REGULATION OF ANTI-

COMPETITIVE
AGREEMENTS
Subject – Competition Law
Business Law Specialisation
Unit 3
Semester X
Curated by – Prof. Shreya Madali
APPRECIABLE ADVERSE EFFECT ON COMPETITION:
While determining whether an agreement has an AAEC under section 3, the
following possibilities are considered:
(i) Conception of barriers to new entrants in the market
(ii) Driving accessible competitors out of the market
(iii) Foreclosure of competition by hindering entry into the market
(iv) Accrual of reimbursement to consumers
(v) improvements in construction or giving out of goods or provision of services
(vi) Promotion of technical, scientific and economic development by means of
production.
- To bring in the application of section 3, it is pertinent that the effect on competition must be
‘appreciable’.
- The word “appreciable adverse effect on competition,” which appears in section 3(1), is not
defined in the Act.
- ‘appreciable,’ effect has to be substantial
- Law Lexicon defines “appreciable” as “capable of being judged of or recognised by the intellect,”
which is “perceptible but not a synonym of substantial.”
- For the most part, ‘appreciable’ means more than just a detectable influence that may or may
not be substantial.
- There is a presumed appreciable adverse effect on competition if the arrangement complies
with section 3(3) of the Competition Act, 2002.
- Even if there is no concrete evidence proving appreciable adverse effect, it’ll be presumed and
the burden will be on the enterprises or the people who entered into the arrangement to prove
otherwise, in this the burden is shifted from CCI to the people who entered into the agreement.
- AAEC can take three forms:
• Anti-competitive agreement
• Abuse of dominance
• Combinations
- The act aims to prevent parties with AAEC in India from engaging unethical
behaviour.
- However, such an aim will not be achieved unless the parties doing business
adhere to the act’s principles.
- When doing business in India, it is critical for parties to avoid keeping any anti-
competitive elements in their agreements.
- In order to function properly in the market, there must be fair competition.
Enterprises should be proactive in addressing anti-competitive elements in their
current agreements.
- Employees can be informed on the consequences of anti-competitive
agreements and how to avoid them.
- Individuals and businesses can always seek the advice of experts who can lead
them to a safer option if necessary
- No one shall enter into any agreement in respect of production, supply,
distribution, storage, acquisition or control of goods or provision of services,
which causes or is likely to cause AAEC.
- The Competition Commission of India (CCI) determines AAEC on the following
factors: Section 19 (3)
• Creation of barriers to new entrants in the market
• Driving existing competitors out of the market
• Foreclosure of competition by hindering entry into the market
• Accrual of benefits to the consumers
• Improvements in production or distribution of goods or provision of services.
Enquiry by the CCI
- Section 19(1) of the Act provides that the CCI may enquire into any alleged contravention of
section 3(1) of the Act on its own or on receipt of any information from any person, consumer
or their association or trade association upon payment of the fees and the manner prescribed.
- The CCI may also act if a reference is made to it by the central government or a state
government or a statutory authority.
- The CCI proceeds with enquiry only when there exists a prima facie case and then it directs the
director general to cause an investigation in the matter.
- In cases where after enquiry CCI finds that the agreement is anti-competitive and has AAEC, it
may pass all or any of the following orders, apart from any interim orders -
• Direct the parties to discontinue and not to re-enter such agreement (cease and desist);
• Impose such penalty as it may deem fit which shall not be more than 10% of the average of the
turnover for the last three preceding financial years upon each of the party;
• In case of a cartel, each producer, seller, distributor, trader or service provider included in that
cartel can be imposed a penalty up to three times of its profit for each year of the continuance
of such agreement or 10% of its turnover for each such year, whichever is higher;
• Direct to modify the agreement and in the manner as may be specified in the order of the CCI;
• Pass any such order or issue such directions as it may deem fit.
- The Competition Commission of India focuses on the demand analysis of the
certain product, production capacity, and utilization of the capacity of the
market participants to understand the following trend or pattern if enterprises
among the same level of trade limit the production.
- A particular period of three years is to be set for trend or pattern analysis.
- The demand analysis is also done to check whether participants in the market
are involved in processing production.
- It limits production even when there is a high demand for the product in the
market over a while, in return, it can have an impact on price rise.
- People or enterprises start hoarding the product whenever the market price is
low and when demand increases with less available product supply, it results in
fluctuations in price which leads to inflation.
