2026 Supreme(Online)(NCLAT) 574

NATIONAL COMPANY LAW APPELLATE TRIBUNAL
Naresh Salecha, MEMBER (TECHNICAL)
Confederation of Indian Alcoholic Beverage Companies – Appellant
Versus
Competition Commission of India – Respondent
Competition App. (AT) No. 04 of 2022 (Arising out of the Order dated 21.10.2021 passed by the Competition Commission of India in Case No. 10 of 2021)

Informants must provide concrete, substantiated documentary evidence, not just general allegations, for the CCI to form a prima facie case. The CCI is not required to order an investigation based on mere assertions.

Headnote:(A) Competition Act, 2002 - Sections 4, 18, 19(1)(a), 19(3), 21, 21A, 26(1), 26(2), 33, 49, 53(b), 54, 60 and 61 - Abuse of dominant position - Monopsony - Whether a monopsony buyer in a regulated sector can be deemed to have abused its dominant position by unilateral price fixation, preferential treatment, and unfair contract terms - Importance of prima facie evidence at the threshold stage under Section 26(2). (Paras 1, 8, 14, 25, 27, 28, 31, 42, 79, 80, 81, 83)

(B) Competition Act, 2002 - Section 26(2) - Prima facie case - Duty of informant - Informant must produce concrete, holistic, and substantiated documentary evidence at the threshold stage to enable the CCI to form a prima facie opinion - General, vague, and unsubstantiated allegations without actual cost sheets, data on losses, or evidence of market exit are insufficient to warrant an investigation. (Paras 68, 70, 71, 80, 81)

(C) Competition Act, 2002 - Section 4 - Abuse of dominance - Regulated market - Price fixation mechanism based on cost sheets submitted by manufacturers and transparent tender process does not, prima facie, amount to unfair or discriminatory pricing, as the competition authority is not the appropriate forum for determining the correct price in a regulated sector. (Paras 33, 35, 73)

(D) Competition Act, 2002 - Section 4 - Preferential treatment - Grant of preference to a state-owned entity for a single product, based on a publicly declared state policy and allowed under tender terms, does not, without proof of distortion of competition or impairment of consumer choice, constitute abuse of dominance. (Paras 37, 76, 77, 84, 85) (E) Competition Act, 2002 - Section 19(1)(a) and 26 - CCI's procedure - The CCI is entitled to close a matter under Section 26(2) if, after examining the information and responses, it forms an opinion that no prima facie case exists - The threshold for ordering investigation requires more than mere allegations; it requires material from which a reasonable opinion of possible contravention can be formed. (Paras 42, 79, 80, 81, 82)

Facts of the case:
Two industry associations of alcoholic beverage companies filed an information before the CCI alleging abuse of dominant position by a state-owned corporation that held a monopsony in the procurement and wholesale distribution of branded alcoholic beverages in a particular state. The appellants alleged unilateral price fixation, arbitrary tender conditions, discriminatory treatment favoring a state-owned distillery, delayed payments, and imposition of additional charges. The CCI, after examining the information and the responses, closed the matter under Section 26(2) for lack of a prima facie case. The CCI found the allegations were general, vague, and unsupported by concrete documentary evidence such as actual cost sheets, data on losses, or evidence of manufacturers exiting the market. The CCI also noted that the price fixation mechanism was based on cost sheets submitted by manufacturers and that the alleged preferential treatment was under a declared state policy. The appellants appealed the CCI's order.

Findings of Court:
The Appellate Tribunal upheld the CCI's order. It held that informants have a duty to furnish complete, accurate, and substantiated information at the threshold stage. The sample cost cards provided by the appellants were insufficiently concrete to enable the CCI to form a prima facie opinion. The appellants failed to provide credible evidence of losses, market exit, or distortion of competition. The CCI's closure of the matter under Section 26(2) was justified as no prima facie case for contravention of Section 4 was made out.

Issues: (1) Whether the CCI erred in not directing an investigation under Section 26(1) despite alleging a monopsony position and a series of allegedly abusive practices. (2) Whether the informants had placed sufficient prima facie material before the CCI to warrant an investigation. (3) Whether the CCI's approach at the threshold stage was akin to a final adjudication on merits.

