the power in terms of Regulation 17(2) of the Regulations
to invite not only the information provider but even 'such other person' which would
include all persons, even the affected parties, as it may deem necessary. In that event it
shall be 'preliminary conference', for whose conduct of business the Commission is
entitled to evolve its own procedure.
(3) The Commission, in cases where the inquiry has been initiated by the
Commission suo moto, shall be a necessary party and in all other cases the
Commission shall be a proper party in the proceedings before the Competition
Tribunal. The presence of the Commission before the Tribunal would help in
complete adjudication and effective and expeditious disposal of matters. Being
an expert body, its views would be of appropriate assistance to the Tribunal.
Thus, the Commission in the proceedings before the Tribunal would be a
necessary or a proper party, as the case may be.
(4) During an inquiry and where the Commission is satisfied that the act is in
contravention of the provisions stated in Section 33 of the Act, it may issue an
order temporarily restraining the party from carrying on such act, until the
conclusion of such inquiry or until further orders without giving notice to such
party, where it deems it necessary. This power has to be exercised by the
Commission sparingly and under compelling and exceptional circumstances.
The Commission, while recording a reasoned order inter alia should: (a) record
its satisfaction (which has to be of much higher degree than formation of a
prima facie view under Section 26(1) of the Act) in clear terms that an act in
contravention of the stated provisions has been committed and continues to be
committed or is about to be committed; (b) It is necessary to issue order of

restraint and (c) from the record before the Commission, it is apparent that
there is every likelihood of the party to the lis, suffering irreparable and
irretrievable damage or there is definite apprehension that it would have
adverse effect on competition in the market.
24. The power under Section 33 of the Act to pass temporary restraint order can only
be exercised by the Commission when it has formed prima facie opinion and directed
investigation in terms of Section 26(1) of the Act, as is evident from the language of
this provision read with Regulation 18(2) of the Regulations.
(5) In consonance with the settled principles of administrative jurisprudence,
the Commission is expected to record at least some reason even while forming
a prima facie view. However, while passing directions and orders dealing with
the rights of the parties in its adjudicatory and determinative capacity, it is
required of the Commission to pass speaking orders, upon due application of
mind, responding to all the contentions raised before it by the rival parties.
Submissions made and findings in relation to Point No. 1
25. If we examine the relevant provisions of the Act, the legislature, in its wisdom, has
used different expressions in regard to exercise of jurisdiction by the Commission. The
Commission may issue directions, pass orders or take decisions, as required, under the
various provisions of the Act. The object of the Act is demonstrated by the prohibitions
contained in Sections 3 and 4 of the Act. Where prohibition under Section 3 relates to
anti-competition agreements there Section 4 relates to the abuse of dominant position.
The regulations and control in relation to combinations is dealt with in Section 6 of the
Act. The power of the Commission to make inquiry into such agreements and the
dominant position of an entrepreneur, is set into motion by providing information to the
Commission in accordance with the provisions of Section 19 of the Act and such inquiry
is to be conducted by the Commission as per the procedure evolved by the legislature
under Section 26 of the Act. In other words, the provisions of Sections 19 and 26 are of
great relevance and the discussion on the controversies involved in the present case
would revolve on the interpretation given by the Court to these provisions.
26. Thus, we may reproduce provisions of Section 19 and 26 which read as under:
19. Inquiry into certain agreements and dominant position of enterprise.--(1)
The Commission may inquire into any alleged contravention of the provisions
contained in Sub-section (1) of Section 3 or Sub-section (1) of Section 4 either
on its own motion or on--
(a) receipt of any information, in such manner and accompanied by
such fee as may be determined by regulations, from any person,
consumer or their association or trade association; or
(b) a reference made to it by the Central Government or a State
Government or a statutory authority.
(2) Without prejudice to the provisions contained in Sub-section (1), the
powers and functions of the Commission shall include the powers and functions
specified in Sub-sections (3) to (7).
(3) The Commission shall, while determining whether an agreement has an
appreciable adverse effect on competition under Section 3, have due regard to

all or any of the following factors, namely:
(a) creation of barriers to new entrants in the market;
(b) driving existing competitors out of the market;
(c) foreclosure of competition by hindering entry into the market;
(d) accrual of benefits to consumers;
(e) improvements in production or distribution of goods or provision of
services;
(f) promotion of technical, scientific and economic development by
means of production or distribution of goods or provision of services.
(4) The Commission shall, while inquiring whether an enterprise enjoys a
dominant position or not under Section 4, have due regard to all or any of the
following factors, namely:-
(a) market share of the enterprise;
(b) size and resources of the enterprise;
(c) size and importance of the competitors;
(d) economic power of the enterprise including commercial advantages
over competitors;
(e) vertical integration of the enterprises or sale or service network of
such enterprises;
(f) dependence of consumers on the enterprise;
(g) monopoly or dominant position whether acquired as a result of any
statute or by virtue of being a Government company or a public sector
undertaking or otherwise;
(h) entry barriers including barriers such as regulatory barriers,
financial risk, high capital cost of entry, marketing entry barriers,
technical entry barriers, economies of scale, high cost of substitutable
goods or service for consumers;
(i) countervailing buying power;
(j) market structure and size of market;
(k) social obligations and social costs;
(l) relative advantage, by way of the contribution to the economic
development, by the enterprise enjoying a dominant position having or
likely to have an appreciable adverse effect on competition;
(m) any other factor which the Commission may consider relevant for
the inquiry.

(5) For determining whether a market constitutes a "relevant market" for the
purposes of this Act, the Commission shall have due regard to the "relevant
geographic market'' and "relevant product market".
(6) The Commission shall, while determining the "relevant geographic market",
have due regard to all or any of the following factors, namely:
(a) regulatory trade barriers;
(b) local specification requirements;
(c) national procurement policies;
(d) adequate distribution facilities;
(e) transport costs;
(f) language;
(g) consumer preferences;
(h) need for secure or regular supplies or rapid after-sales services.
(7) The Commission shall, while determining the "relevant product market",
have due regard to all or any of the following factors, namely:-
(a) physical characteristics or end-use of goods;
(b) price of goods or service;
(c) consumer preferences;
(d) exclusion of in-house production;
(e) existence of specialised producers;
(f) classification of industrial products .
26. Procedure for inquiry under Section 19
(1) On receipt of a reference from the Central Government or a State
Government or a statutory authority or on its own knowledge or
information received under Section 19, if the Commission is of the
opinion that there exists a prima facie case, it shall direct the Director
General to cause an investigation to be made into the matter:
Provided that if the subject matter of an information received is, in the
opinion of the Commission, substantially the same as or has been
covered by any previous information received, then the new
information may be clubbed with the previous information.
(2) Where on receipt of a reference from the Central Government or a
State Government or a statutory authority or information received
under Section 19, the Commission is of the opinion that there exists no
prima facie case, it shall close the matter forthwith and pass such
orders as it deems fit and send a copy of its order to the Central

Government or the State Government or the statutory authority or the
parties concerned, as the case may be.
(3) The Director General shall, on receipt of direction under Sub-
section (1), submit a report on his findings within such period as may
be specified by the Commission.
(4) The Commission may forward a copy of the report referred to in
Sub-section (3) to the parties concerned:
Provided that in case the investigation is caused to be made based on
reference received from the Central Government or the State
Government or the statutory authority, the Commission shall forward a
copy of the report referred to in Sub-section (3) to the Central
Government or the State Government or the statutory authority, as the
case may be.
(5) If the report of the Director General referred to in Sub-section (3)
recommends that there is no contravention of the provisions of this Act,
the Commission shall invite objections or suggestions from the Central
Government or the State Government or the statutory authority or the
parties concerned, as the case may be, on such report of the Director
General.
(6) If, after consideration of the objections and suggestions referred to
in Sub-section (5), if any, the Commission agrees with the
recommendation of the Director General, it shall close the matter
forthwith and pass such orders as it deems fit and communicate its
order to the Central Government or the State Government or the
statutory authority or the parties concerned, as the case may be.
(7) If, after consideration of the objections or suggestions referred to
in Sub-section (5), if any, the Commission is of the opinion that further
investigations is called for, it may direct further investigation in the
matter by the Director General or cause further inquiry to be made by
in the matter or itself proceed with further inquiry in the matter in
accordance with the provisions of this Act.
(8) If the report of the Director General referred to in Sub-section (3)
recommends that there is contravention of any of the provisions of this
Act, and the Commission is of the opinion that further inquiry is called
for, it shall inquire into such contravention in accordance with the
provisions of this Act.
27. The Tribunal has been vested with the power to hear and dispose of appeals against
any direction issued or decision made or order passed by the Commission in exercise of
its powers under the provisions mentioned in Section 53A of the Act. The appeals
preferred before the Tribunal under Section 53A of the Act are to be heard and dealt
with by the Tribunal as per the procedure spelt out under Section 53B of the Act. It will
be useful to refer to both these provisions at this stage itself, which read as under:-
53A. Establishment of Tribunal. - (1) The Central Government shall, by
notification, establish an Appellate Tribunal to be known as Competition
Appellate Tribunal, -

