# Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr

- **Citation:** 2025 INSC 668
- **Court:** Supreme Court of India
- **Decided:** 2025-05-13
- **Case number:** Civil Appeal No. 5843 of 2014
- **Bench:** Vikram Nath, Prasanna B. Varale
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/competition-commission-of-india-v-schott-glass-india-pvt-ltd-anr-38671
- **Pages:** 44

## Headnote

I.
Whether providing exclusionary volume based discounts,
imposing contractual terms, refusing supply etc. will amount
to abuse of dominant position?
II.
Whether the functional-discount / "no-Chinese" scheme
(including the later TMLA arrangement) imposes unfair
or discriminatory conditions under Section 4(2)(a) and
Section 4(2)(b) of the Act?
III.
Whether the LTTSA with Schott Kaisha produced a margin-
squeeze proscribed by Section 4(2)(e) of the Act?
IV.
Whether Schott India tied or bundled NGA and NGC tubes,
thereby breaching Section 4(2)(d) of the Act?
V.
Whether an effects-based (harm) analysis is an essential
component of an inquiry under Section 4 of the Act., and, if
so, whether it was omitted in the present case?
VI.
Whether the investigation and the Commission's order are
vitiated by denial of cross-examination and allied breaches
of natural justice?
Headnotes†
Competition Act, 2002 - s.4 - Abuse of Dominance -
Whether target-discount scheme of Schott India amounts to
discriminatory or exclusionary pricing in contravention of
Section 4(2)(a) and Section 4(2)(b) of the Act - The rebate
structure applied uniformly to all purchasers based solely on
volume thresholds, irrespective of buyer identity - Thus not
in contravention of provisions of Competition Act:
* Author
[2025] 5 S.C.R.
1317
Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
Held: It is an undeniable fact that Schott India holds a dominant
position in the Neutral Glass Tubing market in India - As per
Section 4(2)(a) and 4(2)(b) of the Act, an abuse of dominant
position arises only where a dominant enterprise (i) impose
unfair or discriminatory prices or conditions, (ii) limit production or
technical development, (iii) block others from the market, (iv) force
a buyer to accept an unrelated product or obligation, or (v) use
power in one market to muscle into, or protect, another - Thus
applying different prices only becomes abusive when it lacks an
objective commercial justification or when equivalent customers
cannot obtain the same terms - The rebate ladder introduced
by Schott was directly proportional to the aggregate tonnage of
Neutral Glass Clear ("NGC") and Neutral Glass Amber ("NGA")
collected within the financial year by the customer - Every
customer who reached a slab, whether by one purchase order
or by several, obtained the corresponding allowance on the
entire year's turnover - The rebate therefore rose mechanically
with volume and with nothing else - identity of the buyer was
irrelevant - While larger buyers like Schott Kaisha availed higher
rebates due to greater offtake, no evidence showed denial of
similar rebates to similarly placed customers - Moreover, reliance
is placed on the untested declarations of five converters alleging
that Schott Kaisha received "special" terms - Those statements,
taken ex parte and never subjected to cross-examination, thus
cannot be relied upon - Therefore, the target-discount scheme
of Schott India is not in contravention of Section 4(2)(a) and
4(2)(b) of the Act. [Paras 10, 31, 33, 38, 39]
Competition Act, 2002 - s.4 - Abuse of Dominance -
Functional Discount / "No-Chinese" Scheme - Whether
Unfair or Discriminatory under Sections 4(2)(a) and 4(2)(b)
of the Competition Act, 2002 - the functional rebate and its
successor agreements are not unfair or discriminatory as
the rebate terms remained consistent across similarly placed
converters, with no price discrimination:
Held: The uniform 8% functional rebate was granted to converters
that met three objective and commercially justifiable conditions: (i)
fulfilling a purchase plan to ensure furnace stability; (ii) refraining
from using certain Chinese tubing due to quality concerns (a
condition later withdrawn); and (iii) complying with traceability and
fair-pricing obligations - Each condition is therefore objectively
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connected with the legitimate aim, patient safety and brand
integrity, and is proport

## Text

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[2025] 5 S.C.R. 1316 : 2025 INSC 668
Competition Commission of India
v.
Schott Glass India Pvt. Ltd. & Anr.
(Civil Appeal No. 5843 of 2014)
13 May 2025
[Vikram Nath* and Prasanna B. Varale, JJ.]
Issue for Consideration
I.
Whether providing exclusionary volume based discounts,
imposing contractual terms, refusing supply etc. will amount
to abuse of dominant position?
II.
Whether the functional-discount / "no-Chinese" scheme
(including the later TMLA arrangement) imposes unfair
or discriminatory conditions under Section 4(2)(a) and
Section 4(2)(b) of the Act?
III.
Whether the LTTSA with Schott Kaisha produced a margin-
squeeze proscribed by Section 4(2)(e) of the Act?
IV.
Whether Schott India tied or bundled NGA and NGC tubes,
thereby breaching Section 4(2)(d) of the Act?
V.
Whether an effects-based (harm) analysis is an essential
component of an inquiry under Section 4 of the Act., and, if
so, whether it was omitted in the present case?
