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Evolution of Competition Law of India — 2000 to 2026
Manas Kumar Chaudhuri is a Senior Partner at Khaitan & Co LLP.
The evolution of competition law in India (the Competition Act, or the Act) has been slow, and at times surprising, even now — despite the Act having come into being in early 2003. The reasons for the slower development of the jurisprudence are briefly summarised below.
As soon as the Act received the assent of the President of India, a writ petition was filed by a private litigant against the composition and structure of the agency. The petition was disposed of by the Supreme Court of India with an express observation that, since the intent of the Act is a combination of adjudication and regulation, the Competition Commission of India (CCI) may have at least two benches — one assigned adjudicatory functions and the other regulatory functions. The Court also observed that a specialised court of first appeal should be set up between the CCI and the Supreme Court, and that the advisory and inquisitorial roles of the CCI would continue to form part of its core functions. On these observations, the Government proposed a short amendment. Several matters, however — neither part of the Court’s observations nor contended by the petitioner — were nonetheless inserted into the Amendment Bill. One notable instance was the removal of benches from the structure of the CCI, with the consequence that the presence of a judicial member became optional, if not redundant. The voluntary regime of merger control was changed to a compulsory one, and the office of the Registrar was converted into an administrative office of the Secretary, CCI. A comprehensive amendment was finally notified that travelled well beyond the core challenges of the petitioner and the final observations of the Court.
The Act was then notified in respect of the CCI. In the first phase, the CCI and the Court of First Appeal had full strength, but implementation began cautiously. One core reason was the legacy of the repealed law and the fate of parties affected by the transition, as undecided cases were transferred either to the COMPAT or to the CCI. Amidst that uncertainty, the regulation of combinations was notified, and the CCI became fully functional. Numerous amendments — through the route of public welfare or through statutory regulations — were made on a regular basis. Despite these, the fixed tenures of the Members of the CCI and the COMPAT, and the frequent repatriation of senior functionaries of the CCI and the office of the Director General (the DG) to their parent cadres, produced a recurring loss of institutional memory.
The CCI nonetheless stood distinct from its predecessor in a few salient respects. The Supreme Court had been the only appellate authority under the previous regime; the new regime interposes an appellate tribunal. The earlier law could impose no penalty for breach by enterprises or individuals; the present law may remedy breaches with penalties on both. Yet, from publicly available sources, the recovery of penalties over more than seventeen years of the Act’s enforcement does not present a very encouraging picture.
Beyond the amendments to the Act and the Regulations, the enforcing and investigating authorities were besieged by constitutional writs almost as a matter of routine. Tellingly, those writs in the major High Courts rarely alleged any breach of the Act itself; they turned almost entirely on due process and the principles of natural justice — a pattern that signalled that more comprehensive amendment was inevitable. In the wake of these bottlenecks, and the emergence of new-age enterprises, the Government constituted a Competition Law Review Committee (CLRC) with representation from all conceivable stakeholders. Its recommendations introduced several new features into the Act, of which the salient ones are:
– Computation of penalties on the basis of global turnover (s. 27(b), explanation)
– Appeals maintainable only on an upfront deposit of 25% of the penalty (s. 53B, proviso)
A brief word on the intent of some of these amendments follows.
Hub and Spoke
Though a market-structure concept developed over time between upstream and downstream enterprises, and not always a concern for the authorities, a hub-and-spoke arrangement can pose serious difficulty in the absence of an enabling provision. The want of one limited the CCI’s ability to remedy distortion in several sectors — alcoholic beverages, pharmaceuticals and traditional oligopolies among them. Trade associations and digital intermediaries — the typical hubs — though penalised regularly, often escaped with negligible or no penalty owing to their low financial corpus, so that the remedy was non-deterrent while keeping the CCI occupied with wasteful activity and higher litigation costs. The position is expected to improve.
Commitments and Settlements
The purpose of these provisions is to shorten litigation. Since leniency and leniency-plus already form part of the Act for cartels and bid-rigging, the legislature adopted broadly similar remedies — arising from the voluntary action of the respondent — for the exclusionary or exploitative conduct of dominant enterprises. The Act affords no right of appeal to the party benefiting from early closure, but neither does it protect that party from follow-on actions and damages claims by other private parties.
Limitation Period
A logical addition, consonant with the evolution of the enforcement of antitrust cases.
Despite the many roadblocks, some landmark decisions of the Supreme Court — and one significant closure by the Commission — offer a measure of hope.
The Leading Decisions
Excel Crop Care Ltd v. CCI. The penalty for a breach by a multi-product company is to be computed only on the turnover, or profit as the case may be, of the product forming the cause of action. The doctrine of “relevant turnover,” grounded in proportionality and the purposive interpretation of the statute, thus emerged for the computation of penalties.
Rajasthan Cylinders and Containers Ltd v. Union of India. Where, in an allegation of bid-rigging, the buyer — exercising countervailing buying power — unilaterally settles the final bid price by negotiation, the price so fixed through monopsony behaviour displaces the inference of collusion on price initially suggested by the suppliers.
CCI v. Schott Glass India Pvt. Ltd. Hitherto, the law on abuse of dominance had not developed the principles of theories of harm, objective justification and economic rationale, notwithstanding that the Act rests on the rule of law and natural justice. This decision settled those principles for the first time in a final appeal. Holding in Civil Appeal No(s). 5843/2014 that volume-based rebates are not automatically anti-competitive where applied uniformly across similarly situated buyers and supported by an objective rationale, the Court emphasised the need for an effects-based analysis — requiring both actual or likely anticompetitive effects and the absence of objective justification before conduct is condemned.
Amazon.com NV Investment Holdings LLC v. CCI. A classic instance of a non-adversarial merger clearance that became a keenly contested adversarial proceeding. The acquirer, having obtained unconditional approval, faced contentious litigation more than two years later when the Commission reopened the order and initiated proceedings for gun-jumping and suppression of material facts. The Supreme Court set aside the NCLAT judgment — which had arisen from two distinct orders of the Commission, one non-adversarial and the other adversarial — finding untenable facts and a misapplication of law in the order impugned.
Kailash Gupta v. AIOCDA & Ors. is a good example of how a fourteen-year-old matter loses relevance beyond a reasonable period. The alleged conduct predated 2011, and the DG relied on evidence of that vintage; when the matter came on for final hearing in 2026, the Commission closed it as too dated to pursue.
Conclusion
The genesis of the Act lies in the early years of India’s economic liberalisation. In October 1999 the Government constituted a high-level panel — the Raghavan Committee — to consider whether the predecessor regime, the Monopolies and Restrictive Trade Practices Act and the Commission under it, should continue or be replaced. Among its tasks was to examine India’s shift from controlling monopolies to fostering fair market competition. The Committee advised, among other things, that competition law should apply to both private and government monopolies within a single framework to ensure competitive neutrality. As the predecessor regime rested on “deemed illegal” provisions, the Committee recommended an industry-friendly regime built on the rule of reason. These aspirations are not yet fully realised, and the evolution of the law remains a work in progress. Those of us associated with it from the beginning nonetheless expect the authorities to apply the law in letter and spirit, with objective justification. A better harmony between the sole authority and its stakeholders can secure greater consumer surplus and benefit; minimising unnecessary litigation must be an integral part of that journey.
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