- Subsequently, enterprises release their product from their stock to earn high
dividends as the price cannot be kept at elevated levels if market participants do
not keep their level of supply low in comparison to demand.
EASY EXPLANATION OF ABOVE SLIDE
• The Competition Commission of India examines the behavior of companies in a market to
understand if they are working together to limit production. They focus on analyzing the
demand for a specific product, the production capacity of companies, and how much of that
capacity is being used. This analysis looks at trends or patterns over a three-year period.

• The goal is to check if companies are restricting production, even when there is high
demand for the product. If companies limit production despite high demand, it can lead to
higher prices. Sometimes, companies hoard products when prices are low. When demand
increases and supply is low, it causes price fluctuations, leading to inflation.

• To counteract this, companies release their stored products into the market when demand is
high. This helps them earn more profits because prices cannot remain high unless
companies deliberately keep their supply low compared to demand.
Ola and Uber case
- There was wherein allegation of use of algorithmic pricing to facilitate price fixing cartel made against
taxi aggregators, Ola and Uber
- The Supreme Court of India vide its judgement dated 15.12. 2020 has upheld the concurrent findings on
merits of Competition Commission of India (“CCI/ Commission”) dated 06.11.2018 and the National
Company Law Appellate Tribunal (“NCLAT”) order dated 29.05.2020, was rejected.
- The serious allegation against both taxi aggregators, Ola and Uber, was made by Mr Samir Agrawal, a
Delhi based independent legal practitioner (Informant) before the CCI that OLA and UBER entered into
price-fixing agreements in contravention of Section 3(1) read with Section 3(3)(a) of the Act and also
engaged in resale price maintenance in contravention of Section 3(1) read with Section 3(4)(e) of the Act.
- It was further alleged that due to algorithmic pricing, neither are riders able to negotiate fares with
individual drivers for rides that are booked through the apps, nor are the drivers able to offer any
discounts.
- Thus, the pricing algorithm takes away the freedom of riders and drivers to choose the best price based
on competition, as both must accept the price set by the pricing algorithm.
- As per the informant, algorithmic pricing adopted by Ola & Uber takes away the liberty of individual
drivers to compete and amounts to price fixing through a cartel like arrangement.
- The Commission, however, dismissed the allegation and closed the case under Section 26(2) of the
Competition Act, 2002 (“the Act”) without calling for any response from either Uber and Ola, holding
that there was neither any instance of any agreement/understanding between the cab aggregators and
- The Commission had also noticed that Ola and Uber being Cab Aggregators
operating through their respective apps were not an association of drivers and
they acted as separate entities from their respective drivers.
- A rider books his ride at any given time which is accepted by an anonymous
driver available in the area and such driver has no opportunity to co-ordinate its
action with other drivers thereby ruling out such activity being termed as a
cartel activity.
- The Commission ruled out any cartel like arrangement between Ola/Uber and
their respective drivers.
- Aggrieved by the CCI decision, the Informant filed an appeal against the decision
before NCLAT in the first appeal but the NCLAT vide its order dated 29.5.2020
upheld not only the CCI order but also observed that the since there was
nothing on record to show that the informant suffered a legal injury at the hands
of Ola and Uber as a consumer or as a member of any consumer or trade
association and therefore, the informant has no locus standi to maintain an
action qua the alleged contravention of Act by Ola and/or Uber.
- Before the Apex Court, the Informant, who appeared in person, reiterated the submissions made before
the CCI and the NCLAT.
- In particular, he attacked the finding of the NCLAT on lack of locus standi due to absence of evidence of
suffering any legal injury.
- The Informant, referring to Sections 19 and 35 of the Act, argued that any person can be an informant
who can approach the CCI, as one does not have to be a “consumer” or a “complainant”.
- Interestingly, whereas the Ld. Counsel for OLA vehemently supported the NCLAT decision on grounds of
lack of locus standi by the Informant /Appellant and even pressed for imposition of heavy costs for
indulging in, what he described as frivolous litigation, the Ld. Additional Solicitor General (ASG),
representing the Commission before the Apex Court , supported the appellant/Informant on the issue of
locus .
- The Apex Court after going through the various provisions of the Act and Competition Commission of
India said that impugned judgment of the NCLAT in its narrow construction of section 19 of the Act, which
therefore stands set aside.