(a) to hear and dispose of appeals against any direction issued or
decision made or order passed by the Commission under Sub-sections
(2) and (6) of Section 26, Section 27, Section 28, Section 31, Section
32, Section 33, Section 38, Section 39, Section 43, Section 43A,
Section 44, Section 45 or Section 46 of this Act;
(b) to adjudicate on claim for compensation that may arise from the
findings of the Commission or the orders of the Appellate Tribunal in
an appeal against any finding of the Commission or under Section 42A
or under Sub-section (2) of Section 53Q of this Act, and pass orders
for the recovery of compensation under Section 53N of this Act.
(2) The Headquarter of the Appellate Tribunal shall be at such place as the
Central Government may, by notification, specify.
53B. Appeal to Appellate Tribunal. - (1) The Central Government or the State
Government or a local authority or enterprise or any person, aggrieved by any
direction, decision or order referred to in Clause (a) of Section 53A may prefer
an appeal to the Appellate Tribunal.
(2) Every appeal under Sub-section (1) shall be filed within a period of sixty
days from the date on which a copy of the direction or decision or order made
by the Commission is received by the Central Government or the State
Government or a local authority or enterprise or any person referred to in that
Sub-section and it shall be in such form and be accompanied by such fee as
may be prescribed:
Provided that the Appellate Tribunal may entertain an appeal after the
expiry of the said period of sixty days if it is satisfied that there was
sufficient cause for not filing it within that period.
(3) On receipt of an appeal under Sub-section (1), the Appellate Tribunal may,
after giving the parties to the appeal, an opportunity of being heard, pass such
orders thereon as it thinks fit, confirming, modifying or setting aside the
direction, decision or order appealed against.
(4) The Appellate Tribunal shall send a copy of every order made by it to the
Commission and the parties to the appeal.
(5) The appeal filed before the Appellate Tribunal under Sub-section (1) shall
be dealt with by it as expeditiously as possible and endeavour shall be made by
it to dispose of the appeal within six months from the date of receipt of the
appeal.
28. As already noticed, in exercise of its powers, the Commission is expected to form
its opinion as to the existence of a prima facie case for contravention of certain
provisions of the Act and then pass a direction to the Director General to cause an
investigation into the matter. These proceedings are initiated by the intimation or
reference received by the Commission in any of the manners specified under Section 19
of the Act. At the very threshold, the Commission is to exercise its powers in passing
the direction for investigation; or where it finds that there exists no prima facie case
justifying passing of such a direction to the Director General, it can close the matter
and/or pass such orders as it may deem fit and proper. In other words, the order
passed by the Commission under Section 26(2) is a final order as it puts an end to the

proceedings initiated upon receiving the information in one of the specified modes. This
order has been specifically made appealable under Section 53A of the Act. In
contradistinction, the direction under Section 26(1) after formation of a prima facie
opinion is a direction simpliciter to cause an investigation into the matter. Issuance of
such a direction, at the face of it, is an administrative direction to one of its own wings
departmentally and is without entering upon any adjudicatory process. It does not
effectively determine any right or obligation of the parties to the lis. Closure of the case
causes determination of rights and affects a party, i.e. the informant; resultantly, the
said party has a right to appeal against such closure of case under Section 26(2) of the
Act. On the other hand, mere direction for investigation to one of the wings of the
Commission is akin to a departmental proceeding which does not entail civil
consequences for any person, particularly, in light of the strict confidentiality that is
expected to be maintained by the Commission in terms of Section 57 of the Act and
Regulation 35 of the Regulations.
29. Wherever, in the course of the proceedings before the Commission, the Commission
passes a direction or interim order which is at the preliminary stage and of preparatory
nature without recording findings which will bind the parties and where such order will
only pave the way for final decision, it would not make that direction as an order or
decision which affects the rights of the parties and therefore, is not appealable. At this
stage the case of Automec Srl v. Commission of the European Communities (1990) ECR
II 00367 can be noted, where the Court of First Instance held as under:-
42. As the Court of Justice has consistently held, any measure the legal effects
of which are binding on, and capable of affecting the interests of, the applicant
by bringing about a distinct change in his legal position is an act or decision
against which an action for annulment may be brought under Article 173. More
specifically, in the case of acts or decisions adopted by a procedure involving
several stages, in particular where they are the culmination of an internal
procedure, an act is open to review only if it is a measure definitively laying
down the position of the institution on the conclusion of that procedure, and
not a provisional measure intended to pave the way for that final decision
(judgment in Case 60/81 IBM v. Commission [1981] ECR 2639, at p. 2651,
paragraph 8 et seq.). It follows that the fact that the contested act is a
preparatory measure constitutes one of the barriers to the admissibility of an
action for annulment which the Court may consider of its own motion, as the
Court of Justice acknowledged in its judgment in Case 346/87 Bossi v.
Commission [1989] ECR 303, especially at p.332 et seq.
30. The provisions of Sections 26 and 53A of the Act clearly depict the legislative intent
that the framers never desired that all orders, directions and decisions should be
appealable to the Tribunal. Once the legislature has opted to specifically state the order,
direction and decision, which would be appealable by using clear and unambiguous
language, then the normal result would be that all other directions, orders etc. are not
only intended to be excluded but, in fact, have been excluded from the operation of that
provision. The presumption is in favour of the legislation. The legislature is deemed to
be aware of all the laws in existence and the consequences of the laws enacted by it.
When other orders have been excluded from the scope of appellate jurisdiction, it will
not be permissible to include such directions or orders by implication or with reference
to other provisions which hardly have any bearing on the matter in issue and thus make
non-appealable orders appealable. The provisions of Section 53A(1)(a) use the
expression 'any direction issued or decision made or order passed by the Commission'.
There is no occasion for the Court to read and interpret the word 'or' in any different

form as that would completely defeat the intention of the legislature. The contention
raised before us is that the word 'or' is normally disjunctive and 'and' is normally
conjunctive, but at the same time they can be read vice versa. The respondent argued
that the expression 'any direction issued' should be read disjunctive and that gives a
complete right to a party to prefer an appeal under Section 53A, against a direction for
investigation, as that itself is an appealable right independent of any decision or order
which may be made or passed by the Commission.
31. It is a settled principle of law that the words 'or' and 'and' may be read as vice
versa but not normally. "You do sometimes read 'or' as 'and' in a statute. But you do
not do it unless you are obliged because 'or' does not generally mean 'and' and 'and'
does not generally mean 'or'...." [Green v. Premier Glynrhonwy Slate Co. (1928) 1 KB
561]. As pointed out by Lord Halsbury, the reading of 'or' as 'and' is not to be resorted
to, "unless some other part of the same statute or the clear intention of it requires that
to be done." [Mersey Docks and Harbour Board v. Henderson Bros. (1888) 13 AC 603].
The Court adopted with approval Lord Halsbury's principle and in fact went further by
cautioning against substitution of conjunctions in the case of Municipal Corporation of
Delhi v. Tek Chand Bhatia MANU/SC/0187/1979 : (1980) 1 SCC 158, where the Court
held as under:-
11. ...As Lord Halsbury L.C. observed in Mersey Docks & Harbour Board v.
Henderson LR (1888) 13 AC 603, the reading of "or" as "and" is not to be
resorted to "unless some other part of the same statute or the clear intention of
it requires that to be done". The substitution of conjunctions, however, has
been sometimes made without sufficient reasons, and it has been doubted
whether some of the cases of turning "or" into "and" and vice versa have not
gone to the extreme limit of interpretation.
32. To us, the language of the Section is clear and the statute does not demand that we
should substitute 'or' or read this word interchangeably for achieving the object of the
Act. On the contrary, the objective of the Act is more than clear that the legislature
intended to provide a very limited right to appeal. The orders which can be appealed
against have been specifically stipulated by unambiguously excluding the provisions
which the legislature did not intend to make appealable under the provisions of the Act.
It is always expected of the Court to apply plain rule of construction rather than trying
to read the words into the statute which have been specifically omitted by the
legislature.
33. We may usefully refer to similar interpretation given by this Court in the case of
Super Cassettes Industries Ltd. v. State of U.P. MANU/SC/1677/2009 : (2009)10 SCC
531, wherein the Court was dealing with cancellation of a notice issued under Section
9(2) of the U.P. Imposition of Ceiling of Land Holdings Act, 1960, requiring submission
of a statement by the tenure holder for determination of surplus land in accordance with
law. Sub-section (1) of Section 13 of the said Act read as under:
13. Appeals--(1) Any party aggrieved by an order under Sub-section (2) of
Section 11 or Section 12, may, within thirty days of the date of the order,
prefer an appeal to the Commissioner within whose jurisdiction the land or any
part thereof is situate.
34. The State of UP through its Collector had preferred an appeal under Section 13 of
the Act against an order passed by the authority cancelling the notice which had been
issued under Section 9(2) of the Act. The contention raised was that the said order

amounted to an order being passed under Section 11(2) of the Act. An order passed
under Section 11(2) of the Act in furtherance of the statement prepared by the tenure
holder was final and conclusive and could not be called in question in any court of law.
The Court while interpreting the provisions of Section 13(1) held that it is only the
specific order passed under Section 11(2) and Section 12 of the Act which could be
appealed against and while applying its rule held as under:
23. It is well known that right of appeal is not a natural or inherent right. It
cannot be assumed to exist unless expressly provided for by statute. Being a
creature of statute, remedy of appeal must be legitimately traceable to the
statutory provisions....
xxx xxx xxx xxx
31. Section 13 provides a right of appeal to a party aggrieved by an order
under Sub-section (2) of Section 11 or Section 12 and no other. In other
words, any order passed by the Prescribed Authority other than the order
under-Section (2) of Section 11 or Section 12 is not appealable. From any
reckoning, the order dated December 17, 2003 is neither an order under Sub-
section (2) of Section 11 nor an order under Section 12. Act 1960 does not
make the order of the Prescribed Authority cancelling the notice issued under
Section 9(2) amenable to appeal. Such order does not fall within the ambit of
Section 13.
35. We find that the view taken by the Court in this case squarely applies to the case in
hand as well. Right to appeal is a creation of statute and it does require application of
rule of plain construction. Such provision should neither be construed too strictly nor
too liberally, if given either of these extreme interpretations, it is bound to adversely
affect the legislative object as well as hamper the proceedings before the appropriate
forum.
3 6 . In the case of Maria Cristina De Souza Sadder v. Amria Zurana Pereira Pinto
MANU/SC/0013/1978 : (1979) 1 SCC 92, this Court held as under:
5 ...It is no doubt well-settled that the right of appeal is a substantive right and
it gets vested in a litigant no sooner the lis is commenced in the Court of the
first instance, and such right or any remedy in respect thereof will not be
affected by any repeal of the enactment conferring such right unless the
repealing enactment either expressly or by necessary implication takes away
such right or remedy in respect thereof.
37. The principle of 'appeal being a statutory right and no party having a right to file
appeal except in accordance with the prescribed procedure' is now well settled. The
right of appeal may be lost to a party in face of relevant provisions of law in appropriate
cases. It being creation of a statute, legislature has to decide whether the right to
appeal should be unconditional or conditional. Such law does not violate Article 14 of
the Constitution. An appeal to be maintainable must have its genesis in the authority of
law. Reference may be made to M. Ramnarain Private Limited v. State Trading
Corporation of India Limited MANU/SC/0017/1983 : (1983) 3 SCC 75 and Gujarat Agro
Industries Co. Ltd. v. Municipal Corporation of the City of Ahmedabad
MANU/SC/0300/1999 : (1999) 4 SCC 468. Right of appeal is neither a natural nor
inherent right vested in a party. It is substantive statutory right regulated by the statute
creating it. The cases of Kondiba Dagadu Kadam v. Savitribai Sopan Gujar
MANU/SC/0278/1999 : (1999) 3 SCC 722 and Kashmir Singh v. Harnam Singh

