Delhi HC questions CCI's jurisdiction to order probe of JCB

Fair trade watchdog had ordered the probe saying it was prima facie of the view that JCB abused its dominant position to deny market access to Bull Machines

Delhi High Court has questioned the jurisdiction of Competition Commission of India (CCI) to order a probe into the allegation that British construction equipment maker JCB was abusing its dominant position to deny market access to a competing Indian firm.

Justice Manmohan has restrained fair trade watchdog CCI from passing any final order against J C Bamford Excavators Ltd (JCB) till the question of the commission's jurisdiction is decided by the court.

The court passed the order on the plea of JCB which has challenged CCI's March 11 decision to probe the allegation against the British firm on a complaint by Coimbatore-based Bull Machines Pvt Ltd.

CCI had ordered the probe saying it was prima facie of the view that JCB abused its dominant position to deny market access to Bull Machines, by engaging in "bad faith litigation".

CCI's order had come on Bull's plea that JCB by way of an ex-parte stay from the high court in 2011, had prevented it from launching its light construction equipment, Smart Bull, at the Excon 2011 Exhibition in Bangalore.

The Indian firm had alleged before CCI that JCB had later voluntarily withdrawn the plea for injunction from the high court and the case was filed only to harass Bull Machines.

Justice Manmohan, however, observed that "once an interlocutory application (stay application of JCB) has been disposed of, CCI does not have jurisdiction to interfere".

"It was a consent order," the court said referring to the withdrawal of the 2011 interim application of JCB, and added that instead of moving CCI, Bull Machines should have filed a suit for restitution if it had felt aggrieved.

"Prima facie this court is of the view that a substantial question of jurisdiction of respondent 1 (CCI) arises in the present petition.

"Consequently, till the next date of hearing while the petitioner (JCB) may give information as called upon by the Director General of CCI, no final order/report shall be passed either by CCI or its Director General," the court said and posted the matter for May 26.