VI.
Whether the investigation and the Commission's order are
vitiated by denial of cross-examination and allied breaches
of natural justice?
Headnotes†
Competition Act, 2002 - s.4 - Abuse of Dominance -
Whether target-discount scheme of Schott India amounts to
discriminatory or exclusionary pricing in contravention of
Section 4(2)(a) and Section 4(2)(b) of the Act - The rebate
structure applied uniformly to all purchasers based solely on
volume thresholds, irrespective of buyer identity - Thus not
in contravention of provisions of Competition Act:
* Author
[2025] 5 S.C.R.
1317
Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
Held: It is an undeniable fact that Schott India holds a dominant
position in the Neutral Glass Tubing market in India - As per
Section 4(2)(a) and 4(2)(b) of the Act, an abuse of dominant
position arises only where a dominant enterprise (i) impose
unfair or discriminatory prices or conditions, (ii) limit production or
technical development, (iii) block others from the market, (iv) force
a buyer to accept an unrelated product or obligation, or (v) use
power in one market to muscle into, or protect, another - Thus
applying different prices only becomes abusive when it lacks an
objective commercial justification or when equivalent customers
cannot obtain the same terms - The rebate ladder introduced
by Schott was directly proportional to the aggregate tonnage of
Neutral Glass Clear ("NGC") and Neutral Glass Amber ("NGA")
collected within the financial year by the customer - Every
customer who reached a slab, whether by one purchase order
or by several, obtained the corresponding allowance on the
entire year's turnover - The rebate therefore rose mechanically
with volume and with nothing else - identity of the buyer was
irrelevant - While larger buyers like Schott Kaisha availed higher
rebates due to greater offtake, no evidence showed denial of
similar rebates to similarly placed customers - Moreover, reliance
is placed on the untested declarations of five converters alleging
that Schott Kaisha received "special" terms - Those statements,
taken ex parte and never subjected to cross-examination, thus
cannot be relied upon - Therefore, the target-discount scheme
of Schott India is not in contravention of Section 4(2)(a) and
4(2)(b) of the Act. [Paras 10, 31, 33, 38, 39]
Competition Act, 2002 - s.4 - Abuse of Dominance -
Functional Discount / "No-Chinese" Scheme - Whether
Unfair or Discriminatory under Sections 4(2)(a) and 4(2)(b)
of the Competition Act, 2002 - the functional rebate and its
successor agreements are not unfair or discriminatory as
the rebate terms remained consistent across similarly placed
converters, with no price discrimination:
Held: The uniform 8% functional rebate was granted to converters
that met three objective and commercially justifiable conditions: (i)
fulfilling a purchase plan to ensure furnace stability; (ii) refraining
from using certain Chinese tubing due to quality concerns (a
condition later withdrawn); and (iii) complying with traceability and
fair-pricing obligations - Each condition is therefore objectively
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connected with the legitimate aim, patient safety and brand
integrity, and is proportionate to it - Ledgers for FY 2008-09 to
FY 2011-12, collated by COMPAT, discloses no instance in which
two converters performing the same function received different net
prices - The rebate terms remained consistent across similarly
placed converters, with no price discrimination - The only variation
was credit timing which was commercially rational and not violative
of Section 4(2)(a) -- Every converter prepared to assume the same
traceability and quality-promotion obligations received exactly the
same economic consideration - Therefore, the functional rebate
and its successor agreements therefore do not offend either Section
4(2)(a) or Section 4(2)(b)(i) of the Act. [Paras 40, 41, 45]
Competition Act, 2002 - s.4 - Abuse of Dominance - The
Long-Term Tubing Supply Agreement (LTTSA) between Schott
India and Schott Kaisha resulted into a market squeeze,
prohibited by Section 4(2)(e) of the Competition Act, 2002 -
As Schott India is absent downstream; the wholesale-to-retail
spread left rivals with sustainable margins; and the market
exhibited neither exit nor price elevation - Thus, LTTSA does
not contravene Section 4(2)(e) of the Act:
Held: It is alleged that impugned LTTSA enabled Schott India
to foreclose independent converters by compressing the margin
between their input cost and the downstream selling price of Schott
Kaisha - Three essential condition should be met in for a margin
squeeze - (i). The respondent must itself operate downstream; (ii).
The wholesale-to-retail spread must be insufficient for an equally
efficient competitor; and (iii). The compression must threaten
competitive harm - In the present case Schott India did not operate
in the downstream market for converted glass containers, which
was served by Schott Kaisha, a separate company in which the
global Schott AG holds fifty per cent stakes, the balance being
with the Kaisha promoters, with no board overlap, no common
management, and separate audited accounts - Moreover, there
is no evidence established that equally efficient independent
converters were foreclosed or operated at a loss - There is no
demonstrable squeeze of rivals' margin, as there is no evidence
that equally efficient rivals were forced into losses - Financial
data from nine independent converters show positive EBITDA
throughout the LTTSA period, with seven improving in both volume
and margins - Accordingly, none of the three cumulative conditions
for a margin squeeze were met. [Paras 48-53]
[2025] 5 S.C.R.