MANU/SC/7267/2008 : AIR 2008 SC 1749 may be referred to on this point. Thus, it is
evident that the right to appeal is not a right which can be assumed by logical analysis
much less by exercise of inherent jurisdiction. It essentially should be provided by the
law in force. In absence of any specific provision creating a right in a party to file an
appeal, such right can neither be assumed nor inferred in favour of the party.
38. A statute is stated to be the edict of Legislature. It expresses the will of Legislature
and the function of the Court is to interpret the document according to the intent of
those who made it. It is a settled rule of construction of statute that the provisions
should be interpreted by applying plain rule of construction. The Courts normally would
not imply anything which is inconsistent with the words expressly used by the statute.
In other words, the Court would keep in mind that its function is jus dicere, not jus
dare. The right of appeal being creation of the statute and being a statutory right does
not invite unnecessarily liberal or strict construction. The best norm would be to give
literal construction keeping the legislative intent in mind.
39. This Court in the case of Shiv Shakti Co-op. Housing Society, Nagpur v. Swaraj
Developers MANU/SC/0335/2003 : (2003) 6 SCC 659, while referring to the principles
for interpretation of statutory provisions, held as under:
19. It is a well-settled principle in law that the Court cannot read anything into
a statutory provision which is plain and unambiguous. A statute is an edict of
the legislature. The language employed in a statute is the determinative factor
of legislative intent. Words and phrases are symbols that stimulate mental
references to referents. The object of interpreting a statute is to ascertain the
intention of the legislature enacting it. (See Institute of Chartered Accountants
of India v. Price Waterhouse.) The intention of the legislature is primarily to be
gathered from the language used, which means that attention should be paid to
what has been said as also to what has not been said. As a consequence, a
construction which requires for its support, addition or substitution of words or
which results in rejection of words as meaningless has to be avoided. As
observed in Crawford v. Spooner Courts cannot aid the legislatures' defective
phrasing of an Act, we cannot add or mend, and by construction make up
deficiencies which are left there. (See State of Gujarat v. Dilipbhai Nathjibhai
Patel). It is contrary to all rules of construction to read words into an Act unless
it is absolutely necessary to do so. [See Stock v. Frank Jones (Tipton) Ltd.]
Rules of interpretation do not permit Courts to do so, unless the provision as it
stands is meaningless or of a doubtful meaning. Courts are not entitled to read
words into an Act of Parliament unless clear reason for it is to be found within
the four corners of the Act itself. (Per Lord Loreburn, L.C. in Vickers Sons and
Maxim Ltd. v. Evans, quoted in Jumma Masjid v. Kodimaniandra Deviah.
40. The Law Commission of India, in its 183 rd Report, while dealing with the need for
providing principles of interpretation of statute as regards the extrinsic aids of
interpretation in General Clauses Act, 1897, expressed the view that a statute is a will of
legislature conveyed in the form of text. Noticing that the process of interpretation is as
old as language, it says that the rules of interpretation were evolved at a very early
stage of Hindu civilization and culture and the same were given by 'Jaimini', the author
of Mimamsat Sutras; originally meant for shrutis, they were employed for the
interpretation of Smritis as well. While referring to the said historical background, the
Law Commission said:
It is well settled principle of law that as the statute is an edict of the

Legislature, the conventional way of interpreting or construing a statute is to
seek the intention of legislature. The intention of legislature assimilates two
aspects; one aspect carries the concept of 'meaning', i.e., what the word means
and another aspect conveys the concept of 'purpose' and 'object' or the 'reason'
or 'spirit' pervading through the statute. The process of construction, therefore,
combines both the literal and purposive approaches. However, necessity of
interpretation would arise only where the language of a statutory provision is
ambiguous, not clear or where two views are possible or where the provision
gives a different meaning defeating the object of the statute. If the language is
clear and unambiguous, no need of interpretation would arise. In this regard, a
Constitution Bench of five Judges of the Supreme Court in R.S. Nayak v. A.R.
Antulay MANU/SC/0102/1984 : AIR 1984 SC 684 has held:
...If the words of the Statute are clear and unambiguous, it is the
plainest duty of the Court to give effect to the natural meaning of the
words used in the provision. The question of construction arises only in
the event of an ambiguity or the plain meaning of the words used in
the Statute would be self defeating.
Recently, again Supreme Court in Grasim Industries Ltd. v. Collector of
Customs, Bombay MANU/SC/0256/2002 : (2002) 4 SCC 297 has followed the
same principle and observed:
Where the words are clear and there is no obscurity, and there is no
ambiguity and the intention of the legislature is clearly conveyed, there
is no scope for Court to take upon itself the task of amending or
altering the statutory provisions.
41. Thus, the Court can safely apply rule of plain construction and legislative intent in
light of the object sought to be achieved by the enactment. While interpreting the
provisions of the Act, it is not necessary for the Court to implant, or to exclude the
words, or over emphasize language of the provision where it is plain and simple. The
provisions of the Act should be permitted to have their full operation rather than
causing any impediment in their application by unnecessarily expanding the scope of
the provisions by implication.
42. We are unable to persuade ourselves to agree with the reasoning given and view
taken by the Tribunal in this regard, in the impugned order. Even though the Tribunal
referred to the dictum of the Court in the case of Tek Chand Bhatia (supra), it still
concluded that the use of the words 'any' and 'or' were the expressions of wide
magnitude and that 'any' being an adjective qualifies the nouns under the relevant
provisions, i.e. directions, decisions and orders, all were appealable without exception.
4 3 . The expression 'any', in fact, qualifies each of the three expressions 'direction
issued or decision made or order passed'. It cannot be said that it signifies any one of
them and, particularly, only 'direction issued'. All these words have been used by the
legislature consciously and with a purpose. It has provided for complete mechanism
ensuring their implementation under the provisions of the Act, for example, under
Section 26(1) the Commission is expected to make a decision by formation of a prima
facie opinion and issue a direction to cause an investigation to be made by the Director
General and after receiving the report has to take a final view in terms of Section 26(6)
and even otherwise, it has the discretion to form an opinion and even close a case
under Section 26(2). Having enacted these provisions, the legislature in its wisdom,

made only the order under Section 26(2) and 26(6) appealable under Section 53A of
the Act. Thus, it specifically excludes the opinion/decision of the authority under
Section 26(1) and even an order passed under Section 26(7) directing further inquiry,
from being appealable before the Tribunal. Therefore, it would neither be permissible
nor advisable to make these provisions appealable against the legislative mandate.
4 4 . The existence of such excluding provisions, in fact, exists in different statutes.
Reference can even be made to the provisions of Section 100A of the Code of Civil
Procedure, where an order, which even may be a judgment, under the provisions of the
Letters Patent of different High Courts and are appealable within that law, are now
excluded from the scope of the appealable orders. In other words, instead of enlarging
the scope of appealable orders under that provision, the Courts have applied the rule of
plain construction and held that no appeal would lie in conflict with the provisions of
Section 100A of the Code of Civil Procedure.
4 5 . Expressum facit cessare tacitum - Express mention of one thing implies the
exclusion of other. (Expression precludes implication). This doctrine has been applied
by this Court in various cases to enunciate the principle that expression precludes
implication. Union of India v. Tulsiram Patel MANU/SC/0373/1985 : AIR 1985 SC 1416.
It is always safer to apply plain and primary rule of construction. The first and primary
rule of construction is that intention of the legislature is to be found in the words used
by the legislature itself. The true or legal meaning of an enactment is derived by
construing the meaning of the word in the light of the discernible purpose or object
which comprehends the mischief and its remedy to which an enactment is directed.
[State of Himachal Pradesh v. Kailash Chand Mahajan MANU/SC/0239/1992 : AIR 1992
SC 1277 and Padma Sundara Rao v. State of T.N. MANU/SC/0182/2002 : AIR 2002 SC
1334].
46. It is always important for the Court to keep in mind the purpose which lies behind
the statute while interpreting the statutory provisions. This was stated by this Court in
Padma Sundara Rao's case (supra) as under:-
11. ... The first and primary rule of construction is that the intention of the
legislation must be found in the words used by the legislature itself. The
question is not what may be supposed and has been intended but what has
been said. "Statutes should be construed, not as theorems of Euclid", Judge
Learned Hand said, "but words must be construed with some imagination of the
purposes which lie behind them". (See Lenigh Valley Coal Co. v. Yensavage 218
FR 547. The view was reiterated in Union of India v. Filip Tiago De Gama of
Vedem Vasco De Gama AIR 1990 SC 981.
4 7 . Applying these principles to the provisions of Section 53A(1)(a), we are of the
considered view that the appropriate interpretation of this provision would be that no
other direction, decision or order of the Commission is appealable except those
expressly stated in Section 53A(1)(a). The maxim est boni judicis ampliare justitiam,
non- jurisdictionem finds application here. Right to appeal, being a statutory right, is
controlled strictly by the provision and the procedure prescribing such a right. To read
into the language of Section 53A that every direction, order or decision of the
Commission would be appealable will amount to unreasonable expansion of the
provision, when the language of Section 53A is clear and unambiguous. Section 53B(1)
itself is an indicator of the restricted scope of appeals that shall be maintainable before
the Tribunal; it provides that the aggrieved party has a right of appeal against 'any
direction, decision or order referred to in Section 53A(1)(a).' If the legislature intended

