INDIA Law and Practice Contributed by: Alina Arora, Samarth Gupta and Parth Singh, Shardul Amarchand Mangaldas & Co
6.9 Interaction with Competition/Antitrust Review Merger control and FDI screening operate indepen - dently. The Competition Commission of India reviews combinations based on asset, turnover and deal val - ue thresholds on competition grounds alone, while FDI approval carries the national security assess - ment. There is no statutory co-ordination mechanism between these two regimes. The GoI also has the power under the Competition Act 2002 to exempt combinations from review on grounds of security of the State. 7. Investigations and Litigation in the Defence Sector 7.1 Principal Investigative Authorities Investigative jurisdiction is determined by the offence, as follows: • CBI – corruption in GoI procurement under the Prevention of Corruption Act 1988 (the “PC Act”), whereby consent of the state government is required for the CBI to investigate within a state, unless a constitutional court directs the investiga - tion; • ED – money laundering under the PMLA, where a scheduled offence (eg, procurement-related bribery or cheating) generates proceeds of crime; • police – cheating and criminal breach of trust; • the DRI and customs authorities – export control and customs offences; • the NIA – scheduled offences affecting national security, including under the UAPA and the WMD Act; • MoD vigilance units and the Central Vigilance Commission (CVC) – procurement integrity, with references to the CBI/ED, supplemented by audit findings of Comptroller and Auditor General of India (CAG). In practice, proceedings typically run in parallel – ie, a CBI corruption case, an ED money laundering case predicated on it, and penalty action by MoD.
• whistle-blower complaints; • first information report (which any person may reg - ister with police authorities); • CVC-directed inquiry; • audit observation/objection, especially from the CAG; • intelligence input; or • court direction, whether suo motu, on public inter - est litigation, or on application of an interested party. Under the DAP 2020, a complaint of an integrity pact violation received by the buyer must be referred to the independent external monitors (IEMs) for their com - ments or enquiry (see 2.10 Exclusion Grounds ). Mandatory reporting obligations are specific rather than general, as follows: • statutory auditors must report suspected fraud to the GoI; • listed companies must disclose material events under the listing regulations of the Securities and Exchange Board of India (SEBI); • the voluntary self-disclosure mechanism for export control contraventions is described in 3.9 Enforce- ment, Penalties and Voluntary Disclosure ; and • a person compelled to give a bribe escapes liability under the PC Act only if the matter is reported to law enforcement within seven days (see 7.8 Whistleblower Protections ). 7.3 Investigative Powers and Procedures The CBI, the ED and the DRI have powers to sum - mon persons and documents, examine witnesses, search premises, seize records and property, and arrest. Statements recorded by the ED are admis - sible in evidence – although court rulings permitting this are under review. The ED may attach property as proceeds of crime, including property of equivalent value where tainted property is untraceable or abroad. Indian agencies may also seek foreign assistance to gather evidence, freeze assets, and secure arrests or extraditions under mutual legal assistance treaties or letters rogatory. There is no special procedure for classified material in investigations. The OSA duties described in 5.7
7.2 Triggers for Investigation Investigations may be triggered by:
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