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Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
Competition Act, 2002 - s.4 - Abuse of Dominance - Schott
India tied or bundled NGA and NGC tubes, thereby breaching
Section 4(2)(d) of the Competition Act:
Held: Section 4(2)(d) of the Act is attracted only where a dominant
enterprise, (i). supplies two distinct products, (ii). makes the
supply of the tying product conditional upon acceptance of the tied
product, and (iii). thereby forecloses competitors in the tied-product
market - In the instant case, NGA and NGC are not economically
distinct products, but rather alternative specifications drawn from
the same continuous-melt furnace, with customer demand dictated
by downstream pharmaceutical requirements - Even assuming as
arguendo, NGA and NGC were separate, no coercive condition was
proven - Alleged tying of both the products was based on witness
statements in which no opportunity of cross examination was granted
and an outdated circular, both of weak evidentiary value - No contract,
invoice, or purchase record demonstrated forced bundling - Thus, it
is not proved NGA and NGC are not independent products and the
converters were never compelled to buy both the products moreover
no foreclosure was demonstrated - In these circumstances, the
essential elements of Section 4(2)(d) of the Act are not proved as
NGA and NGC are not independent products. [Paras 54, 55, 56, 58]
Competition Act, 2002 - s.4 - Whether an effects-based (harm)
analysis is an essential component of an inquiry under Section
4 of the Act, and, if so, whether it was omitted in the present
case - That the CCI, having relied on untested statements and
pre-2009 correspondence, Undertook no credible assessment
of harm - The omission of a proper harm analysis vitiates the
CCI's order in limine:
Held: Section 4 of the Act prohibits the abuse of dominance - Abuse
is conduct that distorts the competitive process or harms consumers -
The statute therefore contemplates two logically separate findings: (i).
that the impugned practice falls within one of the descriptive clauses
(a)-(e) of sub-Section (2), and (ii). that it results in, or is likely to result
in, an appreciable adverse effect on competition ("AAEC") - The
majority ruling of the CCI professed to have analysed effects yet
adduced no economic evidence of price increases, output restriction
or foreclosure - However, after compiling converter sales, EBITDA
and price data for FY 2007-08 to FY 2011-12, it was found (i) that all
independent converters expanded output and margins, and (ii) that
pharmaceutical buyers paid identical or higher prices for containers
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from the joint-venture than from other converters - The CCI, having
relied on untested statements and pre-2009 correspondence,
Undertook no credible assessment of harm; and that, on the evidence
marshalled by the COMPAT, converter growth, stable downstream
prices, absence of foreclosure - No appreciable adverse effect on
competition is shown. [Paras 59, 64, 66]
Competition Act, 2002 - s.36 - Whether the investigation
and the Commission's order are vitiated by denial of crossexamination and allied breaches of natural justice:
Held: Section 36(2) of the Act incorporates the Code of Civil
Procedure's guarantees, including the right to "examine witnesses
on oath" and to test them in cross-examination, Regulation 41(5) of
the 2009 General Regulations obliges the DG or the CCI to grant
that opportunity whenever it is "necessary or expedient" - In this
case, the DG relied extensively on statements from converters
commercially adverse to Schott India, by circulating questionnaires,
recording their statements and "surfing the worldwide web", no
independent verification was attempted - The CCI adopted the same
material without independent scrutiny - In short, uncorroborated
testimony is the foundation of every adverse inference by the
DG and CCI against Schott India - Schott India had repeatedly
requested cross-examination, both in writing and orally, but the
CCI rejected the request on technical grounds, ignoring the
substantive right - If the CCI had allowed cross-examination, two
courses were open: (i). either the allegations would have crumbled
under questioning, or (ii). a tested evidentiary record would have
emerged on which a reasoned decision, whichever way, could rest.
Cross-examination would have revealed that several converters
had, during the period in question, expanded output, raised prices
independently of Schott India - The findings of CCI are not legally
sustainable and are contrary to natural justice - COMPAT correctly
allowed the appeal filed by Schott India, as CCI's refusal to let
Schott India cross-examine the converter-witnesses was a material
infraction. [Paras 68, 69, 73, 75]
Case Law Cited
Rajasthan Cylinders v. Union of India [2018] 12 SCR 495 : (2020)
16 SCC 615; Indian National Shipowners' Association v. ONGC,
(2019) SCC OnLine CCI 26; Competition Commission of India v.
Fastway Transmission Pvt. Ltd. [2018] 1 SCR 232 : (2018) 4
SCC 316; Raymond Woollen Mills Limited and Another v. Director
[2025] 5 S.C.R.
1321
Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
General (Investigation and Registration) and Another [2008] 8 SCR
1002 : (2008) 12 SCC 73; State of Kerala v. K.T. Shaduli Grocery
Dealer Etc. [1977] 3 SCR 233 : (1977) 2 SCC 777; Andaman
Timber Industries v. Commissioner of Central Excise, Kolkata-II
(2016) 15 SCC 785 - relied upon.
Cadila Healthcare Ltd. v. CCI, 2018 SCC OnLine Del 11229 -
relied upon.