to enlarge the scope and make orders, other than those, specified in Section 53A(1)(a),
then the language of Section 53B(1) ought to have been quite distinct from the one
used by the legislature.
48. One of the parties before the Commission would, in any case, be aggrieved by an
order where the Commission grants or declines to grant extension of time. Thus, every
such order passed by the Commission would have to be treated as appealable as per the
contention raised by the respondent before us as well as the view taken by the Tribunal.
In our view, such orders cannot be held to be appealable within the meaning and
language of Section 53A of the Act and also on the principle that they are not orders
which determine the rights of the parties. No appeal can lie against such an order. Still
the parties are not remediless as, when they prefer an appeal against the final order,
they can always take up grounds to challenge the interim orders/directions passed by
the Commission in the memorandum of appeal. Such an approach would be in
consonance with the procedural law prescribed in Order XLIII Rule 1A and even other
provisions of Code of Civil Procedure.
49. The above approach will subserve the purpose of the Act in the following manner:
First, expeditious disposal of matters before the Commission and the Tribunal is
an apparent legislative intent from the bare reading of the provisions of the Act
and more particularly the Regulations framed thereunder. Second, if every
direction or recording of an opinion are made appealable then certainly it would
amount to abuse of the process of appeal. Besides this, burdening the Tribunal
with appeals against non-appealable orders would defeat the object of the Act,
as a prolonged litigation may harm the interest of free and fair market and
economy. Finally, we see no ambiguity in the language of the provision, but
even if, for the sake of argument, we assume that the provision is capable of
two interpretations then we must accept the one which will fall in line with the
legislative intent rather than the one which defeat the object of the Act.
50. For these reasons, we have no hesitation in holding that no appeal will lie from any
decision, order or direction of the Commission which is not made specifically appealable
under Section 53A(1)(a) of the Act. Thus, the appeal preferred by SAIL ought to have
been dismissed by the Tribunal as not maintainable.
Submissions made and findings in relation to Point Nos. 2 & 5
5 1 . The issue of notice and hearing are squarely covered under the ambit of the
principles of natural justice. Thus, it will not be inappropriate to discuss these issues
commonly under the same head. The principle of audi alteram partem, as commonly
understood, means 'hear the other side or hear both sides before a decision is arrived
at'. It is founded on the rule that no one should be condemned or deprived of his right
even in quasi judicial proceedings unless he has been granted liberty of being heard.
52. In cases of Cooper v. Wands Worth Board of Works (1863) 14 C.B. (N.S.) 180 and
Errington v. Minister of Health (1935) 1 KB 249, the Courts in the United Kingdom had
enunciated this principle in the early times. This principle was adopted under various
legal systems including India and was applied with some limitations even to the field of
administrative law. However, with the development of law, this doctrine was expanded
in its application and the Courts specifically included in its purview, the right to notice
and requirement of reasoned orders, upon due application of mind in addition to the
right of hearing. These principles have now been consistently followed in judicial
dictum of Courts in India and are largely understood as integral part of principles of

natural justice. In other words, it is expected of a tribunal or any quasi judicial body to
ensure compliance of these principles before any order adverse to the interest of the
party can be passed. However, the exclusion of the principles of natural justice is also
an equally known concept and the legislature has the competence to enact laws which
specifically exclude the application of principles of natural justice in larger public
interest and for valid reasons. Generally, we can classify compliance or otherwise, of
these principles mainly under three categories. First, where application of principles of
natural justice is excluded by specific legislation; second, where the law contemplates
strict compliance to the provisions of principles of natural justice and default in
compliance thereto can result in vitiating not only the orders but even the proceedings
taken against the delinquent; and third, where the law requires compliance to these
principles of natural justice, but an irresistible conclusion is drawn by the competent
court or forum that no prejudice has been caused to the delinquent and the non-
compliance is with regard to an action of directory nature. The cases may fall in any of
these categories and therefore, the Court has to examine the facts of each case in light
of the Act or the Rules and Regulations in force in relation to such a case. It is not only
difficult but also not advisable to spell out any straight jacket formula which can be
applied universally to all cases without variation.
53. In light of the above principles, let us examine whether in terms of Section 26(1) of
the Act read with Regulations in force, it is obligatory upon the Commission to issue
notice to the parties concerned (more particularly the affected parties) and then form an
opinion as to the existence of a prima facie case, or otherwise, and to issue direction to
the Director General to conduct investigation in the matter.
54. At the very outset, we must make it clear that we are considering the application of
these principles only in light of the provisions of Section 26(1) and the finding recorded
by the Tribunal in this regard. The intimation received by the Commission from any
specific person complaining of violation of Section 3(4) read with Section 19 of the Act,
sets into the motion, the mechanism stated under Section 26 of the Act. Section 26(1),
as already noticed, requires the Commission to form an opinion whether or not there
exists a prima facie case for issuance of direction to the Director General to conduct an
investigation. This section does not mention about issuance of any notice to any party
before or at the time of formation of an opinion by the Commission on the basis of a
reference or information received by it. Language of Sections 3(4) and 19 and for that
matter, any other provision of the Act does not suggest that notice to the informant or
any other person is required to be issued at this stage. In contra-distinction to this,
when the Commission receives the report from the Director General and if it has not
already taken a decision to close the case under Section 26(2), the Commission is not
only expected to forward the copy of the report, issue notice, invite objections or
suggestions from the informant, Central Government, State Government, Statutory
Authorities or the parties concerned, but also to provide an opportunity of hearing to
the parties before arriving at any final conclusion under Section 26(7) or 26(8) of the
Act, as the case may be. This obviously means that wherever the legislature has
intended that notice is to be served upon the other party, it has specifically so stated
and we see no compelling reason to read into the provisions of Section 26(1) the
requirement of notice, when it is conspicuous by its very absence. Once the proceedings
before the Commission are completed, the parties have a right to appeal under Section
53A(1)(a) in regard to the orders termed as appealable under that provision. Section
53B requires that the Tribunal should give, parties to the appeal, notice and an
opportunity of being heard before passing orders, as it may deem fit and proper,
confirming, modifying or setting aside the direction, decision or order appealed against.

55. Some of the Regulations also throw light as to when and how notice is required to
be served upon the parties including the affected party. Regulation 14(7) states the
powers and functions, which are vested with the Secretary of the Commission to ensure
timely and efficient disposal of the matter and for achieving the objectives of the Act.
Under Regulation 14(7)(f) the Secretary of the Commission is required to serve notice
of the date of ordinary meeting of the Commission to consider the information or
reference or document to decide if there exists a prima facie case and to convey the
directions of the Commission for investigation, or to issue notice of an inquiry after
receipt and consideration of the report of the Director General. In other words, this
provision talks of issuing a notice for holding an ordinary meeting of the Commission.
This notice is intended to be issued only to the members of the Commission who
constitute 'preliminary conference' as they alone have to decide about the existence of a
prima facie case. Then, it has to convey the direction of the Commission to the Director
General. After the receipt of the report of the Director General, it has to issue notice to
the parties concerned.
56. Regulation 17(2) empowers the Commission to invite the information provider and
such other person, as is necessary, for the preliminary conference to aid in formation of
a prima facie opinion, but this power to invite cannot be equated with requirement of
statutory notice or hearing. Regulation 17(2), read in conjunction with other provisions
of the Act and the Regulations, clearly demonstrates that this provision contemplates to
invite the parties for collecting such information, as the Commission may feel
necessary, for formation of an opinion by the preliminary conference. Thereafter, an
inquiry commences in terms of Regulation 18(2) when the Commission directs the
Director General to make the investigation, as desired.
57. Regulation 21(8) also indicates that there is an obligation upon the Commission to
consider the objections or suggestions from the Central Government or the State
Government or the Statutory Authority or the parties concerned and then Secretary is
required to give a notice to fix the meeting of the Commission, if it is of the opinion
that further inquiry is called for. In that provision notice is contemplated not only to the
respective Governments but even to the parties concerned.
58. The notices are to be served in terms of Regulation 22 which specifies the mode of
service of summons upon the concerned persons and the manner in which such service
should be effected. The expression 'such other person', obviously, would include all
persons, such as experts, as stated in Regulation 52 of the Regulations. There is no
scope for the Court to arrive at the conclusion that such other person would exclude
anybody including the informant or the affected parties, summoning of which or notice
to whom, is considered to be appropriate by the Commission.
59. With some significance, we may also notice the provision of Regulation 33(4) of the
Regulations, which requires that on being satisfied that the reference is complete, the
Secretary shall place it during an ordinary meeting of the Commission and seek
necessary instructions regarding the parties to whom the notice of the meeting has to
be issued. This provision read with Sections 26(1) and 26(5) shows that the
Commission is expected to apply its mind as to whom the notice should be sent before
the Secretary of the Commission can send notice to the parties concerned. In other
words, issuance of notice is not an automatic or obvious consequence, but it is only
upon application of mind by the authorities concerned that notice is expected to be
issued.
60. Regulation 48, which deals with the procedure for imposition of penalty, requires

under Sub-Regulation (2) that show cause notice is to be issued to any person or
enterprise or a party to the proceedings, as the case may be, under Sub-Regulation (1),
giving him not less than 15 days time to explain the conduct and even grant an oral
hearing, then alone to pass an appropriate order imposing penalty or otherwise.
61. Issue of notice to a party at the initial stage of the proceedings, which are not
determinative in their nature and substance, can hardly be implied; wherever the
legislature so desires it must say so specifically. This can be illustrated by referring to
the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on
Dumped Articles and for Determination of Injury) Rules, 1995 under the Customs Tariff
Act, 1975. Rule 5(5) provides that while dealing with an application submitted by
aggrieved domestic producers accounting for not less than 25% of total production of
the like article, the designated authority shall notify the government of exporting
country before proceeding to initiate an investigation. Rule 6(1) also specifically
requires the designated authority to issue a public notice of the decision to initiate
investigation. In other words, notice prior to initiation of investigation is specifically
provided for under the Anti-Dumping Rules, whereas, it is not so under the provisions
of Section 26(1) of the Act.
62. Cumulative reading of these provisions, in conjunction with the scheme of the Act
and the object sought to be achieved, suggests that it will not be in consonance with
the settled rules of interpretation that a statutory notice or an absolute right to claim
notice and hearing can be read into the provisions of Section 26(1) of the Act.
Discretion to invite, has been vested in the Commission, by virtue of the Regulations,
which must be construed in their plain language and without giving it undue expansion.
63. It is difficult to state as an absolute proposition of law that in all cases, at all stages
and in all events the right to notice and hearing is a mandatory requirement of
principles of natural justice. Furthermore, that non- compliance thereof, would always
result in violation of fundamental requirements vitiating the entire proceedings.
Different laws have provided for exclusion of principles of natural justice at different
stages, particularly, at the initial stage of the proceedings and such laws have been
upheld by this Court. Wherever, such exclusion is founded on larger public interest and
is for compelling and valid reasons, the Courts have declined to entertain such a
challenge. It will always depend upon the nature of the proceedings, the grounds for
invocation of such law and the requirement of compliance to the principles of natural
justice in light of the above noticed principles. In the case of Tulsiram Patel (supra),
this Court took the view that audi alteram partem rule can be excluded where a right to
a prior notice and an opportunity of being heard, before an order is passed, would
obstruct the taking of prompt action or where the nature of the action to be taken, its
object and purpose as well as the scheme of the relevant statutory provisions warrant
its exclusion. This was followed with approval and also greatly expanded in the case of
Delhi Transport Corporation v. Delhi Transport Corporation Mazdoor Congress
MANU/SC/0031/1991 : (1991) Supp1 SCC 600, wherein the Court held that rule of audi
alteram partem can be excluded, where having regard to the nature of the action to be
taken, its object and purpose and the scheme of the relevant statutory provisions,
fairness in action does not demand its application and even warrants its exclusion. In
the case of Union of India v. W.N. Chadha MANU/SC/0149/1993 : (1993) Supp 4 SCC
260, wherein the Court was primarily concerned with Section 166(9) of the Criminal
Procedure Code and the application of principles of natural justice in the domain of
administrative law and while deciding whether a person was entitled to the right of
hearing, held as under:

