In Re: Alleged anti-competitive conduct in the Beer Market in India (Part 2)
- Citation06/2017 (In Re: Alleged anti-competitive conduct)
Ratio decidendi
The rule this decision rests on
The penalty imposed under Section 27(b) on a cartel participant must be computed only for the years of its proven participation in the cartel. A computation extending to a period beyond the finding of participation is an inadvertent error, and the Commission may correct it by rectifying the penalty figures in the earlier final order. Under the proviso to Section 27(b), where the penalty is computed by reference to each year of continuance of the cartel, the penalty is fixed at the higher of 2% of the party's turnover or 0.5 times its profit for each such year. Where 2% of turnover exceeds 0.5 times profit across the relevant years, the penalty is 2% of turnover for each year of continuance. A reduction in penalty under Section 46 read with Regulation 4 of the Lesser Penalty Regulations, 2009, is applied to the penalty as recalculated, and the revised figure, not the original figure, is the amount payable.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1. With the permission of the Chair, an ordinary meeting of the Commission was convened today, wherein the captioned matter was taken up by the Commission.
2. In this matter, the Commission passed a final order dated 24.09.2021 under Section 27 of the Competition Act, 2002 (the ‘Act’), inter alia, imposing a penalty of ₹1,50,70,59,203/- (Rupees One Hundred and Fifty Crores Seventy Lacs Fifty Nine Thousand Two Hundred and Three Only), upon Carlsberg India Private Limited (‘OP- 4’), calculated in terms of the proviso to Section 27(b) of the Act @ 2% of its turnover for each year of continuance of cartel.
3. It is noted that the Commission has held OP-4 to be a part of the cartel from 2012 onwards to 10.10.2018. However, the calculation of penalty for OP-4 has been erroneously made for the period 20.05.2009 to 10.10.2018.
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4. As such, in light of the afore-mentioned inadvertent error in the final order dated 24.09.2021, the Commission, vide the present order, recalculates the penalty amount for OP-4 for the period 01.01.2012 to 10.10.2018, as follows:
FINANCIAL RELEVANT RELEVANT 2% OF RELEVANT 0.5 TIMES OF YEAR TURNOVER PROFIT TURNOVER RELEVANT PROFIT 2012 4,31,60,00,000 -1,73,40,00,000 8,63,20,000 -86,70,00,000 Jan 2013 to 6,98,30,00,000 -2,13,10,00,000 13,96,60,000 -1,06,55,00,000 March 14 2014-15 8,37,30,00,000 -2,32,90,00,000 16,74,60,000 -1,16,45,00,000 2015-16 11,82,70,00,000 -1,48,50,00,000 23,65,40,000 -74,25,00,000 2016-17 13,42,20,00,000 -1,67,00,00,000 26,84,40,000 -83,50,00,000 2017-18 14,84,80,00,000 1,06,60,00,000 29,69,60,000 53,30,00,000 2018-19 9,84,72,32,877 96,36,82,192 19,69,44,658 48,18,41,096 TOTAL 69,61,62,32,877 -7,31,93,17,808 1,39,23,24,658 -3,65,96,58,904
5. As 2% of the turnover for each year of continuance of cartel for OP-4 is higher than 0.5 times its profit for each year of continuance of cartel, the Commission decides to impose upon OP-4, penalty @ 2% of its turnover for each year of continuance of cartel, amounting to ₹1,39,23,24,658/- (Rupees One Hundred and Thirty Nine Crores Twenty Three Lacs Twenty Four Thousand Six Hundred and Fifty Eight Only).
6. Upon grant of reduction in penalty to the tune of 20% in terms of Section 46 of the Act read with Regulation 4 of the Competition Commission of India (Lesser Penalty) Regulations, 2009, the penalty amount payable by OP-4 amounts to ₹1,11,38,59,726 (Rupees One Hundred and Eleven Crores Thirty Eight Lacs Fifty Nine Thousand Seven Hundred and Twenty Six Only).
7. Accordingly, paragraphs 296, 297, 307 and 310 of the final order dated 24.09.2021 stand rectified in the above terms.
8. OP-4 is directed to deposit the revised penalty amount within 60 days of the receipt of the present order.
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9. The Secretary is directed to forward a certified copy of the present order to all the parties through their respective legal counsel, accordingly.
Sd/- (Ashok Kumar Gupta) Chairperson
Sd/- (Sangeeta Verma) Member
Sd/- New Delhi (Bhagwant Singh Bishnoi) Date: 04.10.2021 Member
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