The Competition Commission of India (CCI) on July 13, 2026, imposed a penalty of ₹126.87 crore on HP India Sales Private Limited and a combined ₹1.22 crore on five of its resellers for cartelisation in the supply of personal system products including laptops, desktops, workstations, and accessories. The CCI found that HP India had dictated bid prices to its resellers and manipulated their participation in tenders floated on the Government e-Marketplace (GeM) to unfairly benefit itself. The case originated not from a complaint, but from a leniency application filed by HP India itself under Section 46 of the Competition Act, 2002.
What Did the CCI Find?
The CCI’s investigation, conducted under Suo Moto Case No. 07 of 2020, revealed that HP India engaged in a systematic pattern of anti-competitive conduct between 2017 and 2020. The company used its control over Manufacturer Authorisation Forms (MAFs) and transfer pricing to influence which resellers could participate in GeM tenders floated by government buyers in Delhi.
The regulator found that HP India officials communicated specific bid prices to resellers, directed them to participate in certain tenders, and in some instances, restricted participation by withholding authorisations. These actions distorted the competitive bidding process and ensured that HP India and its preferred channel partners won contracts on predetermined terms.
The five resellers found to have colluded with HP India are Delphi Infosolutions, Digitech Computers, Orbit Techsol, Hind Technocare, and Krishna Computers. The CCI also held officials of HP India and these resellers personally liable under Section 48 of the Competition Act, which extends liability to persons in charge of and responsible for the conduct of a company’s business.
How the Cartel Operated
The cartel operated through a combination of price fixing, bid rigging, and customer allocation. According to the CCI, HP India engaged in customer allocation even before the introduction of e-tendering on the GeM portal, and ensured that such allocation continued after the platform adopted electronic bidding.
HP India used its control over Manufacturer Authorisation Forms (MAFs) as the primary tool of enforcement. MAFs are documents that authorise a reseller to participate in a tender on behalf of the manufacturer. By selectively granting or withholding these authorisations, HP India could decide which reseller would bid on which tender, at what price, and whether other resellers would be allowed to compete.
The CCI noted that HP India and its resellers became competitors whenever they bid in the same tender, making their coordination a violation of cartel provisions. The company’s argument that its actions merely affected competition among its own channel partners, rather than between brands, was rejected by the Commission. The CCI held that intra-brand coordination between a manufacturer and its resellers in a bidding process is as damaging to competition as inter-brand collusion.
Two Orders, Two Product Categories
The CCI passed two separate orders on July 13, 2026, covering distinct product categories. Together, they resulted in an aggregate penalty of ₹142.37 crore across both cases.
Personal System Products
This order relates to the sale and supply of laptops, desktops, workstations, and related accessories. The penalties imposed are:
| Entity | Penalty |
|---|---|
| HP India Sales Pvt. Ltd. | ₹126.87 crore |
| Delphi Infosolutions | ₹9.52 lakh |
| Digitech Computers | Separate penalty as determined by CCI |
| Orbit Techsol | Separate penalty as determined by CCI |
| Hind Technocare | Separate penalty as determined by CCI |
| Krishna Computers | Separate penalty as determined by CCI |
| Total (resellers) | ~₹1.22 crore |
The CCI found that HP India dictated bid prices to resellers and manipulated reseller participation in GeM tenders by withholding authorisations to benefit itself. The five resellers were found to have colluded with HP India in this process.
Print Consumables
In a separate and broader case, the CCI imposed a penalty of ₹11.98 crore on HP India and a combined ₹2.30 crore on 16 Tier-2 resellers for cartelisation in the sale of toner cartridges, ink cartridges, and other print consumables.
The regulator found that these resellers engaged in submitting support or cover bids, that is, bids designed to create an illusion of competition while ensuring a predetermined bidder would win. HP India was found to have played a central role in facilitating and monitoring this cartel arrangement.
The 16 resellers include DD Enterprises, Ascent Information, Kaypee Enterprises, Britex Enterprises, Alankar Distributors, Vijay Stationery Mart, G R Enterprises, Perfect Innovative, Khandelwal Traders, A Square Technologies, Innovative Solutions, Pioneer Technologies, Delphi Infosolutions, Shakti Marketing, International Computer Resources, and Arms Peripherals.
The Leniency Programme: How HP India Avoided a Heavier Penalty
A notable aspect of the case is that HP India itself triggered the investigation by filing a lesser penalty application under Section 46 of the Competition Act. This provision forms the basis of the CCI’s Leniency Programme, which is designed to encourage cartel members to self-report in exchange for reduced penalties.
