NCLAT sets aside ₹301.61 crore CCI penalty on Grasim, orders fresh hearing

MUMBAI: In a bid to give relief to Grasim Industries, the National Company Law Appellate Tribunal (NCLAT) on Tuesday said ₹301.61 crore fine was imposed by the Competition Commission of India (CCI) on the grounds that the company was not given adequate opportunity to defend itself.

The penalty was first imposed in 2020 after the CCI ruled that Grasim had abused its dominant position in the viscose staple fiber (VSF) market by charging different prices to different buyers and imposing conditions on customers. It had also directed the company to make its discount policy public and allow buyers to use or trade the fiber freely.

The court, led by Justice Yogesh Khanna, referred the matter to the CCI, directing it to grant hearing to Grasim if he wanted to rely on findings against the company.

An investigation by the Director General (DG) found issues such as pricing differences and certain conditions imposed on buyers, but also noted that the discount and pricing policy alone did not violate the law. “The General Manager determined that the discount/pricing policy was discriminatory, but made it clear that failure to disclose did not violate the provisions,” according to the text of the decision.

However, CCI had instructed Grasim to adopt a transparent and non-discriminatory discount policy, make its price public and remove restrictions on how buyers can use or trade the fibre.

The court said it was not commenting on the merits of the case and asked the regulator to decide the matter independently. “We make it clear that we do not comment on the merits of the case and that (CCI) should not be influenced by anything contained in this decision,” the decision said.

Emailed queries to Grasim earlier today remained unanswered by press time.

The CCI will now hear the matter again and reconsider its findings after giving Grasim the opportunity to respond to points where he disagrees with the investigation report.

Grasim Industries Ltd is part of the Aditya Birla Group with operations spanning cellulosic fibres, chemicals and textiles.