COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED & Ors.

Once it is held that the order under Section 26(1) of the Competition Act is administrative in nature and further that it was merely a prima facie opinion directing the Director General to carry the investigation, the High Court was not competent to adjudge the validity of such an order on merits. At the same time, since it is held that the order of the High Court on the aspect that the CCI could exercise jurisdiction only after proceedings under the TRAI Act had concluded/attained finality, i.e. only after the TRAI returns its findings on the jurisdictional, the ultimate direction given by the High Court quashing the order passed by the CCI is not liable to be interfered with as such an exercise carried out by the CCI was premature. [Paras 98, 99][583-G-H; 584-A-B] Barium Chemicals Ltd. and Another v. Company Law Board and Others AIR 1967 SC 295 : [1966] SCR 311 – relied on State (NCT of Delhi) v. Sanjay (2014) 9 SCC 772 : [2014] 9 SCR 1063 ; Solidaire India Ltd. v. Fairgrowth Financial Services Ltd. & Ors. (2001) 3 SCC 71 : [2001] 1 SCR 932 ; Union of India and Another v. Association of Unified Telecom Service Providers of India and Others (2011) 10 SCC 543 : [2011] 14 SCR 657 ; Competition Commission of India v. Steel Authority of India Limited and Another (2010) 10 SCC 744 : [2010] 11 SCR 112 ; Competition Commission of India v. Coordination Committee of Artistes and Technicians of West Bengal Film and Television & Ors. (2017) 5 SCC 17 : [2017] 5 SCR 1 ; Begum Sabiha Sultan v. Nawab Mohd. Mansur Ali Khan & Ors. (2007) 4 SCC 343 : [2007] 5 SCR 36 ; State of Punjab v. Labour Court, Jullundur & Ors. (1980) 1 SCC 4 : [1980] 1 SCR 953 ; Ashoka Marketing Ltd. & Anr. v. Punjab National Bank & Ors. (1990) 4 SCC 406 : [1990] 3 SCR 649 ; Bhavnagar University v. Palitana Sugar Mill (P) Ltd. & Ors. (2003) 2 SCC 111 : [2010] 11 SCR 112 ; Competition Commission of India v. Steel Authority of India Ltd. & Anr. (2010) 10 SCC 744 : [2007] 10 SCR 656 ; Carona Ltd. v. Parvathy Swaminathan & Sons (2007) 8 SCC 559 : [2007] 10 SCR 656 – referred to A B C D E F G H 500 SUPREME COURT REPORTS [2018] 14 S.C.R. Deutsche Telekom v. European Commission Case C-280/08 P, Judgment dated 14.10.2010 ; FTC v. Supreme Court Trial Lawyers Association 493 US 411 (1990) ; Credit Suisse v. Billing et al 551 US 264 (2007) – referred to Case Law Reference [2002] 1 Suppl. SCR 229 referred to [2014] 9 SCR 1063 [2001] 1 SCR 932 C [2011] 14 SCR 657 [2010] 11 SCR 112 [2017] 5 SCR 1 [2007] 5 SCR 36 [1980] 1 SCR 953 [1990] 3 SCR 649 [2010] 11 SCR 112 [2007] 10 SCR 656 [2007] 10 SCR 656 [2017] 5 SCR 901 (2016) 7 SCC 353 [1966] SCR 311 referred to referred to referred to referred to referred to referred to referred to referred to referred to referred to referred to referred to referred to relied on Para 26 Para 29 Para 30 Para 33 Para 37 Para 44 Para 51 Para 52 Para 54 Para 57 Para 58 Para 58 Para 67 Para 77 Para 96 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 11843 of 2018. From the Judgment and Order dated 21.09.2017 of the High Court of Judicature at Bombay in WP No. 7173 of 2017. With Civil Appeal Nos. 11846, 11844-45, 11852 and 11847-51 of 2018. P. S. Narasimha, ASG, Prashanto Sen, Dr. Abhishek Manu Singhvi, Ramji Srinivasan, Amit Sibal, Darius J. Khambata, Soli K. Cooper, P. Chidambaram, Gopal Jain, Navroz Seervai, Siddharth Luthra, Sr. Advs. A B D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. 501 Arjun Krishnan, Dhruv Malik, V. C. Shukla, Ankur Suingh, Sumit Srivastava, Sarvesh Mishra, Udayan Verma, Kamlendra, Rahul Tanwani, K. R. Sadiprabhu, Ritin Rai, Raghav Shankar, Hiten Sampat, Vishnu Sharma, Nakul Nayak, Aabhas Kshetarpal, Ms. Kritika Bharadwaj, Tushar Bhardwaj, Avishkar Singhvi, Nidhiram Sharma, Srijan Sinha, Naveen Hegde, Jayant Malik, Amit Bhandari, Avinash Amarnath, Marezban P. Bharucha, Ms. Alka Bharucha, Ms. Swathi Girimaji, Areen De, Vipul Wadhwa, Harsh Kaushik, Atul Dua, Ms. Chinmayee Chandra, Ankush Walia, Param Tandon, Anju Berry, Aashish Gupta, Aditya Mukherjee, Ms. Sugnadha Rohatgi, S. S. Shroff, Sanjay Kapur, Ms. Megha Karnwal, Ms. Mansi Kapur and Ms. Shubhra Kapur, Advs. for the appearing parties. The Judgment of the Court was delivered by A. K. SIKRI, J. 1. Leave granted.

#2. Reliance Jio Infocomm Limited (hereinafter referred to as ‘RJIL’) has filed information under Section 19(1) of the Competition Act, 2002 (hereinafter referred to as the ‘Competition Act’) before the Competition Commission of India (for short, ‘CCI’) alleging anti- competitive agreement/cartel having been formed by three major telecom operators, namely, Bharti Airtel Limited, Vodafone India Limited and Idea Cellular Limited (Incumbent Dominant Operators) (hereinafter referred to as the ‘IDOs’). Similar Informations under Section 19 of the Competition Act were also filed by one Mr. Ranjan Sardana, Chartered Accountant, and Mr. Justice Kantilal Ambalal Puj (Retd.). These were registered by the CCI as Case Nos. 80-81, 83 and 95 respectively. As per Section 26 of the Competition Act, on receipt of such an information, the CCI has to form an opinion as to whether there exists a prima facie case or not. If it is of the opinion that there exists a prima facie case, the CCI directs the Director General to cause an investigation to be made into the matter. Apart from the IDOs, certain allegations were also made against the Cellular Operators Association of India (for short, ‘COAI’). The CCI issued notice to these parties and after hearing the RJIL, the aforesaid cellular companies and COAI, it passed a common order dated April 21, 2017 in all these cases (by clubbing them together) holding a view that prima facie case exists and an investigation is warranted into the matter. It, accordingly, directed the Director General to cause investigation in the case. A B C D E F G H 502 SUPREME COURT REPORTS [2018] 14 S.C.R. A Introduction:

#3. Four writ petitions came to be filed by the Bharti Airtel Limited, Vodafone India Limited, Idea Cellular Limited and COAI respectively. The prayed for quashing of the aforesaid order and consequential action/ proceedings on the ground that the CCI did not have any jurisdiction to deal with such a matter. Show-cause notices were issued pursuant to which the CCI as well as RJIL filed their counter affidavits. The mater was heard and vide judgment dated September 21, 2017 the High Court has allowed these writ petitions and quashed/set aside the order dated April 21, 2017 passed by the CCI and consequently notices issued by the Director General of the CCI have also been quashed. We may reproduce the conclusions and operative portion of the order passed by the Bombay High Court here itself, which are as under: “130. Conclusions: a) All the Writ Petitions are maintainable and entertainable. This Court has territorial jurisdiction to deal and decide the challenges so raised against impugned order (majority decision) dated 21 April 2017, passed by the Competition Commission of India (CCI) under the provisions of Section 26(1) of the Competition Act, 2002 in case Nos. 81 of 2016, 83 of 2016 and 95 of 2016 and all the consequential actions/notices of the Director General under Section 41 of the Competition Act arising out of it. b) The telecommunication Sector/Industry/Market is governed, regulated, controlled and developed by the Authorities under the Telegraph Act, the Telecom Regulatory Authority of India Act (TRAI Act) and related Regulations, Rules, Circulars, including all government policies. All the “parties”, “persons”, “stakeholders”, “service providers”, “consumers” and “enterprise” are bound by the statutory agreements/contracts, apart from related policy, usage, custom, practice so announced by the Government/ Authority, from time to time. c) The question of interpretation of clarification of any “contract clauses”, “unified license”, “interconnection agreements”, “quality of service regulations”, “rights and obligations of TSP between and related to the above provisions”, are to be settled by the Authorities/TDSAT and not by the Authorities under the Competition Act. B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 503 d) The concepts of “subscriber”, “test period”, “reasonable demand”, “test phase and commercial phase rights and obligations”, “reciprocal obligations of service providers” or “breaches of any contract and/or practice”, arising out of TRAI Act and the policy so declared, are the matters within the jurisdiction of the Authority/ TDSAT under the TRAI Act only. e) The Competition Act and the TRAI Act are independent statutes. The statutory authorities under the respective Acts are to discharge their power and jurisdiction in the light of the object, for which they are established. There is no conflict of the jurisdiction to be exercised by them. But the Competition Act itself is not sufficient to decide and deal with the issues, arising out of the provisions of the TRAI Act and the contract conditions, under the Regulations. f) The Competition Act governs the anti-competitive agreements and its effect – the issues about “abuse of dominant position and combinations”. It cannot be used and utilized to interpret the contract conditions/policies of telecom Sector/Industry/Market, arising out of the Telegraph Act and the TRAI Act. g) The Authority under the Competition Act has no jurisdiction to decide and deal with the various statutory agreements, contracts, including the rival rights/obligations, of its own. Every aspects of development of telecommunication market are to be regulated and controlled by the concerned Department/ Government, based upon the policy so declared from time to time, keeping in mind the need and the technology, under the TRAI Act. h) Impugned order dated 21 April 2017 passed by the Competition Commission of India (CCI) under the provisions of Section 26(1) of the Competition Act, 2002 and all the consequential actions/ notices of the Director General under Section 41 of the Competition Act proceeded on wrong presumption of law and usurpation of jurisdiction, unless the contract agreements, terms and clauses and/or the related issues are settled by the Authority under the TRAI Act, there is no question to initiating any proceedings under the Competition Act as contracts/agreements go to the root of the alleged controversy, even under the Competition Act. A B C D E F G H 504 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H i) The Authority, like the Commission and/or Director General, has no power to deal and decide the stated breaches including of “delay, “denial”, and “congestion” of POIs unless settled finally by the Authorities/TDSAT under the TRAI Act. Therefore, there is no question to initiate any inquiry and investigations under Section 26(1) of the Competition Act. It is without jurisdiction. Even at the time of passing of final order, the Commission and the Authority, will not be in a position to deal with the contractual terms and conditions and/or any breaches, if any. The uncleared and vague information are not sufficient to initiate inquiry and/or investigation under the Competition Act, unless the governing law and the policy of the concerned “market” has clearly defined the respective rights and obligations of the concerned parties/persons. j) Impugned order dated 21 April 2017 and all the consequential actions/notices of the Director General under the Competition Act, therefore, in the present facts and circumstances, are not mere “administrative directions”. k) Impugned order dated 21 April 2017 and all the consequential actions/notices of the Director General under the Competition Act are, therefore, illegal, perverse and also in view of the fact that it takes into consideration irrelevant material and ignores the relevant material and the law. l) Every majority decision cannot be termed as “cartelisation”. Even ex-facie service providers and its Association COAI have not committed any breaches of any provisions of the Competition Act.

