Supreme Court Dismisses Plea Against NCLAT Ruling That CCI Need Not Put Informant On Notice At Prima Facie Stage

The Supreme Court on Friday refused to interfere with a National Company Law Appellate Tribunal (NCLAT) ruling that the Competition Commission of India (CCI) is not required to issue notice to the informant when it closes a case under Section 26(2) of the Competition Act after finding no prima facie case.

The top court was hearing a plea filed by Karnataka Power Corporation Ltd. (KPCL) against the NCLAT's January 13, 2026 order, which had upheld the CCI's decision to close an abuse of dominance case against Singareni Collieries Company Ltd. (SCCL) in the supply of non-coking coal.

A Bench of Justices J.B. Pardiwala and K.V. Viswanathan found no ground to interfere with the appellate tribunal's ruling.

Senior Advocate Balbir Singh, appearing for KPCL, argued that while an order under Section 26(1) is administrative and does not affect rights, an order under Section 26(2) closes the case and affects parties' rights, and therefore requires adherence to principles of natural justice under Section 36 of the Act.

He contended that the CCI had shut the case without hearing the complainant despite examining issues such as market share and dominance, which, he argued, was impermissible.

However, after hearing KPCL's submissions, the bench dismissed the plea at the threshold.

The NCLAT, while examining the statutory framework had held that “no notice, at this stage, is envisaged under sub-section (2) of Section 26 of the Act.”

It further observed that “neither the Substantive Act nor its Regulations made thereunder, envisage any notice to informant at initial stage and thus we find no fault in the impugned order.”

Rejecting KPCL's challenge, the tribunal said, “Hence, the allegation that principles of natural justice haven't been adhered to is completely untenable.”

It also recorded that “A bare reading of the impugned order would reveal the commission has rather gone beyond to discuss the merit of the information" and that “a speaking order had been passed under Section 26(2) of the Act in complete adherence to the provisions as provided under the present section as well as the said Act.”

Background

The dispute arose from a complaint filed by KPCL before the CCI alleging abuse of dominant position by SCCL in the supply of non-coking coal used for power generation. KPCL claimed that SCCL, along with Coal India entities, was acting in concert and distorting competition in the coal market.

On June 12, 2017, the CCI shut the case under Section 26(2), saying there was no prima facie evidence of abuse of dominance by Singareni Collieries Company Ltd. (SCCL) in the market for production and sale of non-coking coal to thermal power generators in India. It pointed out that SCCL had only a small presence in this market and functioned as a competitor to Coal India, not a dominant player. The Commission also viewed the disagreement as essentially commercial in nature, adding that KPCL was free to pursue its remedies before an appropriate forum if it chose to do so.

KPCL took the matter to the NCLAT, arguing that it should have been heard before the case was closed. The appellate tribunal was not persuaded. It held that the law does not envisage a hearing at the stage where the Commission finds no prima facie case under Section 26(2), and dismissed the appeal.