The Leniency Programme works on a simple principle: cartels are secretive by nature and difficult to detect through external evidence alone. By offering penalty reductions to the first member that comes forward with full, true, and vital disclosures, the programme creates a powerful incentive for companies to break ranks. In competition law theory, this is often described as creating a prisoner’s dilemma among cartel members.
HP India was the first to report the cartel to the CCI at a time when the regulator had no material to form a prima facie view about the existence of the alleged conduct. Despite being the orchestrator of the cartel, the company received a reduction in its penalty for making vital disclosures and cooperating with the investigation. The CCI noted in its order that the company came forward voluntarily and provided information that enabled the regulator to act.
Under the framework, the first applicant can receive up to 100% reduction in penalty, the second up to 50%, and subsequent applicants up to 30%, depending on the value of the information provided. The programme was strengthened by the Competition (Amendment) Act, 2023, which introduced a Leniency Plus mechanism. This allows an applicant already being investigated for a cartel in one market to receive additional penalty reductions for disclosing a separate, unrelated cartel in another market.
About the Competition Commission of India
The Competition Commission of India (CCI) is the chief national competition regulator in India. It is a statutory body established by the Central Government under the Competition Act, 2002, which was passed by Parliament in 2002 and received presidential assent in January 2003. The CCI was formally constituted on October 14, 2003, but became fully functional only in May 2009 when the provisions relating to anti-competitive agreements and abuse of dominant position were notified.
The CCI operates under the Ministry of Corporate Affairs and has its headquarters in New Delhi. Its composition includes a Chairperson and up to six members, all appointed by the Central Government. The current Chairperson is Ravneet Kaur.
The Commission replaced the earlier Monopolies and Restrictive Trade Practices Commission (MRTPC), which functioned under the MRTP Act, 1969. The shift from the MRTP regime to the Competition Act reflected India’s transition from a command-and-control economy to a market-oriented one following the 1991 economic liberalisation. The Raghavan Committee, appointed in 1999, had recommended the new competition law framework.
The CCI has three primary functions: prohibiting anti-competitive agreements under Section 3 of the Act (including cartels, bid rigging, and price fixing), preventing abuse of dominant position by enterprises under Section 4, and regulating combinations such as mergers, acquisitions, and amalgamations under Sections 5 and 6 that could have an appreciable adverse effect on competition.
The Competition Act was significantly amended in 2023 to introduce provisions for settlement and commitment mechanisms, a deal value threshold for merger notifications, and the Leniency Plus framework, among other changes.
What This Means for Public Procurement
This case carries significant implications for government procurement in India. The Government e-Marketplace (GeM) was launched on August 9, 2016, by the Ministry of Commerce and Industry as a paperless, cashless, and contactless online platform for public procurement. It replaced the legacy Directorate General of Supplies and Disposals (DGS&D) system and was designed to bring transparency, efficiency, and inclusiveness to the procurement process.
Public procurement accounts for roughly 20-22% of India’s GDP, making the integrity of this process critical for the efficient use of taxpayer money. The CCI’s action against HP India sends a strong signal that anti-competitive behaviour on the GeM platform will not be tolerated, even when the company itself brings the violation to light.
The case also highlights a potential vulnerability in the GeM system: the ability of manufacturers to use authorisation controls to manipulate bidding outcomes. While GeM has succeeded in reducing human intervention and increasing transparency through e-bidding and reverse auctions, the HP India case shows that sophisticated cartels can adapt to digital platforms by using indirect means such as MAF controls and cover bids.
The CCI rejected HP India’s argument that GeM’s reverse auction system disrupted legacy reseller relationships and that the coordination was merely an industry practice. This establishes an important precedent that manufacturers and their resellers cannot use the defence of routine commercial practice to justify bid rigging.
Key Takeaways
- The CCI imposed a penalty of ₹126.87 crore on HP India and ₹1.22 crore on five resellers for cartelisation in the supply of personal system products through GeM tenders.
- The violations occurred between 2017 and 2020 and involved bid rigging, price fixing, and customer allocation through control over Manufacturer Authorisation Forms (MAFs) .
- The case originated from a lesser penalty application filed by HP India under Section 46 of the Competition Act, 2002, which allows the CCI to reduce penalties for cartel members that self-report and cooperate.
- In a separate order, the CCI imposed ₹11.98 crore on HP India and ₹2.30 crore on 16 resellers for cartelisation in print consumables, bringing the total aggregate penalty to ₹142.37 crore.
- The Competition Commission of India is a statutory body established in October 2003 under the Competition Act, 2002, operating under the Ministry of Corporate Affairs with headquarters in New Delhi.
- GeM was launched on August 9, 2016, by the Ministry of Commerce and Industry and has become India’s primary platform for government procurement, accounting for a significant share of the 20-22% of GDP that the government spends on public procurement.