#131. Hence the following ORDER a) Impugned order dated 21 April 2017, passed by the Competition Commission of India (CCI) under the provisions of Section 26(1) of the Competition Act, 2002 in case Nos. 81 of 2016, 83 of 2016 and 95 of 2016 and all the consequential actions/notices of the Director General under Section 41 of the Competition Act, are liable to be quashed and set aside, in exercise of power under Article 226 of the Constitution of India. Order accordingly. b) All the Writ Petitions are allowed. COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 505 c) There shall be no order as to costs. d) In view of the above, nothing survives in Civil Application (Stamp) No. 17736 of 2017 in Writ Petition No. 7164 of 2017 and the same is also disposed of. No costs.”

#4. Gist of the aforesaid order, as per the High Court, is that insofar as the telecom sector/industry/market is concerned, same is governed, regulated, controlled and developed by the authorities under the India Telegraph Act, 1885 (hereinafter referred to as the ‘Telegraph Act’), the Telecom Regulatory Authority of India Act, 1997 (for short, ‘TRAI Act’), and as well as the related Regulations, Rules, Circulars, etc. Therefore, the question of interpretation or clarification of any “contract clauses”, “unified license”, “interconnection agreements”, “quality of service regulations”, “rights and obligations of TSP between and related to the above provisions”, are to be settled by the Authorities/Telecom Disputes Settlement and Appellate Tribunal (TDSAT) and not by the Authorities under the Act. It has also held that the Competition Act and the TRAI Act are independent statutes and the statutory authorities under the respective Acts are to discharge their power and jurisdiction in the light of the objectives for which they are established. The Competition Act is itself not sufficient to decide and deal with the issues arising out of the provisions of the TRAI Act etc. Thus, the CCI has no jurisdiction to decide and deal with the various statutory agreements, contracts, including rival rights/obligations, of its own. The issues arising out of contract agreements, terms and clauses and/or the related issues are to be settled by the authority under the TRAI Act in the first instance and unless these issues are decided, there is no question of initiating any proceedings under the Act. In a nutshell, it is held that insofar as contracts, etc. which are regulated by the TRAI Act are concerned, in the first instance, it is the authority under the TRAI Act which has to decide these questions. Once there is a determination of the respective rights and obligations under these licenses by the authority under the TRAI Act, which provided an information to the effect that the particular act appears to be anti-competitive, only thereafter the CCI gets jurisdiction to go into the question of such anti-competitive practice. Primarily the message behind the decision of the High Court is that jurisdictional facts are to be decided by the authorities under the TRAI Act which has the exclusive jurisdiction to determine those issues as the TRAI is the statutory authority established for this very purpose, and unless there is A B C D E F G H 506 SUPREME COURT REPORTS [2018] 14 S.C.R. a determination of these facts, the machinery under the Competition Act cannot be invoked. To put it otherwise, the judgment proceeds to decide that it was premature for the CCI to entertain the Information for want of determination of such issues that fall within the domain of the TRAI Act.

#5. It is obvious that the RJIL is not happy with the aforesaid outcome. Even the CCI feels aggrieved. CCI has impugned this decision by filing four special leave petitions, while the other one has been filed by the RJIL.

#6. The material facts which are absolutely essential to determine the controversy, eschewing the unnecessary details, may now be recapitulated. Factual Background: With the decision of the Government of India, more than 25 years ago, ushering into era of globalisation and liberalisation, lot of avenues opened up. It led to the privatisation of business in many sectors which were, hitherto, monopolistic domain of the Government. These included aviation, insurance, telecommunication etc. With the opening of the industrial and other activities in all spheres by placing it in the hands of private sector led to a significant economic development. The absolute control of the Government through public enterprise or otherwise, which had seen licence and quota raj, virtually withered away, thereby reverting back to laissez faire economy to a great extent, though not completely. It led to two significant developments: In the first instance, though the private sector was given full freedom to do the business without any shackles in the form of controls etc., it was also deemed necessary at the same time that in public interest, some of the aspects of the business need to be regulated, of course, not by the Government but by an independent regulatory authority. This necessity prompted the Government to come out with regulatory regime in different sectors. For example, in insurance sector, we have regulatory authority constituted under Insurance Regulatory and Development Authority Act, 1999; for industries generating electricity, there is an electricity regulatory authority constituted under the Electricity Act, 2003; and for telecom sector, with which we are concerned, the TRAI is constituted under the provisions of TRAI Act. A B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 507 Secondly, this requirement to do business thereby allowing free entry to private enterprise led to competition between different players in the private sector. Competition is perceived as a phenomena which is in best public interest in so many ways. Therefore, it becomes necessary to encourage competition. At the same time, tendency of the business enterprises to adopt practices which retard healthy competition needed to be curbed. There was a governing law in the field known as Monopolistic and Restrictive Trade Practice Act, 1969. However, it was felt that a new robust statutory regime is required to take care of the needs of the present day. This necessity prompted the Parliament to come out with a new Act on the subject and the Competition Act, 2002 was passed by the Parliament. Under this Act, the CCI is constituted as a statutory body which is to ensure healthy competition in markets thereby preventing the practice of having adverse effect on competition; to promote and sustain the competition in markets; to protect the interest of consumers and to ensure freedom of trade. In that sense, the CCI is also a regulator. But a unique feature of the CCI is that it is not sector based body but has the jurisdiction across which transcends sectoral boundaries, thereby covering all the industries, with focus on the aforesaid object and purpose behind the Competition Act, 2002.

#7. In the instant appeals, width and scope of the powers of the CCI under the Competition Act, 2002 pertaining to telecom sector i.e. in respect of the companies in telecom industry providing telecom services is to be defined vis-a-vis the scope of the powers of TRAI under the TRAI Act, 1997. It has arisen in these appeals, in the following background: As mentioned above, TRAI is the regulatory which regulates the functioning of the telecom service provider i.e. the telecom sector. Section 11 of the TRAI Act enumerates various functions which TRAI is supposed to perform under the Act. Section 13, likewise, empowers the TRAI to issue directions, from time to time, to the service provider. In exercise of powers under Section 13 read with Section 11 of the TRAI Act, the TRAI issued directions dated June 07, 2005 to all the telecom service providers to provide interconnection within ninety days of the applicable payments made by the interconnection seeker. The purpose behind providing interconnection by one service provider to the other service provider is to ensure smooth communication by a subscriber of one service provider to the cell number which is provided by another A B C D E F G H 508 SUPREME COURT REPORTS [2018] 14 S.C.R. service provider. In that sense, this direction facilitates smooth functioning of the cell phone network even when it is managed by different companies as it ensures interconnectivity i.e. connectivity from one service provider to other service provider.

#8. On October 21, 2013, RJIL was granted Unified License and Unified Access Service License under Section 4 of the Telegraph Act by the Department of Telecom (DoT) for providing telecommunication services in all 22 circles/licensed service areas in India. Soon thereafter, RJIL executed interconnection agreements (ICA) with existing telecom operators inter alia including, Bharti Airtel Limited and Bharti Hexagon Limited (hereinafter collectively referred to as the ‘Airtel’), Idea Cellular Limited (hereinafter referred to as the ‘Idea’); Vodafone India Limited/ Vodafone Mobile Services Limited (hereinafter collectively referred to as the ‘Vodafone’). RJIL commenced test trial of its services after intimation and approval of the DoT and TRAI.

#9. By its ‘firm demand’ letter of June 21, 2016, RJIL vide separate letters requested IDOs to augment Point of Interconnection (POIs) for access, National Long Distance (NLD) and International Long Distance (ILD) services, as according to it, the capacity already provided to it was causing huge POI congestion, resulting in call failures on its network. According to RJIL, these companies intentionally ignored the aforesaid request. Accordingly, RJIL sent a letter dated July 14, 2016 to TRAI stating that the POIs provided by IDOs are substantially inadequate and leading to congestion/call failures on its network in all circles. Hence, TRAI was requested to intervene and direct these telecom operators to augment the POI capacities as per the demands made by RJIL. TRAI vide separate letters dated July 19, 2014 requested inter alia the aforementioned telecom operators to augment POIs as per the RJIL’s request. Further, responses of the respective companies were also sought on the issues raised by RJIL, within seven days. Idea responded by sending letter dated July 26, 2016 to RJIL denying that there had been any delay in augmentation of POIs and further stated that it is willing to fully support RJIL and that it had instructed its circle teams to augment the POIs on the basis of traffic congestion as per the ICA. Likewise, Airtel also sent reply dated August 03, 2016 to TRAI, inter alia stating that augmentation of POIs shall be undertaken as per the terms and conditions of the ICA and on the basis of traffic trends post their commercial launch. RJIL was not satisfied with such responses. It sent A B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 509 another letter dated August 04, 2016 to TRAI reiterating its earlier request for augmentation of POIs by the subject telecom operators. In the meantime, even Cellular Operators Association of India (COAI) intervened by addressing communication dated August 08, 2016 to TRAI wherein it took a stand by stating that the RJIL was providing free service to millions of users under the guise of testing which led to choking of POIs. It was further suggested that due to the free service provided by RJIL, a substantial imbalance in voice traffic had occurred for which the existing operators were not adequately compensated under the Interconnection Usage Charges regulations (IUC) in place.

