Case: Competition Commission of India Vs. M/s. Fast Way Transmission Pvt. Ltd. &amp; Others

The Preamble of the Act, read with the aforesaid provisions, would show that the Commission set up by the Competition Act certainly has a positive role to play. A perusal of Sections18 and 19 would show that it is a positive duty of the Commission to eliminate all practices which have an adverse effect on competition. Further the Commission should promote and sustain competition, apart from protecting the interest of consumers, so as to ensure freedom of trade carried on by all participants in markets all over India. Also, a positive role is given to the Commission to inquire, suo motu, into the dominant position of enterprises, and to prohibit anti competitive agreements. Section 60 then gives the Act overriding effect over other statutes in case of a clash between the Act and such statues to effectuate the policy of the Act, keeping in view the economic development of the country as a whole.8. On the facts of the present case, it is clear that "dominant position" is clearly made out. The Explanation to Section 4 specifically refers to a position of strength that is enjoyed by an enterprise or group thereof in the relevant market, which, as is stated hereinbefore, is Punjab and Chandigarh, in the Cable TV market, which enables respondents no. 1-4 to operate independently of competitive forces prevailing in the relevant market. The Commission has found, on facts, that since the aforesaid MSOs group has 85% of the subscribers share in the aforesaid cable TV market in the State of Punjab and Chandigarh, and that they are able to operate independently of competitive forces prevailing in the aforesaid market. This finding has notbeen set aside by the Appellate Tribunal. Also, the respondent would fall within Explanation (a)(ii) as well, though it is enough that it would fall within sub-section a(i) of the Explanation. Sub-section (ii) refers to a position of strength as enjoyed by the respondents which enables them to affect consumers in its favour.9. Replying upon the definition in Section 2(f)(ii), ShriNarsimha, learned ASG has, in our view, correctly argued that a broadcaster would certainly fall within the wide language contained in the aforesaid sub-section. We may also add that in all fairness the learned counsel for the respondent has agreed with the same. This being the case, it is clear that as both sub-sections (i) and (ii) of clause (a) of the Explanation apply, the respondent could be said to be in a "dominant position", for the purpose of Section 4, in the facts of the present case.10. The question which now arises is whether there is an abuse of such dominant position under Section 4(2)(c) where the respondent could be stated to have indulged in a practice resulting in denial of market access in any manner. 11. It can be seen that in the facts of the case, the broadcaster, namely respondent No. 5, had a broadcast agreement which was entered into for a period of one year from 1stAugust, 2010. This was sought to be terminated within the aforesaid period by the respondent by notices dated 19thJanuary, 2011. The TDSAT has, by its order dated 25thApril, 2012, adverted to Regulation 4.2 of the relevant Telecom Regulations, and has found that the respondents have not followed the aforesaid regulations, inasmuch as no reasons for termination have been given in the notices of termination. This being the case, it is clear that, on the present facts, there is an abuse of the dominant position enjoyed by the respondents 1-4 only for the reason that the broadcaster was denied market access on and after 19thFebruary, 2011 until 1st August, 2011. The words "in any manner" one of wide import and must be given their natural meaning. This being the case, it is difficult to appreciate the reasoning of the Appellate Tribunal that, as the broadcaster and MSOs are not in competition with one another, the provisions of Sections 3 and 4 do not get attracted. As has been held by us, the "dominant position" held by the respondent MSOs is clearly established for the purpose of Section 4 in the present case, and the Commission finding in that behalf is also not set aside by the Appellate Tribunal. If this be so, then once a dominant position is made out on facts, whether a broadcaster is in competition with MSOs is a factor that is irrelevant for the purpose of application of Section 4(2)(c) which, as has been found by us, becomes applicable for the simple reason that the broadcaster is denied market access due to an unlawful termination of the agreement between the said broadcaster and the respondents 1-4. 