Delhi High Court stays Rs 471-cr CCI fine on Maruti Suzuki

Written by Kaushal shroff | New Delhi | Updated: Sep 4 2014, 06:23am hrs
In a major relief for Maruti Suzuki, the Delhi High Court on Wednesday stayed the fair trade watchdogs order levying a penalty of Rs 471 crore on the car maker for abusing its dominant position in the spare parts market.

Last moth, the Competition Commission of India (CCI) had slapped a penalty of R2,545 crore on 14 car makers, which includes Honda Siel Cars India, Volkswagen India, Fiat India Automobiles, BMW India, Ford India, General Motors India, Hindustan Motors, Mahindra & Mahindra, Mercedes-Benz India, Nissan Motor India, Skoda Auto India and Toyota Kirloskar Motor.

The relief by the court has been granted exclusively to Maruti and only till the next date of hearing, which is January 15. Meanwhile, a plea filed by Hyundai and Nissan against the CCI probe order is pending in the Madras High Court. In June this year, a judge of the Madras HC had passed an order directing the companies to move the Competition Appellate Tribunal (Compat) for relief against CCI. Aggrieved with the order, the two car companies moved a division bench (a higher two-judge bench) of Madras HC, which set aside the single judges order and directed the concerned justice to consider the matter afresh.

On Wednesday, the Delhi HC also indicated that the orders of the CCI will be given effect to, only when the pleas pending in the Madras HC are disposed off. The pleas filed by the company in the Madras HC concern themselves with the basic issue of whether CCI has the jurisdiction to conduct a probe in the matter.

The outcome of the cases pending the Madras HC will determine whether the penalties levied by the watchdog will be held as legally valid or not. The next date of hearing of the matter in the Madras HC is September 15. Additionally, the Madras HC had also stayed the CCI order against Nissan directing the company to pay R1.63 crore.