#10. There was further exchange of correspondence between the parties and even by the parties to the TRAI which shows that the parties stuck to their respective positions and it may not be necessary to refer to those communications in detail. Suffice it is to mention that RJIL fixed September 05, 2016 as the launch date, which fact was informed to other service providers as well who were also told that the subscriber base was expected to substantially and swiftly increase resulting in even more POI congestion. On that basis, request was made for urgent POI augmentation vide letter dated September 02, 2016. The TRAI even facilitated a meeting between the representatives of RJIL and other service providers (respondents herein) to sort out and resolve the differences in the interest of the consumers. At the same time, in the said meeting, the three telecom operators (respondents herein) also raised a grievance that free calls being provided by RJIL has resulted in an unprecedented traffic congestion on their respective networks and the current IUC regime is inadequate to cover the cost of efficiently maintaining such high traffic. Thereafter, vide letter dated September 14, 2016, addressed by Airtel to RJIL, it stated that the POIs (also known as E1s) would be converted into 50:50 ratio to outgoing and incoming E1s. In other words, the E1s provided would be converted to ‘only outgoing’ or ‘only incoming’ i.e. one-way E1s. RJIL replied by stating that it was acceptable to them.

#11. Soon thereafter, i.e. in September 2016 itself, Mr. Rajan Sardana, a Chartered Accountant, filed information under Section 19 of the Competition Act (registered as Case No. 81 of 2016) and similar application was filed by Justice K.A. Puj (retired) (registered as Case No. 83 of 2016). Then, it was followed by information under Section 19 of the Competition Act by RJIL in November, 2016 (registered as Case No. 95 of 2016). A B C D E F G H 510 SUPREME COURT REPORTS [2018] 14 S.C.R. A Proceedings before TRAI:

#12. As the matter was with the TRAI as well, it issued show cause notices dated September 27, 2016 to IDOs and RJIL for violation of Standard of Quality of Service of Basic Telephone Service (Wireline) and Cellular Mobile Telephone Service Regulations, 2009 (hereinafter referred to as the ‘QoS’) and for provision of the License Agreements. Similar show cause notices were also sent to other telecom operators. On October 21, 2016, TRAI issued recommendations to DoT after finding that IDOs have violated conditions under the QoS, interconnection agreements and Unified License. The TRAI inter alia stated in its recommendation as under: “21. … (vii) It is evident from the above clauses that the licensees are mandated to provide interconnection to all eligible telecom service provider. However, as mentioned in para 6 above, Airtel along with other service providers have jointly through their association (COAI), declined Point of Interconnection to RJIL which is willful violation of the above mentioned license conditions. ...(x) COAI’s letter dated 2nd September, 2016 which was confirmed by Airtel in the meeting held on 9th September, 2016 clearly indicates attempt by three service providers namely, Airtel, Vodafone India Limited and Idea Cellular Limited to stifle competition in the market and willfully violate the license conditions;…

#23. While the Authority has been taking necessary steps to ensure effective interconnection between Airtel and RJIL, it is evident from Para 21 that Airtel is in non-compliance of the terms and conditions of license and denial of interconnection to RJIL appears to be with ulterior motive to stifle competition and is anti- consumer.”

#13. TRAI recommended that Rs. 50 crore per local service area (LSA) be imposed on all the above three telecom operators for failure to adhere to TRAI norms and regulations. Similar recommendations were also issued to DoT against other telecom operators. Against the recommendations dated October 21, 2016 of TRAI, Vodafone filed a Writ Petition being Writ Petition (C) No. 11740 of 2016 before the High Court at Delhi. Meanwhile, on January 17, 2017, TRAI also recommended imposition of penalty of Rs. 1,90,000/- on Idea for its rejection of mobile B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 511 number portability (MNP) requests to RJIL’s network. Against the aforesaid recommendation, Idea has preferred a Writ Petition being Writ Petition (C) No. 685 of 2017 before the High Court at Delhi. The DoT after examining the matter referred it back to TRAI for fresh consideration vide DoT’s reference dated April 05, 2017 whereby its recommendations imposing penalty upon IDOs were sent back for reconsideration. The TRAI sent its response dated May 24, 2017 to the DoT, wherein it took a categorical stand that telecom operators have intentionally denied and delayed the augmentation of POIs to RJIL. Proceedings before CCI:

#14. The CCI took the cognizance of the three informations given to it under Section 19 of the Competition Act which were registered as Case Nos. 81, 83 and 95 of 2016. It gave hearing to the respondents service providers as well as COAI and passed order dated April 21, 2017 under Section 26(1) of the Competition Act as per which it came to a prima facie conclusion that case for investigation was made out and directed the Director General to cause investigation in the case. This order was passed by majority of 3:2 as two members of CCI dissented from the said order. Operative portion of the majority order holds as under: “23. The Commission notes that allegations of anti-competitive agreement as well as abuse of dominant position have been made for the same conduct of refusal to facilitate call termination services and denial of mobile number portability. As discussed earlier, the Commission is satisfied that there exist a prima facie contravention of Section 3(3)(b) of Act, as the ITOs appear to have entered into an agreement amongst themselves through the platform of COAI, to deny POIs to RJIL. Having been prima facie convinced that the impugned conduct is an outcome of the anti-competitive agreement amongst ITOs, Commission does not find it appropriate to consider the same impugned conduct as unilateral action by each of the ITOs. The Commission therefore at this stage does not find it necessary to deal with the allegations and submissions regarding abuse of dominance in contravention of the provisions of Section 4 of Act.

#24. In view of the foregoing, the Commission directs the DG to cause an investigation into the matter under the provisions of A B C D E F G H 512 SUPREME COURT REPORTS [2018] 14 S.C.R. Section 26(1) of the Act. Considering the substantial similarity of allegations in all the informations, the Commission clubs them in terms of the proviso to Section 26(1) of the Act read with Regulation 27 of the Competition Commission of India (General) Regulations, 2009. The DO is directed to complete the investigation and submit investigation report within a period of 60 days from the date of receipt of this Order, if the DG finds contravention, he shall also investigate the role of the persons who at the time of such contravention were in-charge of and responsible for the conduct of the business of the contravening entity/entities. During the course of investigation, if involvement of any other party is found, DG shall investigate the conduct of such other parties also who may have indulged in the said contravention. In case the DG finds the conduct of the Opposite Parties in violation of the Act, the DG shall also investigate the role of the persons who were responsible for the conduct of the Opposite Parties so as to proceed against them in accordance with Section 48 of the Act.

#25. The Commission makes it clear that nothing stated in this order shall tantamount to final expression of opinion on the merits of the case and DG shall conduct the investigation without being swayed in any manner whatsoever by the observations made herein.”

#15. Likewise, two members who dissented inter alia held as follows: “...As stated above, from the various charts placed on record by the ITOs showing the number of POIs provided by them to RJIL, the respective learned senior counsel for Ops have tried to show that the number of POIs provided to RJIL by 08.11.2016 i.e. within the first quarter itself, were much more than what was demanded. In fact, the charts filed by RJIL itself corroborate this fact. The charts show that even if some of the POIs provided (one-way POIs for connecting outgoing calls from ITOs to RJIL) are not taken into consideration, the number of POIs provided by OP-5 and OP-7 were much more than what was demanded by RJIL. Even in case of OP-2, the same were approximately 64% (NLD POIs) and 85.53% (Access POIs) as on 08.11.2016. However, as we have already observed above, we are not expected to go A B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 513 into the question of providing adequate number of POIs. Yet there is ample material on record to show that RJIL was more to be blamed for congestion in its traffic than the ITOs...” “...we are of the considered opinion that on the basis of material available with the Commission, it is difficult to say that there is a prima facie case...” made out against the Petitioner and others and accordingly, “...the instant cases ought to be closed under Section 26(2) of the Act...” (hereafter “Dissent Note”).”

#16. On June 08, 2017, the Director General issued a letter of investigation to the appellant seeking call data records in respect of certain identified mobile numbers by June 19, 2017. On June 19, 2017, respondent No. 2 issued a letter of investigation to the appellant seeking detailed information/documents to be furnished by June 30, 2017. Immediately thereafter, writ petitions were filed challenging the aforesaid order of the CCI as well as action of the Director General seeking information for holding inquiry. After preliminary hearing, the High Court passed interim orders dated June 30, 2017 on the basis of statement of the counsel for CCI that they shall not proceed with the investigation, which order continued till the disposal of the writ petitions. The High Court after hearing the matter finally allowed the writ petitions, as already mentioned.

#17. It is clear from the above that as per RJIL, the respondent service providers, along with COAI, entered into an anti-competitive agreement/formed a cartel and acted in an anti-competitive manner which is prohibited by the Act. On these allegations, it approached the CCI for initiating inquiry into this anti-competitive practices. Insofar as the nature of alleged anti-competitive agreement is concerned, the allegations of RJIL are the following: (i) Delay in provisioning or denial in provisioning of POIs, also known as ‘E1’ in telecom parlance, to RJIL by IDOs during the testing phase and after commercial launch of RJIL services. POIs are the points where the networks of telecom operators connect. Without sufficient POIs it is not possible for subscribers of one service provider to make calls to subscribers of another service provider. (ii) It was also alleged, inter alia, that IDOs are denying Mobile Number Portability (MNP) requests of customers who wanted to switch to RJIL competing service. A B C D E F G H 514 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H (iii) It was also alleged that COAI was acting at the behest of IDOs against the interest of a competing member, i.e. RJIL, and not for the common interest of the industry and consumers as a whole. Proceedings before the High Court:

#18. Against the order passed by the CCI directing investigation into the aforesaid allegations, in the writ petitions filed by the IDOs and also by COAI, challenge laid to the aforesaid order was premised on the ground that the CCI lacked jurisdiction to entertain such complaints/ information filed under Section 19 of the Competition Act as such a matter falls within the exclusive jurisdiction of another regulatory authority, namely, TRAI.

#19. In nutshell, it was pleaded that the violation alleged by RJIL, namely, whether there was a delay or denial in provisioning POIs, comes within the domain of TRAI as it is the TRAI which has the exclusive jurisdiction to deal with such a matter under the TRAI Act and, in fact, the complaint was also made by TRAI as well which was seized of the matter.