British Airways plc v. Commission, (Court of Justice of the
European Union in Case C-95/04 P, dated 15 March 2007);
Telia Sonera Sverige AB v. Konkurrensverket, (Court of Justice
of the European Union, Case C-52/09, judgment dated 17
February 2011); Microsoft Corp. v. Commission of the European
Communities, (General Court of the European Union, Case
T-201/04, judgment dated 17 September 2007); Intel Corporation
Inc. v. European Commission, (Case C-413/14 P, judgment of 6
September 2017) - relied upon.
List of Acts
The Competition Act, 2002; Code of Civil Procedure, 1908.
List of Keywords
Dominant position; Tying or bundling; Target (volume) rebates;
Abuse of dominance; Untested statements; Margin squeeze;
Statements not subjected to cross examinations.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5843 of 2014
From the Judgment and Order dated 02.04.2014 of the Competition
Appellate Tribunal, Delhi in AP No. 91 of 2012
With
Civil Appeal No. 9998 of 2014
Appearances for Parties
Advs. for the Appellant:
AN Haksar, Amit Sibal, Sr. Advs., Saurabh S Sinha, Ms. Chitra Y
Parande, Gautam Prabhakar, Mrigank Prabhakar, Arjun Krishnan,
Anand S Pathak, Shashank Gautam, Ms. Sreemoyee Deb,
Ms. Anubhuti Mishra, Soham Goswami, Ms. Nandini Sharma,
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Ms. Anisha Bothra, Ms. Aashana Manocha, Abhijeet Singh,
Saksham Dhingra, Rishabh Sharma.
Advs. for the Respondents:
Percival Billimoria, A N Haksar, Sr. Advs, Mahesh Agarwal, Rahul
Goel, Ms. Anu Monga, Rishi Agrawala, Ankur Saigal, Victor Das,
Himanshu Saraswat, Yash Jain, Ms. Aditi Sharma, Ms. Kriti Khatri,
Ms. Rachita Sood, Tushar Bathija, E. C. Agrawala, Arjun Krishnan,
Saurabh Sinha, Ms. Chitra Y Parande, Gautam Prabhakar, Mrigank
Prabhakar.
Judgment / Order of the Supreme Court
Judgment
Vikram Nath, J.
1.
India's economic ascent rests on a delicate but decisive equilibrium.
On the one hand, markets must remain contestable: no undertaking
may extinguish rivalry by stratagems foreign to fair, merit-based
competition. On the other hand, genuine achievement whether
expressed in scale, efficiency or technological advance, must be
rewarded and not punished, for it is the impetus for investment,
innovation and consumer welfare. The Competition Act, 20021, is
the charter that secures both pledges. It equips the Competition
Commission of India with wide-ranging powers of inquiry and remedy,
yet it permits intervention only where hard evidence shows that
the impugned conduct has caused, or is likely to cause, a demand
rigorous fact-finding, adversarial testing of testimony and, above all,
an effects-based appraisal that balances commercial justification
against proven harm. Preserving this symmetry between discipline
and encouragement is essential if the statute is to nurture robust
rivalry while sustaining the confidence of domestic and global investors
who increasingly view India as a premier destination for enterprise
and innovation.
I.
Background of the Case
2.
These statutory appeals, preferred under Section 53T of the Act,
challenge a common order dated 2 April 2014 passed by the
1
In short, the "Act"
[2025] 5 S.C.R.
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Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
Competition Appellate Tribunal2 in Appeal Nos. 91 and 92 of 2012.
Civil Appeal No. 5843 of 2014 has been filed by the Competition
Commission of India3. Civil Appeal No. 9998 of 2014 has been filed
by Kapoor Glass India Pvt. Ltd.4. In both the matters, Schott Glass
India Pvt. Ltd.5 is the contesting respondent.
3.
The proceedings have their genesis in an information lodged on 25
May 2010 by Kapoor Glass under Section 19 of the Act. Kapoor Glass
alleged that Schott India, then the principal domestic manufacturer
of neutral USP-I borosilicate glass tubing, had abused its dominant
position by offering exclusionary volume-based discounts, imposing
discriminatory contractual terms, and, on occasions, refusing supply.
4.
Forming a prima-facie opinion under Section 26(1) of the Act, CCI
directed the Director General (Investigation)6 to inquire into the matter.
The DG's report dated 14 March 2011 concluded that Schott India
had violated Section 4 of the Act. After hearing the parties, CCI by
majority order dated 29 March 2012 levied a penalty equal at a rate
of 4 per cent of Schott India's average of 3 years turnover equivalent
to about Rs 5.66 crores and also issued a cease-and-desist order
against Schott India from doing any discriminatory practices to any
of the converters.
5.
Schott India challenged that order before COMPAT by Appeal No. 91
of 2012. Kapoor Glass also preferred a separate appeal by Appeal
No. 92 of 2012 seeking a broader relief and reiterating its refusalto-supply grievance. By the impugned order COMPAT:
a)
allowed Schott India's appeal, annulled the penalty, and held
that the evidentiary material did not establish any abuse of
dominant position; and
b)
dismissed Kapoor Glass's appeal with costs of ₹ 1,00,000/-.
