CCI Moves Supreme Court Against NCLAT Order Setting Aside ₹301.61 Crore Penalty On Grasim Industries

The Competition Commission of India has moved the Supreme Court against the National Company Law Appellate Tribunal's (NCLAT) decision setting aside its order imposing a ₹301.61 crore penalty on Grasim Industries Ltd.

The penalty had been imposed for the company's alleged abuse of its dominant position in the market for the supply of viscose staple fibre (VSF) to spinners in India.

The appeal filed on July 3 is yet to be listed before the apex court. 

A Bench of Judicial Member Justice Yogesh Khanna and Technical Member Ajai Das Mehrotra had set aside CCI's order of May 5, 2026 and remanded the matter after holding that the Commission violated the principles of natural justice by failing to issue a show cause notice before differing from certain findings of the Director General. 

The case arose from the CCI's March 16, 2020 order holding Grasim guilty of abusing its dominant position under Section 4 of the Competition Act by charging discriminatory prices and imposing supplementary obligations on buyers of VSF.

Besides imposing a ₹301.61 crore penalty, the Commission directed Grasim to publish a transparent discount policy and refrain from imposing end-use restrictions. Grasim challenged the order before the NCLAT.

Rejecting the CCI's contention that there was no departure from the DG findings, the Tribunal held that while the DG had not treated non disclosure of Grasim's pricing policy as a contravention, the Commission directed the company to publicise it. It also found that allowing buyers to trade effectively included traders, contrary to the DG's findings. The Bench observed:

“Similarly, the explanation of the Commission that the word “buyer” refers only to “spinners” is not borne out by plain reading of the direction, as no such definition is provided. In the common parlance, if a “buyer” is allowed to trade, then he can be assumed to be a “trader”. Thus, this direction is also in variance with the findings of the DG.”

Relying on the COMPAT decisions in BCCI v. CCI and InterGlobe Aviation Ltd. v. CCI, the Tribunal held that whenever the Commission proposes to differ from the DG's findings, it must first issue a show-cause notice and provide the affected party a reasonable opportunity of hearing.

The NCLAT set aside the CCI's order and remanded the matter to the Commission for fresh adjudication after complying with the principles of natural justice.