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CCI orders DLF to cease and desist from anti-competitive ways

Last Updated: Tuesday, July 2, 2013 - 21:46

New Delhi: Competition Commission Tuesday directed realty major DLF to "cease and desist" from indulging in anti-competitive practices with regard to flats sold in its Belaire project.

In 2011, CCI had imposed a penalty on DLF in another case related to the same project and the order was later challenged by the company before the competition appellate tribunal.

CCI in today's order said it was not imposing fresh penalty as fine of Rs 630 crore was already slapped on DLF.

"... The Commission orders that cease and desist order passed in Case No 19 of 2010 would apply to the present case as well," Competition Commission of India (CCI) said today.

Case No 19 of 2010 refers to the complaint by Belaire Owners' Association against DLF.

"Since penalty has already been imposed upon DLF in Case No 19 of 2010, the Commission does not deem it appropriate to impose penalty in this case also," CCI said.

As per the complaint by one Dinesh Trehan, DLF cancelled the allotment forfeiting an amount of Rs 87 lakhs deposited by the informant with the opposite party.

The informant alleged abuse of dominant position by DLF and also challenged various clauses in the Apartment Buyer's Agreement saying they were anti-competitive.

Observing that the matter raised by the informant are similar with the issues involved in The Belaire case, the Commission said this aspect has not been denied or disputed by any of the parties.

Meanwhile, in 2011, the regulator had found DLF violating competition norms by imposing unfair conditions on the sale of its services to consumers. Subsequently, the Commission had directed DLF and its group companies offering services of building/ developing to cease and desist from such practices.

Besides directing the company to suitably modify the agreements, the Commission had also imposed a penalty of Rs 630 crore.

In a separate case, the Commission today rejected a complaint from DLF City Club Members Welfare Association that alleged the realty developer of abusing its dominant position in running clubs at the residential colonies.

According to the second order, DLF Recreational Foundation (Opposite Party 1) and DLF (Opposite Party 2) cannot be said to be dominant in the relevant market.

"Since, dominance of OP's 1 and 2 in the relevant market is prima facie not there, so there can be no issue of abuse of dominance," it said.

As per the complaint, members of the association were promised club facility when they applied for allotment of residential plots/flats in the residential colonies developed by DLF.

However, it was alleged that instead of establishing a club as a part of community services to be managed by the members, DLF was running the 'The City Club' as a commercial enterprise and a profit centre and charging exorbitant membership fee.

The complaint was filed against DLF Recreational Foundation, DLF, Financial Commissioner & Principal Secretary, Town & Country Planning Department, Government of Haryana (Opposite Party 3); Director, Town & Country Planning, Government of Haryana, (Opposite Party 4), Administrator, Haryana Urban Development Authority (Opposite Party 5) and The Director, Town Planning, Gurgaon (Opposite Party 6).

"However, non-implementation of provisions of Haryana Development& regulations of Urban Areas Act or the regulations framed thereunder by OP 3 to OP 6 is altogether different matter and informant is free to initiate independent proceeding before appropriate forum against opposite parties," the Commission said in its second order.


First Published: Tuesday, July 2, 2013 - 21:46
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