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Economic, Commercial and Intellectual Property Laws · Competition Law

Duties, Powers and Functions of the Competition Commission of India

Updated 11 October 2026 · Fact-checked

The Competition Commission of India must eliminate practices harming competition, promote and sustain competition, protect consumers and ensure freedom of trade (section 18). It inquires into agreements and dominance with the Director General's help, can pass interim orders (section 33), impose penalties (section 27) and grant lesser penalty to cartel whistle-blowers (section 46).

Understand Duties, Powers and Functions of the Commission

The Competition Act, 2002 sets up the Commission as the market watchdog. Section 18 states its job in four parts: eliminate practices having an adverse effect on competition, promote and sustain competition, protect the interests of consumers, and ensure freedom of trade carried on by other participants in markets in India.

The Commission does not investigate everything itself. Under section 16, it appoints a Director General (with the prior approval of the Central Government) to assist it in conducting inquiry into contravention of the Act. The Director General is assisted by Additional, Joint, Deputy and Assistant Directors General, who work under the DG's general control, supervision and direction. They must be persons of integrity and outstanding ability with experience in investigation and knowledge of fields such as accountancy, management, business, public administration, international trade, law or economics.

The flow is simple. The Commission forms a view that there is a case, the DG investigates, and the Commission decides after inquiry. While the inquiry is on, it can protect the market through an interim order. If it finds a contravention of section 3 (anti-competitive agreements) or section 4 (abuse of dominant position), it passes final orders under section 27.

Cartels are treated more harshly, but there is a carrot too. A cartel member who makes a full, true and vital disclosure can get a lesser penalty under section 46. This helps the Commission detect cartels that are otherwise hidden.

The Commission can also fine those who ignore its directions or the DG's directions. Section 43 covers this: a daily fine for non-compliance without reasonable cause, with a ceiling.

Key rules to remember

Duty of the Commission (section 18)
Eliminate adverse practices + promote and sustain competition + protect consumers + ensure freedom of trade, in markets in India
Learn the four limbs. The Commission may sign memoranda with foreign agencies only with prior Central Government approval, and with Indian statutory authorities or departments without that approval.
Interim order (section 33)
Temporary restraint until the conclusion of inquiry or until further orders, without notice to the party where necessary
Applies where the Commission is satisfied that a contravention of section 3(1), section 4(1) or section 6 has been committed and continues, or is about to be committed.
General penalty (section 27(b))
Penalty ≤ 10% of the average of turnover or income for the last three preceding financial years
Imposed on each person or enterprise party to the agreement or abusing dominance. Turnover means global turnover from all products and services.
Cartel penalty (proviso to section 27(b))
Up to the higher of: 3 × profit for each year of the agreement, or 10% of turnover or income for each year of the agreement
Applies to each producer, seller, distributor, trader or service provider in the cartel.
Other orders (section 27)
Discontinue and not re-enter; modify the agreement; abide by other directions including costs; any other order
The Commission may also pass orders against other members of the same group if they contributed to the contravention.
Non-compliance fine (section 43)
Up to ₹1,00,000 per day of failure, maximum ₹1,00,00,000
For failing without reasonable cause to follow directions of the Commission under section 36(2) and (4) or of the DG under section 41(2).
Lesser penalty (section 46)
Full, true and vital disclosure by a cartel member, before the DG's investigation report is received, with continued cooperation
The lesser penalty is as specified by regulations.

How to solve Duties, Powers and Functions of the Commission questions

Use this method for any question on the Commission's duties, powers, penalties or leniency.

  1. 1Identify what the question asks: a duty, a power, an interim relief, a final order, a penalty amount or leniency.
  2. 2Name the provision first: section 18 for duties, 16 for the DG, 33 for interim orders, 27 for final orders and penalty, 46 for lesser penalty, 43 for non-compliance fines.
  3. 3Check the trigger. Is the issue an agreement (section 3), dominance (section 4) or a combination (section 6)? Interim orders need one of these.
  4. 4Apply the rule with its exact conditions, for example the three-year average turnover for the general penalty, or the report-received bar for lesser penalty.
  5. 5If a number is needed, calculate each limb separately and pick the correct one. For cartels, compare 3 × profit with 10% of turnover and take the higher.
  6. 6Conclude clearly in one line, for example that the Commission may grant a lesser penalty, or may not.

Quickest way: Provision-trigger-outcome shortcut

When to use it: When time is short and you must write a crisp answer in a few minutes.

