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Micromax, Karbonn withdraw appeals before NCLAT against CCI ruling

After a jolt by the Supreme Court to Google last week, Micromax and Karbonn—Indian manufacturers of consumer electronics, including mobile phones —have withdrawn their appeals before NCLAT against a CCI order of October 20 last year in the Android case.

Both Micromax and Karbonn were not party before CCI in the Android case, where the competition watchdog levied ₹1,337 crore penalty on the tech giant Google for its anti-competitive practices.

The National Company Law Appellate Tribunal (NCLAT) competition bench comprising Justice Rakesh Kumar, Member (Judicial) and Alok Srivastava, Member (Technical), on Monday disposed the respective appeals of Micromax and Karbonn as withdrawn.

It maybe recalled that the Supreme Court had in the Google appeal matter on Thursday last refused to interfere with an order passed by NCLAT in the Android matter and declined to grant stay on the directions issued by Competition Commission of India (CCI) in its October 20 ruling last year.

While not being inclined to interfere with the order of NCLAT that declined interim relief, the apex court extended the time for compliance of CCI directions by Google by a further period of one week. The apex court had also directed NCLAT to dispose of the appeal preferred by Google by March 31, 2023.

During the preliminary hearing in the appeals by Micromax and Karbonn, NCLAT had found several defects in the applications and cautioned that the Bench would even impose exemplary cost while deciding on allowing the appeal or dismissing it.

In its appeal before NCLAT, Micromax had contended that the CCI ruling in the Android case had the effect of “condemning” its business without affording any opportunity of hearing its viewpoints on the matter.

Micromax move to prefer an appeal against the CCI’s October 25 order had evoked “surprise” in several quarters given that the CCI order was perceived to help OEMs as it would give them a choice to preinstall apps of their preference in devices.

Some market watchers even contended that Micromax might have been propped up by Google to drum up support in favour of latter’s appeals.

Grounds of appeal
Micromax was of the view that implementation of CCI order could result in a change in the existing bundled services offered by Google. Google would charge a price for its Android OS and various individual apps. This would result in high input costs to Micromax that would lead to smartphones becoming inaccessible to large members of the public, according to Micromax.

This would adversely affect not only the business of Micromax as suppliers of low cost smartphones, but will also adversely affect Centre’s objective of achieving high penetration of smartphone enabled services, it was submitted.

Another ground of appeal related to Android forks, which Micromax contended would inhibit seamless portability and transfer of data. Due to various versions of Android OS, Apps, the smartphone OS and the smartphone device itself will have increased instances of lack of compatibility, according to Micromax’s memorandum of appeal. Smartphones may not work as a smartphone at all due to various and inconsistent Android OS and Apps.

Micromax contended that the CCI’s non-monetary directions on Google are detrimental to the interests of the Indian multinational and the end users.

Also, compromising user experience as a result of incompatible apps and phones will severely impact the sale of Micromax’s smartphones, it was submitted. The Hindu BusinessLine

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