6.
Vide these appeals, CCI seeks revival of its original order and Kapoor
Glass supports CCI on the liability of Schott India but contends that
COMPAT erred in refusing effective relief and in discounting the
2
In short, "COMPAT"
3
In short, "CCI"
4
In short, "Kapoor Glass", the original informant
5
In short, "Schott India"
6
In short, "DG"
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alleged "mixing risk". Schott India, the contesting respondent herein,
on the other hand, defends the COMPAT decision in its entirety.
II.
A Primer on the relevant Competition Law principles:
7.
Before moving ahead, we believe it would be helpful to briefly explain
the chief statutory provision and certain competition-law principles that
recur throughout these appeals and are key to understand this case.
8.
Section 4 of the Act is at the heart of the present dispute. It has
been reproduced hereunder for ease of reference:
"Section 4 - Abuse of dominant position.
(1) No enterprise or group shall abuse its dominant position.
(2) There shall be an abuse of dominant position under
sub-section (1) if an enterprise or a group-
(a) directly or indirectly imposes unfair or discriminatory-
(i) condition in purchase or sale of goods or service; or
(ii) price in purchase or sale (including predatory
price) of goods or service;
(b) limits or restricts -
(i) production of goods or provision of services or
market therefor; or
(ii) technical or scientific development relating to
goods or services, to the prejudice of consumers;
(c) indulges in practice or practices resulting in denial of
market access in any manner;
(d) makes conclusion of contracts subject to acceptance
by other parties of supplementary obligations which, by
their nature or according to commercial usage, have no
connection with the subject of such contracts;
(e) uses its dominant position in one relevant market to
enter into, or protect, another relevant market.
Explanation.-For the purposes of this section,
(a) "dominant position" means a position of strength
enjoyed by an enterprise in the relevant market in India
[2025] 5 S.C.R.
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Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
which enables it to (i) operate independently of competitive
forces prevailing in the relevant market, or (ii) affect its
competitors or consumers or the relevant market in its
favour;
(b) "predatory price" means the sale of goods or provision
of services at a price below cost, as may be determined by
regulations, with a view to reduce competition or eliminate
competitors;
(c) "group" shall have the same meaning as assigned to
it in clause (b) of the Explanation to Section 5."
9.
A bare perusal shows that the provision has two moving parts. First,
it forbids only abuse, not dominance as such. Secondly, it gives five
illustrations of the abuse of dominant position which are (i) price or
contract discrimination, (ii) limiting output, (iii) blocking entry, (iv)
tying or bundling, and (v) leveraging power from one market into
another. If a dominant firm engages in any one of these practices,
and cannot justify it as a legitimate business response to competition,
the conduct is prohibited.
10. Section 4, sub-Section (1) of the Act states that "no enterprise or
group shall abuse its dominant position." Thereafter, sub-Section
(2) then lists, in clauses (a) to (e), the aforementioned five ways in
which abuse may occur. Put shortly, an enterprise may not
(i)
impose unfair or discriminatory prices or conditions,
(ii)
limit production or technical development,
(iii) block others from the market,
(iv) force a buyer to accept an unrelated product or obligation, or
(v)
use power in one market to muscle into, or protect, another.
11. Apart from Section 4 of the Act, in order to aid comprehension of the
discussion that follows, we are outlining the relevant competitionlaw concepts that recur throughout the pleadings and the analysis
that follows:
(i)
Relevant market: Competition is measured within a field large
enough that buyers can, at a reasonable cost, turn to alternative
suppliers. In the present dispute, two layers of trade must be
kept distinct yet viewed together:
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 •
Upstream market - the manufacture and sale of neutral
USP-I borosilicate glass tubing, whether clear or amber.
 •
Downstream market - the sale of pharmaceutical
containers-ampoules, vials, cartridges and syringesmade by converters.
The first market supplies the raw material; the second transforms
it into finished goods. Because the output of the upstream market
is the indispensable input of the downstream market, the two
are conventionally described as "upstream" and "downstream"
respectively.
(ii)
Dominant Position: A firm is dominant when its economic
strength lets it act largely on its own terms. A town with a single
water utility, or a manufacturer whose patented device has no
practical substitute, offers the everyday picture. Dominance is
lawful; the question is how the power is used.
(iii) Volume or "Target" Discounts: These are price reductions
that grow purely with the quantity a buyer takes over an agreed
period. For example, a supermarket chain that orders ten
thousand sacks of rice may pay less per sack than a corner shop
that orders ten. Such scale rebates are benign when offered to
every purchaser on identical volume thresholds.
(iv) Functional discounts: Sometimes the buyer performs an
extra function-say, warehousing, local advertising, or aftersales service. A seller may repay a buyer for performing that
extra task like storing stock, advertising the brand, or providing
repairs. Airlines, for example, pay travel agents a commission
for marketing flights. If the rebate merely covers the cost of
that task and is open to any buyer willing to do the same,
competition law is usually satisfied.
(v)
Margin squeeze: A vertically integrated supplier sells an essential
input to rivals and also competes with them downstream. If it
keeps the input price high and its own downstream price low,
equally efficient rivals may be left with an unsustainable margin.
