For Rama Engineering Works And Mr vs Polyset Plastics Private Ltd on 9 June, 2022

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Competition Commission of India

For Rama Engineering Works And Mr vs Polyset Plastics Private Ltd on 9 June, 2022

COMPETITION COMMISSION OF INDIA

Suo Motu Case No. 06 of 2020

In Re: Cartelisation in the supply of Protective Tubes to Indian Railways

Against:

1. Polyset Plastics Private Ltd. Opposite Party-1
2. M/s Anju Techno Industries Opposite Party-2
3. M/s Power Mould Opposite Party-3
4. Jai Polypan Private Ltd. Opposite Party-4
5. M/s Rama Engineering Works Opposite Party-5
6. M/s Polymer Products of India Opposite Party-6
7. M/s Hari Narayan Bihani Opposite Party-7

CORAM

Ashok Kumar Gupta
Chairperson

Sangeeta Verma
Member

Bhagwant Singh Bishnoi
Member

Present:

For Polyset Plastics Private Ltd., M/s Anju Techno : Dr. Harsh Surana, Ms. Deepali
Industries, M/s Power Mould, Mr. Bhupesh Bafna, Sharma and Mr. Sandeep
Managing Director of Polyset Plastics Private Ltd. and Malik, Advocates
Partner of M/s Power Mould and M/s Anju Techno
Industries, and Ms. Shanta Sohoni, employee at Polyset
Plastics Private Ltd.

For Jai Polypan Pvt. Ltd., Mr. Vishal Baid, Director of : Mr. Rohan Arora, Ms. Shweta
Jai Polypan Pvt. Ltd., Mr. Rajeev Dudhani, Shroff Chopra, Mr. Pranav
Consultant/Advisor at Jai Polypan Pvt. Ltd. and Mr. Satyam, Mr. Kshitij Sharma
Rajesh R., Senior Manager at Jai Polypan Pvt. Ltd. and Mr. Ritesh Puri, Advocates

Suo Motu Case No. 06 of 2020 1
For Rama Engineering Works and Mr. V. Chakrapani, Mr. Tadimalla Bhaskar
Partner of Rama Engineering Works Gowtham, Advocate

For Polymer Products of India Ltd., Mr. Vishnu N.M. : Mr. Kartikey Nayyar and Mr.
and Mr. Venkata Subramanyam, Managing Partners of Shaurya M. Tomar, Advocates
Polymer Products of India Ltd., and Mr. Harsha along with Mr. Venkata
Gumballi, Manager (Admin) of Polymer Products of Subramanyam, party-in-person
India Ltd.

: Ms. Anu Monga, Mr. Rahul
For Hari Narayan Bihani and Mr. Keshav Bihani, Partner
Goel and Ms. Neha Mishra,
of Hari Narayan Bihani
Advocates

ORDER UNDER SECTION 27 OF THE COMPETITION ACT, 2002

Facts:

1. The present matter was initiated by the Commission suo motu, pursuant to receipt of an
application under Section 46 of the Competition Act, 2002 (Act) read with Regulation
5 of the Competition Commission of India (Lesser Penalty) Regulations, 2009 (LPR),
on behalf of Jai Polypan Private Ltd. (including its individuals), for alleged cartelisation
in the supply of protective tubes to the Indian Railways.

2. From the disclosures made in the lesser penalty application, the Commission noted that
there appears to exist coordination and collusion amongst the following vendors of
protective tubes (OPs) from 10.06.2015 to 29.06.2020, in the tenders issued by the
Indian Railways for procurement of protective tubes through the modus operandi of,
inter alia, quoting mutually agreed prices and allocating tenders amongst themselves:
1. Polyset Plastics Private Ltd. (OP-1)
2. M/s Anju Techno Industries (OP-2)
3. M/s Power Mould (OP-3)
4. Jai Polypan Private Ltd. (OP-4)
5. M/s Rama Engineering Works (OP-5
6. M/s Polymer Products of India (OP-6)
7. M/s Hari Narayan Bihani (OP-7)

Suo Motu Case No. 06 of 2020 2
3. Noting the foregoing, the Commission passed an order dated 17.11.2020 under Section
26(1) of the Act, forming an opinion that, prima facie, the conduct of the OPs appears
to be in contravention of the provisions of Section 3(1) read with Section 3(3) of the
Act, and consequently, directed the Director General (DG) to cause an investigation
into the matter and submit a report. The DG was also directed to investigate the role of
the officials/persons who, at the time of such contravention, were in-charge of and
responsible for the conduct of the businesses of respective OPs as well as of the
persons/officers with whose consent or connivance such contravention was committed,
in terms of the provisions contained in Section 48 of the Act.

Investigation by the DG:

4. Pursuant to the directions issued by the Commission, the DG, after conducting a
comprehensive investigation in the matter, submitted the investigation report. Based on
investigation, the findings of the DG in its report, in brief, are as under:

(a) All 07 OPs are engaged in the manufacture and supply of protective tubes. As such,
they are 'enterprise' within the meaning of Section 2(h) of the Act. They are
engaged in identical/similar trade of goods; hence, their conduct can be analysed in
terms of Section 3(3) of the Act.

(b) Evidence of common IP addresses from which bids were quoted and common
directorship/partnership between 3 OPs is found. Further, exchange of several e-
mail communications between the representatives of the OPs is found, wherein:
(i) discussion on prices to be quoted in the tenders is made,
(ii) tender quantity allocation took place,
(iii) the OPs can be seen distributing tenders amongst themselves wherein the OPs
mutually agreed to a given rate, and non-allottees were instructed to quote 8-
10% higher prices,
(iv) the OPs can be seen asking other OPs to withdraw their offers from tenders,
and
(v) the OPs can be seen manipulating the bidding process by forming a pool or
cartel of vendors, even for developmental vendors who were entering the
market and were in the initial phases of manufacturing.

Representatives of certain OPs also admitted to the above arrangement.

Suo Motu Case No. 06 of 2020 3
(c) From the above, the DG observed a modus operandi which was being followed by
the OPs and concluded that all the 07 OPs indulged in contravention of the
provisions of Section 3(3)(a), 3(3)(b), 3(3)(c), and 3(3)(d) read with Section 3(1) of
the Act. In terms of Section 48 of the Act, the DG identified certain individuals of
the OPs who had played an active role in contravention of the provisions of the Act
by the respective OP and/or who were in-charge of and responsible for the conduct
of the business of the respective OP during the period of contravention, and
accordingly, fixed liability upon 10 such individuals.

Proceedings before the Commission:

5. The Commission considered the investigation report submitted by the DG in its
ordinary meeting held on 04.01.2022 and decided to forward an electronic copy of the
'non-confidential qua OPs version' of the same to the OPs and their individuals found
liable by the DG in terms of the provisions of Section 48 of the Act (Parties) for filing
their respective objections/suggestions, if any, to the investigation report, along with
certain financial details. The OPs were directed to furnish their audited Financial
Statements, including Balance Sheets and Profit & Loss Accounts for the Financial
Years (FYs) 2015-16 to 2020-21, along with details of their revenue and profit
generated in these FYs from the sale of protective tubes by way of filing Affidavits
supported by certificates from chartered accountants, while the individuals were
directed to file their income details, including Income Tax Returns (ITRs), for the FYs
2018-19, 2019-20, and 2020-21.

6. After receipt of objections/suggestions from the Parties, the Commission, on
30.03.2022 and 31.03.2022, heard the oral submissions addressed by the respective
learned counsel(s) for the Parties on the DG Report and also heard OP-4 on its
application for lesser penalty through video conference mode. The Commission decided
to pass an appropriate order in the matter in due course. Thereafter, the Parties
submitted their respective written arguments.

Submissions of the Parties:

7. In their suggestions/objections to the investigation report, written arguments, and
during the oral hearing, the Parties took diverse pleas, which are summarised in the
succeeding paras:

Suo Motu Case No. 06 of 2020 4
8. Polyset Plastics Private Ltd. (OP-1), M/s Anju Techno Industries (OP-2), M/s
Power Mould (OP-3), Mr. Bhupesh Bafna, and Ms. Shanta Sohoni

8.1 The informal market understanding amongst the vendors with regard to the supply
of protective tubes to the Railways existed to safeguard and recover the
investments in R&D put forth by the vendors and to deliver good quality product
at a reasonable price. The answering OPs were not fully aware of the exact and
specific competition law in the country and the OPs will certainly be extra careful
and cautious of all rules, regulations, and existing compliances in all their future
dealings. The informal arrangement between the OPs existed in ignorance of
existing laws. Their intentions or actions were not to prevent the entry of any new
entity in the tender process, i.e., were not anti-competitive in nature. The field and
market were always open for all, and the answering OPs' dealings have always
been fair to all.

8.2 In the digital era, the procurement system and subsequent tendering process of the
Indian Railways is very robust and in no way can be influenced by the vendors. It
is not the case that, due to any action on the part of the answering OPs, the price of
the product increased or jacked up.

8.3 The answering OPs have never been party to any earlier inquiry or investigation.
The revenue earned by them from the sale of protective tubes is also very less,
considering the overall business. Further, in light of the impact of the COVID-19
pandemic and the consequent lockdowns, the businesses of the answering OPs
have suffered a lot. Hence, no penalty ought to be imposed upon the answering
OPs.

8.4 Already, heavy penalties on the answering OPs have been imposed in Ref. Case
No. 03 of 2018 titled Chief Materials Manager, North Western Railway v.
Moulded Fibreglass Products LLP, and hence, no further penalties ought to be
imposed.

Suo Motu Case No. 06 of 2020 5
9. Jai Polypan Pvt. Ltd. (OP-4), Mr. Vishal Baid, Mr. Rajeev Dudhani, and Mr.
Rajesh R.

9.1 OP-4 is a lesser penalty applicant before the Commission. It believes that it has the
first marker status and that the Commission was not aware of the existence of the
present cartel before the lesser penalty application was filed by OP-4. Therefore,
OP-4 and its individuals ought to be granted 100% reduction in penalty, if any,
imposed upon them. OP-4 made vital disclosures before the Commission, which
enabled the Commission to form a prima facie opinion regarding the existence of
the present cartel. It also fully co-operated during the course of investigation and
inquiry and is not objecting to the findings contained in the DG Report on merits.

