The Delhi High Court has asked the central government and the Competition Commission of India to place on record their response to a petition filed by Apple Inc. The petition challenges a CCI direction that requires the company to submit audited financial statements for several years.
A bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela was told that the Union Ministry of Corporate Affairs and the CCI had filed a joint counter affidavit on Monday, but it was not yet on record. The bench said, “Counter affidavit has been filed by the respondents on Monday. Let steps be taken to bring the counter affidavit on record,” and granted Apple time to file its rejoinder. The matter has been listed for further hearing on January 27.
During the hearing, senior advocate Abhishek Singhvi, appearing for Apple, said the company received the joint reply only last night and sought time to respond. The Alliance of Digital India Foundation informed the court that it has filed an impleadment application, stating that it was the original informant and complainant in the case. The court directed all parties to file objections, if any, to the impleadment application within 4 weeks.
Apple has also challenged the amendment to the Competition Act, 2002, which allows penalties to be calculated on the basis of a company global turnover. In its plea, Apple argued that the amended provisions allow aggregation of turnover from all products and services, instead of only the affected relevant product or service. It added that global turnover generated outside India can now be considered, rather than turnover from the relevant geographic market in India. The plea said this could expose Apple to a maximum penalty of up to 10 percent of its average global turnover for financial years 2022 to 2024, estimated at around USD 38 billion.
The court earlier asked the government to explain how penalties based on global turnover could be justified when the alleged abuse relates to only one product. Senior advocate Balbir Singh, representing the government and the CCI, said the provision is needed to cover entities with no turnover in India. He also said Apple was trying to “scuttle” the CCI probe and clarified that only India turnover has been sought, with the company asked to submit it by December 8. He added that it would take about 3 to 4 weeks to review the information.
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