The Apple Inc. has filed a petition before the Delhi High Court challenging the recent amendment to the Competition Commission of India’s (CCI) penalty regime, contending that the amended provisions—permitting imposition of penalties based on a company’s global turnover—are arbitrary, unconstitutional and disproportionate. The challenge targets the 2023 amendment to Section 27(b) of the Competition Act, 2002 along with the 2024 regulations issued by CCI, namely the CCI (Determination of Turnover or Income) Regulations, 2024 and the CCI (Determination of Monetary Penalty) Guidelines, 2024. Under the new framework, the CCI is empowered to levy fines of up to 10% of an enterprise’s average global turnover (derived from all products and services) for the three preceding financial years, replacing the older regime which calculated penalties based on “relevant turnover” tied to the specific product or service involved in the alleged anti‑competitive conduct.
In its petition, Apple argues that the new rule could expose it to a potential fine amounting to about 38 billion US dollars. The company calculated this by applying the 10% penalty cap to its global operations’ average turnover over the relevant period. Apple contends that subjecting a global business—many parts of which may have no connection to the alleged conduct in India—to penalties based on worldwide revenue is manifestly arbitrary, grossly disproportionate, and unjust, and violates constitutional safeguards, including equality before law and protection of life and liberty.
Apple further asserts that the amended penalty provisions retroactively alter the basis on which fines are to be calculated, violating the principle that penal provisions should not have retrospective effect unless clearly intended by the legislature. The firm notes that the CCI has already directed it to submit audited financial statements for fiscal years 2022, 2023 and 2024 — applying the new law to past conduct — which, in Apple’s submission, amounts to an impermissible retrospective application of penal norms and adversely affects vested rights and interests.
In addition to constitutional objections, Apple questions the jurisdictional reach of the amended law. The plea argues that the CCI does not have authority to consider global revenue for conduct whose impact is confined to India. Under the Competition Act, the regulator’s enforcement mandate is territorially limited, and punishing a firm based on global operations beyond the jurisdiction bears no rational connection to the alleged anti‑competitive behaviour in the Indian market.
Apple also relies on precedent: earlier jurisprudence under the Competition Act — notably the decision in Excel Crop Care Ltd. vs Competition Commission of India — interpreted “turnover” as meaning the turnover from the product or service directly implicated in the violation, not the entire turnover of the enterprise. The petition claims that the amended law purports to overturn that settled principle without explicitly repealing or replacing it, undermining legal certainty and proportionality.
The petition contends that even in cases involving a small part of a company’s business, the expanded definition permits the CCI to aggregate total global revenue from all business lines and apply the 10% penalty cap on that aggregate revenue. This, Apple argues, could lead to unconscionable penalties far disproportionate to the scale of the alleged offence—penalties not just disconnected from the conduct, but potentially crushing in magnitude.
The matter is set to be heard by a Division Bench of the Delhi High Court comprising Devendra Kumar Upadhyaya (Chief Justice) and Tushar Rao Gedela (Justice) on December 3. The case represents one of the first major challenges to the amended penalty regime, and its outcome is expected to have wide‑ranging implications for how antitrust penalties are calculated for multinational companies operating in India.
With this challenge, Apple seeks a declaration that the amended Section 27(b), along with the 2024 regulations and guidelines, are unconstitutional, and an injunction restraining the CCI and the Government from enforcing them against it. The petition also calls for quashing the order directing Apple to submit its audited global financial statements under the new law.
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