9.2 Through its lesser penalty application, OP-4 provided evidence with respect to (i)
communication between the OPs for rigging the bids floated by the Indian
Railways in relation to protective tubes between June 2015 to June 2020; (ii) the
manner in which tenders were allocated amongst the OPs; (iii) the manner in
which prices were mutually agreed between the OPs; (iv) the manner of addition
of new members to the cartel arrangement and distribution of share percentage
between them; and (v) issues with the cartel, monitoring mechanism, and
resolution. The DG has relied on the information and evidence provided by OP-4
in its investigation report. In light of this, and considering the fact that OP-4 has
fulfilled all conditions for grant of lesser penalty as mentioned under the LPR,
penalty should not be levied on OP-4 and its individuals, and if a penalty is to be
levied, OP-4 and its individuals ought to be granted 100% reduction in penalty
under the LPR.

9.3 The DG has erred in observing that the OPs indulged in geographical allocation of
the market. The Indian Railways distributes its operations into different zones
across the country geographically, and each railway zone procures its products
separately by floating separate tenders. The DG rightly mentions that the OPs had
allocated the market percentage to each vendor. However, this market percentage
is not allocated on the basis of any geographic segmentation, as the OPs supply
their products to the Railways pan-India, i.e., across various railway zones.

Suo Motu Case No. 06 of 2020 6
9.4 Penalty, if any, ought to be imposed only on relevant turnover/profit of OP-4, i.e.,
the turnover/profit derived from the sale of Protective Tubes in the relevant time
period/duration (i.e., 2015-2020).

9.5 The following mitigating factors ought to be considered in case the Commission
deems it necessary to impose a penalty: (i) OP-4 continuously co-operated with
the Commission and the DG during the investigation; (ii) OP-4 earned
insignificant profits from the cartel arrangement; (iii) OP-4 was forced to join
hands with other vendors in order to secure their business because the market is
driven and solely controlled by the Indian Railways and vendors have to adhere to
the framework and tender conditions stipulated by the Indian Railways; (iv) OP-4
is an MSME unit with limited resources and has suffered significant repercussions
of the COVID-19 pandemic, and accordingly, the imposition of penalty will place
an additional significant financial burden on OP-4; and (v) OP-4 played a limited
role in cartel arrangement as Ms. Shanta Sohoni was responsible for co-ordinating
amongst the members of the cartel.

9.6 OP-4 has also disclosed the existence of another cartel arrangement to the
Commission. The Competition Law Review Committee, in its report dated
26.07.2019, has acknowledged the challenges faced by the Commission in cartel
detection and enforcement and, in view of this, recommended that, where an
applicant makes full, true, and vital disclosures with respect to another cartel
(Leniency Plus), such applicant may be granted lesser penalty specified in the
LPR. In view of this, the Commission, while deciding the quantum of penalty
reduction in the present matter, may also take into account the additional
disclosure of contravention of Section 3 of the Act made by OP-4 in another
matter. Considering the legislative desire for Leniency Plus, in addition to the
comprehensive co-operation provided by OP-4 in this matter, the Commission
may, considering the fact that OP-4 has also made full, true, and vital disclosures
with respect to another anti-competitive agreement, grant OP-4 and its individuals
100% immunity from penalty in the present matter.

Suo Motu Case No. 06 of 2020 7
10. Rama Engineering Works (OP-5) and Mr. V. Chakrapani

10.1 The DG has failed to examine Mr. V. Chakrapani of OP-5 on oath before giving a
finding of contravention against OP-5 and him. This is against the principles of
natural justice.

10.2 The DG Report is silent on the period of contravention. Though it appears from
the DG Report that the transactions relating to the alleged cartel took place from
2015 to 2019, OP-5 has been made liable despite the fact that it became an
approved source for the Indian Railways for protective tubes only on 29.05.2019.

10.3 OP-5 never shared any crucial information with the other OPs like bid amount or
bid presentation dates in the relevant period, which may establish the existence of
a cartel. All that the investigation has found against OP-5 are five e-mails agreeing
to a meeting or revealing information about already awarded quantities, which
information was already available in the public domain. No independent source
has been examined to prove the allegations of cartelisation. In fact, there is no
certificate given under Section 65B of the Indian Evidence Act, 1872 in support of
such e-mails relied upon against OP-5. The DG's findings are based on an
incorrect understanding of the facts and law and there is no direct evidence against
OP-5 of indulging in cartelisation. OP-5, in this regard, reserves the right to cross-
examine the investigating officer of the present matter.

10.4 In a monopsonist market with a single buyer, price is set by the buyer, conditions
are such that sellers can predict demand, there is a repetitive bidding process, and
products are identical and specialised; as such, mere price parallelism in such
cases cannot be a reason to arrive at a conclusion of bid rigging. In such a market,
there is a high degree of predictability of prices and bidders may take business
decisions to mirror the prices of competitors quoted in other railway zones by
adjusting or averaging prices in other tenders.

10.5 The DG has not found that any loss of revenue to the Indian Railways occurred as
a result of the present alleged cartel. Hence, there was no appreciable adverse
effect on competition (AAEC) within India. In fact, the prices quoted by OP-5 for
polyacetal protective tubes to the Indian Railways always remained less than the
market price, and the profit margin of OP-5 was also very low (8%).

Suo Motu Case No. 06 of 2020 8
10.6 After obtaining approval, OP-5 was awarded the first order by the South East
Central Railway on 19.08.2019, for which OP-5 had quoted a rate of ₹456, and it
was awarded quantity of 5,771; however, in the same railway zone, in 2018, OP-4
had quoted a price of ₹502.95 and it was awarded the tender at this rate. Similarly,
OP-5 was awarded the tender of the South Western Railway vide P.O. dated
20.10.2020 @₹432 and quantity of 552; however, in February 2020, OP-6 had
quoted a price of ₹470 and was awarded quantity of 2,400. These instances clearly
show that OP-5 was not a part of the alleged cartel.

10.7 Further, the cost breakup of polyacetal protective tube is as follows: 1 kg of raw
plastic Delrin available in the market for ₹250/kg + manufacturing cost ₹100/-
(which includes labour, electricity, etc.) + consumables ₹50/- = Total ₹400/-. In
2019, OP-5 made supplies to South East Central Railway @₹435/- per piece and
to South Central Railway for ₹484/- per piece. In 2020, supplies were made to
South Western Railway @₹432/- per piece. These rates were quoted after keeping
aside a minuscule portion of profit of approx. 8%. This shows that the Indian
Railways were not in any losses, and OP-5 quoted very competitive prices.

10.8 OP-5 had not quoted in any of the tenders through a common IP address with any
other OP.

10.9 Further, the inherent nature of the market for Protective Tubes itself precludes the
possibility of competition, as the product can only be sourced from RDSO-
approved sources, and this creates entry barriers for new entrants in the market.
The DG has not examined the factors stated under Section 19(3) of the Act to
establish any AAEC.

10.10 Penalty, if any, ought to be imposed only on the turnover/profit derived by OP-5
from the sale of protective tubes to the Indian Railways in FY 2019-20 (after it
became an approved source).

10.11 OP-5 is a partnership firm registered with the MSME.

10.12 Certain mitigating factors ought to be considered. The DG has itself brought out in
the investigation report that the demand for polyacetal Protective Tubes remained
low due to the lower pricing of metallic protective tubes, which the Railways

Suo Motu Case No. 06 of 2020 9
continued to procure. Further, coaches also switched to LHB coaches (which do
not require protective tubes) in place of ICF coaches. Hence, the DG itself
observed that it appears that the cartel was formed to deal with excess supply and
low demand. Average turnover earned by OP-5 during the relevant period from the
sale of protective tubes was meagre. Further, due to the COVID-19 pandemic and
economic slowdown, it has become difficult for OP-5 to survive in the market.

11. Polymer Products of India Ltd. (OP-6), Mr. Vishnu N.M., Mr. Venkata
Subramanyam, and Mr. Harsha Gumballi

11.1 OP-6 was only a Part II supplier of protective tubes to the Indian Railways till
25.09.2019. Part II suppliers are not considered for the supply of more than 5% of
the tendered quantity, and only if the rate quoted by them is less than a Part I
source suppliers' rate. Being a Part II source supplier, OP-6 was in no position to
dictate the prices of protective tubes, which are decided on the basis of the prices
of Part I source suppliers. Part II source suppliers are left at complete mercy of
Part I source suppliers, and they are forced to follow the directions set by Part I
source suppliers to survive in the market and procure business. Hence, OP-6,
having no control over the market of protective tubes had not entered into any
cartel arrangement and/or manipulated the prices of protective tubes.

11.2 Post 26.09.2019, when OP-6 got approved as a regular source of supply, whenever
it was informed to quote according to the rates in the market, it flatly ignored. It
quoted competitive rates to the Indian Railways based on various factors, such as
the cost of raw material, labour cost, freight cost, etc. It only quoted such rates
which, based on its calculations, were commercially viable for it. OP-6, after
underquoting in tenders, was asked several times to withdraw the offer, as
reflected in the e-mail dated 09.06.2020; however, it never adhered to any such
communications. It was never a part of any allocation table nor replied to any
meeting proposal post 2019.

11.3 The DG has failed to establish prior agreement of 'meeting of minds' between the
OPs. Rather, the communications referred to between OP-6 and its individuals
with the other OPs express differences of opinions and disagreements. OP-6 has
always followed fair trade practices and accordingly, avoided any professional

Suo Motu Case No. 06 of 2020 10
communication with any competitor with respect to any tender whatsoever for
which OP-6 may or may not bid.

