Amazon, Flipkart Vs CCI: SC Says Cant Grant Special Treatment To Watchdog

In a major blow to Competition Commission of India (CCI), the Supreme Court (SC) has reportedly refused to transfer 24 petitions connected to alleged antitrust violations by Flipkart and Amazon to a division bench of the Karnataka High Court (HC).

As per LiveLaw, SC directed Attorney General (AG) R Venkataramani to take instructions from the competition watchdog on whether it (CCI) agrees regarding transferring all related cases to the single judge HC bench by Monday. 

The case was heard by a two-judge bench comprising Justices Abhay Oka and Pankaj Mithal. 

Justice Oka reportedly observed that the antitrust watchdog cannot be given special treatment by transferring the cases directly to the division bench without first being given the chance to be heard by a single judge as per the Karnataka High Court Rules. 

“Only because some litigant is to be given special treatment, bypass the rules, we can’t place it directly before the division bench,” Justice Oka reportedly remarked.

During the course of the hearing, Justice Oka suggested consolidating all the cases before one HC rather than being directly brought before the Supreme Court.

Arguing for CCI, AG Venkataramani reportedly contended that the watchdog’s inquiry has been in limbo for four years due to ongoing litigation. In response, Justice Oka pointed out that the SC, in similar cases, previously transferred all cases on a single issue to one HC.

Retorting back, the attorney general proposed the SC bench to either transfer all matters to the Delhi HC (a division bench of which heard the issue first) or allow a single judge bench of Karnataka HC to conclude the hearings as the matter was at an advanced stage. 

Venkataramani also reportedly pitched that parties aggrieved with the Karnataka HC judgement could directly approach the Apex Court through a special leave petition, whereby the SC could conclusively decide all the matters.

However, senior advocates Abhishek Manu Singhvi and Mukul Rohatgi, representing Flipkart and Amazon sellers, objected to the suggestion of directly approaching the SC citing that such a move would bypass an intra-court appeal in the High Court.

Then, Justice Oka proposed that SC could transfer all related petitions to the Karnataka HC. Reverting back, the AG noted that a single bench of the Karnataka HC was currently already hearing the matter and sought a transfer to the Delhi HC.

Responding to this, Justice Oka said, “We will be accepting (a) very dangerous argument that because in one High Court, as per rules matter is heard by (the) single judge, only because in other High Court it is heard by division bench it should come to that High Court”.

Thereafter, AGI called for transferring all petitions to a division bench of the Karnataka HC to expedite the issue. It is to this that the bench said that no litigant should receive special treatment by bypassing one step of the litigation process.

“If it comes from a private entity, perhaps. I’m talking about a public institution talking about public interest, consumer interest, I’m not able to get along with my inquiry. How many years to be taken away from that because they (respondents) can go all around the country?” AG responded. 

To this, Singhvi alleged that CCI was engaging in “forum shopping”. Afterwards, the Attorney General sought time to take instructions from CCI and offered to return with a conclusive position on Monday (December 16). 

The Court agreed with the notion and then kept the matter for next hearing on Monday.

At the heart of the matter is the CCI’s internal report which found Amazon and Flipkart guilty of flouting antitrust laws by prioritising certain sellers. As per reports, the two ecommerce companies indulged in exclusive tie-ups, deep discounting tactics and preferential listings in violation of competition law.

Thereafter, multiple sellers associated with Amazon and Flipkart filed petitions in Karnataka, Punjab and Haryana, Delhi, Madras, Allahabad and Telangana High Courts challenging different aspects of the CCI’s probe. On the other hand, the watchdog has sought to club all these pleas before the SC to prevent multiplicity of proceedings and delays.

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