#20. The plea of the appellants, on the other hand, was that violation of telecom regulations, etc. was undoubtedly a matter which could be looked into by the TRAI for which RJIL has approached the TRAI. However, the subject matter of inquiry before the CCI was entirely different, namely, formation of cartel and a concerted effort on the part of the service providers, in collusion with COAI, to curb the competition in the market and, thus, the CCI was competent and had requisite jurisdiction to look into this aspect. To put it otherwise, according to the appellants, the CCI had decided to examine the facts purely from the stand point as to whether the alleged Act constituted anti-competitive practice on the part of the respondents and, therefore, contravened the provisions contained in Section 3 or Section 4 of the Act. This aspect, they had argued, could not be gone into by the TRAI as the CCI was the only statutory authority constituted under the Act to examine such an issue.

#21. The Bombay High Court in the impugned judgment has, thus, inter alia, held as under: “(i) the Competition Commission of India (CCI) had no jurisdiction in view of the Telecom Regulatory Authority of India Act, 1997 and the authorities and regulations made thereunder; COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 515 (ii) the CCI could exercise jurisdiction only after proceedings under the TRAI Act had concluded/attained finality; A (iii) the order dated 21.04.2017 passed under section 26(1) of the Competition Act was not an administrative direction, but rather a quasi judicial one that finally decided the rights of parties and caused serious adverse consequences, because a detailed hearing had been given and many materials had been tendered in the courts of the hearings; (iv) on the merits of the matter, there was no cartelisation as alleged and COAI was exonerated; and (v) the order of the CCI was perverse and liable to be interfered with under writ jurisdiction.” Arguments: The appellants:

#22. Mr. P.S. Narasimha, learned Additional Solicitor General, appeared on behalf of the CCI and submitted that the impugned judgment is contrary to the law. His attack was premised on three principal propositions, which are follows: (i) Jurisdiction of the CCI: The CCI has jurisdiction in the present case and it need not wait till the conclusion of proceedings under the TRAI Act to conclude. (ii) Scope of Judicial Interference under Article 226: The High Court erred in holding that the order passed under section 26(1) was an order resulting in serious adverse consequences merely because the CCI had granted a hearing. (iii) The order of CCI was not perverse and the High Court erred in giving findings on merits. The High Court erroneously exercised writ jurisdiction.

#23. With respect to the first proposition, his argument was that the High Court had failed to appreciate that issues before the CCI are altogether different than the issues before the TRAI and they necessarily be treated differently. He argued that the CCI and TRAI operate in entirely different fields, which is discernible from the Preambles of the respective legislations. The TRAI Act was supposed to enable it to regulate the telecommunication services, adjudicate dispute, dispose of appeals and protect the interests of service providers and consumers of B C D E F G H 516 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H the telecom sector, to promote and ensure orderly growth of the telecom sector. The CCI, on the other hand, is a body that has been established to prevent practices having an adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in markets, in India.

#24. Mr. Narasimha emphasised that the issue before the CCI was whether the opposite parties/respondents, i.e. the IDOs, were acting in concert and colluding (forming a cartel) so as to block or hinder the entry of RJIL in the market in violation of section 3(3)(b) of the Act. The key issue is whether there was an anti-competitive agreement between the IDOs, using the platform of COAI. The issue before the TRAI, on the other hand, is whether the delay/denial of POIs has violated terms of the licence agreement and QoS regulations. The learned ASG pointed out that all the opposite parties have argued that they were justified in declining POIs to RJIL. However, the question before the CCI is whether the conduct of the parties was unilateral or collective action based on an agreement? It is precisely this issue that requires investigation by the Director General. If the conduct of the respondents in delaying/ denying POIs was unilateral (i.e. an independent decision made by each of them), then the conduct cannot be faulted under Section 3 of the Act since Section 3 is premised on existence of an ‘agreement’ as defined in Section 2(b). However, if the conduct of the respondents was based on an ‘agreement’, it would become illegal under Section 3(3)(b) of the Act because its intent and effect is to ‘limit or control production, supply, markets, technical development, investment or provision of services”. It was contended that the conduct may well be legal under the TRAI Act and regulations or other laws. However, it is the collusive/concerted nature of the action coupled with the effect that makes it illegal under the Competition Act.

#25. He adverted to the order dated April 21, 2017 of the CCI, while taking its prima facie view and submitted that the CCI has recognised the distinction between the issues before the TRAI and the issues arising under the Act, as follows: “9. It is observed that telecom sector is regulated by TRAI as the sectoral regulator. On the allegation of insufficient POIs being provided to RJIL, the Commission notes from the information available on TRAI’s website that, on 21st October 2016, TRAI COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 517 had recommended, through three separate communications to the Department of Telecommunications, imposition of penalty of Rs.50 crore per License Service Area (LSA) against Airtel, Vodafone and Idea, for violation of the provisions of License Agreements and the Standards of QoS of Basic Telephone Service (Wireline) and Cellular Mobile Telephone Service Regulations, 2009. Thus, TRAI as a sectoral regulator, has held the said conduct of ITOs in violation of relevant TRAI regulations and recommended penal action against them. However, the recommendations of TRAI is in respect of violations of the provisions of License Agreements and the Standards of QoS of Basic Telephone Service (Wireline) and Cellular Mobile Telephone Service Regulations, 2009 by these OPs. Against this, mandate of the Commission under Section 18 of the Act is ‘...to eliminate practices having adverse effect on competition, promote and sustain competition, protect the interests of consumers and ensure freedom of trade carried on by other participants, in markets in India.’ Accordingly, it becomes the duty and responsibility of the Commission to eliminate practices in the market that have an adverse effect on competition and promote and sustain competition so as to protect the interest of consumers and ensure freedom of trade. Further, as per Section 62 of the Act, provisions of the Act are in addition to and not in derogation of the provisions of any other law for the time being in force. Section 61 of the Act grants exclusive power to the Commission and the Competition Appellate Tribunal to exercise its jurisdiction in respect of any matter which the Act empowers the Commission or the Competition Appellate Tribunal to determine to the exclusion of civil courts. A careful reading of these provisions show that the Commission has the jurisdiction to inquire into the issues alleged in the present information insofar as the same may result in contravention of the provisions of the Act.

#10. It may be noted that the primary grievance of the Informants relates to cartelization by the Opposite Parties, amounting to violation of the provisions of Section 3 of the Act. In this regard, it must be noted that none of the areas covered under Section 3 of the Act are covered by TRAI in its mandate as a sector regulator for TSPs. No doubt, TRAI has the responsibility/obligation to determine whether Quality of Service regulations and interconnection norms A B C D E F G H 518 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H on the levels of congestion at the points of interconnection are complied with it not. But apart from that, none of the other issues as envisaged under Section 3 of the Act are looked into by TRAI. Specifically, TRAI cannot arrive at a determination as to whether the ITOs have colluded and cartelized to deny POIs to the detriment of RJIL in violation of Section 3(3) read with Section 3(1) of the Act. The scope of the Section 3 allegation is not whether the ITOs have breached the terms of their respective License agreement or ICA, rather, the scope of the Section 3 allegations pertains to whether the ITOs have entered into an anti- competitive agreement to provide insufficient POIs or delay the provisions of POIs to RJIL. It is within the mandate of the Commission which can adjudicate on the issue of cartelization amongst enterprises/associations and arrive at a finding on the alleged cartelization. The Commission accordingly holds that the issue of whether such conduct on the part of ITOs (including COAI) has resulted in any anti-competitive effect in the market in violation of the provisions of the Act can and needs to be examined by it.

#11. The Commission recognizes the role and importance of sectoral regulators and exercises its jurisdiction keeping in mind their role and responsibilities. The Commission is a market regulator and has the jurisdiction to look at those issues which affect competition in markets in India, including that of an alleged cartelization amongst enterprises/ associations. The nature of the proceedings before TRAI involving ITOs on the other hand different and related to whether interconnection norms and quality of service regulations are complied with or whether the contractual terms of ICAs have been breached or met. Palpably, these issues are not relevant for determination in the current proceedings before the Commission.

#12. The informants have alleged that the conduct of ITOs amounts to a “cartel” in relation to denial of POIs to RJIL. The definition of cartel has been provided under Section 2(c) of the Act which reads as follows: ‘cartel includes an association of producers, sellers, distributors, traders or service providers who COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 519 by agreement amongst themselves limit, control or attempt to control the production, distribution, sale or price of or, trade in goods or provision of services.’ Further, any alleged agreement amongst enterprises and an association of enterprises, engaged in identical or similar trade or provision of services is covered under Section 3(3) of the act which states that: Any agreement entered into between enterprises or associations of enterprises or persons or associations of persons or between any person and enterprise or practice carried on, or decision taken by, any association of enterprises or association of persons, including cartels, engaged in identical or similar trade of goods or provision of services, which- (a) directly or indirectly determines purchase or sale prices; (b) limits or controls production, supply, markets, technical development, investment or provision of services; (c) ….. (d) ….. shall be presumed to have an appreciable adverse effect on competition.

#13. On the basis of the above, the Commission notes that in addition to ITOs, conduct of COAI also needs to be examined under the provisions of Section 3(3) of the Act.” (emphasis added)

#26. He submitted that it was the statutory duty of the CCI, enumerated in Section 18 of the Act, to eliminate anti-competitive practices and the focus of the CCI was confined to this Court’s judgment in the case of Haridas Exports v. All India Float Glass Manufacturers’ Assn. & Ors.1 wherein it was held that where statutes operate in different fields and have different purposes, it cannot be said that there is implied repeal by one, of the other. In the said case, this Court was considering alleged conflict between the Monopolies & Restrictive Trade Practices Act, 1969 and the Anti-Dumping Rules under the Customs Act/Customs Tariff Act. It was held: 1(2002) 6 SCC 600 A B C D E F G H 520 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H “48. The jurisdiction of the MRTP Commission, in our opinion, is not ousted by the anti-dumping provisions in the Customs Act. The two Acts operate in different fields and have different purposes. The Import Control Act and the Customs Tariff Act are concerned with import of goods into India and the duty which could be imposed on the imported items. Import may be allowed on the basis of an import licence or, depending upon the policy, import may be allowed under OGL — open general licence — where no specific licence for import is required. Whether to allow import or not and the terms on which an item may be imported is a matter of policy and regulated by law.

#52. The levy or non-levy of anti-dumping or other duty being a legislative act pursuant to the exercise of powers under the Customs Tariff Act can also not be a subject-matter of judicial review by the MRTP Commission. The two Acts substantially operate in different fields and the following table brings out some of the distinctions between the MRTP Act and the anti-dumping provisions: [table omitted] A perusal of the above chart indicates that the two statutes and regimes operate in different and distinct spheres and there is no conflict between the two regimes/statutes. Hence, the question of implied repeal of the provisions of Section 33(1)(j) of the MRTP Act, 1969 on account of the provisions of Section 9-A of the Customs Tariff Act, 1975 does not arise.