11.4 OP-6 has not indulged in the modification of any prices arising out of the cartel.

11.5 OP-6 had not quoted in any of the tenders through a common IP address with any
other OP.

11.6 OP-6 had provided all relevant information, documents, and evidence during the
entire proceedings and has co-operated genuinely, fully, continuously, and
expeditiously in the present matter. It has not concealed, destroyed, manipulated,
or removed any relevant and necessary documents of the present case.

11.7 The COVID-19 pandemic has had a catastrophic impact on the entire world,
especially small-scale industries like OP-6, which is a partnership firm and has
been facing the brunt of uncertainty that has been looming around the global
economy since the onset of COVID-19. Hence, the Commission may consider
waiving the levy of any penalty upon OP-6 and its individuals.

11.8 In another similar case bearing Ref. Case No. 03 of 2018 (supra), the Commission
already imposed upon OP-6 and its individuals penalties to the tune of
₹28,80,881/-. As the same relates to substantially similar conduct and for the same
duration the Commission ought not impose any further monetary penalty in the
instant case.

11.9 The product in question, protective tubes, are no longer in use after the
introduction of LHB Coaches. Also considering the redundant nature of the
product, the Commission may adopt lenient approach in the matter.

12. Hari Narayan Bihani (OP-7) and Mr. Keshav Bihani

12.1 Not all documents/e-mails relied upon by the DG in its investigation report have
been supplied along with the DG Report. In fact, the order dated 17.11.2020
passed by the Commission under Section 26(1) of the Act was not even provided
to OP-7, but rather, OP-7 had to seek a copy of the same from the DG.

12.2 OP-7 is a partnership firm. It was approved as a Part II supplier of protective tubes
to the Indian Railways on 26.07.2017 and upgraded as Part I supplier on
04.07.2019. There is no finding in the DG Report that after grant of approval as

Suo Motu Case No. 06 of 2020 11
Part I supplier, OP-7 interacted/communicated/met with the other OPs in terms of
the alleged cartel. In fact, after approval as Part I vendor, OP-7 quoted
independent/competitive prices and was allotted up to 100% tender quantity
(higher than any allocation made by OP-1).

12.3 The DG has failed to establish prior agreement of 'meeting of minds' between the
OPs. Mere receipt of certain e-mails by OP-7 does not show 'agreement' or
'action in concert' or 'understanding' with respect to it, especially when the actual
conduct (price quotations and quantities allotted) of OP-7 is contrary to what has
been suggested in the e-mails. Unilateral/independent action not to follow the
alleged price dictates/quantity allocation shows that OP-7 was not a part of the
alleged cartel.

12.4 There is no evidence in the form of common IP address, call records, meetings,
etc., against OP-7. There is also no evidence of any e-mail being sent by OP-7
prior to 25.07.2019.

12.5 Regarding the e-mail dated 25.07.2019 sent by OP-7 to other OPs, it may be noted
that the same was sent only after the relevant tender was closed on 11.07.2019. As
far as Price List Rate (PLR) mentioned in the said e-mail and other e-mails is
concerned, the same is the rate fixed/suggested by Indian Railways itself based on
its own calculation and estimation of cost of production. The DG has failed to
make a comparison between PLR, actual quoted rates, and tender award rates, or
between the quoted and awarded quantities.

12.6 Regarding other e-mails, e-mails dated 11.11.2019 and 12.11.2019 do not mention
inclusion of OP-7 in the cartel pool or allocation of any quantity to it; there is no
proof of any actual conduct/meeting post e-mails dated 15-16.11.2019; e-mails
dated 20.09.2019, 07.10.2019, 03.02.2020, 16.03.2020, and 29.06.2020 were not
acted upon by OP-7; e-mails dated 10.02.2020, 17.03.2020, and 08.06.2020 were
not marked to OP-7; e-mail dated 08.06.2020 in fact states that OP-7 is not
following/quoting the dictated prices; and e-mails dated 09.06.2020, 10.06.2020,
and 12.06.2020 only show OP-4 threatening to discontinue the cartel if the
dictated prices are not followed. It may be noted that OP-7 did not even participate
in any Railway tender between February 2020 and 08.06.2020. Further, it was

Suo Motu Case No. 06 of 2020 12
because of non-cooperation of OP-7 only that the cartel arrangement broke and
OP-4, the ringleader, approached the Commission by way of filing lesser penalty
application, which was nothing but a counter blast to wipe out competitors.

12.7 Market for polyacetal protective tubes is a monopsonist market with a single
buyer, i.e., the Indian Railways. Further, with the requirement of RDSO approval
for vendors, there exist entry barriers in this market. As such, the buyer, i.e.,
Indian Railways, has the power to influence the price quoted by the vendors as it
finalises the price. PLR is set by the Railways and it, at its sole discretion, gives
counter offer and allocates quantities. Vendors have no option but to accept the
counter offer. Thus, suppliers can, at no point in time, have any control over the
prices. The present case is, therefore, squarely covered by the judgment of the
Hon'ble Supreme Court in Rajasthan Cylinders and Containers Limited v. Union
of India and Another (2020) 16 SCC 615, and the present inquiry against OP-7, in
terms of the said judgment, ought to be closed.

12.8 Also, though the Hon'ble Supreme Court had observed in Rajasthan Cylinders
(supra) that the examination of a buyer in a monopsony market is critical for the
purposes of investigation, in the present case, neither RDSO nor Indian Railways
were summoned by the DG for recording their statements or clarifying any factual
position. With respect to polyacetal protective tubes, raw material and its suppliers
are also categorially specified by RDSO. Hence, it is difficult to imagine that
RDSO/Railways would not be aware of the prices of raw material, cost of
production, and final prices of protective tubes. The DG has failed to examine
RDSO/Railways on any such aspect.

12.9 The DG has also failed to examine the other parties (apart from the OPs) who were
participating in the tenders for protective tubes issued by the Indian Railways.

12.10 The DG has failed to establish any AAEC in the market. It has not examined the
factors stated under Section 19(3) of the Act to establish any AAEC. The alleged
conduct of the OPs neither created any entry barriers in the market, nor drove
existing competitors out of the market, nor led to foreclosure of competition by
hindering entry into the market. In fact, with OP-7 quoting competitive rates as
Part I supplier, Indian Railways (the consumer) has benefitted.

Suo Motu Case No. 06 of 2020 13
12.11 Relevant turnover/profit for OP-7 in the present case ought to be the revenue/profit
derived from sale of polyacetal protective tubes for Axle Box Guide in ICF to the
Indian Railways from the tenders filled by OP-7 between 04.07.2019 to February
2020.

12.12 As OP-7 was not a part of the cartel arrangement, no liability in terms of Section
48 of the Act can be imposed upon Mr. Keshav Bihani, Partner of OP-7. Anyhow,
at this stage, penalty upon him cannot be imposed, as the issue of simultaneous
invocation of Section 48 proceedings before giving a finding of contravention
against the company is presently pending adjudication before the Hon'ble
Supreme Court of India.

Analysis:

13. The Commission has perused the application seeking lesser penalty filed by OP-4 under
Section 46 of the Act; the investigation report submitted by the DG and the evidences
collected by the DG; the suggestions/objections to the DG Report and the written
arguments filed by the Parties; and also heard the oral arguments made by the
respective learned counsel(s) representing the Parties in the matter. Before proceeding
to examine the evidence collected by the DG, the Commission deems it appropriate to
note the product/article involved in the present matter.

14. The present matter involves allegations of cartelisation relating to the product
'polyacetal protective tube' for axle box guide in Integral Coach Factory (ICF). The
DG, in its report, has noted that the primary suspension in ICF bogie is through a
dashpot arrangement, which is mainly a cylinder piston arrangement. This arrangement
provides the dampening effect during the running of the coach. The cover of this
complete dashpot arrangement is known as protective tube.

15. The Indian Railways, in order to ensure reliability, availability, and safe working of
Railway assets, follows the practice of maintaining lists of approved vendors for certain
specific items. It is noted from the DG Report that polyacetal protective tube is one
such item. Research Designs and Standards Organisation (RDSO) is the nodal agency
of the Indian Railways for vendor approval. It maintains two lists--of Part I and Part II
vendors. RDSO-approved vendors included in Part I are eligible for regular supply to
the Indian Railways and for getting an order for full quantity of tenders floated by the

Suo Motu Case No. 06 of 2020 14
Indian Railways, whereas vendors approved and included in Part II are eligible for
developmental order and getting an order for part quantity (up to 25% only). The
RDSO-approved vendors/suppliers of polyacetal protective tubes to the Indian
Railways, along with their timelines of approval, are as follows:

Date of approval Date of approval
Manufacturer
as Part II source as Part I source
Polyset Plastics Private Ltd. (OP-1) 16.09.2009 01.04.2017
M/s Anju Techno Industries (OP-2) 16.09.2009 11.07.2016
M/s Power Mould (OP-3) 16.09.2009 18.07.2016
Jai Polypan Private Ltd. (OP-4) 09.04.2015 01.01.2017
M/s Rama Engineering Works (OP-5) 26.07.2015 29.05.2019
M/s Polymer Products of India (OP-6) 17.06.2017 26.09.2019
M/s Hari Narayan Bihani (OP-7) 26.07.2017 04.07.2019
16. From the evidence on record, it is noted that all the OPs are, inter alia, engaged in the
manufacture and supply of polyacetal protective tubes to the Indian Railways. Since all
the OPs have been engaged in identical/similar trade of goods, their alleged cartel
conduct can be analysed by the Commission in terms of Section 3(3) of the Act.

17. Against the above background, the Commission shall analyse the conduct of the OPs
and the evidence corroborating the same w.r.t. the tenders floated by the Indian
Railways for the procurement of polyacetal protective tubes to assess if there was any
anti-competitive agreement between them w.r.t. such tenders.