- The Supreme Court held, any person may provide information to the CCI, which may then act upon it in
accordance with the provisions of the Act.
- Hon’ble Supreme Court held that Whereas, a complaint could be filed only from a person who was
aggrieved by a particular action, information may be received from any person, obviously whether such
person is or is not personally affected.
- However, on the merits of the case, Apex Court decided not to interfere with the concurrent finds of the
CCI and NCLAT.
What happened at CCI subsequently
- On June 20, 2018, CCI disposed off four separate informations alleging contravention of Sections 3 & 4 of
the Competition Act, filed by Meru Travel Solutions Private Limited (‘Meru’) against ANI Technologies
Private Limited (‘Ola’), Uber India Systems Pvt. Ltd. (‘Uber’), Uber BV, and Uber Technologies
International Inc. through a common order.
- The allegations against the parties in the four sets of information were broadly similar:
(a) that the arrangement entered into between Ola, Uber and their driver-partners is an anti-competitive
arrangement as it is designed to lock them into the parties’ network by providing huge incentives
(b) that Ola and Uber are individually or collectively dominant in cities such as Hyderabad, Chennai,
Mumbai and Kolkata
(c) that, in the alternate, Ola and Uber are dominant as a ‘group’, due to the presence of common
controlling institutional shareholders. The presence of these common shareholders also raises the issue
of anti-competitive information exchange
(d) that the parties had abused this position of dominance by indulging in predatory pricing by offering
huge discounts and incentives to customer and driver-partners, and consequentially foreclosing the
competition in the market by creating entry barriers.
- CCI observed that the incentive model offered to driver-partners by Uber and Ola would not fall within the
meaning of the term ‘agreement’ which is a pre-requisite under Section 3 of the Competition Act.
- CCI noted, that per its decisional practice, in the radio taxi service market, both drivers and riders have the
option of ‘multi-homing’ by switching easily to a different aggregator by the medium of mobile
- Further such alleged agreements cannot cause lock-ins and hence, barriers to
entry in the radio taxi services market.
- Accordingly, CCI noted that no contravention of Section 3 of the Competition Act
was made out in the case.
- With respect to the allegations under Section 4 of the Competition Act, CCI
noted that per its past decisional practice, the relevant markets in the present
case would be the markets for ‘radio taxi services in Hyderabad’, ‘radio taxi
services in Chennai’, ‘radio taxi services in Mumbai’ and ‘radio taxi services and
yellow taxi services in Kolkata’. Within these markets, CCI observed that, given
the nature of competition, prima facie dominance of Uber and Ola individually is
not made out.
- CCI further noted that under the scheme of Section 4 of the Competition Act, a
dominant position can be enjoyed only by one enterprise or group, and hence
the contention of Meru that Uber and Ola were collectively dominant was
without any merit.
- CCI next considered the allegation that Ola and Uber are dominant as a ‘group’
due to the presence of controlling institutional shareholders such as Softbank,
Tiger Global, Sequoia Capital and others.
- CCI noted that the issue at hand was whether the presence of common
investors in Ola and Uber would lead to the erosion of competitive restraints
that each poses on the other.
- CCI noted that there is no evidence on record to suggest that competition
between Ola and Uber has been compromised in any manner.
- CCI held that it would be legally untenable to hold that the parties were
influenced in their operational decisions by the common investors.
- In light of the above, CCI concluded that a prima facie case had not been
established against the parties under Section 3 or Section 4 of the Competition
Act, and accordingly disposed off the informations under Section 26(2) of the
Competition Act.
Hyundai Motor India Ltd. Vs Competition Commission of India & Ors.
- The appeal under Section 53B of the Competition Act, 2002 as filed by the Appellant-‘Hyundai Motor India Limited’
against the order dated 14th June, 2017, passed by the Competition Commission of India in which the Commission
had held that Hyundai Motor had contravened the provisions of Section 3(4)(e) read with Section 3(1) of the Act,
2002 through arrangements which resulted into Resale Price Maintenance. (Resale price maintenance is a practice in
which a manufacturer fixes the price for the resale of a brand product and the retailer is not allowed to sell it at a
lower price. Manufacturers use resale price maintenance to more directly prevent inter-retailer price competition.)
