CCI v. Hyundai: 420 cr penalty in ignorance of stay by Mad HC, CCI concedes mistake

After imposing a penalty of Rs. 420.26 crore on Hyundai Motor India Limited (Hyundai) for anti-competitive practices, the Competition Commission of India (CCI) told the Madras High Court yesterday that it will not enforce its order since the same was rendered in ignorance of a stay order by Madras High Court..Additional Solicitor General G Rajagopalan appeared for the CCI. Senior Advocate Muthukumarswamy along with a team from IPN Associates LLP led by Partner G Guruprasath appeared for Hyundai..The case.The matter is related to the Rs. 2,544.64 crore penalty imposed by the CCI on 14 carmakers last year. Hyundai had, however, escaped the axe since it had moved the Madras High Court challenging the jurisdiction of CCI in the matter and had obtained a stay. Thereafter, the writ filed by Hyundai was dismissed and an appeal was preferred. While admitting the appeal, a Division Bench of High Court of Madras had directed Hyundai to participate before the CCI but had restrained the CCI from passing any final order. However, the CCI had gone ahead and imposed a penalty of Rs. 420 crore on Hyundai by an order dated July 27, 2015..CCI accepts mistake, blames communication gap with lawyer.Hyundai had filed an application against the same in Madras High Court. It had also given a notice to CCI contending that the order of CCI was in violation of the interim order passed by the Madras High Court. Surprisingly, the CCI acknowledged their mistake in a written response to Hyundai and stated that the order was passed due to a miscommunication by their advocate..Subsequently, when the application filed by Hyundai came up for hearing yesterday, Hyundai submitted that the CCI stood in violation of the earlier order of the High Court dated April 13, 2015 vide which the High Court had passed an order to the effect that CCI shall not pass any orders in the proceedings before it till the final order is passed in the Writ Appeals. It was also brought to the knowledge of the court that a contempt petition has already been moved by Hyundai..Additional Solicitor General, G Rajagopalan appearing for the regulator CCI, submitted that the order passed by the regulator was passed due to a communication gap between the CCI and its advocate and will not be enforced till the disposal of the Writ Appeals preferred by Hyundai..Stay in favour of Hyundai back in operation.The same was accepted by the court. Consequently, the CCI order of July 27, 2015 effectively stands stayed till the writ appeals filed by Hyundai are disposed of by the High Court.