#53. It is thus seen that the provisions relating to anti-dumping contained in the Customs Tariff Act do not in any way affect the power or jurisdiction of the MRTP Commission. The Import Control Act and the Customs Tariff Act on the one hand and the MRTP Act on the other operate in different independent fields and the authority under one has no jurisdiction over the other. In other words, their paths do not cross each other. While the provisions of the Anti-Dumping Act are concerned with the levy of anti- dumping duty, the MRTP Act in the present case would be concerned with the agreements between the parties which relate to the restrictive trade practices. Therefore, it would be incorrect COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 521 to say that the incorporation of the anti-dumping provisions ousts the jurisdiction of the MRTP Commission to inquire and pass orders, inter alia, with regard to restrictive trade practice in India.” The learned ASG pointed out that the allegation against the respondents i.e. IDOs is that they have through an anti-competitive agreement/cartel, limited the provision of services by delaying or denying POIs to RJIL, with a view to block its entry in the market. As per him, such an agreement would raise a presumption of ‘appreciable adverse effect’ on competition.

#27. Explaining the scheme of the Act, Mr. Narasimha referred to the provisions of Section 3 which prohibits anti-competitive agreements of the nature mentioned therein. He also referred to the definitions of ‘agreement’, ‘cartel’, ‘enterprise’ and ‘service’ contained in Section 2 of the Act and submitted that the definition of ‘agreement’ is not restricted to written agreements, but even extends to ‘action in concert’, which, according to him, is wide enough to allegations of RJIL, if proved correct, within the mischief of Section 3 of the Act. He also referred to Section 19(3) of the Act which lists certain factors to be considered in analysing adverse effect on competition and submitted that creation of barriers to new entrants in the market and foreclosure of competition by hindering entry into the market are to be perceived as having adverse effect on competition. He, thus, submitted that having regard to the aforesaid provisions, the CCI wanted to investigate the matter with focus on the aspect as to whether there was an agreement between the respondent service providers and they acted in concert pursuant to the said agreement; whether it amounted to anti-competitive act on the part of these respondents and had adverse effect on the competition. In the process, the CCI was also supposed to examine as to whether the respondents colluded with COAI and abused their dominant position. His further argument was that inquiry into these aspects was within the exclusive domain of the CCI as it is the CCI which is supposed to ensure that no such anti-competitive practices are adopted by anybody and if that has happened, the CCI is empowered to issue directions in terms of Section 27 of the Act and also impose penalties. It has power to impose even lesser penalties as provided in Section 46 of the Act.

#28. Mr. Narasimha also referred to Section 60 of the Act which provides for overriding effect for the Act and reads as under: A B C D E F G H 522 SUPREME COURT REPORTS [2018] 14 S.C.R. “60. Act to have overriding effect. - The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force.” It was emphasised that the case of the CCI is not that the TRAI does not have power to exercise jurisdiction at all in the present factual matrix and there is no conflict of jurisdiction or legal regimes. Rather, both the TRAI and the CCI exercise their jurisdiction in their respective fields. Exercise of jurisdiction by the CCI to investigate an alleged cartel does not impinge upon TRAI’s jurisdiction to regulate the industry in any way. Submission in this behalf was that the TRAI exercises its jurisdiction by ensuring compliance with the interconnect agreements, license conditions, interconnection regulations, quality of service norms and regulations etc. Based on past experience, the TRAI frames regulations for the improvement of the telecom industry in the future. For instance, the June 07, 2005 direction of TRAI which provided for a 90-day period for interconnection has now been replaced by the interconnection regulations of 2018, by which the time period for provision of POIs has been reduced to 30 days, because it was found that due to technical advancements, it was possible to give POIs in a much shorter time frame, and parties were using the 90-day period to delay the provision of POIs, as in the case of RJIL. However, the TRAI does not have the power to penalize for past conduct which was of anti-competitive nature. It was further submitted that while the competition law seeks to promote efficient allocation and utilization of resources by inter alia lowering the entry barriers in the market, the primary objective of the sectoral regulators like the TRAI is development of their respective sector. However, what is important to bear in mind is that the promotion of competition and prevention of competitive behaviour may not be high on the agenda of a sectoral regulator which makes it prone to ‘regulatory capture’. The position has been very succinctly captured by the Report of the Working Group on Competition Policy, Planning Commission of India, Government of India, February 2007 which states as follows: “7.2.3 The objective of a sectoral regulator is to provide good quality service at affordable rates, but the promotion of competition and prevention of anti-competitive behaviour may not be high on its agenda or the laws governing the regulator may be silent on this aspect. It is not uncommon for sectoral regulators to be more closely aligned with the interest of the A B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 523 firms being regulated, which is also known as ‘regulatory capture’. Besides, a sectoral regulator may not have an overall view of the economy as a whole and may tend to apply yardsticks which are different from the ones used by the other sectoral regulators. In other words, there is a possibility of the lack of consistency across sectors. On the other hand, CCI will be able to apply uniform competition principles across all sectors of economy.” (emphasis added) The National Competition Policy 2011 has also observed as following: “8.3 The objective of a sectoral regulator is to provide good quality service at affordable rates, but the promotion of competition and prevention of anti-competitive behaviour may not be high on its agenda or the laws governing the regulator may be silent on this aspect. Besides, a sectoral regulator may not have an overall view of the economy as a whole and may tend to apply yardsticks which are different from the ones used by the other sectoral regulators. In other words, there is a possibility of the lack of consistency across sectors as regards competition issues. On the other hand, the CCI, which is expected to have developed the core competence, expertise and capacity in competition related issues, will be able to apply uniform competition principles across all sectors of economy. Besides, enforcement and penalizing violations of Competition Act is the exclusive area of the CCI. Even otherwise, the general principle for economic efficiency would be, whoever can do a thing in best and most professional manner should do it.” (emphasis added)

#29. The learned ASG, on taking support from the above, submitted that the sectoral regulators, by contrast, will not be as experienced in conducting competition analysis as the competition authorities. Being susceptible to regulatory capture, the day-to-day interactions between industry officials and regulatory agency may lead to a commonality of interests that can interfere with the perspective necessary to evaluate competitive harms and to construct remedies that will protect competition A B C D E F G H 524 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G for the benefit of the economy as a whole. While the sector specific regulators typically impose and monitor various behavioral conditions, the competition agencies are more likely to opt for structural remedies which would lead the sector to evolve to a point where sufficient new entry is induced thereby promoting genuine competition. According to him, keeping in view the aforesaid respective roles in mind, the Parliament in its wisdom and foresight has built in a mechanism within the Act to address apparent conflicts of jurisdiction. The ‘comity’ between the sectoral regulator (TRAI) and the market regulator (CCI) is entirely addressed by a reading of Section 21 and Section 21A of the Act. In any case, Section 60 of the Act had an overriding effect. To support his argument, the learned ASG relied upon State (NCT of Delhi) v. Sanjay2 wherein this Court dealt with the issue of whether a prescription of offence under the Mines & Minerals Development & Regulation (MMDR) Act would exclude the application of the Indian Penal Code. The Court held that due to the absence of a non-obstante clause, the application of the Indian Penal Code was not excluded. In the present case, the TRAI Act does not apply notwithstanding any other laws, and it does not contain an overriding effect provision containing a non-obstante clause. The relevant paragraphs of the judgment have been extracted below: “62. Sub-section (1-A) of Section 4 of the MMDR Act puts a restriction in transporting and storing any mineral otherwise than in accordance with the provisions of the Act and the Rules made thereunder. In other words no person will do mining activity without a valid lease or licence. Section 21 is a penal provision according to which if a person contravenes the provisions of sub-section (1- A) of Section 4, he shall be prosecuted and punished in the manner and procedure provided in the Act. Sub-section (6) has been inserted in Section 4 by amendment making the offence cognizable notwithstanding anything contained in the Code of Criminal Procedure, 1973. Section 22 of the Act puts a restriction on the court to take cognizance of any offence punishable under the Act or any Rule made thereunder except upon a complaint made by a person authorised in this behalf. It is very important to note that Section 21 does not begin with a non obstante clause. Instead of the words “notwithstanding anything contained in any law for the H 2(2014) 9 SCC 772 COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 525 time being in force no court shall take cognizance….”, the section begins with the words “no court shall take cognizance of any offence.

#63. It is well known that a non obstante clause is a legislative device which is usually employed to give overriding effect to certain provisions over some contrary provisions that may be found either in the same enactment or some other enactment, that is to say, to avoid the operation and effect of all contrary provisions.”

#30. He also premised his argument on the basis that the Act is a special statute in the field of telecommunications regulation, including technical aspects connected thereto, and in case of conflict between two special legislations, the later enactment would prevail. In Solidaire India Ltd. v. Fairgrowth Financial Services Ltd. & Ors.3, this Court held as under: “7. Coming to the second question, there is no doubt that the 1985 Act is a special Act. Section 32(1) of the said Act reads as follows: “32. Effect of the Act on other laws.—(1) The provisions of this Act and of any rules or schemes made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law except the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and the Urban Land (Ceiling and Regulation) Act, 1976 (33 of 1976) for the time being in force or in the Memorandum or Articles of Association of an industrial company or in any other instrument having effect by virtue of any law other than this Act.”

#8. The effect of this provision is that the said Act will have effect notwithstanding anything inconsistent therewith contained in any other law except to the provisions of the Foreign Exchange Regulation Act, 1973 and the Urban Land (Ceiling and Regulation) Act, 1976. A similar non obstante provision is contained in Section 13 of the Special Court Act which reads as follows: “13. Act to have overriding effect.—The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law, other 3(2001) 3 SCC 71 A B C D E F G H 526 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G than this Act, or in any decree or order of any court, tribunal or other authority.”