18. From the DG Report, it is noted that three out of the seven OPs, viz., OP-1, OP-2, and
OP-3, were declared sister concerns before the RDSO, yet were participating in the
same tenders for the same product as competitors, and they were operated by the
following common directors/partners:

S. No. Company/Firm Director/Partner
Polyset Plastics i. Mr. Bhupesh P. Bafna, Managing Director
1.
Private Ltd ii. Ms. Anjuu Bafna, Director
i. Mr. Bhupesh P. Bafna, Partner
M/s Anju Techno
2. ii. Mr. Shailesh P. Bafna, Partner
Industries
(representing HUF of Mr. S. P. Bafna)
i. Mr. Bhupesh P. Bafna, Partner
3. M/s Power Mould ii. Mr. Shailesh P. Bafna, Partner
(representing HUF of Mr. S. P. Bafna)

Suo Motu Case No. 06 of 2020 15
19. The DG has noted that all three sister concern entities were under the care of one
person, viz., Mr. Bhupesh Bafna.

20. Further, upon analysis of the details of IP addresses from which the OPs filed the bids
in the Railway tenders for Polyacetal Protective Tubes, which were obtained by the DG
from the Centre for Railway Information System (CRIS), it is noted that, in the 12
tenders tabulated below, bids were submitted by the three sister concern OPs from a
common IP address:

S. No. Tender No. Tender floated by Opening date Common IP addresses
1. 11142530-A Central Railways 29.04.2014 OP-1, OP-2, and OP-3
2. 11152530 Central Railways 30.04.2015 OP-1, OP-2, and OP-3
3. 42155371-A Central Railways 19.05.2015 OP-1, OP-2, and OP-3
4. 11152530-A Central Railways 28.05.2015 OP-1, OP-2, and OP-3
5. 48156501 Central Railways 26.10.2015 OP-1, OP-2, and OP-3

6. 11161075 Central Railways 22.04.2016 OP-1, OP-2, and OP-3
7. 73160060 Central Railways 27.03.2017 OP-1, OP-2, and OP-3

8. 731600604 Central Railways 17.04.2017 OP-1, OP-2, and OP-3

9. 38181075 Central Railways 11.05.2018 OP-1 and OP-3
10. 51191807 Central Railways 23.08.2019 OP-1, OP-2, and OP-3

11. 07f 90117 Northern Railways 14.11.2019 OP-1, OP-2, and OP-3

12. 07200117A Northern Railways 01.12.2020 OP-1 and OP-2

21. In the view of the Commission, in light of the above evidences, there appears to be sort
of collusion between OP-1, OP-2, and OP-3 w.r.t. the tenders issued by the Indian
Railways for the procurement of polyacetal protective tubes.

22. In order to understand the exact nature of such collusion/coordination and the
involvement, if any, of any other OPs in such collusion/coordination, the Commission
proceeds to analyse various e-mail communications exchanged between the following
key representatives of the OPs between 18.11.2015 and 29.06.2020 with regard to
various tenders issued by the Indian Railways for the procurement of polyacetal
protective tubes:

Suo Motu Case No. 06 of 2020 16
Mr. Bhupesh Bafna
1. OP-1
Ms. Shanta Sohoni
2. OP-2 Mr. Bhupesh Bafna
3. OP-3 Mr. Bhupesh Bafna
Mr. Vishal Baid
4. OP-4 Mr. Rajeev Dudhani
Mr. Rajesh R.
5. OP-5 Mr. V. Chakrapani
Mr. Vishnu NM
6. OP-6 Mr. Harsha Gumballi
Mr. A. Venkata Subramanyam
7. OP-7 Mr. Keshav Bihani
23. Though an argument has been raised by OP-5 that such e-mail communications cannot
be relied upon as the same are not accompanied by a certificate in terms of Section 65B
of the Indian Evidence Act, 1872, the Commission in this regard notes that such
certificate is, in fact, available on record in support of the aforesaid e-mail
communications.

24. Relevant excerpts of the aforementioned e-mail communications are tabulated
hereunder:

Suo Motu Case No. 06 of 2020 17
S. E-mail (To and
Content of e-mail Observation
No. From)
Ms. Shanta Sohoni of It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
1. (Pl. Inform us as soon as tender gets finalise for update the position time to time)
OP-1 to OP-4 (P.S.: Pl. Discuss with us before quoting the tender where quantities are splited)
Subject: PT-AC.xlsx
Attachments: PT-AC.xlsx
Allotment of Protective Tubes
Account for Polyacetal Protective Tubes
S. Due Qty.
Rly. Tender No. Qty. PPPL JPPL
No. date dropped
1 ICF 02151253 12/06/15 23879 16137 7742
2 CR 11152530 30/04/15 4000 0 0 4000 Tender Ms. Shanta Sohoni divided the
3 NFR 30150013 30/07/15 1635 0 1635 dropped
forthcoming tenders on a
4 NFR 30150013-A 09/09/15 10978 5489 5489
Ms. Shanta Sohoni of quantity basis (75%-25%)
2. 5 SCR 30151051 23/09/15 8339 8339
OP-1 to OP-4 6 SR 04150910 23/09/15 11219 11219 between OP-1 Group (OP-1,
7 WCR 30151008-A 06/10/15 7810 7810 OP-2, and OP-3) and OP-4.
8 CR 48156501 26/10/15 1440 1440 She kept updating the same as
9 NWR 30151015 29/10/15 3269 3269 well.

Total Qty. 72569
Dropped Qty. 11742
Bal. Qty. 60827
75% PPPL 36496
25% JPPL 12165
Total Qty. 92042
Ms. Shanta Sohoni of Dropped Qty. 23097
3.
OP-1 to OP-4 Bal. Qty. 68945
75% PPPL 51709

Suo Motu Case No. 06 of 2020 18
S. E-mail (To and
Content of e-mail Observation
No. From)
25% JPPL 17236
Excess/ Shortage PPPL -527
Excess/ Shortage JPPL 527
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
(Pl. Inform us as soon as tender gets finalise for update the position time to time)
Mr. Rajeev Dudhani
OP-4 shared up-to-date
of OP-4 to Ms. Mam,
4. position with Ms. Shanta
Shanta Sohoni of Pl. see attached file regarding upto date position in P. Tube (orders received upto 21/03/2016)
Sohoni.
OP-1
Mr. Rajesh R. of OP-
5. 4 to Ms. Shanta -
Sohoni of OP-1
OP-4 to Ms. Shanta OP-4 asked for allocation of
6. Pl. send allocation for below tenders immediately
Sohoni of OP-1 new tenders. Ms. Shanta
Total Qty. 94892 Sohoni updated and divided
Dropped Qty. 28007 forthcoming tenders on
Bal. Qty. 66885 quantity basis (75%-25%)
75% PPPL 50164
Ms. Shanta Sohoni of between OP-1 Group (OP-1,
7. 25% JPPL 16721
OP-1 to OP-4 OP-2, and OP-3) and OP-4.
Excess/ Shortage PPPL -2,598
Excess/ Shortage JPPL 2,598
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
(Pl. Inform us as soon as tender gets finalise for update the position time to time)
Mr. Rajesh R. of OP- Pl. note that the following P. Tube tender due on 22/04/2016 OP-4 sought allocation for
8. 4 to Ms. Shanta C. Rly Tender No. 11161075 due on 22/04/2016 forthcoming tenders from OP-
Sohoni of OP-1 Kindly give allocation. 1.

Suo Motu Case No. 06 of 2020 19
S. E-mail (To and
Content of e-mail Observation
No. From)
Mr. Rajesh R. of OP-
Dear Mam,
9. 4 to Ms. Shanta
Pl. Give allocation for NCR tender no. 30161646 due on 14/06/2016.
Sohoni of OP-1
Mr. Rajeev Dudhani Mam,
of OP-4 to Ms. Pl. Give allocation for this tender and also give forthcoming tenders allocation.
10.
Shanta Sohoni of Regards
OP-1 Rajeev Dudhani
Total Qty. 97048
Dropped Qty. 29127
Bal. Qty. 67921
75% PPPL 50941
Ms. Shanta Sohoni of
11. 25% JPPL 16980
OP-1 to OP-4 Excess/ Shortage PPPL -701
Ms. Shanta Sohoni updated and
Excess/ Shortage JPPL 701
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
divided forthcoming tenders on
(Pl. Inform us as soon as tender gets finalise for update the position time to time) quantity basis (75%-25%)
Please see the attached file regarding update of P. Tube account. See the red colour remarks. between OP-1 Group (OP-1,
The attachment states as follows: OP-2, and OP-3) and OP-4.
Total Qty. 97048 In reply, OP-4 made certain
Mr. Rajeev Dudhani Dropped Qty. 29127
remarks in the table sent by
Bal. Qty. 67921
of OP-4 to Ms. Ms. Shanta Sohoni in red.
12. 75% PPPL 50941
Shanta Sohoni of 25% JPPL 16980
OP-1 Excess/ Shortage PPPL -701
Excess/ Shortage JPPL 701
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
(Pl. Inform us as soon as tender gets finalise for update the position time to time)

Suo Motu Case No. 06 of 2020 20
S. E-mail (To and
Content of e-mail Observation
No. From)
OP-4 asked Ms. Shanta Sohoni
OP-4 to Ms. Shanta
13. Pl. Issue Protective tube allocation for July 2016. to make allocations. Ms.
Sohoni of OP-1
Shanta Sohoni replied saying
Ms. Shanta Sohoni of allocation will be made after
14. Allotment will be made after 4th July 2016 because SWR tender will be opening on 11/7/16
OP-1 to OP-4 04.07.2016.
Total Qty. 97678
Dropped Qty. 32231
Bal. Qty. 65447 Ms. Shanta Sohoni updated and
75% PPPL 49085 divided forthcoming tenders on
Ms. Shanta Sohoni of
15. 25% JPPL 16362 quantity basis (75%-25%)
OP-1 to OP-4 Excess/ Shortage PPPL -2557 between OP-1 Group (OP-1,
Excess/ Shortage JPPL 2557 OP-2, and OP-3) and OP-4.
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
(Pl. Inform us as soon as tender gets finalise for update the position time to time)
For Protective tube also we are charging ED @ 6% and CST @ 5.5%
Ms. Shanta Sohoni of SWR tender was dropped because you have charged ED @ 12.5%.
Ms. Shanta Sohoni informed
16. OP-4 that SWR tender was
OP-1 to OP-4 If you are paying ED @ 12.5% for this item, then you have to reduce your basic rate to match our rate.
Pl. confirm dropped because of OP-4
Due to mistake we were quoted ED @ 12.5% but it is 6% only. charging higher excise duty.
OP-4 to Ms. Shanta So kindly confirm the rates to be quoted by JPPL for all the future tender as there is little bit increase in the rate of She stated that if OP-4 charged
17.
Sohoni of OP-1 Part - 1 (PPPL) rate.
higher Excise Duty, it has to
Please decide the final rate (basic + 6% +5.5%) for JPPL & PPPL.
Ms. Shanta Sohoni of Now, recent tender we have quoted Rs. 432 /- + ED 6 % + CST 5.5% + freight Rs. 35/- (depend on destination) reduce the basic rate to match
18. the rate with OP-1.
OP-1 to OP-4 You should quote 425/- +++...