88. The principle of law that could be deduced from the above decisions is that
it is no doubt true that the fact that a decision, whether a prima facie case has
or has not been made out, is not by itself determinative of the exclusion of
hearing, but the consideration that the decision was purely an administrative
one and a full-fledged inquiry follows is a relevant -- and indeed a significant --
factor in deciding whether at that stage there ought to be hearing which the
statute did not expressly grant.
89. Applying the above principle, it may be held that when the investigating
officer is not deciding any matter except collecting the materials for
ascertaining whether a prima facie case is made out or not and a full inquiry in
case of filing a report under Section 173(2) follows in a trial before the Court or
Tribunal pursuant to the filing of the report, it cannot be said that at that stage
rule of audi alteram partem superimposes an obligation to issue a prior notice
and hear the accused which the statute does not expressly recognise. The
question is not whether audi alteram partem is implicit, but whether the
occasion for its attraction exists at all.
64. The exclusion of principles of natural justice by specific legislative provision is not
unknown to law. Such exclusion would either be specifically provided or would have to
be imperatively inferred from the language of the provision. There may be cases where
post decisional hearing is contemplated. Still there may be cases where 'due process' is
specified by offering a full hearing before the final order is made. Of course, such
legislation may be struck down as offending due process if no safeguard is provided
against arbitrary action. It is an equally settled principle that in cases of urgency, a
post-decisional hearing would satisfy the principles of natural justice. Reference can be
made to the cases of Maneka Gandhi v. Union of India (1978) 1 SCC 48 and State of
Punjab v. Gurdayal MANU/SC/0433/1979 : AIR 1980 SC 319. The provisions of Section
26(1) clearly indicate exclusion of principles of natural justice, at least at the initial
stages, by necessary implication. In cases where the conduct of an enterprise,
association of enterprises, person or association of persons or any other legal entity, is
such that it would cause serious prejudice to the public interest and also violates the
provisions of the Act, the Commission will be well within its jurisdiction to pass ex
parte ad interim injunction orders immediately in terms of Section 33 of the Act, while
granting post decisional hearing positively, within a very short span in terms of
Regulation 31(2). This would certainly be more than adequate compliance to the
principles of natural justice.
6 5 . It is true that in administrative action, which entails civil consequences for a
person, the principles of natural justice should be adhered to. In the case of Raj
Restaurant and Anr. v. Municipal Corporation of Delhi MANU/SC/0019/1982 : (1982) 3
SCC 338, the Supreme Court held as under:
5. Where, in order to carry on business a licence is required, obviously refusal
to give licence or cancellation or revocation of licence would be visited with
both civil and pecuniary consequences and as the business cannot be carried on
without the licence it would also affect the livelihood of the person. In such a
situation before either refusing to renew the licence or cancelling or revoking
the same, the minimum principle of natural justice of notice and opportunity to
represent one's case is a must. It is not disputed that no such opportunity was
given before taking the decision not to renew the licence though it is admitted
that the for the reasons herein before set out the licence was not renewed such
a decision in violation of the principle of natural justice would b void. Now, it is

true that no specific order is made setting out the reason for refusal to renew
the licence. But the action taken of sealing the premises for carrying on the
business without a licence clearly implies that there was refusal to renew the
licence and the reasons are now disclosed. And the action disclosing the
decision being in violation of the principle of natural justice, deserves to be
quashed.
66. Wherever, this Court has dealt with the matters relating to complaint of violation of
principles of natural justice, it has always kept in mind the extent to which such
principles should apply. The application, therefore, would depend upon the nature of
the duty to be performed by the authority under the statute. Decision in this regard is,
in fact, panacea to the rival contentions which may be raised by the parties in a given
case. Reference can be made to the judgment of this Court in the case of Canara Bank
v. Debasis Das MANU/SC/0225/2003 : (2003) 4 SCC 557. We may also notice that the
scope of duty cast upon the authority or a body and the nature of the function to be
performed cannot be rendered nugatory by imposition of unnecessary directions or
impediments which are not postulated in the plain language of the section itself.
'Natural justice' is a term, which may have different connotation and dimension
depending upon the facts of the case, while keeping in view, the provisions of the law
applicable. It is not a codified concept, but are well defined principles enunciated by the
Courts. Every quasi judicial order would require the concerned authority to act in
conformity with these principles as well as ensure that the indicated legislative object is
achieved. Exercise of power should be fair and free of arbitrariness.
6 7 . Now, let us examine what kind of function the Commission is called upon to
discharge while forming an opinion under Section 26(1) of the Act. At the face of it, this
is an inquisitorial and regulatory power. A Constitution Bench of this Court in the case
of Krishna Swami v. Union of India MANU/SC/0222/1993 : (1992) 4 SCC 605 explained
the expression 'inquisitorial'. The Court held that the investigating power granted to the
administrative agencies normally is inquisitorial in nature. The scope of such
investigation has to be examined with reference to the statutory powers. In that case
the Court found that the proceedings, before the High Power Judicial Committee
constituted, were neither civil nor criminal but sui generis. Referring to the investigation
under criminal jurisprudence as well as scope of inquiry under service jurisprudence,
the Court held as under:
61. The problem could be broached through a different perspective as well. In
normal parlance, in a criminal case, investigation connotes discovery and
collection of evidence before charge-sheet is filed and based thereon definite
charges are framed. Inquiry by a Magistrate is stopped when the trial begins.
The trial is a culminating process to convict or acquit an accused. In Service
Jurisprudence, departmental inquiry against a delinquent employee, bears
similar insignia to impose penalty. At the investigation stage the accused or the
charged officer has no say in the matter nor is he entitled to any opportunity.
The disciplinary authority or inquiry officer, if appointed, on finding that the
evidence discloses prima facie ground to proceed against the delinquent officer,
the inquiry would be conducted. The criminal court frames charges after
supplying the record of investigation relied on. Equally, the disciplinary
authority/inquiry officer would frame definite charge or charges and would
communicate the same together with a statement of the facts in support thereof
sought to be relied on and would call upon the delinquent officer to submit his
explanation or written statement of defence etc. At the trial/inquiry the person
is entitled to reasonable opportunity to defend himself....

68. The exceptions to the doctrine of audi alteram partem are not unknown either to
civil or criminal jurisprudence in our country where under the Code of Civil Procedure
ex-parte injunction orders can be passed by the court of competent jurisdiction while
the courts exercising criminal jurisdiction can take cognizance of an offence in absence
of the accused and issue summons for his appearance. Not only this, the Courts even
record pre-charge evidence in complaint cases in absence of the accused under the
provisions of the Code of Criminal Procedure. Similar approach is adopted under
different systems in different countries. Reference in this regard can be made to the
case of Azienda Colori Nazionali ACNA S.P.A. v. Commission of the European
Communities (1972) ECR 0933, where the argument was raised that the Commission
had infringed the administrative procedure laid down in Regulation No. 17/62 of the
European Council Regulation. In that case the Commission of the European
Communities sent the notice of the objections to the applicant at the time of informing
the applicant about the decision to initiate procedure to establish infringement of rules
on competition. The European Court of Justice while holding that sending notification of
the above mentioned decision simultaneously with the notice of objections cannot affect
the rights of the defence, stated as under:
10. Neither the provisions in force nor the general principles of law require
notice of the Decision to initiate the procedure to establish an infringement to
be given prior to notification of the objections adopted against the interested
parties in the context of such proceedings.
1 1 . It is the notice of objections alone and not the Decision to commence
proceedings which is the measure stating the final attitude of the Commission
concerning undertakings against which proceedings for infringement of the
rules on competition have been commenced.
6 9 . The jurisdiction of the Commission, to act under this provision, does not
contemplate any adjudicatory function. The Commission is not expected to give notice
to the parties, i.e. the informant or the affected parties and hear them at length, before
forming its opinion. The function is of a very preliminary nature and in fact, in common
parlance, it is a departmental function. At that stage, it does not condemn any person
and therefore, application of audi alteram partem is not called for. Formation of a prima
facie opinion departmentally (Director General, being appointed by the Central
Government to assist the Commission, is one of the wings of the Commission itself)
does not amount to an adjudicatory function but is merely of administrative nature. At
best, it can direct the investigation to be conducted and report to be submitted to the
Commission itself or close the case in terms of Section 26(2) of the Act, which order
itself is appealable before the Tribunal and only after this stage, there is a specific right
of notice and hearing available to the aggrieved/affected party. Thus, keeping in mind
the nature of the functions required to be performed by the Commission in terms of
Section 26(1), we are of the considered view that the right of notice of hearing is not
contemplated under the provisions of Section 26(1) of the Act. However, Regulation
17(2) gives right to Commission for seeking information, or in other words, the
Commission is vested with the power of inviting such persons, as it may deem
necessary, to render required assistance or produce requisite information or documents
as per the direction of the Commission. This discretion is exclusively vested in the
Commission by the legislature. The investigation is directed with dual purpose; (a) to
collect material and verify the information, as may be, directed by the Commission, (b)
to enable the Commission to examine the report upon its submission by the Director
General and to pass appropriate orders after hearing the parties concerned. No inquiry
commences prior to the direction issued to the Director General for conducting the