#9. It is clear that both these Acts are special Acts. This Court has laid down in no uncertain terms that in such an event it is the later Act which must prevail. The decisions cited in the above context are as follows: Maharashtra Tubes Ltd. v. State Industrial & Investment Corpn. of Maharashtra Ltd. [(1993) 2 SCC 144]; Sarwan Singh v. Kasturi Lal [(1977) 1 SCC 750 : (1977) 2 SCR 421]; Allahabad Bank v. Canara Bank [(2000) 4 SCC 406] and Ram Narain v. Simla Banking & Industrial Co. Ltd. [AIR 1956 SC 614 : 1956 SCR 603]”

#31. The learned ASG endeavoured to support his proposition by referring to the contrasting provision contained in Section 14 of the TRAI Act which provides for dispute resolution in respect of various categories of persons before the TDSAT, which specifically carves out an exception in respect of monopolistic trade practice, restrictive trade practice and unfair trade practice, which was subject to the jurisdiction of the Monopolies and Restrictive Trade Practices Commission (MRTP Commission). He submitted that this was another indicator in the TRAI Act itself from which it can be inferred that when it comes to anti- competitive practices, an embargo is put on the TRAI to deal with such practices, inasmuch as the Competition Act is enacted to repeal and replace the obsolete regime of the MRTP Act. In this behalf, he drew sustenance from Section 8 of the General Clauses Act to submit that the Competition Act could be read in place of MRTP Act while construing the provisions of Section 14 of the TRAI Act.

#32. His another submission, in this hue, was that a distinction needs to be drawn between facilitating competition (as provided in Section 11 of the TRAI Act) on the one hand and curbing and deterring anti-competitive conduct and practices on the other hand. His submission in this behalf was that the function of the TRAI under Section 11(1)(a)(iv) was to facilitate competition which was purely recommendatory in nature and not part of regulatory function of the TRAI, as held in Union of India and Another v. Association of Unified Telecom Service Providers of India and Others4. He also argued that TRAI has no power to enforce compliance, pass orders, or give directions of the nature envisaged under the Act to curb anti-competitive conduct. H 4(2011) 10 SCC 543 COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 527

#33. The learned ASG also relied upon the judgment of the European Commission in Deutsche Telekom v. European Commission5 wherein it was held that it is only if the legislative framework eliminates the possibility of competition (for example, a statutory monopoly) that the jurisdiction of the Commission would be excluded. Following passage from the said judgment was specifically referred to: “80. According to the case-law of the Court of Justice, it is only if anti-competitive conduct is required of undertakings by national legislation, or if the latter creates a legal framework which itself eliminates any possibility of competitive activity on their part, that Articles 81 EC and 82 EC do not apply. In such a situation, the restriction of competition is not attributable, as those provisions implicitly require, to the autonomous conduct of the understandings. Articles 81 EC and 82 EC may apply, however, if it is found that the national legislation leaves open the possibility of competition which may be prevented, restricted or distorted by the autonomous conduct of undertakings (Joined Cases C-359/95P and C-379/ 95P Commission and France v. Ladbroke Racing (1997) ECR I- 6265, paragraphs 33 and 34 and the case-law cited).”

#34. Mr. Narasimha also referred to another judgment of the General Court of the European Union in Telefonica SA v. European Commission (T-336/07) wherein it was held that the European Commission could intervene in the telecommunications market, even though the entry was regulated through a sectorial regulator. He pointed out that this decision of the General Court was upheld in appeal by the European Court of Justice vide its judgment dated July 10, 2014.

#35. Mr. Narasimha also contrasted the investigative regime under the two Acts, i.e. Section 12 of the TRAI Act vis-a-vis Section 41 read with Section 36(2) of the Competition Act and submitted that the Director General under the Competition Act is better equipped to deal with detection and investigation of anti-competitive agreements.

#36. Labelling as erroneous, the approach of the High Court that CCI should await the outcome of the proceedings before TRAI to attain finality, answer given by Mr. Narasimha was that this approach was erroneous for three reasons. First, the High Court has failed to appreciate the different fields/domains in which the CCI and the TRAI operate. 5Case C-280/08P, Judgement dated 14.10.2010 A B C D E F G H 528 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G Secondly, the course of action proposed by the High Court would result in considerable delay defeating the CCI’s investigation. Thirdly, the High Court has failed to notice the role played by Section 21A of the Act.

#37. He again emphasised that CCI is not inquiring into the adequacy of POIs provided to RJIL by the respondents, or compliance with the QoS standards of TRAI and licence conditions, but was examining whether the conduct of the respondents was unilateral or it was the result of anti- competitive agreement. Insofar as requirement of speedy investigation by the CCI is concerned, he submitted that such a requirement has already been acknowledged and mandated by this Court in Competition Commission of India v. Steel Authority of India Limited and Another6. Further, if at any stage, prior to or after taking a decision, the CCI is of the view that opinion of TRAI is required, it could always make reference under Section 21A of the Competition Act.

#38. On the second proposition, namely, the High Court could not have entertained writ jurisdiction in respect of an order passed under Section 26(1) of the Competition Act, Mr. Narasimha clarified that he was not taking the position that the High Court ,in no circumstance/ situation, exercise its extraordinary jurisdiction under the said provision, in spite of an order passed under Section 26 of the Competition Act. His submission, however, was that as per the judgment in Steel Authority of India Limited case, such jurisdiction would be very narrow and is to be exercised in exceptional cases. According to him, no such exceptional circumstance arises in the instant case as order in question was only a prima facie view of the CCI and such an order was administrative in nature. Learned ASG specifically referred to the following discussion in the case of Steel Authority of India Limited: “38. In contradistinction, the direction under Section 26(1) after formation of a prima facie opinion is a direction simpliciter to cause an investigation into the matter. Issuance of such a direction, at the face of it, is an administrative direction to one of its own wings departmentally and is without entering upon any adjudicatory process. It does not effectively determine any right or obligation of the parties to the lis. Closure of the case causes determination of rights and affects a party i.e. the informant; resultantly, the said party has a right to appeal against such closure of case under H 6(2010) 10 SCC 744 COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 529 Section 26(2) of the Act. On the other hand, mere direction for investigation to one of the wings of the Commission is akin to a departmental proceeding which does not entail civil consequences for any person, particularly, in light of the strict confidentiality that is expected to be maintained by the Commission in terms of Section 57 of the Act and Regulation 35 of the Regulations.

#97. The above reasoning and the principles enunciated, which are consistent with the settled canons of law, we would adopt even in this case. In the backdrop of these determinants, we may refer to the provisions of the Act. Section 26, under its different sub- sections, requires the Commission to issue various directions, take decisions and pass orders, some of which are even appealable before the Tribunal. Even if it is a direction under any of the provisions and not a decision, conclusion or order passed on merits by the Commission, it is expected that the same would be supported by some reasoning. At the stage of forming a prima facie view, as required under Section 26(1) of the Act, the Commission may not really record detailed reasons, but must express its mind in no uncertain terms that it is of the view that prima facie case exists, requiring issuance of direction for investigation to the Director General. Such view should be recorded with reference to the information furnished to the Commission. Such opinion should be formed on the basis of the records, including the information furnished and reference made to the Commission under the various provisions of the Act, as aforereferred. However, other decisions and orders, which are not directions simpliciter and determining the rights of the parties, should be well reasoned analysing and deciding the rival contentions raised before the Commission by the parties. In other words, the Commission is expected to express prima facie view in terms of Section 26(1) of the Act, without entering into any adjudicatory or determinative process and by recording minimum reasons substantiating the formation of such opinion, while all its other orders and decisions should be well reasoned.”

#39. He also drew the attention of the Court to paragraph 25 of the CCI’s order dated April 21, 2017 as per which the Director General was asked to conduct the investigation without being swayed in any manner A B C D E F G H 530 SUPREME COURT REPORTS [2018] 14 S.C.R. whatsoever by the observations made by the CCI in the said order. He submitted that in these circumstances the said order was merely administrative in nature and could not be labelled as quasi-judicial order. In the same vein his further submission was that the observations of the High Court that the CCI has decided several issues and elements with clear adverse consequences was clearly erroneous and contrary to the well-established principle of law. In support, he also referred to the judgments of the Bombay and the Allahabad High Courts.

#40. Dilating on his third proposition, namely, the CCI order was not perverse, he submitted that there was sufficient material before the CCI for formation of a prima facie opinion that the conduct of the respondents was violative of Section 3(3)(b) of the Competition Act. He submitted that such material was taken into consideration and discussed in the order itself and he referred to certain paragraphs of the order dated April 21, 2017 in this behalf. In the process, he again emphasised that none of the observations made in the said order are conclusive findings in any way and not binding on the Director General and this was only the starting point, as held in the case of Excel Crop Care Limited.

#41. M/s. Harish Salve, Dr. A.M. Singhvi, Ramji Srinivasan and Amit Sibal, learned senior advocates, argued on behalf of RJIL. Their detailed submissions were almost on the lines on which Mr. Narasimha, learned ASG, had argued on behalf of the CCI.

#42. In the first place, it was emphasised that insofar as dragging of COAI into this investigation is concerned, it was sought to be justified by placing reliance on Section 3 of the Act which specifically recognises possible mischief by an association of persons or an association of enterprises. It was stressed that Section 3(3) recognises certain agreements as per se violations, and shall be presumed to have appreciable adverse effect on competition. Submission was that associations of enterprises, after the operation of the Act are now liable to be viewed with great suspicion in view of the fact that by its very nature an association of competing enterprises provides a convenient platform for such competitors to assemble together.