Suo Motu Case No. 06 of 2020 21
S. E-mail (To and
Content of e-mail Observation
No. From)
Mr. Rajeev Dudhani OP-4 replied that it had quoted
of OP-4 to Ms. Thanks wrongly and what final rates
19. We will quote ICF & WCR tender basic 425 +6% +5.5% + Rs.35/- freight = Total Rs. 510.27 (all inclusive).
Shanta Sohoni of Pl. Confirm. should be quoted in the future.
OP-1
Total Qty. 147593
Dropped Qty. 32231 Ms. Shanta Sohoni updated and
Bal. Qty. 115362 divided forthcoming tenders on
75% PPPL 86522 quantity basis (75%-25%)
25% JPPL 28841 between OP-1 Group (OP-1,
Ms. Shanta Sohoni of Excess/ Shortage PPPL -2,557 OP-2, and OP-3) and OP-4. It
20. Excess/ Shortage JPPL 2,557
OP-1 to OP-4 was also advised to discuss
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
ATI got Part I status w.e.f. 11/07/16. Therefore, all tenders will be shared 75% - 25%. before quoting in tenders where
(Pl. Inform us as soon as tender gets finalise for update the position time to time) quantities are to be split. It is
Regards also mentioned that OP-2 got
PPPL approval as a Part I vendor.
(P.S.: Pl. Discuss with us before quoting the tender where quantities are splited)
Mr. Rajeev Dudhani
OP-4 pointed out to OP-1 the
of OP-4 to Ms. Mam,
21. Pl. see attachment file regarding the remark of JPPL for P. Tube accounts as on date 05/09/2016 remarks made by it in the
Shanta Sohoni of Rajeev Dudhani
attachment file sent by OP-1 to
OP-1
OP-4.
Mr. Rajesh R. of OP- Mam,
In reply, OP-1 stated that the
22. 4 to Ms. Shanta Pl. see P. tube accounts updated.
Pl. accommodate the surplus/ deficit figures in the accounts. allocation has been updated on
Sohoni of OP-1
the basis of remarks made by
Ms. Shanta Sohoni of
23. As per your remarks, updated statement is enclosed herewith. Future tender will be allotted accordingly. OP-4.
OP-1 to OP-4

Suo Motu Case No. 06 of 2020 22
S. E-mail (To and
Content of e-mail Observation
No. From)
Mam, OP-4 pointed out to OP-1 the
Mr. Rajesh R. of OP- Pl. see update accounts of PT.AC
remarks made by it in the
24. 4 to Ms. Shanta Regards
Rajesh attachment file sent by OP-1 to
Sohoni of OP-1
Jai Polypan OP-4.
Mr. Rajesh R. of OP-
Mam, OP-4 asked Ms. Shanta Sohoni
25. 4 to Ms. Shanta
Pl. send new allocation for forthcoming tenders of Protective tube. to make allocations.
Sohoni of OP-1
Total Qty. 168356
Dropped Qty. 39087 Ms. Shanta Sohoni updated and
Bal. Qty. 129269 divided forthcoming tenders on
75% PPPL 96952 quantity basis (75%-25%)
25% JPPL 32317 between OP-1 Group (OP-1,
Ms. Shanta Sohoni of Excess/ Shortage PPPL 8,092 OP-2, and OP-3) and OP-4. It
26. Excess/ Shortage JPPL -6,997
OP-1 to OP-4 was also advised to discuss
It is decided that we will do this business on quantity basis. Sharing will be 75% - 25% basis.
ATI got Part I status w.e f. 11/07/16. Therefore, all tenders will be shared 75% - 25%. before quoting in tenders where
(Pl. Inform us as soon as tender gets finalise for update the position time to time) quantities are to be split. It is
Regards again mentioned that OP-2 got
PPPL approval as a Part I vendor.
(P.S.: Pl. Discuss with us before quoting the tender where quantities are splited)
While seeing the comparative statement of CR tender, it is clear that we will not get order for Polyacetal Protective OP-4 informed OP-1 that, since
Mr. Rajeev Dudhani Tube and the rate is very higher than metal protective tube. the Central Railways tender has
In future we will get any information regarding the issue or order from CR we will inform you.
of OP-4 to Ms. not been allotted to OP-4, the
27. Pl. allot forthcoming tenders of Protective tube while in LT or OT.
Shanta Sohoni of Also note as per our Kolkata office Tender No. 11155165C opened on 5/5/2017(Polyacetal tubes), the order issued to same should be removed from
OP-1 BBC for full qty. its account under the cartel
If you have any information for this tender. arrangement.

Suo Motu Case No. 06 of 2020 23
S. E-mail (To and
Content of e-mail Observation
No. From)
Please remove this amount from our account against this tender.
Regards
Rajeev Dudhani
JPPL
Mr. Rajesh R. of OP-
Mam,
28. 4 to Ms. Shanta
Pl. issue allocations for coming tenders in August, 2017 for Protective tube.
Sohoni of OP-1
S. Tender Qty.
Rly. Due date Qty. PPPL JPPL Polymer
No. No. dropped
1 SCR 30171051 16/08/2017 9563 7650 1913
2 SR 04170910 16/08/2017 6590 5272 1318 OP-4 asked Ms. Shanta Sohoni
3 WCR 30171008 29/08/2017 10413 8330 2083 to make allocations.
Total 26566 15981 5272 5313 0 Ms. Shanta Sohoni divided
forthcoming tenders on
Ms. Shanta Sohoni of Earlier Earlier Net Excess/ quantity basis (60%-20%-
OP-1 to Mr. Harsha Excess Shortage Shortage
29. 20%) between OP-1 Group
Gumballi of OP-6 Total Qty. 26566
Dropped Qty. 0 (OP-1, OP-2, and OP-3), OP-4,
and OP-4
Bal. Qty. 26566 and OP-6.
60% PPPL 15940 6997 22937
20% JPPL 5313 8092 -2779
20% Polymer 5313
It is decided that we will do this business on quantity basis. Sharing will be 20% for each firm. Polyset is having 3
firms therefor share of Polyset will be 60%, JPPL 20% & Polymer 20%
(Pl. Inform us as soon as tender gets finalise for update the position time to time)
For S.C. Rly. Tender 30171051 due on 16/08/2017, Polyset will quote Basic Rate Rs. 441/- + Freight Rs. 38/- per pc.
Ms. Shanta Sohoni of OP-1 informed rates to be
30. +GST @5% = Total Rs. 502.95 per pc. (all inclusive).
OP-1 to OP-4 and Polymer is requested to quote Rs. 432/- + Freight Rs. 35/- +GST @5% = Total Rs. 490.35 per pc. (all inclusive). quoted in the South Central

Suo Motu Case No. 06 of 2020 24
S. E-mail (To and
Content of e-mail Observation
No. From)
Mr. Harsha Gumballi Non - allotties should quote minimum 8% higher than above rates. Railway tender to OP-4 and
of OP-6 Regards OP-6.
Shanta Sohoni
OP-4, in reply, inquired about
What rate to be quoted below tenders by JPPL & Polymer.
Mr. Rajeev Dudhani Kindly decide and inform us. the rates to be quoted in
of OP-4 to Ms. S. Tender Southern Railway and West
31. Rly. Due Date Qty. PPPL JPPL Polymer
Shanta Sohoni of No. No. Central Railways tenders also.
OP-1 1 SR 04170910 16/08/2017 6590 5272 1318
2 WCR 30171008 29/08/2017 10413 8330 2083
OP-4 informed OP-1 that it
could not get the Central
Protective tender for Central Railway allotted to us. But it was both metal and polyacetal P. Tube tender and P. Tube
Railways tender, as vendors of
metal-based protective tubes
Mr. Rajesh R. of OP- (Metal) parties have quoted low rates hence we are not getting order and kindly remove this qty. from our account and
issue fresh allocations for the forth coming tenders. Also let me know the status of SWR tender where we both are had quoted a lower price.
32. 4 to Ms. Shanta equally allotted.
Hence, it requested OP-1 to
Sohoni of OP-1 Details of tender CR
remove such quantity from the
CR 11171075 21/07/17 10284 10284
allocation table under cartel
arrangement and issue fresh
allocations.
Earlier Excess Ms. Shanta Sohoni divided
Ms. Shanta Sohoni of Total Qty. 43005 forthcoming tenders on
Dropped Qty. 1201
OP-1 to Mr. Harsha quantity basis (60%-20%-
33. Bal. Qty. 41804
Gumballi of OP-6 60% PPPL 25082 -988
20%) between OP-1 Group
and OP-4 20% JPPL 8361 1173 (OP-1, OP-2, and OP-3), OP-4,
20% Polymer 8361 -184 and OP-6.

