The Telegraph
Tuesday , May 20 , 2014
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Coal India incurs CCI wrath

Calcutta, May 19: The Competition Commission of India (CCI) has once again found Coal India Ltd guilty of abusing its dominant position in fuel supply and has ordered the state-run miner to “cease and desist” from indulging in unfair business practices.

The orders, issued on May 15 and made public today, are based on complaints filed by the Madhya Pradesh Power Generating Company, West Bengal Power Development Corporation and Sponge Iron Manufacturers Association.

The orders are directed to Coal India and its seven subsidiaries. Most of the complaints accuse Coal India of indulging in anti-competitive practices by entering into one-sided fuel supply agreements (FSAs) and restricting the supply by selling coal through the more lucrative e-auction route.

These rulings come on the back of a penalty of Rs 1,773.05 crore imposed by the CCI on Coal India last December. This time, no penalty has been imposed.

In its order, the CCI points out that Coal India through its subsidiaries “operates independently of market forces and enjoys undisputed dominance in the relevant markets of supply of non-coking coal to thermal power producers and sponge iron manufacturers in India”.

The commission has found that Coal India and its subsidiaries has “imposed discriminatory terms and conditions in FSAs” and restricted fuel supply through its MoUs. However, the fair trade regulator said it had not found the PSU miner and its arms “to be restricting the supply by means of diverting the coal to sale through e-auction” as was alleged in the complaints.

DLF woe

The Competition Appellate Tribunal today upheld a Rs 630-crore penalty imposed on realty major DLF by the CCI and emphasised that the abuse of dominant position should be dealt with iron hands.

DLF said it would move the Supreme Court on the matter.

In August 2011, the Competition Commission found DLF violating fair trade norms and imposed the fine on a complaint by the Belaire Owners’ Association.