  1. Write the section number and its heading in one line.
  2. State the trigger in one sentence using the Act's words.
  3. State the outcome: the order, the cap or the bar.
  4. For penalties, write the formula and substitute figures directly.
  5. End with a one-line conclusion.

Common mistakes in Duties, Powers and Functions of the Commission

  • Saying a cartel penalty is just 10% of turnover

    Students remember the general cap and forget the proviso.

    Fix: For cartels, state the higher of 3 times profit per year or 10% of turnover per year of the agreement.

  • Using the last year's turnover for the general penalty

    It seems the natural base.

    Fix: Use the average of turnover or income of the last three preceding financial years.

  • Granting lesser penalty after the DG's report is received

    Students focus on disclosure and ignore the provisos.

    Fix: Lesser penalty cannot be imposed if the section 26 investigation report was received before the disclosure. The discloser must also keep cooperating until the proceedings end.

  • Thinking interim orders need prior notice to the party

    Natural justice habit.

    Fix: Section 33 allows a temporary restraint without giving notice where the Commission deems it necessary.

  • Saying interim orders can be passed for any contravention

    Students generalise.

    Fix: Section 33 covers section 3(1), section 4(1) and section 6 only, and only during an inquiry.

  • Treating the DG as a decision-maker

    The DG investigates, so students assume the DG decides.

    Fix: The DG assists the Commission in inquiry. The Commission decides and passes orders.

Worked examples

Example 1

An enterprise in a cartel has a profit of ₹2 crore each year and a turnover of ₹15 crore each year. The cartel ran for 3 years. State the maximum penalty the Commission may impose on it under section 27.

Show the solution
  1. The proviso to section 27(b) applies because the agreement was entered into by a cartel.
  2. Limb one: 3 × profit for each year = 3 × ₹2 crore × 3 years = ₹18 crore.
  3. Limb two: 10% of turnover for each year = 10% × ₹15 crore × 3 years = ₹4.5 crore.
  4. The Commission may impose up to whichever is higher, which is ₹18 crore.

Answer: The maximum penalty is ₹18 crore, being the higher of ₹18 crore and ₹4.5 crore.

Example 2

During an inquiry into alleged abuse of dominant position, the Commission finds that the conduct is continuing and may harm competitors. Can it restrain the enterprise before the inquiry ends, and can it do so without notice? Separately, can a cartel member who discloses after the DG's investigation report is received claim lesser penalty?

Show the solution
  1. Provision: section 33 allows interim orders during an inquiry.
  2. Trigger: the Commission must be satisfied that an act in contravention of section 4(1) has been committed and continues, or is about to be committed. Abuse of dominance falls under section 4(1).
  3. Effect: it may temporarily restrain the party until the conclusion of the inquiry or until further orders, without notice where it deems this necessary.
  4. On leniency, section 46 first proviso says lesser penalty cannot be imposed where the report of investigation under section 26 was received before the disclosure.
  5. Therefore the late discloser cannot claim lesser penalty.

Answer: Yes, the Commission may pass a temporary restraining order under section 33, even without notice if it deems it necessary. A cartel member disclosing after the section 26 report is received cannot get lesser penalty under section 46.

Exam tips

  • Quote the section number with each power. ICSI answers earn marks for citing the provision.
  • Memorise the cartel penalty proviso and practise one numerical with it.
  • For leniency, list the conditions: full, true and vital disclosure, before the report, continued cooperation, and loss of benefit for false evidence.
  • In long answers, follow the order: duty under section 18, DG's role, interim order, final orders and penalty, leniency.
  • Mention that turnover means global turnover from all products and services.

Practice questions from Competition Law

Duties, Powers and Functions of the Commission in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Duties, Powers and Functions of the Commission: frequently asked questions

What is the main duty of the CCI under the Competition Act?

Section 18 requires the Commission to eliminate practices having an adverse effect on competition, promote and sustain competition, protect consumers' interests and ensure freedom of trade for other participants in markets in India.

What is the role of the Director General in a CCI investigation?

The DG is appointed by the Commission with the Central Government's prior approval to assist it in inquiry into contraventions. The DG investigates under the Commission's direction, and the Commission then decides the matter.

Can the CCI pass an interim order without hearing the party?

Yes. Under section 33, where it deems it necessary, the Commission can temporarily restrain a party without giving notice. This applies during an inquiry into contravention of section 3(1), section 4(1) or section 6.

How does lesser penalty or leniency work under the Competition Act?

A cartel member making a full, true and vital disclosure may get a lesser penalty under section 46, as specified by regulations. It is not available if the DG's report was already received, and the member must cooperate until the proceedings end.