Suo Motu Case No. 06 of 2020 25
S. E-mail (To and
Content of e-mail Observation
No. From)
It is decided that we will do this business on quantity basis. Sharing will be 20% for each firm. Polyset is having 3
firms therefor share of Polyset will be 60%, JPPL 20% & Polymer 20%
(Pl. Inform us as soon as tender gets finalise for update the position time to time)
Mr. Rajesh R. of OP-
34. 4 to Ms. Shanta -
Sohoni of OP-1 OP-4 asked Ms. Shanta Sohoni
Mr. Rajesh R. of OP- to make allocations.
35. 4 to Ms. Shanta Pl. issue allocation for SWR Tender No. 30171519 due on 12/01/2108 for 87725 nos. immediately.
Sohoni of OP-1
Ms. Shanta Sohoni gave a price
Ms. Shanta Sohoni of For NFR due 06/03/2018, Polyset will quote Rs. 441/- + Freight Rs. 40/- per pc + GST @ 5% extra = Total Rs. quote of OP-1 for NFR tender
OP-1 to Mr. Harsha 505.05 (All incl)
36. and asked non-allotties and
Gumballi of OP-6 Non-allotties should quote 8-10% higher than PLR and Polymer Products is requested to quote 8-10% higher rate
than PLR because his account is surplus OP-6 to quote 8-10% higher
and OP-4
than PLR.
Earlier Excess
Ms. Shanta Sohoni updated and
Total Qty. 86535
Dropped Qty. 13138
divided forthcoming tenders on
Bal. Qty. 73397 quantity basis (60%-20%-
Ms. Shanta Sohoni of 60% PPPL 44038 1439 20%) between OP-1 Group
37.
OP-1 to OP-4 20% JPPL 14679 -787 (OP-1, OP-2, and OP-3), OP-4,
20% Polymer 14679 -651 and OP-6.
It is decided that we will do this business on quantity basis. Sharing will be 20% for each firm. Polyset is having 3
In reply, OP-4 asked Ms.
firms therefor share of Polyset will be 60%, JPPL 20% & Polymer 20%
(Pl. Inform us as soon as tender gets finalise for update the position time to time)
Shanta Sohoni to provide rates
Mr. Rajesh R. of OP- Dear Mam, for WCR tender, and Ms.
38. Shanta Sohoni supplied the
4 to Ms. Shanta Pl. send the rates we have to quote in the below P. Tube tender immediately.

Suo Motu Case No. 06 of 2020 26
S. E-mail (To and
Content of e-mail Observation
No. From)
Sohoni of OP-1 Rly. Tender No. Due Date Qty. PPPL JPPL Polymer rates to be quotes rates of both
WCR 30181008 29/05/2018 7910 3164 3164 1582 OP-1 and OP-4, to which OP-4
Polyset will quote Rs. 441/- + Freight Rs. 35/- per pc. + GST @ 5% = Total Rs. 499.80 per pc all incl
Ms. Shanta Sohoni of agreed.
39. JPPL will quote Rs. 441/- + Freight Rs. 40/- per pc. + GST @ 5% = Total Rs. 505.05 per pc all incl.
OP-1 to OP-4 Pl. confirm
OP-4 to Ms. Shanta
40. OK. We will quote as per your mail.
Sohoni of OP-1
Ms. Shanta Sohoni updated and
Ms. Shanta Sohoni of divided forthcoming tenders on
It is decided that we will do this business basis. Sharing will be 20% for each firm. Polyset is having 3 firms therefore
OP-1 to OP-4 and quantity basis (60%-20%-
41. share of Polyset will be 60%, JPPL 20% & Polymer 20%.
Mr. Harsha Gumballi (Pl. Inform us as soon as tender gets finalize for update the position time to time) 20%) between OP-1 Group
of OP-6 (OP-1, OP-2, and OP-3), OP-4,
and OP-6.
Earlier Excess
Total Qty. 100792
Dropped Qty. 14483
Ms. Shanta Sohoni updated and
Bal. Qty. 86309 divided forthcoming tenders on
Ms. Shanta Sohoni of 60% PPPL 51785 397 quantity basis (60%-20%-
42.
OP-1 to OP-4 20% JPPL 17262 186 20%) between OP-1 Group
20% Polymer 17262 -582 (OP-1, OP-2, and OP-3), OP-4,
It is decided that we will do this business basis. Sharing will be 20% for each firm. Polyset is having 3 firms therefore
and OP-6.
share of Polyset will be 60%, JPPL 20% & Polymer 20%.
(Pl. Inform us as soon as tender gets finalize for update the position time to time)
Mr. Rajesh R. of OP- Pl. see the attachment file regarding our updated accounts. OP-4 asked OP-1 to see the
43. 4 to Ms. Shanta Also please refer our earlier mail dt. 8/8/2018 for SWR tender 100 Nos. attachment file regarding its
Sohoni of OP-1 Kindly update our account and issue allocation accordingly. updated accounts and updated

Suo Motu Case No. 06 of 2020 27
S. E-mail (To and
Content of e-mail Observation
No. From)
OP-4's allocation accordingly.
Earlier Excess
Total Qty. 123682
Dropped Qty. 14483
Ms. Shanta Sohoni updated and
Bal. Qty. 1091199 divided forthcoming tenders on
Ms. Shanta Sohoni of 60% PPPL 65519 215 quantity basis (60%-20%-
44.
OP-1 to OP-4 20% JPPL 21840 808 20%) between OP-1 Group
20% Polymer 21840 -1022 (OP-1, OP-2, and OP-3), OP-4,
It is decided that we will do this business basis. Sharing will be 20% for each firm. Polyset is having 3 firms therefore
and OP-6.
share of Polyset will be 60%, JPPL 20% & Polymer 20%.
(Pl. Inform us as soon as tender gets finalize for update the position time to time)
Earlier Excess
Total Qty. 131139
Dropped Qty. 14483
Ms. Shanta Sohoni updated and
Bal. Qty. 116656 divided forthcoming tenders on
Ms. Shanta Sohoni of 60% PPPL 69994 -1276 quantity basis (60%-20%-
45.
OP-1 to OP-4 20% JPPL 23331 2300 20%) between OP-1 Group
20% Polymer 23331 -1022 (OP-1, OP-2, and OP-3), OP-4,
It is decided that we will do this business basis. Sharing will be 20% for each firm. Polyset is having 3 firms therefore
and OP-6.
share of Polyset will be 60%, JPPL 20% & Polymer 20%.
(Pl. Inform us as soon as tender gets finalize for update the position time to time)

Suo Motu Case No. 06 of 2020 28
S. E-mail (To and
Content of e-mail Observation
No. From)

OP-4 informed OP-1 about the
Mr. Rajesh R. of OP- NWR tender JPPL will quote Rs. 479/- basic + 5% GST = Rs. 502.95 per pc.
Pl. Confirm the rates. PPPL & JPPL are equally allotted in this tender. price it would quote in North
46. 4 to Ms. Shanta
Regards Western Railway tender and
Sohoni of OP-1 Rajesh Nair requested OP-1 to confirm, as
the said tender was allocated
equally between OP-1 and O-4.
In reply, OP-1 informed OP-4
Recently we have received the order @ Rs. 463.50 per pc. + Freight Rs. 35/- per pc. + GST 5% = Total Rs. 523.42
Ms. Shanta Sohoni of per pc. (All incl.) about its price and the price
47. that OP-4 should quote.
OP-1 to OP-4 You are requested to quote Rs. 498.50 + GST 5% = Rs. 523.42 all incl.
Pl. Confirm. OP-4 then informed OP-1 that
it has submitted a revised bid
Mr. Rajesh R. of OP- OK. As per our discussion, I have submitted revised BID today @ 498.50 + 5% GST. on the basis of discussions
48. 4 to Ms. Shanta Regards between OP-1 and OP-4.
Sohoni of OP-1 Rajesh Nair
OP-4 asked OP-1 to see its
Mr. Rajesh R. of OP- Pl. see the updated P. Tube account.
updated accounts sent as
49. 4 to Ms. Shanta Our excess pcs=449 Nos. only instead of 2300 Nos.
Pl. update the same in the record issue coming allocation accordingly. attachment and update OP-4's
Sohoni of OP-1
allocation accordingly.
Mr. Rajesh R. of OP- Pl. issue allocation for tender No. 30181519 SWR due on 5/2/2019 for P. Tube OP-4 asked Mr. Shanta Sohoni
Urgent to make allocations for South
50. 4 to Ms. Shanta
Thanks and Regards,
Sohoni of OP-1 Rajesh Nair
Western Railway tender.
In reply, Ms. Shanta Sohoni
51. Ms. Shanta Sohoni of informed OP-4 to quote 8-10%
Subject: Allotment of SWR Protective tube due 5-2-2019

Suo Motu Case No. 06 of 2020 29
S. E-mail (To and
Content of e-mail Observation
No. From)
OP-1 to OP-4 Pl. quote strictly 8-10% higher than PLR (PLR Rs. 441/- + Freight Rs. 35/- + GST 5% = 499.80 all incl) higher than the Price List Rates
in SWR tender.
Earlier Excess
Total Qty. 142685
Dropped Qty. 19960
Ms. Shanta Sohoni updated and
Bal. Qty. 122725 divided forthcoming tenders on
Ms. Shanta Sohoni of 60% PPPL 73635 -734 quantity basis (60%-20%-
52.
OP-1 to OP-4 20% JPPL 24545 2783 20%) between OP-1 Group
20% Polymer 24545 -2048 (OP-1, OP-2, and OP-3), OP-4,
It is decided that we will do this business basis. Sharing will be 20% for each firm. Polyset is having 3 firms therefore
and OP-6.
share of Polyset will be 60%, JPPL 20% & Polymer 20%.
(Pl. Inform us as soon as tender gets finalize for update the position time to time)
Rama Engineering joined the pool w.e f. 19/06/2019 Ms. Shanta Sohoni informed
We have made allotment accordingly with discussion with REW. that OP-5 has also joined the
Earlier Excess/ Allotted Net Excess/
Ms. Shanta Sohoni of Firm Share cartel and circulated a new
Shortage Qty. Shortage
53. OP-1 to OP-4 and PPPL (3) 60% -3483 6894 2086
allotment with sharing pattern
OP-5 JPPL (1) 20% 3483 2298 212 of 60%-20%-20% in quantity
REW (1) 20% 0 2298 -2298 distribution amongst OPs 1, 2,
Total 100% 0 11490 0 and 3, OP-4, and OP-5.
Ms. Shanta Sohoni sent an
We have worked out earlier account taking 80% in account and accordingly excess/shortage taken into new account. earlier allocation on a quantity
Earlier working file is enclosed herewith for your reference.
Ms. Shanta Sohoni of basis (60%-20%-20%)
54. It is decided that we will do this business on quantity basis. Sharing will be 20% for each firm
OP-1 to OP-4 Polyset is having 3 firms therefore share of Polyset will be 60%, JPPL 20% & Polymer 20% between OP-1 Group (OP-1,
(Pl. inform us as soon as tender gets finalise for update the position time to time) OP-2, and OP-3), OP-4, and
OP-6. She stated that, based on

