CCI probe wing for action against Haryana Depts

[RajaRC]

CCI probe wing for action against Haryana Depts

Joe C Mathew / New Delhi December 15, 2010, 0:41 IST

http://business-standard.com/india/storypage.php?autono=418330

Says they were evasive on behalf of DLF, wouldn’t answer queries.

The investigation wing of the Competition Commission of India (CCI)
has sought penal action against two Haryana state government
establishments — the Haryana Urban Development Authority (HUDA) and
the Town and Country Planning Department — for not responding to its
queries on a case relating to India’s largest property developer, DLF
Ltd.


The investigation was based on the complaints registered by a group of
DLF customers against the company’s alleged “abuse of dominant
position” by putting “discriminatory and abusive clauses” in the
apartment agreements provided to allottees of its Belaire and Park
Place projects in Gurgaon, close to Delhi.


The Director General, Investigations, who gave his findings recently,
is known to have endorsed the charges made by the allottees. The
report said DLF’s conduct breached the Competition Act. The CCI will
have its first meeting to consider the DG’s report on January 6, 2011.

“The DG’s report had found the conditions imposed on the allottees
anti-customer and anti-competitive. It also felt the matter a fit case
for inquiry by the government of Haryana,as there are possibilities of
violations of several state laws as well,” a legal source privy to the
report said.

Said a DLF spokesperson: “As the matter is sub judice, we would not
like to comment on the issue, except that the CCI has asked us to give
our comments/objections to this report.”

According to the report, the DGI had sent repeated notices to the
secretary, HUDA, and Director, Town and Country Planning. However,
there was no response from either office.

“Instead of co-operating, the government offices appeared to be
evasive. This happened even after they were informed that CCI can take
action under Section 43 of the Act if someone is unwilling to share
the information sought,” the source said.

The petition before CCI, filed by Belaire Owners’ Association against
DLF Ltd, Department of Town & Country Planning, Haryana, and Haryana
Urban Development Authority, contended DLF had failed to deliver the
residential projects on time and put “discriminatory and abusive
clauses” in the apartment agreements provided to the allottees. It
also said the builder was abusing its dominant position in the market.

The two projects are expected to have a total of 2,200 flats, priced
between Rs 1.5 crore and Rs 3 crore, making the apartments worth Rs
4,500-5,000 crore in all.

The projects, which started in August 2006, were expected to be
completed in three years, but the developer extended the deadline to
April 2011.

Under the Competition Act, CCI can slap a penalty of up to Rs 1 crore
for non-disclosure of information. In a recent case, Kingfisher
Airlines was penalised by CCI for not providing sufficient details
sought by the DG as part of its investigation. This matter was,
however, stayed by the Competition Appellate Tribunal.