CCI orders second DLF probe in 2 days

The Competition Commission of India (CCI) has ordered a new investigation against real estate major DLF for alleged abuse of its dominant market position in development and sale of residential units in the company's Skycourt project in Gurgaon.

CCI said that the conduct of the company prima facie appears to be abusive in terms of the relevant Section of the Competition Act. The new order comes close on the heels of the investigation ordered by the CCI on Monday into similar complaints related to the 'Regal Gardens at the DLF Garden City' project in Gurgaon.

The CCI order, dated February 5 but released on Tuesday, states, "At the outset, it may be noted that the Commission has already received many informations where opposite party (DLF Universal) has been prima facie found to be dominant in market for provision of services for development of residential apartments in the territory of Gurgaon."

The order adds, "The issues raised in this case are also of the same nature where the informant is aggrieved by the conduct of OP which is alleged to be onesided and discriminatory resulting into abuse of dominant position. The informant has alleged that owing to its dominant position, OP has imposed hidden costs and onerous conditions on the buyers by way of an 'agreement' which is extremely one-sided and biased towards OP."

The fair trade regulator has asked the probe to be completed within 60 days. The CCI said that considering the previous orders of the Commission and investigations carried out by the director general (CCI's investigation arm), it appears that market for provision of services for development and sale of residential units in Gurgaon is the relevant market in the present case.

DLF chief financial officer Ashok Tyagi said in an analyst presentation, "We came to know of it only yesterday. CCI has not passed a judgment but only ordered an enquiry into the 'Regal Gardens' matter because they felt that the causes of dominance and the agreement which they have opined upon earlier were prima facie valid. Let's see." With regard to a few other projects, the CCI has already found DLF guilty of having abused its dominant market position.