CCI drops contempt petition against AICF

By Venkatachari Jagannathan

Chennai, Aug 4 (IANS) Advising the All India Chess Federation (AICF) to comply with its orders in letter and spirit within the stipulated timelines, the Competition Commission of India (CCI) has dropped the contempt proceedings against the chess body.

The contempt petition was filed by three chess players -- Karun Duggal, Gurpreet Pal Singh and Devendra Bajpai -- Duggal had told IANS earlier.

In its order issued on July 24, the CCI considering the affidavit filed by the AICF as ordered earlier decided to drop the proceedings initiated under Section 42 of the Competition Act against the Indian chess body.

In its affidavit, the AICF had said that it had complied with the Jul7 12, 2018 order and also requested the CCI to record satisfactory compliance of the orders passed by it and also close the proceedings against it under Section 42 of the Act.

As per Section 42 of the Competition Act, a person failing to comply with the orders of the Commission can be punished with a fine of up to Rs 1 lakh per day during which such non-compliance occurs, subject to a maximum fine of Rs 10 crore.

Further, if a person fails to comply with the order or fails to pay the fine, he shall be punished with imprisonment for a term which may extend to three years or with a fine which may extend to Rs 25 crore, or both.

The CCI on July 24 said that its order "shall be without prejudice to any other proceedings that are pending against AICF, either before the NCLAT (National Company Law Appellate Tribunal) or any other court in respect of the conduct(s) which has been found to be in contravention of the provisions of the Act."

On July 12, 2018, the CCI held that the undertaking prescribed by the AICF for players regarding non-participation in events not authorised by it amounts to restraints that are in the nature of exclusive distribution and refusal to deal as defined in Section 3(f) and 3(4)(d) of the Competition Act, 2002.

The CCI said non-compliance of such undertaking will result in banning of players and removal of their Elo ratings, create entry barriers, foreclose competition and restrict opportunities available to chess players.

The CCI also imposed a penalty of Rs 6,92,350 on the AICF for infringing the provisions of Section 4 of the Act and directed the chess body to deposit the penalty within 60 days and file a compliance report.

According to the CCI order dated July 12, 2018, the AICF shall establish the prejudice caused by a chess player before taking any disciplinary action against him. Needless to say, the disciplinary actions taken shall be proportional, fair and transparent.

The disciplinary actions against the four players and other similar players shall be reviewed by the AICF on these lines, the CCI ordered.

Recently, the global chess body FIDE restored the Elo ratings of over 50 Indian chess players, including those who had filed a case with the CCI.

"Now the players have to try and get registered with AICF," a chess player told IANS preferring anonymity.

On October 4, 2018, the AICF got a stay order from the National Company Law Appellate Tribunal (NCLAT) against the Rs 6,92,350 penalty imposed by the CCI vide its July 2018 order.

On the contempt petition filed by the three chess players, the CCI pointed out that there was no stay on the directions it had issued to the AICF vide its July 2018 order.

"AICF clearly knew about the requirement of complying with the specific directions of the Commission and that no stay has been granted by the NCLAT with respect to the said directions. Thus the onus was on AICF to comply with the aforesaid directions and file a compliance report. However, till date, AICF has not filed a compliance report to this effect," the CCI said in its order dated November 30, 2018.

"Thus, the Commission is convinced that AICF deserved to be subjected to proceedings under Section 42 of the Act," the CCI said and ordered show cause notice to the AICF as to why action should not be taken under the said section.