Only 0.23% of the total penalty has been realized in the last 3 years in the 327 cases where penalty has been imposed by the Competition Commission of India. Close to 81% of the total penalty has been stayed by Competition Appellate Tribunal/High Court/ Supreme Court.
Competition Commission of India (CCI) enforces ‘The Competition Act, 2002’ to prevent practices having adverse effect on competition, promote and sustain competition in markets, to protect the interests of consumers and ensure freedom of trade carried on by other participants in markets. CCI consists of a Chairperson and 6 members appointed by the Central Government.
Duties of CCI are the following
- To eliminate practices having adverse effect on the competition.
- To promote and sustain competition.
- To protect the interests of the consumers.
- To ensure freedom of trade carried on by other participants in India
The following are the main Provisions of The Competition Act
- To prohibit anti-competitive agreements (formation of Cartels).
- To prohibit abuse of dominant position.
- To regulate the combination (mergers).
- Competition advocacy (creating awareness programs regarding competition of markets and anti-competitive practices).
The following process is followed by the CCI on receipt on a complaint by the consumers.
More Anti-Trust cases than Combination ones
Complaints with the CCI can be filed in two broad categories, Anti-Trust & Combination. Data shared by the government for the last three years indicates that a greater number Anti-Trust Cases were filed than the Combination Cases. It is surprising to note that the number of Anti-trust cases received and examined in the first seven months of 2016-17 (April,2016 to October,2016) is more than the total number of cases received in each of last 3 years. In all, penalty was imposed in 327 cases out of the 639 cases decided by the CCI during this time period.
More than Rs 100 crore penalty imposed in 18 cases
As per the data shared by the government, 21 companies or individuals were penalized more than Rs 100 crore each during this period. The penalty in these 21 cases amounted to a total of 11840 crore rupees or 91.6% of the total penalty amount. The penalty amount has been stayed by the tribunal or courts in 19 of the 21 cases and the stayed amount is a whopping Rs 9915.26 crore, 76.75% of the total penalty imposed by the CCI. In two of these cases, the penalty imposed by the CCI has been dismissed by the tribunal or the court. The penalty has been dismissed in the case of Coal India (penalty of Rs 1773 crore) and Jet Airways (penalty of Rs 151 crore).
Penalty of more than Rs 1000 crore was imposed in the following 6 cases.
Out of the 327 cases decided by the CCI where penalty has been imposed during this period, penalty between one lakh and one crore rupees was imposed in 46% of the cases. However, these 46% cases make up for only 0.25% of the total penalty amount during this period. Penalty of more than 100 crore rupees was imposed in 21 cases and they make up for 91.6% of the total penalty amount imposed during this period.
Only 0.23% of the imposed Penalty realized till date
Out of 327 cases, only 42 individuals or enterprises have paid the imposed penalty amount which is 0.23% of the total penalty imposed. It is also observed that in certain cases, a part of the penalty is paid while the rest is either stayed or dismissed by the tribunal or courts. More than a crore rupees of penalty has been realized only in 9 of the 327 cases.
Stay granted by Tribunal or Court in 81% of the cases
Close to 81% of the cases decided by the CCI in the last three and half years have been stayed by either the tribunal or the courts. The top 10 companies by the amount of penalty stayed make up for 78% of the total penalty amount stayed by the tribunal or the court. These companies accounted for Rs 8228.2 crore in penalty out of the total stayed penalty amount of Rs 10454.08 crore.
Penalty dismissed in 227 cases
Either part or full penalty has been dismissed by the tribunal or court in 227 of the 327 cases. An amount of Rs 1773 crore has been dismissed in the case of Coal India Limited which makes up for 73% of the total dismissed amount. A total penalty amount of Rs 2428 crore has been dismissed by tribunal or court.
Penalty yet to be realized in 18 cases that are not stayed or dismissed
There are a total of 18 cases in which penalty has not been paid. In these 18 cases, 8 relate to individuals and the rest are enterprises. The total amount of unpaid penalty is Rs 5.99 crore and the highest unpaid amount is Rs 2.51 crore. But these amounts are negligible compared to the penalty amount stayed or dismissed by tribunals/courts.