COMPAT allows appeal against Competition Commission’s order on GAIL India
Directing an investigation into gas utility GAIL (India) Limited for alleged contravention of the competition law, the Competition Appellate Tribunal (COMPAT) has allowed appeal against an earlier order by the Competition Commission of India (CCI) with regard to gas supply agreements.
The CCI had in 2015 dismissed the complaints filed by Gujarat Industries Power Company Ltd (GIPCL) and Gujarat State Fertilizers & Chemicals Ltd (GSFCL), both of which have gas sales agreements with GAIL. The CCI order had stated that it could not find GAIL guilty of abusing its ‘dominant position’ in the city of Vadodara. The tribunal, however, noted that the commission had acted beyond the scope of its powers.
“The exercise undertaken by the Commission to determine the issues like relevant market, dominant position enjoyed by Respondent No. 2 (GAIL) in the relevant market and its conclusion that (GAIL) cannot be held to have abused its dominant position was clearly beyond the scope of the power required to be exercised under Section 26(1) of the Act”, stated the compat order.
Further, the tribunal directed the director general (DG) of the commission to investigate the initial complaints and specified that, “the impugned order is set aside and it is held that the appellant has succeeded in making out a prima facie case of violation of Section 4 of the Act which needs to be investigated.”
The DG has been instructed to submit a report in this regard to the competition commission with 60 days.