investigation. Therefore, even from the practical point of view, it will be required that
undue time is not spent at the preliminary stage of formation of prima facie opinion and
the matters are dealt with effectively and expeditiously.
70. We may also usefully note that the functions performed by the Commission under
Section 26(1) of the Act are in the nature of preparatory measures in contrast to the
decision making process. That is the precise reason that the legislature has used the
word 'direction' to be issued to the Director General for investigation in that provision
and not that the Commission shall take a decision or pass an order directing inquiry into
the allegations made in the reference to the Commission.
71. The Tribunal, in the impugned judgment, has taken the view that there is a
requirement to record reasons which can be express, or, in any case, followed by
necessary implication and therefore, the authority is required to record reasons for
coming to the conclusion. The proposition of law whether an administrative or quasi
judicial body, particularly judicial courts, should record reasons in support of their
decisions or orders is no more res integra and has been settled by a recent judgment of
this Court in the case of Assistant Commissioner, C.T.D.W.C. v. Shukla and Brothers
MANU/SC/0258/2010 : JT 2010 (4) SC 35, wherein this Court was primarily concerned
with the High Court dismissing the appeals without recording any reasons. The Court
also examined the practice and requirement of providing reasons for conclusions, orders
and directions given by the quasi-judicial and administrative bodies. The Court
examined various judgments of this Court in relation to its application to administrative
law and held as under:
1 0 . The Supreme Court in the case of S.N. Mukherjee v. Union of India
MANU/SC/0346/1990 : (1990) 4 SCC 594, while referring to the practice
adopted and insistence placed by the Courts in United States, emphasized the
importance of recording of reasons for decisions by the administrative
authorities and tribunals. It said "administrative process will best be vindicated
by clarity in its exercise". To enable the Courts to exercise the power of review
in consonance with settled principles, the authorities are advised of the
considerations underlining the action under review. This Court with approval
stated:
the orderly functioning of the process of review requires that the
grounds upon which the administrative agency acted be clearly
disclosed and adequately sustained.
xxx xxx xxx xxx
12. At the cost of repetition, we may notice, that this Court has consistently
taken the view that recording of reasons is an essential feature of dispensation
of justice. A litigant who approaches the Court with any grievance in
accordance with law is entitled to know the reasons for grant or rejection of his
prayer. Reasons are the soul of orders. Non-recording of reasons could lead to
dual infirmities; firstly, it may cause prejudice to the affected party and
secondly, more particularly, hamper the proper administration of justice. These
principles are not only applicable to administrative or executive actions, but
they apply with equal force and, in fact, with a greater degree of precision to
judicial pronouncements. A judgment without reasons causes prejudice to the
person against whom it is pronounced, as that litigant is unable to know the
ground which weighed with the Court in rejecting his claim and also causes

impediments in his taking adequate and appropriate grounds before the higher
Court in the event of challenge to that judgment...
13. The principle of natural justice has twin ingredients; firstly, the person who
is likely to be adversely affected by the action of the authorities should be given
notice to show cause thereof and granted an opportunity of hearing and
secondly, the orders so passed by the authorities should give reason for
arriving at any conclusion showing proper application of mind. Violation of
either of them could in the given facts and circumstances of the case, vitiate the
order itself. Such rule being applicable to the administrative authorities
certainly requires that the judgment of the Court should meet with this
requirement with higher degree of satisfaction. The order of an administrative
authority may not provide reasons like a judgment but the order must be
supported by the reasons of rationality. The distinction between passing of an
order by an administrative or quasi-judicial authority has practically
extinguished and both are required to pass reasoned orders...
72. In this very judgment, the Court while referring to other decisions of the Court held
that it is essential that administrative authorities and tribunals should accord fair and
proper hearing to the affected persons and record explicit reasons in support of the
order made by them. Even in cases of supersession, it was held in Gurdial Singh Fijji v.
State of Punjab MANU/SC/0455/1979 : (1979) 2 SCC 368 that reasons for supersession
should be essentially provided in the order of the authority. Reasons are the links
between the materials on which certain conclusions are based and the actual
conclusions. By practice adopted in all courts and by virtue of judge- made law, the
concept of reasoned judgment has become an indispensable part of basic rule of law
and in fact, is a mandatory requirement of the procedural law. Clarity of thoughts leads
to clarity of vision and therefore, proper reasoning is foundation of a just and fair
decision. Reference can be made to Alexander Machinery (Dudley) Ltd. v. Crabtree 1974
ICR 120 in this regard.
73. The above reasoning and the principles enunciated, which are consistent with the
settled canons of law, we would adopt even in this case. In the backdrop of these
determinants, we may refer to the provisions of the Act. Section 26, under its different
Sub-sections, requires the Commission to issue various directions, take decisions and
pass orders, some of which are even appealable before the Tribunal. Even if it is a
direction under any of the provisions and not a decision, conclusion or order passed on
merits by the Commission, it is expected that the same would be supported by some
reasoning. At the stage of forming a prima facie view, as required under Section 26(1)
of the Act, the Commission may not really record detailed reasons, but must express its
mind in no uncertain terms that it is of the view that prima facie case exists, requiring
issuance of direction for investigation to the Director General. Such view should be
recorded with reference to the information furnished to the Commission. Such opinion
should be formed on the basis of the records, including the information furnished and
reference made to the Commission under the various provisions of the Act, as afore-
referred. However, other decisions and orders, which are not directions simpliciter and
determining the rights of the parties, should be well reasoned analyzing and deciding
the rival contentions raised before the Commission by the parties. In other words, the
Commission is expected to express prima facie view in terms of Section 26(1) of the
Act, without entering into any adjudicatory or determinative process and by recording
minimum reasons substantiating the formation of such opinion, while all its other
orders and decisions should be well reasoned.

74. Such an approach can also be justified with reference to Regulation 20(4), which
requires the Director General to record, in his report, findings on each of the allegations
made by a party in the intimation or reference submitted to the Commission and sent
for investigation to the Director General, as the case may be, together with all evidence
and documents collected during investigation. The inevitable consequence is that the
Commission is similarly expected to write appropriate reasons on every issue while
passing an order under Sections 26 to 28 of the Act.
75. The concept of necessary and proper parties is an accepted norm of civil law and its
principles can safely be applied to the proceedings before the Tribunal to a limited
extent. Even some provisions of the Act and the Regulations would guide the discussion
in this behalf. In terms of Section 7(2) of the Act the Commission is a body corporate
having perpetual succession and a common seal with power to sue and be sued in its
name. In terms of Section 53A, the Tribunal is constituted to hear and dispose of
appeals against any direction issued, decision made or order passed under the
provisions stated therein. The Tribunal is also vested with the power of determining the
claim of compensation that may arise from the findings recorded by the Commission. As
already noticed, the procedure for entertaining the appeals is specified under Section
53B of the Act.
7 6 . The right to prefer an appeal is available to the Central Government, State
Government or a local authority or enterprise or any person aggrieved by any direction,
decision or order referred to in Clause (a) of Section 53A (ought to be printed as
53A(1)(a)). The appeal is to be filed within the period specified and Section 53B(3)
further requires that the Tribunal, after giving the parties to appeal an opportunity of
being heard, to pass such orders, as it thinks fit, and send a copy of such order to the
Commission and the parties to the appeal. Section 53S contemplates that before the
Tribunal a person may either appear 'in person' or authorize one or more chartered
accountants or company secretaries, cost accountants or legal practitioners or any of its
officers to present its case before the Tribunal. However, the Commission's right to
legal representation in any appeal before the Tribunal has been specifically mentioned
under Section 53S(3). It provides that the Commission may authorize one or more of
chartered accountants or company secretaries or cost accountants or legal practitioners
or any of its officers to act as presenting officers before the Tribunal.
77. Section 53T grants a right in specific terms to the Commission to prefer an appeal
before the Supreme Court within 60 days from the date of communication of the
decision or order of the Tribunal to them.
78. The expression 'any person' appearing in Section 53B has to be construed liberally
as the provision first mentions specific government bodies then local authorities and
enterprises, which term, in any case, is of generic nature and then lastly mentions 'any
person'. Obviously, it is intended that expanded meaning be given to the term 'persons',
i.e.\1, persons or bodies who are entitled to appeal. The right of hearing is also
available to the parties to appeal. The above stated provisions clearly indicate that the
Commission a body corporate, is expected to be party in the proceedings before the
Tribunal as it has a legal right of representation. Absence of the Commission before the
Tribunal will deprive it of presenting its views in the proceedings. Thus, it may not be
able to effectively exercise its right to appeal in terms of Section 53 of the Act.
Furthermore, Regulations 14(4) and 51 support the view that the Commission can be a
necessary or a proper party in the proceedings before the Tribunal. The Commission, in

