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IN THE HIGH COURT OF DELHI
Prathiba M. Singh, J.
Eaton Power Quality Pvt. Ltd. - Appellant
Versus
Competition Commission of India - Respondent
W.P.(C) 6797 of 2020 & CM Appl. 23544 of 200
Decided On : 10-09-2021
Important Points
Subject
Competition Law - Regulatory Approvals
Act Referred
COMPETITION COMMISSION OF INDIA PROCEDURE IN REGARD TO THE TRANSACTION OF BUSINESS RELATING TO COMBINATIONS REGULATIONS: Reg.27, Sch.1
GENERAL CLAUSES ACT: S.21
Headnote
(B) Review - Power of the CCI to review its own orders - Repeal of Section 37 of the Act eliminates the CCI’s power to review except for rectification of clerical mistakes under Section 38 - The CCI's action of allowing review upon Schneider's application was held to lack jurisdiction. (Paras 92-108)
(C) Procedural Fairness - The CCI's failure to provide notice or hearing to Schneider prior to passing the order dated 7th January 2020 was a significant procedural lapse. (Paras 105-107)
JUDGMENT
GLOSSARY OF TERMS:
| S. No. | Term | Abbreviation |
| 1. | The Competition Act, 2002 | Act |
| 2. | The Competition Commission of India (Procedure in Regard to the transaction of Business relating to Combination Regulations | Combinations) Regulations, 2011 |
| 3. | Competition Commission of India | CCI |
| 4. | Appreciable Adverse Effect on Competition | AAEC |
| 5. | Eaton Power Quality Pvt. Ltd. | Eaton |
| 6. | Electrical and Automation Business | E&A Business |
| 7. | Larsen and Toubro Ltd. | L&T |
| 8. | Schneider Electric India Pvt. Ltd. | Schneider |
| 9. | Acquisition of the E&A Business of L&T by Schneider | Combination |
| 10. | Monitoring Agency - M/s. Moore Singhi Advisors LLP | MA |
| 11 | Approval Order dated 18th April 2019, approving the Combination | Approval Order |
| 12. | Expression of Interest | EOI |
| 13. | Low Voltage Switchgear | LV Switchgear |
Prathiba M. Singh, J.
1. This judgment has been pronounced through video conferencing.
2. The present writ petition has been filed by Eaton Power Quality Pvt. Ltd. (hereinafter, "Eaton") challenging the impugned order dated 11th August, 2020, passed by Respondent No. 1/ Competition Commission of India (hereinafter `CCI').
Brief Facts
3. The genesis of the present dispute is the acquisition of the electrical and automation business (hereinafter, "E&A Business) of Larsen and Toubro Ltd. (hereinafter, L&T) by Respondent No.2 - Schneider Electric India Pvt. Ltd. (hereinafter, `Schneider'). This acquisition shall hereinafter be referred to as the "Combination".
4. A notice seeking approval of the Combination was filed before the CCI on 25th May 2018 by Schneider and MacRitchie Investments Private Limited, which were the acquirers in the proposed Combination. On this notice, considering the fact that Schneider and L&T were the topmost market shareholders in the E&A business, the CCI, came to a prima facie opinion that the said Combination was likely to have an Appreciable Adverse Effect on Competition (hereinafter, "AAEC") in the LV Switchgear business. Thereafter, CCI conducted its market investigation and proposed various modifications to the Combination, after taking into account the proposals of the parties to the Combination. It passed the Approval Order under Section 3 1 of the COMPETITION ACT , 2002 (hereinafter, "The Act"), encompassing the said modifications, as also the timelines thereto, on 18th April 2019 (hereinafter referred to as "Approval Order"). Upon the said approval, it also appointed a Monitoring Agency- Moore Singhi Advisors LLP (Respondent No. 3) (hereinafter, "MA"), as per Regulation 27 of the Competition Commission of India (Procedure in Regard to the transaction of Business relating to Combinations) Regulations, 2011 (hereinafter, "Combination Regulations") to monitor the implementation of the said modifications to the Combination, among other functions.
5. The present petition concerns the implementation of two of the said modifications or remedies that were proposed by the CCI in its Approval Order, being the remedy of `White Labelling', and the consequential `Non- exclusive technology transfer' licences which were to be given.
6. Pursuant to the Approval Order, invitation for Expression of Interest (hereinafter, "EOI") was published, upon which various entities filed their registrations on a particular portal, provided for availing of the remedies. The Petitioner- Eaton is one of these entities, however due to the non- submission of required supporting documentation, Eaton was ousted by Schneider from availing of the White Labelling remedy. Aggrieved by the same, Eaton filed an application before the CCI for its inclusion in the said process, qua which, the CCI, in its decision dated 7th January 2020, as communicated on 13th January, 2020, directed Schneider to include Eaton in the White Labelling process, and the MA to take appropriate measures to ensure that all the applicants including Eaton are treated at par in a fair and transparent manner.
7. Schneider being aggrieved by this decision of the CCI, both on the ground that it was not heard prior to the decision b