Telecom operators that control not only broadband network but
also sell retail internet access provide the classic example.
(vi) Tying or bundling: Where a supplier insists that customers
accept product A as a pre-condition for buying product B, it is
[2025] 5 S.C.R.
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Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
tying; where A and B are sold only as a package, it is bundling.
The practice becomes abusive if the supplier wields dominance
in product A to force unwanted sales of B, thereby foreclosing
choice.
(vii) Mixing risk: In the instant case, there is an allegation that certain
converters might blend premium Schott tubing with cheaper
imports and still market the containers as wholly premium. If true,
the practice could endanger patients and tarnish the reputation
of high-quality suppliers. Whether that risk existed, and how
Schott India responded, will be examined in due course.
(viii) Procedural fairness: Even in an inquisitorial setting, the parties
must see and test the evidence against them. Cross-examination
of a witness is a recognised, though not in every case, an
indispensable safeguard. A serious denial of that opportunity
can itself undermine the findings of the adjudicating body.
Having explained these basic concepts pertaining to the matter, we
shall now proceed to detail the material facts of the case and the
determinations made at each previous stage of the proceedings.
III.
Factual Matrix
12. Schott India, the first respondent, is a wholly-owned subsidiary of
Schott Glaswerke Beteiligungs-GmbH, which in turn is wholly owned
by Schott AG of Mainz, Germany. Its Jambusar plant in Gujarat,
acquired in 1998 from Bharat Glass Tubes, manufactures neutral
borosilicate tubing in the following three grades: Fiolax-clear (for
export and domestic sale), Neutral Glass Clear7 and Neutral Glass
Amber8.
13. Neutral borosilicate tubing constitutes the upstream market; converters
re-heat and form that tubing into ampoules, vials, cartridges and
syringes, which comprise the downstream market and are supplied
to pharmaceutical undertakings. Of the five Indian tube-makers that
existed prior to 1998, all except Schott India and Triveni Glass (now
Nipro-Triveni) had exited by 2010 and the balance of demand was
met by imports from Germany, Japan, Italy and, at the low-end, China.
7
In short, "NGC"
8
In short, "NGA"
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14. In May 2008, a Schott group company entered into a joint-venture
with Kaisha Manufacturers, creating Schott Kaisha Pvt. Ltd.9, the
country's largest converter. Schott Kaisha is neither a subsidiary
nor a division of Schott India, but it purchases a substantial share
of the latter's annual melt.
15. Discount architecture and agreements: To secure economies of
scale and steady furnace utilisation, Schott India offered two rebate
schemes:
a.
Target (volume) rebates: slabbed discounts, credited quarterly,
rising with aggregate annual purchases of NGC and NGA; and
b.
Functional rebates: an eight-per-cent allowance extended
to converters that (i) met annual purchase plans, (ii) refrained
from using Chinese tubing, and (iii) adhered to "fair-pricing"
commitments in their container sales.
16. Long-Term Tubing Supply Agreement10: In 2008 Schott India and
Schott Kaisha executed a three-year agreement under which the
converter agreed to source at least eighty per cent of its requirements,
approximately thirty per cent of Schott India's capacity, in consideration
of a price concession over the slab rate, a three-year price freeze
and priority dispatch in periods of tight supply.
17. On 20 May 2009, the principal abuse-of-dominance provisions of
the Act were brought into force. On 25 May 2010, Kapoor Glass, a
Mumbai converter, lodged an information alleging, inter alia, that:
(i)
The target-rebate structure coerced loyalty and tied clear and
amber tubes;
(ii)
The functional rebate and its successor Trade-Mark Licence
Agreement11 foreclosed the use of lower-priced Chinese tubes;
(iii) The LTTSA conferred on Schott Kaisha an unmatchable cost
advantage; and
(iv) Schott India had rationed supplies to independent converters
whilst fully meeting Schott Kaisha's demands.
9
In short, "Schott Kaisha"
10
In short, "LTTSA"
11
In short, "TMLA"
[2025] 5 S.C.R.
1329
Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
18. Acting on a prima-facie opinion under Section 26 (1) of the Act, CCI
directed the DG to investigate. In a report dated 14 March 2011, the
DG gave the following findings:
(i)
Schott India enjoyed a market share exceeding sixty per cent
and was dominant in the upstream market;
(ii)
The combined effect of the target rebates, functional rebates
and the Long-Term Agreement was to foreclose rival suppliers,
attracting clauses (a), (b) and (e) of Section 4(2) of the Act;
(iii) Aggregating NGC and NGA purchases for rebate purposes
amounted to tying, offending clause (d); and
(iv) Selective supply curtailments denied market access to certain
converters, invoking clause (c).
19. On 29 March 2012, the majority of the Commission substantially
endorsed the DG's analysis. The Economic Member of the
Commission dissented on the discount issues and gave various
relevant findings which would be important for the discussions that
follow. The majority, however, reasoned that:
(i)
The volume-based "target" rebates, the trademark-linked
"functional" rebates, and the LTTSA, taken together, "tilted the
playing field" in favour of Schott Kaisha and foreclosed effective
competition in the upstream market;
(ii)
The aggregation of clear and amber tubing for the purpose of
achieving higher rebate slabs operated, in effect, as a tying
arrangement; and
(iii) The temporary curtailment of supplies to certain converters
reinforced the exclusionary strategy.