Suo Motu Case No. 06 of 2020 30
S. E-mail (To and
Content of e-mail Observation
No. From)
earlier excess/shortage, new
allocation has been made.
Subject: PT allotment
Attachments: PT2-AC.xlsx
Account for Polyacetal Protective Tubes
M/s. Hari Narayan Bihani, Jaipur got approval Ms. Shanta Sohoni informed
PLR : Rs. 454/- + Freight Rs. 40/- + GST @ 5% that OP-7 has also joined the
(Non-allotties should quote 8% to 10% higher than PLR) cartel and circulated new
S. Tender Total Allotted Qty.
Rly. Due date PPPL JPPL REW HNB allotment with sharing pattern
No. No. Qty. Qty. dropped
1 WCR 30191008 11/07/2019 11452 9162 1832 1832 0 5497 of 50%-16.67%-16.67%-
2 SR 04190910 29/07/2019 2892 2314 2314 16.67% in quantity distribution
Ms. Shanta Sohoni of 3 SCR 30191051 06/08/2019 9940 7952 4771 3181 5497 amongst OPs 1, 2, and 3, OP-4,
55. OP-1 to OP-5, OP-4, Total 24284 19427 8918 1832 3181 5497 0 OP-5, and OP-7. The PLR to
and OP-7 be quoted by the vendor who
Dropped 0
has been allotted a tender was
Balance 19427
also circulated and it was stated
Earlier Excess(-)/ Allotted Net Excess(+)/ that suppliers who are not
Firm Share
Shortage(+) Qty. Shortage(-) allotted a tender under cartel
PPPL (3) 50.00% 5229 9714 -6025 should quote 8%-10% higher
JPPL (1) 16.67% -5811 3239 4405 than PLR.
REW (1) 16.67% 582 3239 -640
HNB 16.67% 0 3239 2258
Total 1 0 19429 -2
Dropped 0
Ms. Shanta Sohoni of Ms. Shanta Sohoni circulated
56. Balance 26857
OP-1 to OP-7, OP-5, the revised allotment with

Suo Motu Case No. 06 of 2020 31
S. E-mail (To and
Content of e-mail Observation
No. From)
and OP-4 Firm Share
Earlier Excess(-)/ Allotted Net Excess(+)/ sharing pattern of 50%-
Shortage(+) Qty. Shortage(-) 16.67%-16.67%-16.67% in
PPPL (3) 50.00% 5229 13429 -7083
quantity distribution amongst
JPPL (1) 16.67% -5811 4477 3166
REW (1) 16.67% 582 4477 2893
OPs 1, 2, and 3, OP-4, OP-5,
HNB 16.67% 0 4477 1021 and OP-7.
Total 1 0 26860 -3

Dropped 0
Ms. Shanta Sohoni again
Balance 27756
circulated the revised allotment
Ms. Shanta Sohoni of Earlier Excess(-)/ Net Excess(+)/ with sharing pattern of 50%-
Firm Share Allotted Qty.
57. OP-1 to OP-7, OP-5, Shortage(+) Shortage(-) 16.67%-16.67%-16.67% in
and OP-4 PPPL (3) 50.00% 5229 13878 -5132 quantity distribution amongst
JPPL (1) 16.67% -5811 4627 3016
OPs 1, 2, and 3, OP-4, OP-5,
REW (1) 16.67% 582 4627 1243
and OP-7.
HNB 16.67% 0 4627 871
Total 1 0 27759 -2
M/s. Polymer Products India Ltd., Bangalore got approval as approved supplier of Polyacetal Protective tube w.e f. Ms. Shanta Sohoni sent an e-
26/09/2019 and join the pool.
Hence, we have revised our working and allotment of new tenders are given in the enclosed statement.
mail to other OPs stating that
Ms. Shanta Sohoni of
All are requested to quote your tender accordingly. OP-6 has got approval, and
OP-1 to Mr. Harsha
Non- allotties should quote min. 8-10% higher than PLR. accordingly, the allocation
58. Gumballi and Mr. For any doubt pl. discuss before quoting. table has been revised. The
Surya of OP-6, OP-7, M/s. Hari Narayan Bihani, Jaipur got approval PLR to be quoted by the
OP-5, and OP-4 PLR : Rs. 454/- + Freight Rs. 40/- + GST @ 5%
(Non-allotties should quote 8% to 10% higher than PLR)
vendor who has been allotted a
Firm Share Earlier Excess(-)/ Allotted Qty. Net Excess(+)/ tender was also circulated and

Suo Motu Case No. 06 of 2020 32
S. E-mail (To and
Content of e-mail Observation
No. From)
Shortage(+) Shortage(-) it was stated that suppliers who
PPPL (3) 42.80% -9532 13016 -4340 are not allotted a tender under
JPPL (1) 14.30% 4483 4349 134
cartel should quote 8%-10%
REW (1) 14.30% 2710 4349 -348
higher than PLR.
HNB 14.30% 2338 4349 101
PPI 14.30% 0 4349 4451 In reply, Mr. Venkata of OP-6
Total 1.00 -1 30410 -1 stated that only tenders quoted
from the date of their entry into
the cartel should be considered
in the allocation table, and
tenders prior to that should not
Mr. Venkata
be considered.
Subramanyam of OP- We are in the group from day before so please consider from that day as our entry, tenders quoted before by us do not
59. On the other hand, OP-4
6 to Ms. Shanta consider
informed that, since the
Sohoni of OP-1
vendors, prior to joining the
cartel, underquoted and got the
tenders on their joining, such
JPPL cannot accept the points raised by Polymer Products. tenders which they got prior to
Mr. Rajesh R. of OP- Every time one member is coming with big underquoting and joining the pool. It is not possible.
joining the cartel should be
4 to Mr. Venkata Polymer products should aware that pool is running in P. Tube. Then how we can accept this type of query.
accounted for in their account
60. Subramanyam of OP- Our opinion is that where ever the tenders goes to them before joining should be accounted in their account for
in the allocation table under
6 and Ms. Shanta smooth running of pool otherwise there is no meaning to run the pool.
It was very painful to say that we are not getting any business from this pool such type of quoting by firms. cartel arrangement. The
Sohoni of OP-1
This is for information to all members. previous underquoting by OP-6
(which was done independently
by OP-6) hampered smooth

Suo Motu Case No. 06 of 2020 33
S. E-mail (To and
Content of e-mail Observation
No. From)
functioning of the pool.

Shanta Sohoni to OP-
Ms. Shanta Sohoni sent an e-
5, OP-7, Mr. Venkata
mail to other OPs to hold a
61. Subramanyam of OP- -
meeting of the approved
6, and Mr. Vishal
vendors to discuss the business
Baid of OP-4
of polyacetal protective tubes.
Mr. V. Chakrapani of
In reply, OP-5 stated that any
OP-5 to Ms. Shanta Subject: Re: Meeting regarding business of Protective Tube
62. date for meeting with prior
Sohoni with CC to Any date with prior intimation is OK for me
intimation is fine for it.
other OPs
Ms. Shanta Sohoni circulated
new allotment with sharing
PLR : Rs. 454/- + Freight Rs. 40/- + GST @ 5% pattern of 42.8%-14.3%-
(Non-allotties should quote 8% to 10% higher than PLR) 14.3%-14.3%-14.3% in
Ms. Shanta Sohoni of Earlier Excess(-)/ Net Excess(+)/ quantity distribution amongst
Firm Share Allotted Qty.
Shortage(+) Shortage(-)
OP-1 to OP-7, Mr. OPs 1, 2, and 3, OP-4, OP-5,
PPPL (3) 42.80% -10047 14645 -5277
63. Harsha Gumballi, JPPL (1) 14.30% 4655 4893 -238
OP-6, and OP-7. The PLR to
and Mr. Surya of OP- REW (1) 14.30% 2882 4893 -721 be quoted by the vendor who
6, OP-5, and OP-4 HNB (1) 14.30% 2510 4893 1042 has been allotted a tender was
PPI (1) 14.30% 0 4893 5194 also circulated and it was stated
Total 1.00 -1 34217 -1 that suppliers who are not
allotted a tender under cartel
should quote 8%-10% higher