#43. The involvement of COAI was sought to be proved by arguing that the IDOs have not argued that COAI letters must be ignored since the decision to provide or not to provide POIs to its competitor was A B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 531 taken by each of them independently either Airtel by itself, or Vodafone by itself, or Idea by itself. But the facts of the case disclose active involvement by that common platform called COAI. As per the Reliance Jio, the COAI admittedly facilitated exchange of information between the three IDOs. It draws references in its response to private letters exchanged between Reliance Jio and each of the IDOs separately. The decisions of the COAI are not decisions of a majority comprising of a large and diverse pool of members that could suggest a democratic decision making. By its very constitution, the COAI’s majority views were nothing but the common views of the three IDOs that controlled it. It was also argued that in the preliminary conference and in the High Court defence raised was that COAI was not a front for these three IDOs but was merely espousing general industry issues. It does not explain how it chanced upon private documents and correspondence exchanged bilaterally between RJIL with each of the IDOs separately. It does not explain how it voiced the common decisions on behalf of those three IDOs. The COAI was not the fourth voice but was the prohibited chorus of those three colluding competitors. Thus, no legitimacy can be attributed to actions of the COAI. Attention of the Court was drawn to the letter dated August 08, 2016 (before the announcement of launch of services by Reliance Jio dated September 01, 2016) and the letter dated September 02, 2016 (after the launch of Reliance Jio) which, according to Reliance Jio, expose the common collusive conduct of these competitors to first delay the launch and secondly to scuttle the launch. It was also contended that the concerted, collusive conspiracy by the three existing IDOs (having a collective market share of 65%) to meet with each other under auspices of their association called Cellular Operators Association of India (COAI) and evolve a common strategy to respond to challenge posed by a new entrant RJIL, is by itself violative of Section 3 of the Act. The learned senior counsel pointed out that the defence of the COAI is that it was merely lobbying the Government for enacting a change in law or regulation to stop Reliance Jio from carrying out test on such a large scale by introducing limits on number of Test-subscribers. However, the letters of COAI revealed an active participation of taking sides of certain operators whose interest was to hinder, or at least slowdown the entry of the new operator. COAI announced unilateral decisions like virtual boycott (which is not the same as lobbying for change of regulation). To A B C D E F G H 532 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H support this argument, reference was made to the decisions of Supreme Court of United States in FTC v. Supreme Court Trial Lawyers Association7 wherein it has observed that: “no violation of the Act can be predicated upon mere attempts to influence the passage or enforcement of laws,” even if the defendants’ sole purpose is to impose a restraint upon the trade of their competitors. But in the Noerr case the alleged restraint of trade was the intended consequence of public action; in this case the boycott was the mans by which respondents sought to obtain favourable legislation. The restraint of trade that was implemented while the boycott lasted would have had precisely the same anticompetitive consequences during that period even if no legislation had been enacted. In Noerr, the desired legislation would have created the restraint on the truckers’ competition; in this case the emergency legislative response to the boycott put an end to the restraint.”

#44. On the submission that the dangers of a trade association being hijacked to further the cause of only a few competitors and yet attempt to give the entire exercise a veneer of respectability has been also commented upon in the recent decision of this Court in Competition Commission of India v. Coordination Committee of Artistes and Technicians of West Bengal Film and Television & Ors.8 wherein it has been observed that: “47. In the instant case, admittedly the Coordination Committee, which may be a “person” as per the definition contained in Section 2(l) of the Act, is not undertaking any economic activity by itself. Therefore, if we were to look into the “agreement” of such a “person” i.e. Coordination Committee, it may not fall under Section 3(1) of the Act as it is not in respect of any production, supply, distribution, storage, acquisition or control of goods or provision of services. The Coordination Committee, which as a trade union acting by itself, and without conjunction with any other, would not be treated as an “enterprise” or the kind of “association of persons” described in Section 3. A trade union acts as on behalf of its members in collective bargaining and is not engaged in economic activity. In such circumstances, had the Coordination Committee 7493 US 411 (1990) 8(2017) 5 SCC 17 COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 533 acted only as trade unionists, things would have been different. Then, perhaps, the view taken by the Tribunal could be sustained. However, what is lost in translation by the Tribunal i.e. in applying the aforesaid principle of the activity of the trade union, is a very pertinent and significant fact, which was taken note of by the DG as well as CCI in its majority opinion. It is this: the Coordination Committee (or for that matter even Eimpa) are, in fact, association of enterprises (constituent members) and these members are engaged in production, distribution and exhibition of films. Eimpa is an association of film producers, distributors and exhibitors, operating mainly in the State of West Bengal. Likewise, the Coordination Committee is the joint platform of Federation of Senior Technician and Workers of Eastern India and West Bengal Motion Pictures Artistes’ Forum. Both Eimpa as well as the Coordination Committee acted in a concerted and coordinated manner. They joined together in giving call of boycott of the competing members i.e. the informant in the instant case and, therefore, the matter cannot be viewed narrowly by treating Coordination Committee as a trade union, ignoring the fact that it is backing the cause of those which are “enterprises”. The constituent members of these bodies take decision relating to production or distribution or exhibition on behalf of the members who are engaged in the similar or identical business of production, distribution or exhibition of the films. Decision of these two bodies reflected collective intent of the members. When some of the members are found to be in the production, distribution or exhibition line, the matter could not have been brushed aside by merely giving it a cloak of trade unionism. For this reason, the argument predicated on the right of trade union under Article 19 of the Constitution, as professed by the Coordination Committee, is also not available.” (emphasis supplied) Arguments: The respondents:

#45. Mr. Darius J. Khambata, senior advocate, appeared on behalf of Idea Cellular Ltd. Mr. Gopal Jain and Mr. Navroz Seervai, senior advocates, appeared on behalf of Bharti Airtel Ltd. Mr. Ranjit Kumar, Mr. Arvind Datar and Mr. Sidharth Luthra, senior advocates, appeared A B C D E F G H 534 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C on behalf of Vodafone India Ltd. Mr. P. Chidambaram, senior advocate, appeared on behalf of the COAI. TRAI had also intervened in the matter and supported the legal submission of the IDOs, namely, that TRAI had the exclusive jurisdiction to deal with the matter, i.e. there was a complete absence of jurisdiction in CCI to deal with the issue at hand. Instead of taking note of the submissions of these counsel separately, we are taking note of the submissions in a consolidated manner as that would avoid repetition.

#46. The submissions of the respondents can be paraphrased as under: (i) The TRAI Act, being a special law, ousts the jurisdiction of CCI to examine the telecom sector. In that sense, exclusive jurisdiction vests in TRAI to regulate the telecom sector, including competition related issues, thereby ousting the jurisdiction of the CCI altogether. (ii) Even if the CCI has the jurisdiction, TRAI’s jurisdiction will D prevail. (iii) In the alternative, the jurisdictional facts, in any case, had to be determined by the TRAI in the first place. Since there was absence of jurisdictional facts, the CCI could not have proceeded with the matter and ordered the investigation. Thus, the CCI’s order for carry out investigation is premature. (iv) The impugned order passed by the CCI under Section 26(1) of the Competition Act applies the ‘prima facie test’ and consequences of such an order are grave. Such an order was quasi-judicial in nature and, therefore, amenable to judicial review under Article 226 of the Constitution of India. Thus, the writ petitions filed by the IDOs challenging this order were maintainable. (v) On merits, the prima facie order passed by the CCI was without considering the material submitted by the IDOs. In this behalf it was argued that the IDOs had provided sufficient POIs and given ample proof thereof, which was not taken into consideration by the CCI while passing the impugned order under Section 26(1) of the Competition Act. This also becomes a valid ground to challenge the order by filing writ petition under Article 226 of the Constitution of India. E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 535

#47. Insofar as the argument of the respondents that the TRAI Act is a complete code and the jurisdiction of CCI is totally ousted, the argument proceeded on the following basis: The real issue which arises is comparison of two regimes – one regulated by TRAI under the Indian Telegraph Act, 1885, Wireless Telegraphy Act, 1933 and the TRAI Act, 1997 which together forms a comprehensive and complete code; and the other being CCI under the Competition Act. The various provisions under these legislations seen with the terms of the License Agreement show that the issues arising out of interconnection between different operators shall be determined within the overall framework of the interconnection regulations/directions/ orders issued by TRAI from time to time. The Object and Reasons of the TRAI Act itself lays down that it is mandated to make arrangements for protection and promotion of consumer interest and ensuring fair competition and to ensure orderly and healthy growth of telecommunication infrastructure. Moreover, the competition in the telecom sector is of a different kind as it has to function under the constant monitoring and regulation of TRAI. TRAI effectively plays the role of a watchdog of the sector as otherwise the entire sector would collapse if there is no interdependence between the telecom operators. Moreover, under Section 11(1)(a)(iv) of the TRAI Act, the authority is required to take measures to facilitate competition in the market. CCI can ensure competition only in an unregulated sector and not in the likes of the telecom sector wherein even the tariffs are capped/determined by TRAI.

#48. On the aforesaid basis, the submission was that: (a) The TRAI Act is a complete code. (b) Exclusive jurisdiction vests in TRAI to regulate the telecom sector including competition related issues. (c) The TDSAT has the exclusive jurisdiction to examine the disputes between licensees including the one raised by RJIL before CCI. (d) CCI has no jurisdiction to decide disputes pertaining to the telecom sector. In this hue it was submitted that the Statement of Objects and Reasons of the TRAI Act made it abundantly clear by satisfying that TRAI was supposed to make “arrangements for protection and promotion A B C D E F G H 536 SUPREME COURT REPORTS [2018] 14 S.C.R. of consumer interest and ensuring fair competition...”. It was, thus, clear that even the competition aspects of the telecom sector were within the domain of TRAI. The respondents also drew comparison of the Preamble of the Competition Act with that of the TRAI Act to point out that insofar as dealing with the issue of fair competition in telecom sector is concerned, it was overlapping to a great extent in the following manner: Competition Act TRAI Act An Act to provide, keeping in view the economic development of the country, for the establishment of a Commission to provide An Act establishment of the Telecom Regulatory Authority of India and the Telecom Dispute Settlement and Appellate Tribunal (“TDSAT”) “prevent practices having adverse effect on competition [-] to promote and sustain competition in markets [for protection and promotion of consumer interest and ensuring fair competition (Statement of Object and Reasons)] to protect interests of consumers and to protect service providers and consumers of the telecom sector (Preamble) interest of to ensure freedom of trade carried on by other participants in the markets, in India to promote and ensure orderly growth of the telecom sectoral for matters connected incidental thereto” therewith or For matters connected therewith and incidental thereto

#49. It was submitted that pursuant to Section 11(1)(a)(iv) read with Section 11(1)(b)(ii), (iii), (iv) of the TRAI Act (including directions and regulations issued by TRAI), the TRAI has been statutorily mandated to perform functions on a variety of matters including measures aimed at facilitating competition and regulated interconnection between service providers. Reliance was also placed on Section 12 of the TRAI Act which empowers TRAI with vast powers to discharge its functions, including to call for information, conduct investigations and issue such necessary directions as it may deem necessary for the discharge of its functions. Moreover, TRAI has also been empowered to issue appropriate directions under Section 12 and make regulations under Section 36 of the TRAI Act. Section 29 of the TRAI Act provides for A B C D E F G H COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 537 penalties for contravention of directions of the TRAI. Further, under Section 14A of the TRAI Act, it has been provided that any person may make an application before the TDSAT. With regard to the jurisdiction, Section 15 and 27 of the TRAI Act provide for explicit bar on jurisdiction of the civil courts to determine any matter with regard to which TDSAT or TRAI have been empowered by or under the TRAI Act.

