Delhi High Court stays CCI order for recovery of ₹223 crore penalty from MakeMyTrip

The Delhi High Court on Wednesday stayed the recovery of a ₹223.48 crore penalty imposed by the Competition Commission of India (CCI) on MakeMyTrip (MMT) for abuse of its dominant position in the hotel bookings sector [MakeMyTrip India Pvt Ltd & Anr v. Competition Commission of India and Ors]

Justice Prathiba M Singh granted interim relief to MMT subject to the company depositing 10% of the fine amount.

The CCI had in October imposed penalties on Goibibo-MakeMyTrip (Go-MMT) and OYO for anti-competitive behaviour.

In its information to the CCI, the Federation of Hotel and Restaurant Associations of India had alleged that MMT was giving preferential treatment to OYO on its platform and was restricting access to other competitors.

MMT approached the National Company Law Appellate Tribunal (NCLAT) against the order. However, the NCLAT directed the company to deposit 10% of the penalty as a condition for admission of the appeal.

This order was then challenged before the High Court, with MMT arguing the Appellate Tribunal has not granted any interim protection as regards the remaining 90% of the penalty, but directed it to pay 10% of fine merely as a pre-condition for admission of appeal.

After hearing the arguments, the High Court observed that a pre-deposit of 10% of the penalty amount could not have been made for mere admission of the appeal.

MMT’s counsel told the Court that they are willing to deposit 10% of the penalty, subject to the recovery of the remaining amount being stayed.

The Court noted the submission in its order and directed the CCI to not recover the whole amount, if 10% of it is deposited.

“In view of the submission finally made on behalf of the Petitioner, it is directed that subject to the deposit of 10% of the total penalty amount of ₹223.48 crores, in accordance with the order of the CCI, as directed by the NCLAT, no recovery shall be effected in respect of the remaining 90% of the penalty amount. The said deposit shall be without prejudice to the rights and contentions of the parties,” the Court ordered.

Justice Singh further said that as far as the other directions of the CCI are concerned, the company is free to approach the NCLAT for any other interim relief.

The CCI had issued the following directions to Go-MMT:

a. MMT-Go is directed to suitably modify its agreements with hotels/chain hotels, to remove/abandon the price and room availability parity obligations imposed by it on its hotel/chain hotel partners with respect to other OTAs.

b. MMT-Go is directed to modify its agreement with hotels/chain hotels, to remove/abandon the exclusivity conditions that exist inter-alia in the form of D minus clause.

c. MMT-Go is directed to provide access to its platform on a fair, transparent and non discriminatory basis to the hotels/chain hotels, by formulating the platforms’ listing terms and conditions in an objective manner.

d. MMT-Go will notify all its hotel/chain hotel partners, about the aforesaid modifications.

e. MMT-Go is directed to provide transparent disclosures on its platform as regards the properties not available on its platform, either on account of termination of the contractual arrangement with any hotel/chain hotel or by virtue of exhaustion of quota allocated to MMT-Go by such hotel/chain hotel.

Senior Advocates Mukul Rohatgi and Ramji Srinivasan, along with Advocates Shashank Gautam, Rajat Moudgil, Aashna Manocha, Akshat Hansari, Anisha Bohra, Swapnil Singh, Sreemoyee Deb and Anand Sree appeared for MMT.

Additional Solicitor General N Venkataraman with Advocates Rajeev Saxena, Samar Bansal, Chandra Shekhara Bharatho, Amritha Chandramouli, S Ram Narayana, Rahul Vijay Kumar, Madhav Gupta and Vedant Kapur, Rajeev Saxena, Siddharth Luthra and Saurav Bansal appeared for CCI.

Advocates Vaibhav Gaggar, Vaibhav Chouker, Ela Bali, Kokila Kumari, Faiz Siddiqui, Somdev Tiwari, Mrityunjay Mahendra, Abir Roy, T Sundar Ramanathan, Vivek Pandey, Aman Shankar, Soham Goswami, Rohan Arora, Rukmini Bobde, Sonal Gupta, Ishan Nagar, Abhishek Thakral and Amlaan Kumar appeared for other respondents. 

[Read Order]