Competition Act – No Requirement of Mens Rea under Section 43-A

There was no requirement of mens rea under Section 43-A or an intentional breach as an essential element for levy of penalty. The Act does not use the expression “the failure has to be wilful or mala fide” for the purpose of imposition of penalty. The breach of the provisions of the Act is punishable and considering the nature of the breach, it is discretionary to impose the extent of penalty. Mens rea is important to adjudge criminal or quasi-criminal liability, not in case of violation of the civil statutory provision.

In Hindustan Steel Ltd. v. State of Orissa [Hindustan Steel Ltd. v. State of Orissa, (1969) 2 SCC 627 : AIR 1970 SC 253] , with respect to the failure to comply with the civil obligation it was laid down thus:

mens rea is not an essential ingredient for contravention of the provision of a civil Act. The penalty is attracted as soon as a contravention of the statutory obligations as contemplated by the Act is established and, therefore, the intention of the parties committing such violation becomes immaterial. In other words, the breach of a civil obligation which attracts penalty under the provisions of an Act would immediately attract the levy of penalty irrespective of the fact whether the contravention was made by the defaulter with any guilty intention or not. This apart that unless the language of the statute indicates the need to establish the element of mens rea, it is generally sufficient to prove that a default in complying with the statute has occurred. The penalty has to follow and only the quantum of penalty is discretionary.

The penalty is attracted as soon as the contravention of the statutory obligation as contemplated by the Act and the Regulation is established and hence intention of the parties committing such violation becomes wholly irrelevant.

Unless the language of the statute indicates the need to establish the presence of mens rea, it is wholly unnecessary to ascertain whether such a violation was intentional or not.

The imposition of penalty under Section 43-A is on account of breach of a civil obligation, and the proceedings are neither criminal nor quasi-criminal. Thus, a penalty has to follow. Discretion in the provision under Section 43-A is with respect to quantum. SCM Solifert Ltd. v. CCI, (2018) 6 SCC 631

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