Ratio Decidendi: For the CCI to form a prima facie opinion under Section 26(2), the informant must produce concrete, holistic, and substantiated documentary evidence. Vague and general allegations without supporting data on costs, margins, losses, or market impact do not meet the threshold required to direct an investigation. The CCI is not required to accept an informant's claims at face value and is empowered to close the matter if it concludes, after reviewing the available material, that no prima facie case exists. Result : Appeal dismissed with no order as to costs. (Para 86)

Table of Content
1. jurisdiction and parties of this appeal. (Para 1 , 2 , 3)
2. appellants' allegations of abuse of dominance by respondent 2. (Para 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23)
3. appellants' arguments on cci's error in closing the case. (Para 25 , 26 , 27 , 28 , 29 , 30)
4. cci's defense of its order and justification for closure. (Para 31 , 32 , 33 , 34 , 36 , 37 , 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47)
5. respondent 2 & 3's defense and justification of their conduct. (Para 48 , 49 , 50 , 51 , 52 , 54 , 55 , 56 , 57 , 58 , 59 , 60 , 61 , 62 , 63 , 64 , 65 , 66)
6. tribunal's analysis and findings on each allegation. (Para 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74 , 75 , 76 , 77 , 78 , 79 , 80 , 81 , 82 , 83 , 84 , 85)
7. final conclusion and dismissal of the appeal. (Para 86)

J U D G E M E N T

( 20 .05.2026)

NARESH SALECHA, MEMBER (TECHNICAL)

1. The present appeal has been filed by two appellants i.e. Confederation of Indian Alcoholic Beverage Companies (“CIABC”), who is Appellant No.1 herein and Association of Distillers, Brewers and Vintners of India (“ADBVI”), who is the Appellant No. 2 herein, under Section 53 (b) of the Competition Act, 2002 (the “Competition Act/Act”) challenging the Impugned Order dated 21.10.2021 in Case No. 10 of 2021 passed by the Competition Commission of India under Section 26 of the Competition Act.

Competition Commission of India (CCI) is the Respondent No.1 herein. Kerala State Beverages (Manufacturing and Marketing) Corporation Limited, is a government corporation established under the Foreign Liquor Rules, 1953 (formulated under the Cochin Akbari Act, 1077 (“Akbari Act”), is the Respondent No.2 herein.

Travancore Sugar and Chemicals Limited, who is a government owned and controlled distillery, is the Respondent No.3 herein.

2. It has been stated that Appellant No. 1 was incorporated on 30.07.1998 as a non-profit public limited company under Section 25 of the Companies Act, 1956, now corresponding to Section 8 of the Companies Act, 2013. The Appellant No. 1 is an industry association representing alcohol beverage companies in India and companies closely associated with the Indian alcohol beverage industry and its members include both international and domestic companies engaged in several branded segments of the alcoholic beverage market. The Appellant No. 2 is an association representing large, small, and medium-scale distillers operating in the State of Kerala. We note that both Appellant No.1 and Appellant No.2 have pleaded on same facts and grounds, hence, we shall record their pleadings in conjoint manner and refer them collectively as the Appellants hereinafter.

3. It is noted that Kerala State Beverages (Manufacturing and Marketing) Corporation Limited, i.e. Respondent No. 2, is a government corporation established under the Foreign Liquor Rules, 1953, with exclusive control over procurement and wholesale distribution of alcoholic beverages in Kerala and the Respondent No. 3 is a government-owned distillery from which Respondent No.2 procures alcohol along with other private manufacturers.

4. The Appellants submitted that on 29.04.2020, the Appellants filed information under Section 19(1)(a) of the Competition Act before Respondent No. 1. The Appellants contended that the information clearly disclosed abuse of dominant position by Respondent No. 2 in the relevant market, namely the market for procurement and wholesale distribution of branded alcoholic beverages in the State of Kerala.

5. The Appellants stated that the information relied on the legal and regulatory framework governing liquor procurement in Kerala to show that Respondent No. 2 occupied a monopsony position, meaning it was the exclusive purchaser of alcoholic beverages from private manufacturers. The Appellants submitted that this position made Respondent No. 2 dominant in the relevant market, since private manufacturers had no meaningful alternative buyer for their p

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