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HC keeps stay on CCI’s Maruti fine

Justice Rajiv Shakdher also restrained CCI from taking any “coercive measures” against the car-maker after it sought protection on the ground that other automobile manufacturers have already got relief from the division bench of the High Court and it be treated on par with them.

“ view of the above submissions no coercive measures be taken by the CCI till further order of this court,” the court said.On September 3 last year, MSI got relief when the High Court had given an interim stay to the fair trade watchdog’s August 25, 2014 order till the final disposal of similar pleas before the Madras High Court, filed by car manufacturers Hyundai and Nissan.

On August 25, 2014, the CCI had slapped a total penalty of Rs 2,545 crore on 14 car-makers in India in September last year. Out of the total, the fine imposed on MSI was Rs 471.14 crore.

The CCI had found them guilty of violating trade norms in the spare parts and after-services market and the same was to be deposited within 60 days.

The other car-makers are before the division bench of the High Court, which has also stayed the CCI’s August 25, 2014 order till disposal of the appeals. Apart from seeking a stay on the fine, Maruti, which was represented by senior advocate Amit Sibal, has also challenged CCI’s legal proceedings on alleged anti-competitive practice of selling spare parts at higher prices.

Sibal argued that CCI had suo motu expanded the scope of probe into the entire car industry even though it had originally received a complaint against three automobile firms - Honda, Volkswagen and FIAT.

The counsel questioned whether the anti-trust regulator had the powers to expand the scope of investigations on its own, even if the complainant had not named a company in the original complaint. The CCI Director General’s (DG) probe showed these car companies violated competition norms with respect to their agreements with local Original Equipment Suppliers (OESs) as well as in terms of pacts with authorised dealers. The DG is the investigation arm of CCI.

The complaint was filed in January, 2011 against Honda, Volkswagen and FIAT. In April 2011, CCI extended its probe to other manufacturers it found were following a similar practice.

Apart from Maruti and Nissan, Honda Siel Cars India, Volkswagen India, Fiat India Automobiles, BMW India, Ford India, General Motors India, Hindustan Motors, Mahindra and Mahindra, Mercedes-Benz India, Skoda Auto India and Toyota Kirloskar Motor have also been penalised.
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