Having concluded that the conduct attracted Clauses (a) through (e)
of Section 4 (2) of the Act, the CCI:
(i)
Directed Schott India to cease and desist from the impugned
practices with immediate effect; and
(ii)
Levied a monetary penalty calculated at four per cent of the
company's average turnover for the three preceding financial
years, amounting to ₹ 5.66 crore.
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20. Schott India and Kapoor Glass appealed the matter to COMPAT
by way of Appeal Nos. 91 and 92 of 2012. The COMPAT gave the
following finding in the impugned order:
(i)
Appeal of Schott India allowed: The evidence against the
company rested "for the most part on statements never subjected
to cross-examination"; on that footing COMPAT found no proof
of discriminatory rebates, margin squeeze or tying. It pointed
out that, barring one exception, every converter had grown its
output after 2009, a fact at odds with the charge of foreclosure.
(ii)
All sanctions annulled: The penalty of one per cent of turnover
and the attendant cease-and-desist directives were quashed
in toto.
(iii) Appeal of Kapoor Glass dismissed with costs: Kapoor
Glass's prayer for wider relief was rejected and costs of ₹
1,00,000 were imposed.
(iv) Serious procedural lapse recorded: COMPAT remarked that
the CCI's refusal to let Schott India cross-examine the converterwitnesses was a material infraction that gravely weakened the
probative worth of their allegations.
21. In the present appeals against the COMPAT's order, the parties seek
the following reliefs:
(i)
CCI seeks reinstatement of its original order and penalty,
contending that COMPAT misread the evidence and overstated
the impact of the procedural lapse.
(ii)
Kapoor Glass, aligning with CCI on liability, argues that COMPAT
further erred in downplaying the alleged "mixing" of Schott and
Chinese tubes.
(iii) Schott India, being the main respondent, supports the COMPAT's
decision in full, submits that its rebates were open to all
converters on equal quantitative terms, and renews its objection
that denial of cross-examination fatally tainted the CCI's process.
IV.
Arguments Advanced
22. Mr. Amit Sibal, learned Senior Counsel for the appellant-CCI, has
advanced the following main arguments:
[2025] 5 S.C.R.
1331
Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
A.
Schott India's unquestioned dominance: It is submitted that
during the investigation period, Schott India supplied more than
sixty per cent of neutral USP-I borosilicate tubing, controlled
the only large-scale domestic melt tanks and possessed clear
technological and capacity advantages. On any accepted test,
it occupied a dominant position in the upstream market.
B.
Loyalty-inducing "target" rebates: It is argued that the
annual-slab rebate scheme penalised converters who failed to
meet their forecast: a single below-target month dragged the
entire year's purchases into a lower tier, clawing back earlier
discounts. Converters therefore dared not split orders with
alternative suppliers, while Schott Kaisha, by reason of volume,
always secured the maximum twelve-per-cent rebate. Such
discrimination, Counsel contends, is in violation of clause (a)
of Section 4(2) of the Act.
C.
Exclusionary functional rebates and the LTTSA: Schott
Kaisha's LTTSA locked in eighty per cent of its requirements for
three years, guaranteed price freezes and monthly "functional"
bonuses and gave it delivery priority. It is submitted that this
package, unavailable to others, further foreclosed rivals and
breached clauses (a), (b) and (e).
D.
Tying of clear and amber tubes: Discounts were calculated on
the combined quantity of clear and amber tubing. Because Schott
India held over ninety per cent of amber tubes, indispensable
for light-sensitive formulations, converters had little choice but
to buy clear tubes from it as well. The appellants characterise
this as a tie-in contrary to clause (d).
E.
Margin squeeze on independent converters: It is argued that
the preferential input price to Schott Kaisha enabled it either
to sell containers below the cost level sustainable by equally
efficient converters or to harvest abnormal margins, squeezing
rivals out of the downstream market in violation of clauses (a)
and (e).
F.
Selective refusals to supply: Instances were cited where
converters who sourced even modest volumes elsewhere found
their subsequent Schott allocations curtailed or delayed. It is
argued that such conduct amounts to denial of market access
under clause (c).
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G.
"Mixing" rationale a façade: It is submitted that the assertion
that Chinese tubes might be secretly mixed with Schott tubes
is speculative; no concrete incident was proven. The quality
argument therefore serves only to cloak an exclusivity obligation.
H.
Procedural lapse not fatal: Finally, it is contended that
Regulation 41(5) vests discretion in the CCI to refuse crossexamination. The converters' statements, although not tested
orally, were corroborated by documentary evidence, rebate
circulars, purchase data and the LTTSA. The absence of crossexamination, it is argued, cannot outweigh this substantive
proof of abuse.
I.
