The corporate war between the market leader in the decorateive segment of Indian paints industry , Asian Paints and the new entrants , Birla Opus now and JSW Paints in 2019, has taken an interesting turn , after my last blog reporting on the initial stage when the Competition Commission of India (CCI) , directed fresh investigation against Asian Paints on the complaint filed by Birla Opus . Those who want to read my earlier blog may read it here.
The fate of Asian Paints’s challange of CCI’s prima facie order of 1st July , 2025 directing fresh investigation, before the Bombay High Court was keenly awaited . But the Bobmay High Court refused to intervene .
The recent Bombay High Court judgement of 11 September 2025 against the Asian Paints Ltd. (and its affirmation even by the Supreme Court in its recent order of 13 October, 25) has , therefore, again attracted media attention. These verdicts have created a perception of regulatory uncertainty in the corporate Board rooms, as to whether “competitors” are being protected at the cost of “competition” per se due to the rejection of the recently introduced concept of civil procedure, the res judicata, by the Competition Amendment Act, 2023, by the High Court in this dispute. Such perception is not good for growth of our economy and needs to be debated upon. Let me introduce the background to set the context.
Background– The entry of two new market players, JSW Paints in May 2019 and Birla Opus (of Grasim Industries Ltd.- An Aditya Birla Group Company ), in March 2024 , in India’s growing decorative paints industry, a highly competitive, yet oligopolistic market, (with a market size of USD3.28Billion in 2024 and projected to reach USD 5.47 Billion by 2033, growing at a CAGR of 5.42%, during 2025-2033), has intensified fierce competition. The established players, including the market leader, Asian Paints, holding approximately 55-59% market share (as against Berger Paints holding approximately 18-18.6%, Kansai Nerolac Paints with approximately 15-17% and Azko Nobel (Dulux) with about 7% market share) are facing the heat. Unfortunately, this intense competition , has since converted into “corporate wars” with both new entrants approaching the Competition Commission of India (CCI) with similar complaints of abusing its dominant position against Asian Paints of allegedly restricting the common dealers from promoting or even distributing the products of these two new brands through its market policies thereby trying to create “exclusivity” in its favour at the cost of expansion of both the new entrants in the market. Whereas JSW Paints filed the complaint in 2019, Birla Opus filed in 2024. Noticeably, both approached CCI within a few months of launch of their brands against Asian Paints with similar allegations.
To be fair, the CCI, found prima facie case for intervention in complaints of both JSW Paints and Birla Opus and referred each complaint for investigation to the Director General (DG), its investigating arm. The earlier Complaint filed by JSW Paints in 2019 was dismissed by the CCI vide its order dated 08 September 2022, after the investigation report by the DG found no credible evidence of such abuse of dominance against Asian Paints (It was found during the investigation that JSW had added more dealers than Asian Paints during the relevant period, and only a few overlapping dealers provided weak or unverified claims. Other actions such as reduction of credit limits etc, which were alleged to be anti-competitive but were found by the DG to be commercially justified and part of the standard practice of Asian Paints. Thus, the DG concluded there was no contravention of Sections 3 or 4 of the Competition Act, 2002). This vindicated the stand taken by Asian Paints before the CCI during the post investigation inquiry. Of course, the appeal filed by JSW Paints is pending before the NCLAT.
In the meantime, the competition law in India was amended by way of the Competition Amendment Act, 2023 and one of the changes made was to introduce the well-known concept of civil procedure code, namely, res judicata, based upon the legal maxim nemo debet bis vexari pro una et eadem causa (no one should be vexed twice for the same cause), which[1] enabled the CCI not to inquire ( meaning dismiss or not to entertain at prima facie stage ) repeated complaint on the same or substantially the same facts and issues .
Therefore, when, in around June 2024, Birla Opus filed another complaint against Asian Paints, apparently with similar allegations of trying to enforce exclusivity on common dealers and when Asian Paints came to know about it through media reports, it approached the CCI with request for giving a hearing before taking any decision on this subsequent complaint, on similar allegations, by Birla Opus. However, though the CCI, considered the initial written objections filed by Asian Paints (wherein it also referred to the earlier decision of the CCI in the JSW Paints case of September 2002 ), yet in its prima facie order dated 01 July 2025[2] , while directing fresh investigation against Asian Paints , CCI did not even refer to or examine the applicability or otherwise , of the newly introduced provision of Section 26(2A) of the Act, as amended, which debarred the consideration of this subsequent complaint ,as aforesaid.
