In a recent development, the court dismissed the request to stay the summons issued by the Director General of the Competition Commission of India (CCI) to two senior officials, including a Director of Shyam Steel Industries Ltd. The court emphasized that the issuance of the summons under section 26(1) of the Competition Act, 2002 does not involve any adjudicatory processes and would not cause immediate prejudice to the petitioners during the investigation stage. The court clarified that the petitioners would have ample opportunities to challenge the investigation process or its outcome at a later stage. The summons were issued as part of an investigation into alleged cartelization by steel manufacturers, and the Director of the petitioner company was summoned based on the potential possession of evidence relevant to the case.The counsel representing the petitioners argued that the summons were issued without following the statutory mandate outlined in section 26(1) of the Act, which requires the Commission to form a prima facie opinion before directing the Director General to conduct an investigation. The counsel relied on a previous order of the Madras High Court that directed the Director-General to act in accordance with the law. However, it was noted that the petitioner company was not mentioned in the said order, and the Commission's decision to direct the DG to examine the case was only made accessible to the petitioners at a later date.The Additional Solicitor General (ASG) representing the CCI contended that the investigation was of significant public interest as it pertained to allegations of steel price manipulation. The ASG argued that the Director General had no choice but to initiate the investigation following the direction from the Madras High Court. The court acknowledged the requirement for the Commission to form a prima facie opinion before initiating an investigation, as highlighted in a Supreme Court case.While acknowledging that the Madras High Court's order was not directly related to the petitioner corporation, the court stated that the order compressed and subsumed the sequential steps for the Commission to inquire into alleged contraventions. The court determined that there was no jurisdictional error and found no reason for the petitioners to obstruct the investigation. It emphasized that the petitioners had the opportunity to disprove the charges and bring the proceedings to a close if the prima facie case ceases to exist.In light of the claims of cartelization and manipulation of steel supply and pricing, the court recognized the broader consequences of such acts on the general public, including end-users, consumers, and home buyers. It emphasized the need to consider the greater public interest and concluded that there was no compelling reason to interfere with the investigation by restraining the respondents from proceeding with the impugned Summons.
In a recent development, the court dismissed the request to stay the summons issued by the Director General of the Competition Commission of India (CCI) to two senior officials, including a Director of Shyam Steel Industries Ltd. The court emphasized that the issuance of the summons under section 26(1) of the Competition Act, 2002 does not involve any adjudicatory processes and would not cause immediate prejudice to the petitioners during the investigation stage. The court clarified that the petitioners would have ample opportunities to challenge the investigation process or its outcome at a later stage. The summons were issued as part of an investigation into alleged cartelization by steel manufacturers, and the Director of the petitioner company was summoned based on the potential possession of evidence relevant to the case.The counsel representing the petitioners argued that the summons were issued without following the statutory mandate outlined in section 26(1) of the Act, which requires the Commission to form a prima facie opinion before directing the Director General to conduct an investigation. The counsel relied on a previous order of the Madras High Court that directed the Director-General to act in accordance with the law. However, it was noted that the petitioner company was not mentioned in the said order, and the Commission's decision to direct the DG to examine the case was only made accessible to the petitioners at a later date.The Additional Solicitor General (ASG) representing the CCI contended that the investigation was of significant public interest as it pertained to allegations of steel price manipulation. The ASG argued that the Director General had no choice but to initiate the investigation following the direction from the Madras High Court. The court acknowledged the requirement for the Commission to form a prima facie opinion before initiating an investigation, as highlighted in a Supreme Court case.While acknowledging that the Madras High Court's order was not directly related to the petitioner corporation, the court stated that the order compressed and subsumed the sequential steps for the Commission to inquire into alleged contraventions. The court determined that there was no jurisdictional error and found no reason for the petitioners to obstruct the investigation. It emphasized that the petitioners had the opportunity to disprove the charges and bring the proceedings to a close if the prima facie case ceases to exist.In light of the claims of cartelization and manipulation of steel supply and pricing, the court recognized the broader consequences of such acts on the general public, including end-users, consumers, and home buyers. It emphasized the need to consider the greater public interest and concluded that there was no compelling reason to interfere with the investigation by restraining the respondents from proceeding with the impugned Summons.
