Tuesday, January 31, 2023

Supreme Court dimisses appeal against order of CCI which challenged the clause 28 of Rules of Legal Education

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The Supreme Court on April 04 , dismissed an appeal against the order of the Competition Commission of India (CCI) which rejected the challenged  to the Clause 28 of Rules of Legal Education, 2008 according to which, candidates belonging to General category who have attained the age of more than 30 years, are barred from pursuing legal education.

The Division Bench of Justice Sanjay Kishan Kaul and MM Sundaresh dismissed the case filed by one Thupili Raveendra Babu while observing the point in question cannot be challenged in the competition jurisdiction and an appropriate representation should be made to the Bar Council of India (BCI) in this regard.

Earlier , the appellant approached the CCI under Section 19(1)(a) of the Competition Act, 2002 alleging contravention of provisions of Section 4 of the Act by BCI.

The appellant, aged 52 years, is working as an executive engineer in Central Public Works Department (CPWD) under the Ministry of Urban Development, Government of India and plans to voluntarily retire to pursue legal education. He appeared for LLB (3 year) entrance examination in the State of Andhra Pradesh(APLAWCET) on 01.10.2020 and secured first rank in the said examination in the state.

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According to the appellant , the BCI is an elected body of advocates in India. It regulates legal practice as well as legal education in India. It enjoys the dominant position in controlling the legal education as well as the legal practice in India.

In the CCI the, appellant states that Clause 28 of Schedule III, Rule 11 to Part IV
– Rules of Legal Education, 2008, a part of Bar Council of India Rules enacted under the Advocates Act, 1961, according to which the candidates belonging to General category who have attained the age of more than 30 years, are barred from pursuing legal education. The BCI has allegedly imposed maximum age restrictions upon the new entrants to enter into the legal education and thus, created indirect barriers to the new entrants in the profession of legal service. The impugned Clause 28 has been incorporated by the BCI in contravention of Section 4 of the Act by ‘misusing its dominant position’. By having done so, the BCI has also allegedly indulged in colourable exercise of power.

He alleged that the members of the BCI, by way of aforementioned Clause 28, conspired to reduce the competition to its electors and created indirect barriers in the profession of legal service. He has also alleged that the members of the BCI who are managing the affairs of the BCI are misusing the dominant position enjoyed by the BCI in controlling the legal education in India.

Based on the above, the appellant  has prayed before the Commission to declare the impugned Clause 28 as illegal and void ab initio and impose maximum penalty on the BCI for the violation of Section 4 of the Act and indulging in colourable exercise of power.

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The appellant has also prayed before the Commission for interim directions under Section 33 of the Act for suspending the impugned Clause 28. He submitted that allegedly prima facie case of violation of Section 4 of the Act is established against the BCI and the balance of convenience lies in his favour. He further states that irreparable loss and harm would be caused to him and many other legal aspirants for pursuing legal education in India, if the operation of Clause 28 is not suspended.

In CCI , the Coram comprising Chairperson
Ashok Kumar Gupta , Members Sangeeta Verma and Bhagwant Singh Bishnoi held that the primary question which falls for consideration is whether BCI is an ‘enterprise’ within the meaning of Section 2(h) of the Act. The term ‘enterprise’ has been defined under Section 2(h) of the Act, inter alia, as a person or a department of the Government, engaged in any activity relating to provision of any kind of services.

 In the present matter, the Commission noted that the BCI is a statutory body established under Section 4 of the Advocates Act, 1961. Section 7 of the said Act lays down the functions of the BCI which includes promotion of legal education in India and to lay down standards of such education in consultation with the Universities in India and the State Bar councils. Further, Section 49 of the Advocates Act, 1961 empowers the BCI to make rules for discharging its functions under the said Act such as prescribing qualifications and disqualifications for membership of a Bar Council, minimum qualifications required for admission to a course of degree in law in any recognised university, prescribing the standards of legal education for the universities in India, etc. Thus, it is noted that the BCI appears to carry out functions which are regulatory in nature in respect of the legal profession.

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It is noted that in case of In re: Dilip Modwil and Insurance Regulatory and Development Authority (IRDA)1, decided on 12.09.2014, the Commission had the occasion to examine the status of IRDAI as an ‘enterprise’ under the Act. The Commission had observed that any entity can qualify within the definition of the term ‘enterprise’ if it is engaged in any activity which is relatable to the economic and commercial activities specified therein. It was further observed that regulatory functions discharged by a body are not per se amenable to the jurisdiction of the Commission.

In the present matter, when the BCI appears to be discharging its regulatory functions, it cannot be said to be an ‘enterprise’ within the meaning of Section 2(h) of the Act and consequently, the allegations made in relation to discharge of such functions which appears to be non-economic in nature, may not merit an examination within the provisions of Section 4 of the Act , said the CCI.

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“In view of the foregoing, the Commission is of the opinion that there exists no prima facie case under the provisions of Section 4 of the Act and the information filed is directed to be closed forthwith against the Opposite Parties under Section 26(2) of the Act. Consequently, no case for grant for relief(s) as sought under Section 33 of the Act arises and the same is also rejected”

-order of the CCI reads dated January 20 , 2021.

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