This obviously led the Media[3] to raise a question, Does the CCI’s prima facie decision to order a fresh investigation, despite the earlier closure of similar complaints/allegations made against the same company, signalled a potentially different assessment of the facts or market dynamics in the instant case? Or was it that the BIRLA OPUS provided some new and creditable evidence in support of its allegations, which were not available before the DG in the earlier case by JSW Paints?
In the meanwhile , Asian Paints challenged this CCI prima facie order dated 01 July,2025 in the Bombay High Court , wherein it primarily raised the above issue of how could the CCI ignore the statutory mandate of res judicata principle introduced by the Amendment Act,2023 , without even granting an opportunity of hearing before taking the decision to order fresh investigation against it on similar facts and issues , which, it itself had closed in the 2022 order in the JSW Paints case ?
Bombay High Court decision -In its judgement of 11 September, 2025[4] , the Court has dismissed the case of Asian Paints mainly for the grounds that the newly inserted provision in the Amendment Act , 2023 only expressly enables the CCI to dismiss a repeat complaint on similar facts and issues but it does neither places any jurisdictional embargo upon CCI to dismiss each such repeat complaint nor it gives the affected party a legal right to be heard by the CCI before ordering an investigation if it finds that a prima facie case exists on the basis of the evidence produced before it by the complainant in the subsequent case. The Court, referring to an earlier landmark decision[5] of the Supreme Court also held that the affected party had no legal right of hearing before the CCI while passing an order directing investigation by the DG , which is in the nature of an administrative order and that the affected party gets every opportunity to defend itself before the DG during the investigation and if it can succeed in disproving the case of the complainant and the DG finds no evidence of anti-competitive conduct or abuse of dominance then the CCI may again dismiss the complaint , as happened in the earlier case of JSW Paints in 2022.
Supreme Court Order -Asian Paints challenged the above judgment of Bombay High Court in the Apex Court, which, by its order dated 13 October 2025, allowed Asian Paints to withdraw its SLP.
The Hon’ble Apex Court, in my humble view, has missed an opportunity to lay down guidelines on this moot issue, that is, as to under what circumstances the CCI can and should invoke Section 26(2A) of the Act to dismiss repeat complaints. This was all the more necessary because it is also well known that markets are dynamic in nature and the competition law operates in rem and should not be ordinarily restrained by technical rules of procedure like res judicata and thisview was upheld by the High Courts of Karnataka and Delhi in the cases of Amazon, Cadilla Healthcare and WhatsApp LLC, which was affirmed by the Supreme Court inthe cases of Flipkart & Amazon and WhatsApp LLC. But these decisions were given before the amendment in the Competition Act and may no longer be relevant. Hence , there was an urgent need for guidelines form the Apex Court to reomove the legal an dregulatory uncertainty . Furthermore, the absence of guidelines by the Apex Court, is likely to make this novel provision redundant, which will be against the legislative intent behind the 2023 amendment.
Caveat- Though I do not disagree with the ratio decidendi of the Bombay High Court judgement that this new provision does not and cannot hinder CCI’s inherent power to direct investigation into an apparent case of anti-competitive conduct, if strong evidence in support exists. The purpose of this blog is to place all the facts in the right perspective to generate a healthy debate which may eventually settle the law and develop jurisprudence on this moot issue, so that efficiency in the market is not sacrificed due to unnecessary litigations owing to the current regulatory uncertainty.
#competition #abuseofdominance #Asianpaints #BirlaOpus #JSWPaints
[1] Sub section (2A) of Section 26 of the Competition Act, 2002.
[2] Under sub section (1) of Section 26 of the Competition Act, 2002
[3] https://www.financialexpress.com/business/industry/cci-orders-probe-against-asian-paints-on-birla-firm-compliant/3899518/;
https://economictimes.indiatimes.com/prime/corporate-governance/asian-paints-and-anti-trust-a-tale-of-two-complaints-and-a-deal-in-between/pr%E2%80%A6 (I have been quoted in both these news reports)
[4] in Writ Petition No. 2887 of 2025 titled Asian Paints Ltd. Vs CCI & Grasim Industries Ltd.
[5] In CCI Vs SAIL & Anr. (2010) 10 SCC 744