#50. It was submitted that in the present case, at the time RJIL filed its Information before the CCI on November 08, 2016 as also when the prima facie order was passed on April 21, 2017, TRAI was seized of the matter pertaining to provisioning of POIs and even made certain recommendations to the DoT on October 21, 2016. Accordingly, TRAI had assumed jurisdiction and was exercising the same. Thus, the dispute was being dealt with and was addressed by the TRAI and even on this ground, the jurisdiction of the CCI stands ousted.

#51. The TDSAT has the exclusive jurisdiction to examine the disputes between licensees including the one raised by RJIL before CCI. This very submission on the exclusion of CCI’s jurisdiction was sought to be projected from another angle. It was submitted that in the Information filed by RJIL before the CCI, Reliance Jio stressed: (a) The dispute raised by RJIL before the CCI pertains to the specific performance of the Interconnect Agreement and the rights and liabilities arising therefrom; (b) The Interconnect Agreement is completely regulated by the TRAI inter alia under Section 11(1)(b)(ii), (iii), (iv) of the TRAI Act read with the Quality of Service Regulations, 2009 issued thereunder. The argument was that the prayers sought by RJIL in the Information filed before the CCI clearly demonstrate that RJIL was seeking specific performance of the Interconnect Agreement. Hence, RJIL has dressed up what is essentially a contractual complaint into anti-competition clothing. In the present dispute, upon a meaningful reading of the Information it can clearly be seen that through clever drafting, RJIL has dressed up the allegations of delay/denial of the POIs as alleged anti-competitive behaviour. In this behalf, reliance was placed on the decision of this Court in Begum Sabiha Sultan v. Nawab Mohd. Mansur Ali Khan & Ors.9, wherein it was held: 9(2007) 4 SCC 343 A B C D E F G H 538 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G “10. There is no doubt that at the stage of consideration of the return of the plaint under Order 7 Rule 10 of the Code, what is to be looked into is the plaint and the averments therein. At the same time, it is also necessary to read the plaint in a meaningful manner to find out the real intention behind the suit. In Moolji Jaitha and Co. v. Khandesh Spg. and Wvg. Mills Co. Ltd. [AIR 1950 FC 83] the Federal Court observed that: (AIR p. 92, para 24) “The nature of the suit and its purpose have to be determined by reading the plaint as a whole.” It was further observed: (AIR p. 92, para 25) “The inclusion or absence of a prayer is not decisive of the true nature of the suit, nor is the order in which the prayers are arrayed in the plaint. The substance or object of the suit has to be gathered from the averments made in the plaint and on which the reliefs asked in the prayers are based.” It was further observed: (AIR p. 98, para 59) “It must be borne in mind that the function of a pleading is only to state material facts and it is for the court to determine the legal result of those facts and to mould the relief in accordance with that result.”

#52. In support of the submission that a special legislation i.e. the TRAI Act, will prevail over the provisions of the Competition Act, which according to the respondents is general in nature, reliance has been placed on the decisions of this Court in State of Punjab v. Labour Court, Jullundur & Ors.10. In the said matter, the Court was inter alia seized of the issue whether the employee-respondents were at liberty to seek the payment of gratuity by invoking the remedy available under Section 33-C(2) of the Industrial Disputes Act, 1947 as opposed to the Payment of Gratuity Act, 1972. In deciding the said dispute, it was held that: “7. It is apparent that the Payment of Gratuity Act enacts a complete code containing detailed provisions covering all the essential features of a scheme for payment of gratuity. It creates the right of payment of gratuity, indicates when the right will accrue, and lays down the principles for quantification of the gratuity. It provides further for recovery of the amount, and contains an H 10(1980) 1 SCC 4 COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 539 especial provision that compound interest at nine per cent per annum will be payable on delayed payment. For the enforcement of its provisions, the Act provides for the appointment of a controlling authority, who is entrusted with the task of administering the Act. The fulfilment of the rights and obligations of the parties are made his responsibility, and he has been invested with an amplitude of power for the full discharge of that responsibility. Any error committed by him can be corrected in appeal by the appropriate Government or an Appellate Authority particularly constituted under the Act.

#8. Upon all these considerations, the conclusion is inescapable that Parliament intended that proceedings for payment of gratuity due under the Payment of Gratuity Act must be taken under that Act and not under any other. That being so, it must be held that the applications filed by the employee respondents under Section 33-C(2) of the Industrial Disputes Act did not lie, and the Labour Court had no jurisdiction to entertain and dispose of them. On that ground, this appeal must succeed.” (emphasis supplied)

#53. Applying the aforesaid tests to the present case, the submission of the respondents is that: (a) The subject area of competition law is dealt with by the Competition Act, 2002. (b) The TRAI Act, 1997 is a complete code in itself and regulates the Telecom Sector. (c) The Preamble, the Statement of Objects and Reasons and Section 11(1) of the TRAI Act provide the TRAI with the power to inter alia regulate competition in the telecom sector. (d) Accordingly, being the special law regarding the telecom sector, as regards competition issues arising in the telecom sector, the TRAI Act would prevail over the Competition Act.

#54. Replying to the argument of the appellants that the TRAI Act as well as the Competition Act are both special statutes and hence, the rule of statutory interpretation of special law prevailing over the general law will be inapplicable in the present dispute, the respondents referred A B C D E F G H 540 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H to the decision of this Court in Ashoka Marketing Ltd. & Anr. v. Punjab National Bank & Ors.11. In the said case, the Court was seized of an issue on whether the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 would override the provisions of the Delhi Rent Control Act, 1958 in relation to the premises belonging to Punjab National Bank Ltd., a body corporate under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970. Each side argued that the enactment relied upon by it is a special statute and the other enactment is general. The Court held that the Rent Control Act is a special statute regulating the relationship of landlord and tenant in the Union Territory of Delhi and even the Public Premises Act is a special statute relating to eviction of unauthorised occupants from public premises. While concluding that both the enactments are special statutes, the Court held: “”61. ...in the case of inconsistency between the provisions of two enactments, both of which can be regarded as special in nature, the conflict has to be resolved by reference to the purpose and policy underlying the two enactments and the clear intendment conveyed by the language of the relevant provisions therein.

#64. ...In our opinion, therefore, keeping in view the object and purpose underlying both the enactments viz. the Rent Control Act and the Public Premises Act, the provisions of the Public Premises Act have to be construed as overriding the provisions contained in the Rent Control Act.” (emphasis supplied)

#55. Heavy reliance was placed on the judgment of the United States Supreme Court in the case of Credit Suisse v. Billing et al12. Here the submission was that if the CCI is permitted to examine the information of RJIL that it was to be provided POIs immediately despite there being a period of 90 days in the ICA, the following would be the consequences: (i) The same may cause a threat and may alter the functioning of telecom sector on account of threat of intervention of CCI even where the acts are in accordance with TRAI’s Regulations. The same would threaten efficient functioning of the telecom sector. 11(1990) 4 SCC 406 12551 US 264 (2007) COMPETITION COMMISSION OF INDIA v. BHARTI AIRTEL LIMITED AND ORS. [A. K. SIKRI, J.] 541 (ii) The additional benefits to competition would be very small as the TRAI Regulations anyway have been framed keeping in mind “facilitation of competition” in telecom sector. (iii) The same would encourage future actions before CCI when telecom related issues will be dressed up as competition issues. It was the fervent plea that in order to avoid such conflict of standards and norms, the TRAI Act being the sectoral law and the TRAI is already seized of the matter, the CCI should not be allowed to proceed.

#56. According to the respondents, the jurisdictional facts in the present matter would be: (a) Failure to provide adequate POIs in the test phase; or (b) Delay in providing POIs; or (c) Providing inadequate POIs.

#57. Mr. Datar, in particular, submitted that from a perusal of the extensive pleadings and findings of the High Court, it is manifest that the above issues are pending consideration before the TRAI/DoT as well as in connected writ petitions pending adjudication before the Delhi High Court. The emphasis was that there must first be clear findings on the above issues in the context of the TRAI Act, Rules and Regulations. According to him, that alone is not enough. It is necessary to establish that violation of the provisions of TRAI Act amounts to “abuse of dominance” or “anti-competitive agreements”. As per him, Section 21 and 21A of the Competition Act make it clear that jurisdiction of the CCI is divided into parts, viz: (a) Economic activity not regulated by any statutory authority. (b) Economic activity regulated by a statutory authority. In the latter case, Section 21A is mandatory and the CCI can act only in accordance with Sections 21A(1) and (2). Submission was that in economic activity that is regulated by a statutory authority, CCI can exercise powers under Section 26 only after complying with Section 21A. It was predicated on the principle that when the law prescribes things to be done in a particular manner, all other modes of action are prohibited. (Bhavnagar University v. Palitana Sugar Mill (P) Ltd. & Ors.13) 13(2003) 2 SCC 111 A B C D E F G H 542 SUPREME COURT REPORTS [2018] 14 S.C.R. A B C D E F G H

#58. In this hue, it was also argued that the decision of this Court in Competition Commission of India v. Steel Authority of India Ltd. & Anr.14 has no application to the present case because it does not deal with a sector that is regulated by a statutory authority. On the other hand, reliance was placed on the judgment in the case of Carona Ltd. v. Parvathy Swaminathan & Sons15.

#59. It was submitted that the facts of the SAIL case are clearly distinguishable from the present case as the main issue before the Supreme Court in SAIL was whether an appeal can be filed against an order passed under Section 26(1) of the Competition Act. Distinction was sought to be drawn on the basis of the following facts: (a) in the present case, CCI issued notice and called the TSPs including Vodafone for a preliminary conference to be held on January 31, 2017 and the parties were heard on January 31, 2017, February 07, 2017 and February 08, 2017; (b) hearing was held before CCI and detailed notes on arguments were submitted with supporting documents by the TSPs including Vodafone; (c) the prima facie order has been passed after hearing the submissions of the TSPs holding that a prima facie case of violation of the Competition Act has been made out; and (d) the prima facie order also provide for reasons in support of the decision arrived at by the CCI.

#60. Justifying the observations of the High Court that the order of the CCI cannot be treated as an ‘administrative order’, it was submitted that the order was passed by the CCI after collecting the detailed information from the parties and by holding the conferences, calling material details, documents, affidavits and by recording the opinion. It was also submitted that the High Court had rightly noted that majority decision of the CCI has given reasons by overlooking the law and the record. It was a reasoned order/direction and, therefore, judicial review is permissible. In this behalf it was submitted that the aforesaid view was taken on the basis of the following: