Madras High Court today disposed of writ appeals by Tamil Nadu Film Exhibitors Council permitting it to filing a Memorandum of compromise/settlement between them and producers of the film ‘Viswaroopam’ starring Kamal Hassan, before the Competition Commission of India, New Delhi.
A Division Bench comprising Justices V Ramasubramanian and P R Shivakumar which disposed off appeals by the Council to set aside the August 16, 2013 order of a Single judge and proceedings before the CCI on another, seeking a direction to local police to act on a complaint by them.
However, the court made it clear that though there is a bar on jurisdiction of the civil courts in respect of the matter of CCI or its affiliate tribunals, the jurisdiction of the high court under Article 226 of the Constitution may not apply to it.
“Therefore, despite the fact that the orders of the CCI are subject to the appellate jurisdiction of the Commission, the jurisdiction of the High Court under Art 226 will not stand ousted,” it said.
Raaj Kamal Film International, who produced Vishwaroopam had filed a complaint before the CCI on January 8, 2013, alleging that Tamil Nadu Theatre Owners Association on Dec 20 2012 decided to ban its screening released via DTH.
The Producers claimed that this would be tantamount to an anti-competitive practice, violating Section 3(3)(b) of Competition Act, 2002.
CCI on January 16, 2013 said that in terms of Section 26(1) of the Competition Act, 2002, there was a prima facie case requiring an investigation by its Director General.
Meanwhile, the commissioner of police, Chennai, also issued an order on January 23, 2013 under Sec 144 of CrPc, prohibiting the exhibition of the film. But it was later revoked on February 3.
However, DG of CCI issued a notice on April 1, asking Council to furnish some information as well as documents, following which the latter moved Madras High Court 16.01.2013
The Council also lodged a complaint on April 13 with the Commissioner of Police, alleging that the complaint by the Producers before CCI was on the basis of a forged document, namely the alleged resolution of Dec 20 2012.
It also filed another petition in Madras High Court seeking a direction to Commissioner of Police to take their complaint on record and initiate action against the Producers.
The court on Aug 16, 2013 dismissed both petitions. The council then filed the present appeals.
The bench at the time of admission of these appeals, in an interim order permitted the DG to proceed with the investigation and finalise the same but directed CCI not to proceed with the matter without the leave of High Court.
Meanwhile, compromise was arrived at between the producers and Council and a MoU was drawn up.
The Council contended that in view of MoU, nothing survives before CCI. This was contested by CCI on the ground that DG of Investigation had already filed a report before the Commission, holding that charges of infringement of provisions of the Act are found to be true and that therefore, settlement inter parties cannot be accepted in matters of this nature.
The bench disposed of the appeals while answering the questions whether it is possible, in the context of the scheme of Competition Act, 2002, for two adversaries to reach a settlement, thereby closing the doors for an investigation or inquiry; and whether it can record a memorandum of settlement like the one that the parties have reached in this casee.
In this case, the DG of CCI had already completed probe and filed a report and concluded that practices and conduct of the Council are restrictive in nature to control the film exhibition business.
The judge said the report had not only concluded that the appellant was guilty of violation of the provisions of the Act of Anti-Competitive Practices, but also pointed out that it is the second instance of such nature.
“Therefore, we are of the considered view that the appellant should file the memorandum of compromise/settlement before Competition Commission itself so that the Commission will be in a better position to appreciate whether the same could be accepted with or without modifications.