- The Commission further held that Hyundai Motor engaged in mandating its dealers to use recommended lubricants
and oils and thereafter issued direction of cease and desist on the Hyundai Motor from indulging in conduct that has
been found to be in contravention of the provisions of the Act, 2002 and imposed penalty at the rate of 0.3% of its
average relevant turnover of the last three financial years which has been rounded off at Rs. 87 Crores with direct on
to deposit the same within the stipulated period.
- ‘Hyundai Motor’ was incorporated under the provisions of the Companies Act, 1956, on 6th May, 1996, for
manufacturing and distribution of motor vehicles and their parts.
- ‘1st Informant’- ‘Fx Enterprise Solutions India Pvt. Ltd.’ had a Hyundai dealership for sale and service of Hyundai cars
of which Shri Ankit Agrawal was the Managing Director.
- Pursuant to ‘Hyundai Motor’ advertisement calling for applications for Hyundai dealership in Faridabad territory in
2005, ‘1st Informant’- ‘Fx Enterprise Solutions India Pvt. Ltd.’ responded to the advertisement and submitted its
application. After multiple meetings held with the officers of ‘Hyundai Motor’, ‘1st Informant’- ‘Fx Enterprise
Solutions India Pvt. Ltd.’ purchased a plot in Faridabad to meet the standards required by ‘Hyundai Motor’ and
commenced a dealership for sale and services of spare parts of Hyundai cars from May 2006.
- ‘1st Informant’- ‘Fx Enterprise Solutions India Pvt. Ltd.’ submitted a notice of termination of dealership to ‘Hyundai
Motor’ on 25th April, 2014.
ALLEGATIONS
- The allegation of ‘1st Informant’- ‘Fx Enterprise Solutions India Pvt. Ltd.’ was that the
Opposite Party No-1 entered into exclusive dealership arrangements with its dealers,
and dealers are required to obtain prior consent of the Appellant before taking up
dealerships of another brand.
- further alleged that the ‘Hyundai Motor’ also imposed a “Discount Control Mechanism”
through which dealers were only permitted to provide a maximum permissible discount
and the dealers were not authorised to give discount which is above the recommended
range, and the same amounted to “resale price maintenance”, in contravention of Section
3(4)(e) of the Act, 2002.
- ‘Hyundai Motor’ is responsible for price collusion amongst competitors through a series
of “hub – and – spoke” arrangements.
- ‘1st Informant’- ‘Fx Enterprise Solutions India Pvt. Ltd.’ has alleged that ‘Hyundai Motor’
perpetuates hub and spokes arrangement, wherein bilateral vertical agreements between
supplier and dealers and horizontal agreements between dealers through the role played
by a common supplier, results in ‘price collusion and unwanted cars’ to its dealers and
‘Hyundai Motor’ designated sources of supply for complementary goods for dealers,
which results in a “tie-in” arrangement in violation of Section 3(4)(a) of the Act, 2002.
- allegation of ‘2nd Informant’- ‘St. Antony’s Cars Pvt. Ltd.’ is that the term of the
Dealership Agreement (Dealership Agreement) was initially for a period of three
years from the date of execution.
- It is alleged that Clause 5(iii) of the agreement prohibited the dealer from
investing in any other business, particularly in dealerships with competitors of
the ‘Hyundai Motor’.
- It was further alleged that, pursuant to the said clause, the dealers of the
‘Hyundai Motor’ could not take dealerships of competitors of the ‘Hyundai’,
even if the dealership was a completely separate entity from the dealership of
the ‘Hyundai Motor’.
- Therefore, according to ‘2nd Informant’- ‘St. Antony’s Cars Pvt. Ltd.’, Clause 5(iii)
of the Dealership Agreement amounted to “refusal to deal” and is in
contravention of the provisions Section 3(4)(d) of the Act, 2002.
REPORT SUBMITTED BY DIRECTOR GENERAL
- The ‘DG’ after investigation, while observing that passenger cars manufactured and sold by different
players are interchangeable and substitutable by consumers in view of their utility, defined a ‘broad
relevant market’ as “Sale of Passenger Cars in India”.
- The ‘DG’ further sub-divided this ‘relevant market’ and defined ‘separate relevant market(s)’ for each
of the contraventions identified as follows:
(i) Refusal to Deal: For analysing Clause 5(iii) of the Dealership Agreement concerning refusal to deal
contravention, the DG defined the relevant market as “Inter-Brand Sale of Passenger cars in
India”; violating section 3(4)(d).
