Supreme Court refuses to interfere with NCLAT order, asks Google to comply

The Supreme Court, on Thursday, refused to interfere with the National Company Law Appellate Tribunal (NCLAT) order imposing a penalty of Rs 1,338 crore on Google India for abuse of dominance in relation to the Android ecosystem, the Livelaw reported.

The apex court, however, directed the NCLAT to dispose of the appeal filed by Google by March 31, 2023.

The Supreme Court bench led by Chief Justice of India DY Chandrachud refrained from commenting on the merits of the matter as the matter is still pending in NCLAT. 

The bench also affirmed that the CCI findings "cannot be regarded as contrary to the weight of record at interlocutory stage".

"Findings by CCI cannot be said to be without jurisdiction or with manifest error", the bench observed.

Saying that since the appellants were already pursuing interlocutory remedies before NCLAT and the SC, the compliance with the CCI order is extended by a further period of one week.

Earlier on January 17, the Supreme court bench, while hearing the tech giant's plea against the NCLAT order, declined to stay the Competition Commission of India's (CCI) decision to impose a Rs 1,338 crore penalty on it for unfair and anti-competitive practices. The bench asked, "Will Google follow the same approach taken by it in European Union, as regards pre-installed apps in Android-based mobile phones, in India?"

The CCI had earlier told the apex court that the EU Commission had found Google's practice anti-competitive in 2016 and that the tech company has since complied with the European order. However, it is unwilling to follow a similar order passed by the CCI.

What is the case?

The CCI had imposed a penalty of Rs 1,337.76 crore on Google for abusing its dominant position in multiple markets in the Android Mobile device ecosystem, apart from issuing cease and desist order. The CCI also directed Google to modify its conduct within a defined timeline. 

Smart mobile devices need an operating system (OS) to run applications (apps) and programs. Android is one such mobile operating system. In 2005, Google acquired the company, also named Android, which developed this operating system. The first public version of this operating system, Android, was launched in 2008.

The CCI said that "in the instant matter has examined various practices of Google w.r.t. licensing of this Android mobile operating system and various proprietary mobile applications of Google (e.g. Play Store, Google Search, Google Chrome, YouTube, etc.)."

And has found "Google to be dominant in the markets for licensable operating system (OS) for smart mobile devices and market for app stores for Android smart mobile OS, in India". This is certainly a domain for CCI. The regulator has also concluded that potentially "if the app developers do not comply with Google's policy of using Google Play's Billing System (GPBS), they are not permitted to list their apps on the Play Store and thus, would lose out the vast pool of potential customers in the form of Android users".