A Division Bench of the Supreme Court comprising Chief Justice of India Dhananjaya Y. Chandrachud, P S Narasimhaand J.B. Pardiwala today orally observed that by filing an appeal on the eleventh hour before the National Company Law Appellate Tribunal (NCLAT) against the order of Competition Commission of India (CCI) in Android matter, Google contrived emergency in seeking stay.
The apex court also asked the tech giant if it would be ready to practise the same regime in India as it has in Europe. “Please reflect on this and come back”, the CJI told Google at the hearing on Monday.
After a brief and heated argument, the Supreme Court posted the matter on Wednesday for further hearing.
During the hearing, N Venkatraman, Additional Solicitor General of India representing CCI contended before the Supreme Court that the appeal against the CCI order was filed by Google before the NCLAT only in the month of December– a day before the limitation period was to expire. He also contended that Google is discriminating between consumers in India and EU as Google has already complied with similar directions issued by EC in 2018.
Venkatraman told the bench that Google was taking different standards in Europe and India.
“We are going to show some shocking data. Their grievance that they’re unable to comply with the order within 90 days doesn’t stand because they’re fully complying with the order passed in 2016 in the European Union. €4 billion fully paid. All these directions have totally complied within Europe for the past five years. Standing committee is now going into this, this will now be part of digital law. European Union has already held them to be dominant. We are a third-world country. How can they discriminate Indian consumers from European consumer?” he said.
Initially, the Bench was inclined to remand the matter back to NCLAT for a decision on the interim relief application of Google. However, after the vociferous protest by Venkatraman, the Bench posted the matter for disposal on Wednesday.
With the deadline looming for Google to change its entire business model, the Supreme Court had last Wednesday agreed to list on January 16 the tech giant’s appeal against the NCLAT order that refused any stay of the ten remedial directions issued by CCI.
Also read: Android case: Supreme Court agrees to urgent listing of Google appeal on January 16
This has come in the nick of time for Google as the three months window allowed in the CCI’s landmark order of October 20 last year for the tech giant to bring its conduct in line with guidelines expires on January 19.
The Supreme Court is the last forum for Google to block the anti trust ruling issued by the CCI on October 20 in the Android platform.
Google’s penalty
CCI had on October 20 imposed a penalty of ₹1,337 crore (about $ 161 million) besides issuing ten non-monetary directions (remedial directions) against Google that, among other things, required it to change its business model entirely.
The penalty was imposed on Google for abuse of its dominance in various markets of the Android ecosystem. Android powers 97 per cent of smartphones in India, which is now the world’s second largest smartphone market, after China.
The remedial directions of CCI will require Google to make far-reaching changes to the Android mobile platform which has been in place for the last 14-15 years and force it to modify its existing contracts, introduce new licence agreements and alter its existing arrangements with more than 1,100 device manufacturers and thousands of app developers, noted the appeal filed by the tech giant before the apex court.
“Tremendous advancement in growth of an ecosystem of device manufacturers, app developers and users is at the verge of coming to a halt because of the remedial directions”, the memorandum of appeal highlighted.
Grounds of appeal
In the appeal before Supreme Court, Google has contended that the National Company Law Appellate Tribunal (NCLAT) had erred in summarily rejecting its request for a stay on the Remedial Directions on an inadequate and unjustifiable reason.
Google has also contended that the Tribunal had erred in making the admission of Google’s NCLAT Appeal against the Commission’s Order subject to a pre-deposit amount.
Also read: Android case: NCLAT to further hear Micromax, Karbonn appeals on April 23
The statutory provision does not impose any condition of pre-deposit for entertaining the appeal. Therefore, the right to file the appeal and have the said appeal decided on merits, if it is filed within the period of limitation, is conferred by the statute and that cannot be taken away by imposing the condition of deposit of an amount leading to the dismissal of the main appeal itself if the said condition is not satisfied, according to Google.
Google has also in the grounds of appeal contended that NCLAT has failed to appreciate that the penalty directions issued by the Commission are illegal.