(ii) Resale Price Maintenance (RPM): For the purposes of analysing whether the OP imposes a
(maximum) resale price, the DG defined the relevant market as “Intra Brand Sale of Hyundai Brand of
Cars in Delhi and NCR”; violating section 3(4)(a).
(iii) Tie-in arrangements:
• In determining whether the OP imposes a tie-in arrangement with respect to the sale of CNG kits,
the DG defined the relevant market as “Sale of CNG Kits for Hyundai Brand of Cars in Delhi and NCR”;
• For determining whether the OP imposes a tie- in arrangement for lubricants, the DG defined the
relevant market as “Sale of Lubricants for Hyundai Brand of Cars in India”
• To analyse whether the OP imposes a tie-in arrangement in relation to obtaining car insurance, the
DG defined the relevant market as “Insurance for Hyundai Brand of Cars in India”.
(iv) the DG stated that the Commission has defined 3 segments of the automobile
market, viz.:
(a) the primary market consisting of manufacturing and sale of passenger vehicles
(b) the secondary market or aftermarket for each brand of spare parts
(c) an aftermarket for each brand of repair services.
- As the issue of tie-in arrangement of the OP with regard to the sale of CNG Kits, lubricants
and insurance policies and services also falls within the scope of aftermarket services, the
DG defined the product aftermarket as “after sales services of Hyundai Brand of Cars”.
- The ‘DG’ also held that the ‘Hyundai Motor’ has ‘entered into tie-in arrangements’ with
regard to sale of cars and:
(a) supply and retrofitting of CNG kits
(b) sale and supply of lube oils
(c) sale of insurance policies and services incidental thereto.
The ‘DG’ held that the aforesaid tie-in arrangements amount to exclusive supply agreement
and refusal to deal and therefore, it found the ‘Hyundai Motor’ to have violated the
provisions of Section 3
- The Commission held that HMIL has contravened the provisions of Section 3(4)
(e) read with Section 3(1) of the Act through arrangements which resulted into
Resale Price Maintenance.
- Such arrangements also included monitoring of the maximum permissible
discount levels through a Discount Control Mechanism.
- Further, HMIL has contravened the provisions of Section 3(4)(a) read with
Section 3(1) of the Act in mandating its dealers to use recommended
lubricants/ oils and penalising them for use of non-recommended lubricants
and oils to the tune of Rs. 87 crore.
- The Delhi bench of National Company Law Appellate Tribunal (NCLAT) recently
passed a decision in the case of Hyundai Motor India Ltd vs CCI, setting aside a
fine of Rs 87 crore by Competition Commission of India (CCI) for anti-
competitive practices.
Shri Shamsher Kataria v. Honda Siel Cars India Ltd. & Ors
- In 2011, Shamsher Kataria filed a complaint to the Competition Commission of India (CCI) against
Honda, Volkswagen, and Fiat (carmakers) alleging that these three companies were abusing their
dominant position in the market and were indulged in anti-competitive practices by controlling
the operations of those workshops and service centers which sell automobile spare parts.
- These companies put a restriction on the availability of original spare parts, software programs,
and technical information without which services and maintenance of the automobile is
impossible
- The aforementioned car companies and their respective dealers refused to supply genuine spare
parts and technological equipment in the open market for providing maintenance and repair
services.
- The car manufacturers mandated that the authorized dealers source their spare parts only from
the Original Equipment Manufacturers (OEMs) and such spare parts could not be sold in the open
market thus monopolizing this spare-parts market.
- OEMs and their authorized dealers charged high prices to the consumers for spare parts and
maintenance services thus imposing vertical restraints on their authorized dealers.
- CCI ordered the Director-General to investigate the allegations. While investigating, the director
general found 14 more such automobile companies who were indulged in anti-competitive
practices of the same kind.
Report By DG-
• DG agreeing with the allegations made by Shamsher Kataria stated that the activities
performed by of OEMs were in violation of sections 3 and 4 of the Act.
• Consumers were ‘locked into’ aftermarket suppliers of the car purchased due to the
Technical difference between various primary market products as it restricted consumers’
choice in complementary products/services
• DG emanated that there were vertical agreements between OEMs due to which their
authorized dealers cause Appreciable Adverse Effect on Competition (AAEC), thus
violating section 19(3) of the Act.