12. Having said this, however, we are of the view that no penalty ought to have been imposed on the facts of the present case. The finding of the Competition Commission that TRP rating of the broadcaster was not so low as it was almost equal to that of other channels, is not correct. In the counter affidavit filed before us by the respondent, they have specifically stated the TAM ratings of the respondent channel, as opposed to other news channels, from the month of September 2010 to January 2011, were as follows: S.No.Name of the ChannelAverage GRP of the Channel during five month period (Sept.’10 – Jan.’11) 1.AAJ TAK33.6 2.Day and Night News3.8 3.IBN724.7 4.MH1 News7.0 5.NDTV India22.5 6.PTC News35.6 7.Star News27.9 8.Zee News21.5 13. A perusal of the aforesaid chart would show that the GRP given to the news channel `Day and Night is much lower than that given to any other channel, and that learned senior counsel for the respondent was correct in stating that this was the reason for terminating the agreement with the broadcaster in mid-stream. Though we find that, on the facts of this case, Section 4(2)(c) has been breached, yet the reason given by respondents 1 to 4 for termination being otherwise justifiable, we feel that no penalty should be levied on the facts of the present case.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]7. The Preamble of the Act, read with the aforesaid provisions, would show that the Commission set up by the Competition Act certainly has a positive role to play. A perusal of Sections18 and 19 would show that it is a positive duty of the Commission to eliminate all practices which have an adverse effect on competition. Further the Commission should promote and sustain competition, apart from protecting the interest of consumers, so as to ensure freedom of trade carried on by all participants in markets all over India. Also, a positive role is given to the Commission to inquire, suo motu, into the dominant position of enterprises, and to prohibit anti competitive agreements. Section 60 then gives the Act overriding effect over other statutes in case of a clash between the Act and such statues to effectuate the policy of the Act, keeping in view the economic development of the country as a whole.8. On the facts of the present case, it is clear that "dominant position" is clearly made out. The Explanation to Section 4 specifically refers to a position of strength that is enjoyed by an enterprise or group thereof in the relevant market, which, as is stated hereinbefore, is Punjab and Chandigarh, in the Cable TV market, which enables respondents no.to operate independently of competitive forces prevailing in the relevant market. The Commission has found, on facts, that since the aforesaid MSOs group has 85% of the subscribers share in the aforesaid cable TV market in the State of Punjab and Chandigarh, and that they are able to operate independently of competitive forces prevailing in the aforesaid market. This finding has notbeen set aside by the Appellate Tribunal. Also, the respondent would fall within Explanation (a)(ii) as well, though it is enough that it would fall withina(i) of the Explanation.(ii) refers to a position of strength as enjoyed by the respondents which enables them to affect consumers in its favour.9. Replying upon the definition in Section 2(f)(ii), ShriNarsimha, learned ASG has, in our view, correctly argued that a broadcaster would certainly fall within the wide language contained in the aforesaidWe may also add that in all fairness the learned counsel for the respondent has agreed with the same. This being the case, it is clear that as both(i) and (ii) of clause (a) of the Explanation apply, the respondent could be said to be in a "dominant position", for the purpose of Section 4, in the facts of the present case.It can be seen that in the facts of the case, the broadcaster, namely respondent No. 5, had a broadcast agreement which was entered into for a period of one year from 1stAugust, 2010. This was sought to be terminated within the aforesaid period by the respondent by notices dated 19thJanuary, 2011. The TDSAT has, by its order dated 25thApril, 2012, adverted to Regulation 4.2 of the relevant Telecom Regulations, and has found that the respondents have not followed the aforesaid regulations, inasmuch as no reasons for termination have been given in the notices of termination. This being the case, it is clear that, on the present facts, there is an abuse of the dominant position enjoyed by the respondentsHaving said this, however, we are of the view that no penalty ought to have been imposed on the facts of the present case. The finding of the Competition Commission that TRP rating of the broadcaster was not so low as it was almost equal to that of other channels, is not correct.A perusal of the aforesaid chart would show that the GRP given to the news channel `Day and Night is much lower than that given to any other channel, and that learned senior counsel for the respondent was correct in stating that this was the reason for terminating the agreement with the broadcaster inThough we find that, on the facts of this case, Section 4(2)(c) has been breached, yet the reason given by respondents 1 to 4 for termination being otherwise justifiable, we feel that no penalty should be levied on the facts of the present case.