terms of Section 19 read with Section 26 of the Act, is entitled to commence
proceedings suo moto and adopt its own procedure for completion of such proceedings.
Thus, the principle of fairness would demand that such party should be heard by the
Tribunal before any orders adverse to it are passed in such cases. The Tribunal has
taken this view and we have no hesitation in accepting that in cases where proceedings
initiated suo moto by the Commission, the Commission is a necessary party. However,
we are also of the view that in other cases the Commission would be a proper party. It
would not only help in expeditious disposal, but the Commission, as an expert body, in
any case, is entitled to participate in its proceedings in terms of Regulation 51. Thus,
the assistance rendered by the Commission to the Tribunal could be useful in complete
and effective adjudication of the issue before it.
79. Regulations 24 to 26 define powers of the Commission to join or substitute parties
in proceedings, permit person or enterprises to take part in proceedings and strike out
unnecessary parties. Out of these provisions regulation 25(1) has a distinct feature as it
lays down the criteria which should be considered by the Commission while applying its
mind in regard to application of a party for impleadment. The person or enterprise
sought to be impleaded should have substantial interest in the outcome of the
proceedings and/or that it is necessary in the public interest to allow such an
application. In other words, substantial interest in proceedings and serving of larger
public interest, amongst others, are the criteria which could be considered by the
Commission. This principle would obviously stand extended for exercise of jurisdiction
by the Tribunal. In our view, the Commission would have substantial interest in the
outcome of the proceedings in most of the cases as not only would the judgments of
the Tribunal be binding on it, but they would also provide guidelines for determining
various matters of larger public interest and affect the economic policy of the country.
80. In light of the above statutory provisions, let us examine the scheme under the
general principles as well. The provisions of Order I Rule 10 of Code of Civil Procedure
control the parties to the proceedings and their addition or deletion thereof. Wide
discretion is vested in the Court/appropriate forum in regard to impleadment of
necessary and proper parties to the proceedings. Of course, such discretion has to be
exercised in accordance with provisions of law and the principles enunciated by various
judicial pronouncements. The consideration before the Court, while determining such a
question, is whether the said party is a necessary or a proper party and its presence
before the Court is essential for complete and effective adjudication of the subject
matter, inter alia, it should also be kept in mind that multiplicity of litigation is to be
avoided and that the necessary or proper party should not be left out from the
proceedings, particularly, before the tribunal or the forum.
81. These principles were stated by this Court in Udit Narain Singh Malpaharia v. Addl.
Member, Board of Revenue, Bihar MANU/SC/0045/1962 : AIR 1963 SC 786, wherein
this Court has held as under:-
7. To answer the question raised it would be convenient at the outset to
ascertain who are necessary or proper parties in a proceeding. The law on the
subject is well settled: it is enough if we state the principle. A necessary party
is one without whom no order can be made effectively; a proper party is one in
whose absence an effective order can be made but whose presence is necessary
for a complete and final decision on the question involved in the proceeding.
82. Another way to examine the matter is that if the proceedings cannot be concluded
completely and effectively in absence of a party, that party should be normally

impleaded as a party before the Court, of course, subject to other restrictions in law.
While non-joinder of necessary parties may prove fatal, the non-joinder of proper
parties may not be fatal to the proceedings, but would certainly adversely affect interest
of justice and complete adjudication of the proceedings before the appropriate forum.
8 3 . As a normal rule, the applicant/informant is dominus litis and has the right to
control the proceedings, but at the same time, such applicant is required to notify all
other parties against whom the applicant wishes to proceed. Even if an applicant fails to
join a party the Court has the discretion to direct joining of such party as the question
of impleadment has to be decided on the touchstone of Order I Rule 10 which provides
that a necessary or proper party may be added. [Ramesh Hirachand Kundanmal v.
Municipal Corporation of Greater Bombay MANU/SC/0493/1992 : (1992) 2 SCC 524.
84. In the proceedings, which are initiated by the Commission suo moto, it shall be
dominus litis of such proceedings while in other cases, the Commission being a
regulatory body would be a proper party discharging inquisitorial, regulatory as well as
adjudicatory functions and its presence before the Tribunal, particularly, in light of the
above stated provisions, would be proper. The purpose is always to achieve complete,
expeditious and effective adjudication. This Court in the case of Brahm Dutt v. Union of
India MANU/SC/0054/2005 : (2005) 2 SCC 431, while considering the constitutional
validity of Section 8 of the Act observed that the Commission is an expert body which
had been created in consonance with international practice. The Court observed that it
might be appropriate if two bodies are created for performing two kinds of functions,
one, advisory and regulatory and other adjudicatory. Though the Tribunal has been
constituted by the Competition (Amendment) Act, 2007, the Commission continues to
perform both the functions stated by this Court in that case. Cumulative effect of the
above reasoning is that the Commission would be a necessary and/or a proper party in
the proceedings before the Tribunal.
85. Under this issue we have to discuss the ambit and scope of the powers vested in
the Commission under Section 33 of the Act. In order to objectively analyze the content
of the submissions made before us, it will be appropriate to refer to the provisions of
the said Section, which read as under:
33. Power to issue interim orders. - Where during an inquiry, the Commission
is satisfied that an act in contravention of Sub-section (1) of Section 3 or Sub-
section (1) of Section 4 or Section 6 has been committed and continues to be
committed or that such act is about to be committed, the Commission may, by
order, temporarily restrain any party from carrying on such act until the
conclusion of such inquiry or until further orders, without giving notice to such
party, where it deems it necessary
86. A bare reading of the above provision shows that the most significant expression
used by the legislature in this provision is 'during inquiry'. 'During inquiry', if the
Commission is satisfied that an act in contravention of the stated provisions has been
committed, continues to be committed or is about to be committed, it may temporarily
restrain any party 'without giving notice to such party', where it deems necessary. The
first and the foremost question that falls for consideration is, what is 'inquiry'? The
word 'inquiry' has not been 69 defined in the Act, however, Regulation 18(2) explains
what is 'inquiry'. 'Inquiry' shall be deemed to have commenced when direction to the
Director General is issued to conduct investigation in terms of Regulation 18(2). In

other words, the law shall presume that an 'inquiry' is commenced when the
Commission, in exercise of its powers under Section 26(1) of the Act, issues a direction
to the Director General. Once the Regulations have explained 'inquiry' it will not be
permissible to give meaning to this expression contrary to the statutory explanation.
Inquiry and investigation are quite distinguishable, as is clear from various provisions
of the Act as well as the scheme framed thereunder. The Director General is expected to
conduct an investigation only in terms of the directive of the Commission and
thereafter, inquiry shall be deemed to have commenced, which continues with the
submission of the report by the Director General, unlike the investigation under the
MRTP Act, 1969, where the Director General can initiate investigation suo moto. Then
the Commission has to consider such report as well as consider the objections and
submissions made by other party. Till the time final order is passed by the Commission
in accordance with law, the inquiry under this Act continues. Both these expressions
cannot be treated as synonymous. They are distinct, different in expression and operate
in different areas. Once the inquiry has begun, then alone the Commission is expected
to exercise its powers vested under Section 33 of the Act. That is the stage when
jurisdiction of the Commission can be invoked by a party for passing of an ex parte
order. Even at that stage, the Commission is required to record a satisfaction that there
has been contravention of the provisions mentioned under Section 33 and that such
contravention has been committed, continues to be committed or is about to be
committed. This satisfaction has to be understood differently from what is required
while expressing a prima facie view in terms of Section 26(1) of the Act. The former is
a definite expression of the satisfaction recorded by the Commission upon due
application of mind while the latter is a tentative view at that stage. Prior to any
direction, it could be a general examination or enquiry of the information/reference
received by the Commission, but after passing the direction the inquiry is more definite
in its scope and may be directed against a party. Once such satisfaction is recorded, the
Commission is vested with the power and the informant is entitled to claim ex parte
injunction. The legislature has intentionally used the words not only 'ex parte' but also
'without notice to such party'. Again for that purpose, it has to apply its mind, whether
or not it is necessary to give such a notice. The intent of the rule is to grant ex parte
injunction, but it is more desirable that upon passing an order, as contemplated under
Section 33, it must give a short notice to the other side to appear and to file objections
to the continuation or otherwise of such an order. Regulation 31(2) of the Regulations
clearly mandates such a procedure. Wherever the Commission has passed interim order,
it shall hear the parties against whom such an order has been made, thereafter, as soon
as possible. The expression 'as soon as possible' appearing in Regulation 31(2) has
some significance and it will be obligatory upon the fora dealing with the matters to
ensure compliance to this legislative mandate. Restraint orders may be passed in
exercise of its jurisdiction in terms of Section 33 but it must be kept in mind that the ex
parte restraint orders can have far reaching consequences and, therefore, it will be
desirable to pass such order in exceptional circumstances and deal with these matters
most expeditiously.
8 7 . During an inquiry and where the Commission is satisfied that the act has been
committed and continues to be committed or is about to be committed, in contravention
of the provisions stated in Section 33 of the Act, it may issue an order temporarily
restraining the party from carrying on such act, until the conclusion of such inquiry or
until further orders, without giving notice to such party where it deems it necessary.
This power has to be exercised by the Commission sparingly and under compelling and
exceptional circumstances. The Commission, while recording a reasoned order, inter
alia, should: (a) record its satisfaction (which has to be of much higher degree than
formation of a prima facie view under Section 26(1) of the Act) in clear terms that an

act in contravention of the stated provisions has been committed and continues to be
committed or is about to be committed; (b) it is necessary to issue order of restraint
and (c) from the record before the Commission, there is every likelihood that the party
to the lis would suffer irreparable and irretrievable damage, or there is definite
apprehension that it would have adverse effect on competition in the market.
88. The power under Section 33 of the Act, to pass a temporary restraint order, can
only be exercised by the Commission when it has formed prima facie opinion and
directed investigation in terms of Section 26(1) of the Act, as is evident from the
language of this provision read with Regulation 18(2) of the Regulations.
89. It will be useful to refer to the judgment of this Court in the case of Morgan Stanley
Mutual Funds v. Kartick Das MANU/SC/0553/1994 : (1994) 4 SCC 225, wherein this
Court was concerned with Consumer Protection Act 1986, Companies Act 1956 and
Securities and Exchange Board of India (Mutual Fund) Regulations, 1993. As it appears
from the contents of the judgment, there is no provision for passing ex-parte interim
orders under the Consumer Protection Act, 1986 but the Court nevertheless dealt with
requirements for the grant of an ad interim injunction, keeping in mind the expanding
nature of the corporate sector as well as the increase in vexatious litigation. The Court
spelt out the following principles:
36. As a principle, ex parte injunction could be granted only under exceptional
circumstances. The factors which should weigh with the court in the grant of ex
parte injunction are--
(a) whether irreparable or serious mischief will ensue to the plaintiff;
(b) whether the refusal or ex parte injunction would involve greater
injustice than the grant of it would involve;
(c) the court will also consider the time at which the plaintiff first had
notice of the act complained so that the making of improper order
against a party in his absence is prevented;
(d) the court will consider whether the plaintiff had acquiesced for
sometime and in such circumstances it will not grant ex parte
injunction;
(e) the court would expect a party applying for ex parte injunction to
show utmost good faith in making the application;
(f) even if granted, the ex parte injunction would be for a limited
period of time.
(g) General principles like prima facie case, balance of convenience and
irreparable loss would also be considered by the court.
90. In the case in hand, the provisions of Section 33 are specific and certain criteria
have been specified therein, which need to be satisfied by the Commission, before it
passes an ex parte ad interim order. These three ingredients we have already spelt out
above and at the cost of repetition we may notice that there has to be application of
mind of higher degree and definite reasons having nexus to the necessity for passing
such an order need be stated. Further, it is required that the case of the informant-
applicant should also be stronger than a mere prima facie case. Once these ingredients

