The Bombay High Court recently comprising of a division Bench of G.S. Patel and Madhav J. Jamdar, JJ., directed the Competition Commission of India not to take any coercive actions against Asianet Star Communications Private Limited, Disney Broadcasting and Star India. (Asianet Star Communications Private Limited Versus Competition Commissioner of India & Ors, with connected matters)
In the present matter, the challenge was to an order issued by Competition Commission of India on 28-2-2022, wherein an investigation under Section 26(1) of the Competition Act 2002 was directed.
The Bench stated that the purpose of the present order was to simply hold the parties in a form of a status quo or a neutral position until they can be heard fully once the Court reopens after the summer recess and once the CCI has been given a reasonable opportunity to file an affidavit and submit a compilation of relevant law.
Additionally, the High Court intended to give 2nd respondent, the complainant, an opportunity before the CCI to file a further affidavit.
Facts of the case
The probe was ordered on the basis of information filed by Asianet Digital Network Private Limited (ADNPL), an MSO operating in Kerala, Karnataka, Telangana and Andhra Pradesh.
According to the complaint, Star India was providing a bouquet of channels to its competitors at lesser prices resulting into denial of market access and also amounting to unfair and discriminatory pricing. The complainant had alleged that Star was offering additional discounts to select multi system operators (MSOs) and the main competitor of Asianet Digital Network in Kerala viz. KCCL (Kerala Communicators Cable Ltd).
The CCI prima facie had found a case of abuse of dominance, discrimination, denial of market access. CCI’s order is predicated upon a finding that Star India is circumventing TRAI’s New Regulatory Framework by entering into marketing agreements for offering additional discounts beyond the prescribed cap to KCCL, placing MSOs such as Asianet Digital Network at a huge disadvantage.
CCI found Star India dominant owing to its exclusive content thus making access to its TV channels indispensable for MSO, significant market share, size and economic resources and countervailing power.
Star India and Disney had filed individual writs challenging the CCI order directing investigation on the grounds that CCI lacks subject matter jurisdiction as the issue of circumvention of TRAI’s framework and discriminatory pricing of TV channels falls within the purview of TRAI.
Contention of the Parties
Mr Khambata counsel for the petitioner drew the courts attention inter alia to the decision of the Supreme Court in Competition Commission of India v Bharti Airtel Limited and Ors and submitted that a complaint of the nature presented by the 2nd Respondent must be first placed before the TDSAT and cannot be placed before the CCI directly.
Senior Advocate Darius Khambata, appearing for Star India, submitted that the order was bad and cannot be sustained.
Advocate Somsekhar Sundaresan appearing for CCI, however, opposed the petition on the point of jurisdiction stating that since the entire issue arose in Kerala, the challenge ought to have been in a court of Kerala.
Supplementing Sundaresan's point, Senior Advocate Navroz Seervai for ADNPL supported the order passed. He submitted that ADNPL's contention was only that the petitioners were subverting the TRAI/TDSAT norms causing prejudice to it.
They both contended that all that CCI intended to do was data collection.
Courts Observation and Judgment
The court said it wanted to hear CCI and ADNPL, therefore it would hear the matter on June 8, to fix a date for final disposal. Affidavits in reply should be filed by May 7, and a rejoinder by June 3.
The court said that documents sought by the DG should be handed over to him in the meantime, but no order be passed or action be taken by the CCI.
The bench noted, "In the meantime, the Petitioners in all three cases will, on a without-prejudice and no-equities basis, furnish to the Director General such documentary material and information as he has called for or in response to his queries. The CCI is not to pass any further orders or to adjudicate further on the 2nd Respondent's complaint until further orders of the Court."
The bench directed that the CCI is not to permit or direct any coercive actions against the Petitioners until the next date. This order will operate until 8th June 2022.
Read Order @Latestlaws.com
Picture Source :
