Supreme Court Dismisses Appeal Against NCLAT Order Clearing NSE In Co-Location Abuse Of Dominance Case
Kirit Singhania
26 May 2026 11:20 AM IST
The Supreme Court on Tuesday upheld the NCLAT's order clearing the National Stock Exchange in the co-location access abuse of dominance case, refusing to interfere with the tribunal's finding that no prima facie case of anti-competitive conduct was made out.
The NCLAT had held that mere dominance does not amount to abuse and found no material showing denial of market access or appreciable harm to competition.
“Merely being a dominant player is not bad in itself, unless it has resulted into abuse of its dominant position resulting into AAEC. The abuse can occur when a dominant enterprise like NSE in the present case, exploit its position by imposing unfair or discriminatory conditions of price or limit or restrict its services or product. If such elements are not present, then obviously such dominance cannot be presumed to be abusive,” the tribunal had observed.
A Bench of Justices J.B. Pardiwala and Vijay Bishnoi found no grounds to interfere with the NCLAT order and dismissed the appeal at the threshold.
Background
The dispute arose from a complaint filed by Manoj K. Sheth before the Competition Commission of India (CCI) alleging that National Stock Exchange of India Ltd. abused its dominant position by granting preferential market access to select brokers through its “co-location” facilities.
It was alleged that brokers using co-location servers received faster access to trading data, resulting in front-running, information asymmetry and unfair trading advantages over other market participants. Reliance was placed on SEBI investigations and TAC reports regarding alleged inequities in data dissemination architecture.
On June 28, 2021, the CCI closed the case under Section 26(2) of the Competition Act, holding that no prima facie case of abuse of dominance was made out. The CCI observed that co-location facilities are globally recognised services that improve liquidity and market efficiency.
On appeal, the NCLAT upheld the CCI's order. The Tribunal noted that SEBI itself had not prohibited co-location services and that the Securities Appellate Tribunal (SAT) had also overturned findings regarding violations of SECC Regulations.