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CS Executive · Economic, Commercial and Intellectual Property Laws · Competition Law

Anand Foods Ltd, a dominant enterprise, found to have abused its dominant position, had turnovers of Rs 400 crore, Rs 500 crore and Rs 600 crore in the last three preceding financial years. Under section 27(b), what is the maximum penalty the Commission can impose on it?

The maximum penalty is Rs 50 crore. Section 27(b) allows up to ten per cent of the average turnover of the last three preceding financial years, and the average of 400, 500 and 600 crore is 500 crore, so ten per cent is 50 crore.

  1. ARs 40 crore
  2. BRs 50 croreCorrect
  3. CRs 60 crore
  4. DRs 150 crore

Explanation

Section 27(b) caps the penalty at ten per cent of the average turnover or income of the last three preceding financial years. Average = (400+500+600)/3 = Rs 500 crore; 10% = Rs 50 crore. Rs 60 crore wrongly uses only the latest year's turnover.

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