Objections Raised by OEM’s
• They objected to enlarging the ambit of DG’s investigation.
• The OEMs argued that the automobile market is a unified ‘systems market’ where the
spare parts are an indivisible part of the automobile market.
• The OEMs claimed that they were not in a dominant position and alleged that DG ignored
statutory levies and other costs while computing the mark-up.
• OEMs said that generally after the warranty period many consumers switch to
independent repairers so consumers are not ‘locked in’ in any way.
CCI’s Order (25th August 2014)
• After observing all the facts and circumstances CCI observed that each OEM was enjoying
a dominant position in the market, which restricted local dealers to enter the open
market.
• Irrespective of any fact, if an agreement or act eliminates the competition in the market
then the commission has to strike it down.
• Consequently OEMs held liable for violating Sections 3(4) (b), 3(4) (c), 3(4) (d, 4(2) (a) (i),
4(2) (c) and 4(2) (e) of the Competition Act.
In the year 2016
• OEM opposed the penalty passed by the CCI on 25th August 2014 before the
Competition Appellate Tribunal (COMPAT).
• Thereafter on 9 December 2016 COMPAT reduced the penalty to 2% of the
average relevant turnover (i.e., the average annual turnover of spare parts in the
aftermarket).
• However, they were in the favour of the order passed by the CCI.
• It was held that the appellants indulged in practices that result in denial of
market access to independent repairers of automobiles thus violating Section
4(2) (c) of the Competition Act 2002.
• OEM was not satisfied with the decision made by the CCI and COMPAT so
subsequently, they filed a Writ petition in Delhi High Court in 2019.
The following issues were raised before the High Court
• Whether CCI has jurisdiction to administer and investigate in this case? A
tribunal with judicial functions or does it have administrative and investigative
functions and adjudicates issues?
• Whether the composition of CCI is unconstitutional because it violates the
doctrine of separation of powers?
• Whether Section 22(3) of the Competition Act 2003 constitutionally valid or
not?
• Whether the expansion of the scope of investigation by CCI’s under Section
26(1) illegal? Does ‘revolving door’ practice vitiate any of the provisions of this
act?
• Whether Section 27(b) of the act is unconstitutional or not?
Judgment
- On 10th April 2019, a landmark judgment was passed by the High Court of Delhi, where, The
Delhi High Court enunciated that it is not necessary that the first step taken by CCI is always
in aid to adjudication, what matters is the further steps, which means that the step in
furtherance of the inquiry must be towards adjudication.
- While referring to the case CCI v Steel Authority of India Ltd, It stated that in the present
case CCI had performed advisory, investigative, administrative, and adversarial functions
but it had not performed the exclusive adjudicatory functions of a tribunal.
- In this regard, the court enunciated that the order passed by CCI is subject to appeal to a
tribunal (i.e., an appellate tribunal).
- Further, the provision of judicial review as regards any procedural flaw under Article 226 of
the Constitution is always available.
- The Delhi High Court observed that CCI gave the order and DG only performed the
investigation (under Section26 (1)) and presented the facts before CCI, so there is no
violation of separation of power, thus Section 26(1) is not unconstitutional.
- The High Court asked CCI to keep at least one legal practitioner as a member of CCI, who can
check the violation of the law.
- The High Court observed that casting a vote may sway the vote, so it declared Section
22(3) void in its entirety. However, the proviso which mandates a quorum of three
members would be retained.
- Court asked CCI to frame guidelines to ensure that the membership of CCI should not
vary when the final hearing starts.
- It also stated that the final hearing must be heard by at least 5 members inclusive of
judicial members (mandatory).
- The Delhi High Court referred to the case of Excel Crop where the Supreme Court
held that the subject matter of the investigations can be extended even to the third
parties. So, investigating the other 14 companies was not illegal.
- The Delhi High Court observed that CCI has done a deeper analysis of the suit and
also it has followed all the steps for proper investigation as prescribed by law thus the
penalty imposed by CCI was justified.
- Subsequently, High Court said that though Section 27 of the Competition Act doesn’t
provide any guidelines for imposing a penalty the principal followed by CCI were in
accordance with the principle laid down by the Supreme Court in the case of Excel
Crop and Hindustan Steel Ltd v State of Orissa, thus valid and acceptable.