LHC dismisses petitions against CCP

LAHORE: A Lahore High Court (LHC) full bench on Monday dismissed a set of petitions challenging formation and powers of the Competition Commission of Pakistan (CCP).

The three-member bench comprising Justice Ayesha A Malik, Justice Shahid Jamil Khan and Justice Muhammad Sajid Mehmood Sethi announced the verdict on petitions filed by LPG Association, cement factories and other associations belonging to different sectors.

The court had on July 16 reserved the verdict on the petitions, after hearing arguments of the parties, and it was announced today in open court. Justice Ayesha A Malik authored the judgment. The matter was pending since the last 11 years.

The LPG Association had filed the first petition in 2009, when the CCP started taking actions against its members in terms of price regulation, and got stay against commission’s actions. Later, associations of different industries filed identical petitions and got the interim relief as well.

Earlier, In their arguments, the petitioners’’ counsel submitted that Competition Ordinances of 2007, 2009 and 2010 and Competition Act 2010 were ultra vires of the Constitution as Parliament lacks legislative competence to make a law on the subject of competition.

They further argued that the act and the ordinances created a parallel judicial system in violation of Article 175 and 203 of the Constitution by creating an authority, which is to exercise judicial powers but is not a court. “Consequently the right of fair trial and due process has been infringed, which was a violation of the Constitution”, they added.

They submitted that the act provided a right of appeal before the Supreme Court against Competition Appellate Tribunal (CAT) judgments and it was a violation of Article 185 of the Constitution. “The Article 185 envisions an appeal to the Supreme Court only against judgments, decrees and orders of the High Courts. Under the Constitution, a direct appeal to the Supreme Court cannot be justified”, they added.

The counsel have also argued that Section 62 of the act did not save or give continuance to any of the proceedings, decisions, orders and actions taken under the Ordinances. The lapse of one ordinance cannot be extended by another Ordinance.

Hence all show cause notices and orders passed by the CCP cease to exist as they were never saved by the Ordinances or the Act, they added.However, the counsel for federation and other respondents argued that the act and the ordinances were not ultra vires of the Constitution as the Parliament was competent to promulgate an Act.

The section 62 of the act should be read in the form of a declaratory statement by the legislature to give legal cover to actions, proceedings, orders etc. by the CCP during the period 2.10.2007 to 5.10.2010 which included the gap periods until the promulgation of the Act, they added.

They further stated that exercise of judicial power by the CCP was in line with the work of regulatory authorities, created in terms of Entry 14 of the Federal Legislative List in the Fourth Schedule of the

Constitution. They also argued that an appeal before the Supreme Court was permissible under Article 175 and entries of federal legislative list against any order by the CAT.The CCP’’s counsel argued that the government had established the commission to abolish cartelisation, control profiteering and to create a competition in the market.

However, he said

the commission had been dormant to this effect due to the stay order. He said it was unfortunate that very initial actions of the CCP were still under litigation.