are satisfied and where the Commission deems it necessary, it can pass such an order
without giving notice to the other party. The scope of this power is limited and is
expected to be exercised in appropriate circumstances. These provisions can hardly be
invoked in each and every case except in a reasoned manner. Wherever, the applicant is
able to satisfy the Commission that from the information received and the documents in
support thereof, or even from the report submitted by the Director General, a strong
case is made out of contravention of the specified provisions relating to anti-
competitive agreement or an abuse of dominant position and it is in the interest of free
market and trade that injunctive orders are called for, the Commission, in its discretion,
may pass such order ex parte or even after issuing notice to the other side.
91. For these reasons, we may conclude that the Commission can pass ex parte ad
interim restraint orders in terms of Section 33, only after having applied its mind as to
the existence of a prima facie case and issue direction to the Director General for
conducting an investigation in terms of Section 26(1) of the Act. It has the power to
pass ad interim ex parte injunction orders, but only upon recording its due satisfaction
as well as its view that the Commission deemed it necessary not to give a notice to the
other side. In all cases where ad interim ex parte injunction is issued, the Commission
must ensure that it makes the notice returnable within a very short duration so that
there is no abuse of the process of law and the very purpose of the Act is not defeated.
92. In light of the above discussion, the next question that we are required to consider
is, whether the Court should issue certain directions while keeping in mind the scheme
of the Act, legislative intent and the object sought to be achieved by enforcement of
these provisions. We have already noticed that the principal objects of the Act, in terms
of its Preamble and Statement of Objects and Reasons, are to eliminate practices having
adverse effect on the competition, to promote and sustain competition in the market, to
protect the interest of the consumers and ensure freedom of trade carried on by the
participants in the market, in view of the economic developments in the country. In
other words, the Act requires not only protection of free trade but also protection of
consumer interest. The delay in disposal of cases, as well as undue continuation of
interim restraint orders, can adversely and prejudicially affect the free economy of the
country. Efforts to liberalize the Indian Economy to bring it at par with the best of the
economies in this era of globalization would be jeopardised if time bound schedule and,
in any case, expeditious disposal by the Commission is not adhered to. The scheme of
various provisions of the Act which we have already referred to including Sections 26,
29, 30, 31, 53B(5) and 53T and Regulations 12, 15, 16, 22, 32, 48 and 31 clearly show
the legislative intent to ensure time bound disposal of such matters.
93. The Commission performs various functions including regulatory, inquisitorial and
adjudicatory. The powers conferred by the Legislature upon the Commission under
Sections 27(d) and 31(3) are of wide magnitude and of serious ramifications. The
Commission has the jurisdiction even to direct that an agreement entered into between
the parties shall stand modified to the extent and in the manner, as may be specified.
Similarly, where it is of the opinion that the combination has, or is likely to have, an
appreciable adverse effect on competition but such adverse effect can be eliminated by
suitable modification to such combination, the Commission is empowered to direct such
modification. These powers of the Commission, read with provisions mentioned earlier,
certainly require issuance of certain directions in order to achieve the object of the Act
and to ensure its proper implementation. The power to restructure the agreement can be
brought into service and matters dealt with expeditiously, rather than passing of ad

interim orders in relation to such agreements, which may continue for indefinite
periods. To avoid this mischief, it is necessary that wherever the Commission exercises
its jurisdiction to pass ad interim restraint orders, it must do so by issuing notices for a
short date and deal with such applications expeditiously. Order XXXIX, Rules 3 and 3A
of the Code of Civil Procedure also have similar provisions. Certain procedural
directions will help in avoiding prejudicial consequences, against any of the parties to
the proceedings and the possibility of abuse of jurisdiction by the parties can be
eliminated by proper exercise of discretion and for valid reasons. Courts have been
issuing directions in appropriate cases and wherever the situation has demanded so.
Administration of justice does not depend on individuals, but it has to be a collective
effort at all levels of the judicial hierarchy, i.e. the hierarchy of the Courts or the fora
before whom the matters are sub-judice, so that the persons awaiting justice can
receive the same in a most expeditious and effective manner. The approach of the
Commission even in its procedural matters, therefore, should be macro level rather than
micro level. It must deal with all such references or applications expeditiously in
accordance with law and by giving appropriate reasons. Thus, we find it necessary to
issue some directions which shall remain in force till appropriate regulations in that
regard are framed by the competent authority.
Findings on Merits:
9 4 . Having examined various legal issues arising in the present case, we will now
revert back to the facts of the case in hand. It is clear that Jindal Steel, the informant,
had made a reference to the Commission. The Commission had initiated proceedings
and asked for further information from the informant and thereafter, had even issued
notice calling upon SAIL to submit its views and comments. From the record it is clear
that parties had appeared before the Commission. The SAIL had failed to file the reply
and prayed for extension of time, which was declined by the Commission in its order
dated 8th December, 2009. The Director General was asked to conduct the
investigation, but liberty was granted to SAIL to file its views and comments during the
pendency of the investigation. Since further time was declined, SAIL preferred an
appeal before the Tribunal, which resulted in passing of the order impugned in the
present appeal. We are unable to accede to the submission that the Commission is not a
necessary or proper party before the Tribunal. On the contrary, the Regulations and
even the interest of justice demands that for complete and effective adjudication the
Commission be added as a necessary and proper party in the proceedings before the
Tribunal. The direction issued by the Commission was set aside by the Tribunal and
further time was granted to SAIL to file its further reply in addition to what has been
filed on 15th December, 2009 and the Tribunal then directed the Commission to
consider all such material and record a fresh decision. We have held that there is no
statutory obligation on the Commission to issue notice for grant of hearing to the
parties at the stage of forming an opinion under Section 26(1) of the Act unless, upon
due application of mind, it finds it necessary to invite parties or experts to render
assistance to and produce documents before the Commission at that stage. We are also
unable to agree with the view expressed by the Tribunal that the inquiry commences as
soon as the aspects highlighted in Sub-section (1) to Section 19 are fulfilled and
brought to the notice of the Commission. It is obvious that Regulation 18(2) was not
brought to the notice of the Tribunal which resulted in error of law, particularly, when
examined in the light of other provisions and scheme of the Act as well. The
Commission, vide its order dated 8th December, 2009, had, for reasons stated therein,
declined the extension of time to SAIL. This order of the Commission cannot be stated
to be without jurisdiction or suffering from any apparent error of law. However, the
Tribunal, in exercise of its judicial discretion, had interfered with the said order and

granted further time to SAIL unconditionally. We do not propose to interfere in the
exercise of the discretion by the Tribunal except to the extent of imposition of cost. We,
therefore direct that SAIL should pay cost of Rs. 25,000/- to the informant for seeking
extension of time. The cost shall be conditional, whereafter, the additional reply filed by
SAIL would be taken on record and the Commission shall apply its mind to form a prima
facie view in terms of Section 26(1) of the Act, if the report of the Director General has
not been received as yet. In the event the report prepared by the Director General
during the period 8th December, 2009 to 11th January, 2010 has been received, the
Commission shall proceed in accordance with the provisions of the Act and the
principles of law enunciated in this judgment giving proper notice to the informant as
well as to SAIL and pass appropriate orders.
Conclusion and Directions
9 5 . Having discernibly stated our conclusions/ answers in the earlier part of the
judgment, we are of the considered opinion that this is a fit case where this Court
should also issue certain directions in the larger interest of justice administration.
96. The scheme of the Act and the Regulations framed thereunder clearly demonstrate
the legislative intent that the investigations and inquiries under the provisions of the Act
should be concluded as expeditiously as possible. The various provisions and the
Regulations, particularly Regulations 15 and 16, direct conclusion of the
investigation/inquiry or proceeding within a "reasonable time". The concept of
"reasonable time" thus has to be construed meaningfully, keeping in view the object of
the Act and the larger interest of the domestic and international trade. In this backdrop,
we are of the considered view that the following directions need to be issued:
(A) Regulation 16 prescribes limitation of 15 days for the Commission to hold
its first ordinary meeting to consider whether prima facie case exists or not and
in cases of alleged anti-competitive agreements and/or abuse of dominant
position, the opinion on existence of prima facie case has to be formed within
60 days. Though the time period for such acts of the Commission has been
specified, still it is expected of the Commission to hold its meetings and record
its opinion about existence or otherwise of a prima facie case within a period
much shorter than the stated period.
(B) All proceedings, including investigation and inquiry should be completed by
the Commission/Director General most expeditiously and while ensuring that
the time taken in completion of such proceedings does not adversely affect any
of the parties as well as the open market in purposeful implementation of the
provisions of the Act.
(C) Wherever during the course of inquiry the Commission exercises its
jurisdiction to pass interim orders, it should pass a final order in that behalf as
expeditiously as possible and in any case not later than 60 days.
(D) The Director General in terms of Regulation 20 is expected to submit his
report within a reasonable time. No inquiry by the Commission can proceed any
further in absence of the report by the Director General in terms of Section
26(2) of the Act. The reports by the Director General should be submitted
within the time as directed by the Commission but in all cases not later than 45
days from the date of passing of directions in terms of Section 26(1) of the Act.
(E) The Commission as well as the Director General shall maintain complete

'confidentiality' as envisaged under Section 57 of the Act and Regulation 35 of
the Regulations. Wherever the 'confidentiality' is breached, the aggrieved party
certainly has the right to approach the Commission for issuance of appropriate
directions in terms of the provisions of the Act and the Regulations in force.
97. In our considered view the scheme and essence of the Act and the Regulations are
clearly suggestive of speedy and expeditious disposal of the matters. Thus, it will be
desirable that the Competent Authority frames Regulations providing definite time frame
for completion of investigation, inquiry and final disposal of the matters pending before
the Commission. Till such Regulations are framed, the period specified by us supra shall
remain in force and we expect all the concerned authorities to adhere to the period
specified.
98. Resultantly, this appeal is partially allowed. The order dated 15th February, 2010
passed by the Tribunal is modified to the above extent. The Commission shall proceed
with the case in accordance with law and the principles enunciated supra.
99. In the circumstances there will be no order as to costs.
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MANU/SC/0690/2010

Equivalent Citation: (2010)10SC C 744, [2010]11SC R112

IN THE SUPREME COURT OF INDIA

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