The learned Senior Counsel has relied upon the following case
laws in support of their arguments:
(i)
Excel Crop Care Ltd. v. Competition Commission of India
and another12,
(ii)
Competition Commission of India v. Steel Authority of
India Ltd.13,
(iii) Competition Commission of India v. Fastway Transmission
Pvt. Ltd.14,
(iv) K.L. Tripathi v. State Bank of India, (1984) 1 SCC 43
(v)
Transmission Corporation v. Sri Rama Krishna Rice Mills15,
(vi) United Brands Co. & United Brands Continental BV v.
Commission16,
(vii) Irish Sugar plc, Commission Decision IV/34.621
(viii) HOV SVZ/MCN, Commission Decision IV/33.941
23. Shri A.N. Haksar, learned Senior Counsel for Kapoor Glass, has
rendered similar submissions to CCI but has also made the following
additional points:
12
(2017) 8 SCC 47
13
(2010) 10 SCC 744
14
(2018) 4 SCC 316
15
(2006) 3 SCC 74
16
Case 27/76, EUCJ
[2025] 5 S.C.R.
1333
Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
A.
Two-decade exclusionary course of conduct. Kapoor
Glass's purchase orders for Schott tubes were first rebuffed
in 2000. From that moment, nine years before Section 4 of
the Act came into force, Schott India treated Kapoor Glass as
a non-customer while continuing to serve other converters,
thereby laying the ground for Schott Kaisha's later entry. The
chronological record (1996-2010) filed in evidence is said to
reveal a pre-meditated plan to freeze Kapoor Glass out of both
upstream and downstream trade
B.
Espionage and intimidation tactics. Kapoor Glass's internal
paperwork surfaced in Schott India's possession; key employees
were poached; and Schott Kaisha's managing director reportedly
"gloated" that Kapoor Glass had been finished (letter of 23
Jan 2010). These incidents, Kapoor Glass submits, show that
upstream dominance was reinforced by unlawful means and by
threats to converters who awarded job-work to Kapoor Glass.
C.
Absolute refusal to supply means abuse under Section
4(2)(c) of the Act. The boycott began in 2000, years before
the 2002 label episode deployed by Schott India as an afterthe-fact excuse. Any private trade-mark grievance expired
with limitation; competition law requires proportionality, not a
perpetual embargo by the sole large-scale amber-tube supplier.
D.
Persistent mix-up hazard. Kapoor Glass maintains that a
real and present danger existed of converters mis-labelling
containers by "mixing" premium Schott tubes with lower-grade
imports. The LTTSA and the functional rebate, it is submitted,
were devised not to protect quality but to immunise Schott
Kaisha from price rivalry on the pretext of that hazard; COMPAT,
in discounting the risk, ignored contemporaneous complaints
from Ranbaxy, Cadila and other buyers.
E.
Quantum of penalty. Finally, Kapoor Glass submits that the
four-per-cent turnover penalty originally imposed by the CCI was
conservative, given both the duration of the abuse (2008-2012)
and the deterrence objective set out in Section 27(b). It prays
for reinstatement of the penalty and for broader behavioural
remedies.
F.
The learned Senior Counsel has placed reliance on the following
precedents apart from those relied on by the Counsel for CCI:
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[2025] 5 S.C.R.
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(i)
Voltas Ltd. v. Union of India17,
(ii)
Coal India Ltd. v. Competition Commission of India18,
(iii) Samir Agarwal v. Competition Commission of India19,
24. Mr. Percival Billimoria, learned Senior Counsel, for the respondentSchott India, has advanced the following main arguments:
A.
Reliance on un-tested statements vitiates the case: It is
submitted that the Director-General's report, and consequently
the majority order of the CCI, rest almost entirely on
questionnaires and witness statements procured from a handful
of converters openly adverse to Schott India. None of those
deponents was offered for cross-examination despite the
respondent's repeated requests. That denial, by itself, renders
the evidentiary foundation infirm and justified the COMPAT's
rejection of the findings.
B.
Volume (or "target") rebates are legitimate and nondiscriminatory: The impugned discount ladder rewarded only
the quantity actually lifted in a financial year; every converter,
large or small, moved up the scale on identical tonnage slabs.
Differential outcomes reflected differential volumes, not the
identity of the purchaser. Such scale rebates, it is argued, are
standard commercial practice and have been treated as lawful
in the CCI's own earlier decisions.
C.
The LTTSA is objectively justified: Neutral USP-I tubing is
produced in continuous-fire tanks that run at about 1600 °C
and requires extremely high investment. To finance capacity
expansion Schott India sought a three-year, eighty-per-cent
offtake commitment from its then largest customer, Schott
Kaisha. The modest extra rebate and price-freeze granted in
return are submitted to be a normal quid pro quo for assured
purchase and not an exclusionary device.
D.
Functional rebate covered additional services, not loyalty:
Converters who wished to emboss the "Schott" mark on the
17
(1995) Supp. 2 SCC 498
18
(2023) 10 SCC 345
19
(2021) 3 SCC 136
[2025] 5 S.C.R.
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Competition Commission of India v. Schott Glass India Pvt. Ltd. & Anr.
finished container had to meet traceability and marketing
obligations and bore the associated costs. The functional
allowance merely reimbursed those outlays and was open
to any converter prepared to undertake the same function.