Cartel Amongst Paper Mills? Gujarat High Court Refuses To Interfere With CCI’s Investigation Order

Case: J.K. Paper Ltd. Through Santosh Wakhloo, Authorized Signatory Herein v. Competition Commissioner of India

Coram: Justice Biren Vaishnav

Case No.: R/SPECIAL CIVIL APPLICATION NO. 12932 of 2019

Court Observation: The order u/S.26(1) merely directs an investigation. It does not effects the rights and liabilities of the petitioner. The CCI is to examine the validity of the allegations as to whether the petitioner’s conduct is anti-competitive. The petitioner has been provided an opportunity to file its objections and suggestions to the DG report and the petition therefore is certainly misconceived.

What is evident from the chronology of dates and events set out hereinabove is that pursuant to the Information Petitions filed, the CCI in exercise of powers u/S.26(1) of the Act formed a prima facie case for directing investigation into the allegations against the paper mills. In context of the paper industry the order was passed in August, 2014 and November, 2015 respectively. These orders were accepted by the petitioners at the relevant point of time and the petitioner continued to voluntarily participate in the proceedings before the DG.

Having voluntarily furnished the information including the information on copier paper, at this stage of the investigation when the objections and suggestions of the petitioner have been invited the petitioner cannot be allowed to set up a case that the copier paper was never a part of investigation. Reading the investigation reports and the orders passed under Sections 26(1) read with Section 26(3) of the Act would indicate that the order is an administrative order which only forms a prima facie opinion. The petitioner has been given an opportunity of producing evidence before the DG during the process of investigation and by the orders impugned the DG has called upon the petitioner to file its objections / suggestions to the investigation report. It cannot be said therefore that the petitioners’ doors are closed. After affording a reasonable opportunity and considering the objections and suggestions, the Commission based on the investigation reports will take an appropriate decision.

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Cartel Amongst Paper Mills