Supreme Court Dismisses Delayed Appeal Against NCLAT Judgment In Nagpur-Mumbai Expressway CDA Cartel Case

The Supreme Court on Wednesday refused to interfere with the National Company Law Appellate Tribunal's (NCLAT) judgment upholding the Competition Commission of India's (CCI) decision to close antitrust proceedings over the procurement of Crystalline Durability Admixture (CDA) for the Nagpur-Mumbai Super Communication Expressway project.

The court dismissed the appeal after refusing to condone the delay in its filing.

The proceedings had been initiated on a complaint by Apaar Infratech Pvt. Ltd., which alleged cartelisation and abuse of dominant position.

A bench of Justices Sanjay Kumar and Sanjeev Sachdeva dismissed the appeal after finding that the appellant had failed to show sufficient cause for condoning the delay in approaching the court.

Justice Kumar observed, "This is a statutory appeal, under Section 53T. You have to show sufficient cause for filing the appeal." When informed that there was a delay of about 93 days, which had increased to around 98 days by the date of the hearing, the bennch asked counsel to take it through the delay application.

Reading from the appellant's own pleadings, Justice Kumar questioned the explanation that the company learned of the NCLAT judgment much later. Referring to the averments, he remarked,

"This is your own case before the Competition Commission... You don't even follow up as to what is happening with your case?"

The court also referred to another pleading stating that the appellant came across the NCLAT judgment only after "squeezing out some time in between commissioning of different projects." The court found this exlanation unconvincing.

Counsel for Apaar Infratech submitted that the appellant was a small company with limited resources and relied on Supreme Court precedents advocating a liberal approach to condonation of delay.

The bench, however, remained unconvinced. It repeatedly asked counsel to establish "sufficient cause" under Section 53T and indicated that merely being a small company could not justify the prolonged delay.

Finding no grounds to condone the delay, the court dismissed the appeal

Background

The dispute arose after Apaar Infratech Pvt Ltd approached the Competition Commission of India (CCI) alleging that the Maharashtra State Road Development Corporation (MSRDC) had abused its dominant position in procuring Crystalline Durability Admixture (CDA) for the Nagpur Mumbai Super Communication Expressway project. Apaar claimed that MSRDC's requirement of Indian Road Congress (IRC) accreditation unfairly excluded competitors while including two allegedly ineligible or dummy entities in its approved vendor list, thereby facilitating cartelisation by Penetron India Pvt. Ltd. and its related entities.

On 24 August 2022, the CCI closed the case under Section 26(2) of the Competition Act, holding that no prima facie case of abuse of dominance or anti competitive agreement was made out. It found that Penetron India and its parent company operated at different levels of the supply chain, ruling out cartelisation and held that MSRDC was not dominant in the relevant market.

Dismissing Apaar's appeal, the NCLAT upheld the CCI's findings. It held that Penetron India and its parent company formed part of the same "group" and had a vertical relationship rather than a horizontal one, making the allegation of cartelisation legally untenable. The Appellate Tribunal also agreed that the relevant geographic market was India, not Maharashtra, and since MSRDC was not dominant in that market, no case of abuse of dominance arose.

The NCLAT also held that merely prescribing IRC accreditation as an eligibility criterion did not amount to unfair or discriminatory conduct and found no procedural error in the CCI closing the matter without directing a DG investigation.