Suo Motu Case No. 06 of 2020 34
S. E-mail (To and
Content of e-mail Observation
No. From)
than PLR.
As per WCR officials order goes to HNB and Polyset. OP-4 complained to OP-1
Pl. see the allocation below: about the allotment of Western
S. Tender Total Allotted Central Railway tender to OP-1
Mr. Rajesh R. of OP- Rly. Due date PPPL JPPL REW HNB
No. No. Qty. Qty.
and OP-7. It stated that it has
64. 4 to Ms. Shanta 1 WCR 30191008 11/07/2019 11452 9162 1832 1832 0 5496
Pl. confirm whether you have received the order and how much quantity. HNB confirmed the order received. only supplied 2900 quantity in
Sohoni of OP-1
Kindly remove 1832 Nos. from our PT2 account and accordingly issue coming allocations. the year to ICF, and so, how
During the whole year we have supplied only 2900 Nos. to ICF. can it run its factory in such
How can we run our factory with this pool. pool?
Earlier Excess(-)/ Net Excess(+)/
Ms. Shanta Sohoni of Firm Share Allotted Qty. Ms. Shanta Sohoni again
Shortage(+) Shortage(-)
OP-1 to OP-5, OP-4, PPPL (3) 42.80% -8871 17352 -3355 circulated sharing pattern of
and Mr. Harsha JPPL (1) 14.30% 2823 5798 -813 42.8%-14.3%-14.3%-14.3%-
65.
Gumballi and Mr. REW (1) 14.30% 2882 5798 -666 14.3% in quantity distribution
Surya of OP-6 and HNB (1) 14.30% 3166 5798 543 amongst OPs 1, 2, and 3, OP-4,
PPI (1) 14.30% 0 5798 4289
OP-7 OP-5, OP-6, and OP-7.
Total 1.00 -1 40542 -1
Above mentioned tender is allotted between Polyset and Jai Polypan. Ms. Shanta Sohoni of
Ms. Shanta Sohoni of Polyset will quote Rs. 454.50 + Freight Rs. 40/- + GST 12% = Rs. 553.84 per pc all incl.
66. OP-1 provided the rates to be
OP-1 to OP-4 Jai Polypan will quote Rs. 460/- + Freight Rs. 45/- + GST 12% = Rs. 560.60 per pc all incl.
Pl. confirm the same. quoted in tender allotted to
Mr. Rajesh R. of OP- Mam, both OP-1 and OP-4, to OP-4.
OK. JPPL will quote 460+45+12% = 565.60 per pc all incl. In response, OP-4 confirmed
67. 4 to Ms. Shanta
Regards that it will quote the price
Sohoni of OP-1 Rajesh Nair
given by OP-1.
Polymer Products underquoted in this tender. Why??
68. Mr. R. Nair of OP-4 However, later, OP-4
Last year in WCR tender HNB taken our quantity and now this year ICF Polymer Products. How can we run the pool.

Suo Motu Case No. 06 of 2020 35
S. E-mail (To and
Content of e-mail Observation
No. From)
to Ms. Shanta Sohoni During the year 2019-2020 we have only supplied 2900 Pcs. P. Tubes then how can we run our factory?????? complained to OP-1 that while
of OP-1 What is the use of this pool???? ICF tender was allotted to OP-
Regards
1 and OP-4, OP-6 underquoted
Rajesh Nair
Ms. Shanta Sohoni of in the same without any
OP-1 to Mr. Harsha intimation.
ICF tender was allotted to Polyset and Jai Polypan.
Gumballi, Mr. Surya, In turn, OP-1 advised OP-6 to
How Polymer Products underquoted without any advance intimation and also l3-14% lower than the PLR.
69.
and Mr. Venkata You are requested to withdraw your offer immediately and copy of withdrawal letter should be forwarded to us for withdraw its offer immediately.
Subramanyam of OP- confirmation. Thereafter, OP-4 can be seen
6 asking OP-1 about the status of
OP-6's withdrawal.
Mr. Rajeev Dudhani
Have u received withdrawal letter from Polymer products ? ? ?
of OP-4 to Ms.
70. What is the next step for pool???
Shanta Sohoni of Rajeev Dudhani
OP-1
Mr. Rajeev Dudhani
of OP-4 to Ms. What is the status of withdrawal letter. It seems that Polymer products is not interested in pool?
71.
Shanta Sohoni of If they not withdraw their offer then it will be very difficult to continue pool.
OP-1
Ms. Shanta Sohoni sent
Ms. Shanta Sohoni of allotment for Southern Railway
OP-1 to OP-5, OP-7, Allotment for SR tender due on 01/07/2020 for Protective tube is sent herewith. tender and requested other OPs
All are requested to quote the rate as per allotment without underquoting.
72. OP-4, and Mr. to quote rates as per allocation
We have revised the share pattern which may please be noted.
Harsha Gumballi and table without undercutting. She
Mr. Surya of OP-6 also informed the revised share
pattern.

Suo Motu Case No. 06 of 2020 36
25. From the above e-mails, it is very clear that there were communications between the
OPs w.r.t. the tenders issued by the various zonal railways for the procurement of
polyacetal protective tubes. The aforesaid communications clearly indicate the modus
operandi of the collusion/coordination in the form of cartel pool amongst the OPs,
which includes the allocation/allotment of tenders amongst the OPs, revision of sharing
pattern, induction of new members to the pool, calculation methods to arrive at the
price to be quoted, discussion on rates to be quoted, complaints regarding undercutting,
and communication amongst OPs to withdraw offers. Such arrangement between the
OPs led to manipulation of Indian Railways' bidding process for the procurement of
polyacetal protective tubes.

26. The modus operandi of the cartel arrangement emanating from the e-mail
communications between the parties seems to be that Ms. Shanta Sohoni, an employee
of OP-1 (as well as on behalf of OP-2 and OP-3), used to make allocation of tenders
between the OPs. Usually, an e-mail was circulated from Ms. Shanta Sohoni of OP-1
(and also on behalf of OP-2 and OP-3) to the other OPs (OP-4, OP-5, OP-6, and OP-7)
allocating forthcoming tenders in total for the period ahead, revising the previously
allocated quantity on the basis of excess/shortage value, and also informing and
discussing the prices to be quoted.

27. Ms. Shanta Sohoni kept a record of all the forthcoming tenders of Indian Railways
updated online on the Indian Railways E-Procurement System (IREPS). She allocated
tenders on the basis of allotment value (a decided percentage (%) distribution of
tenders) to each member, which was maintained similar to an account statement. In this
regard, allocation tables were also maintained which also mentioned earlier
shortage/excess value and allocated value with net excess. Therefore, tenders were
allocated in compliance with the allocation done/allotment share. There were also
instances where tenders were allocated to more than one member/vendor/supplier as
agreed. In such cases, members mutually agreed to a price before filing the bids. Ms.
Shanta Sohoni communicated the basic price which the designated vendor should quote
in the allocated tender. Thereafter, the vendors communicated the price based on their
respective additional taxes and arrived at a mutually agreed price over e-mails for
submitting the bids. It is also seen from the e-mails that Ms. Shanta Sohoni also
instructed the members of the cartel via e-mail that non-allottee vendors should quote

Suo Motu Case No. 06 of 2020 37
prices that are 8-10% higher than the basic prices agreed by members. In course of
time, various players/vendors kept adding to the pool and the share of each member
was adjusted accordingly in order to accommodate new players.

28. The existence of such cartel pool/arrangement between the OPs was also acknowledged
by Ms. Shanta Sohoni and Mr. Bhupesh Bafna of OPs 1, 2, and 3 in their statements
recorded before as well as by OP-4 in its lesser penalty application.

29. Hence, the following is clearly established from the material on record:

(a) OP-1, OP-2, and OP-3

• They are sister concerns with common partners/directors, who submitted bids
in multiple railway tenders from common IP addresses;

• There are several e-mail communications sent and received by Ms. Shanta
Sohoni to/from competitors from November 2015 to June 2020, and several
CC'ed to Mr. Bhupesh Bafna, wherein allocation of tenders, discussion on
prices, complaints regarding undercutting, and OPs asking other OPs to
withdraw their bids, were made;

• Representatives of these OPs, Ms. Shanta Sohoni and Mr. Bhupesh Bafna,
admitted the cartel arrangement in their respective statements recorded before
the DG.

(b) OP-4

• In its lesser penalty application, OP-4 admitted to the cartel arrangement
described above;

• As can be seen from the aforementioned e-mail communications, several e-
mail communications were sent and received by Mr. Rajesh R. and Mr. Rajeev
Dudhani to/from competitors from November 2015 to June 2020, wherein
allocation of tenders, discussion on prices, complaints regarding undercutting,
and OPs asking other OPs to withdraw their bids, were made.

• There were several e-mail communications received by OP-5 from Ms. Shanta
Sohoni of OP-1 from June 2019 to June 2020. In the e-mail dated 19.06.2019

Suo Motu Case No. 06 of 2020 38
sent by Mr. Shanta Sohoni to competitors, it is stated that OP-5 has joined the
cartel pool from 19.06.2019, and it can be seen that 20% share is allocated to
it. Thereafter, in the e-mail dated 25.07.2019, it can be seen that the share of
OP-5 is revised to 16.67%. Then, again, e-mails dated 20.09.2019, 07.10.2019,
and 11.11.2019 were marked by Ms. Shanta Sohoni to OP-5 allocating various
upcoming tenders. In fact, when Ms. Shanta Sohoni proposed holding of a
meeting vide e-mail dated 15.11.2019 to discuss the business of polyacetal
protective tubes, in reply thereto, Mr. V. Chakrapani of OP-5 agreed to the
meeting on any date with prior intimation to him. In the opinion of the
Commission, OP-5 was clearly part of the cartel arrangement post June 2019,
when it became a Part I vendor as a percentage share and multiple tenders
were allocated to it, and by even receiving and even replying to such e-mails
from its competitors, OP-5 was not only privy to the information contained in
these e-mails, which also, at times, related to prices to be quoted by the
vendors in the tenders floated, but also, at one instance, agreed to meet its
competitors. This compromised the independence of the OPs while giving
quotations to the Railways. In the e-mail dated 03.02.2020 marked to OP-5
also, its share was revised to 14.30%, which continued to remain the same in
the e-mail dated 16.03.2020. However, vide e-mail dated 29.06.2020 marked
to OP-5 also, the share of OP-5 was revised.

• Though OP-5 has made an argument that mere price parallelism cannot be a
ground to arrive at a conclusion of bid rigging, specifically in a monopsonist
market, the Commission observes that, in the present matter, manipulation of
the bidding process by the OPs is largely evident from the communications
regarding allocations of tenders and price quotations exchanged between them.

(d) OP-6

• There are several e-mail communications received by Mr. Harsha Gumballi,
Mr. Surya, and Mr. Venkata Subramanyam from Ms. Shanta Sohoni of OP-1
and other OPs from August 2017 to July 2018 (as Part II vendor), then again
from October 2019 (after OP-6 got approval as Part I vendor on 26.09.2019) to
June 2020. As a Part II vendor, e-mails dated 05.08.2017, 10.08.2017,

Suo Motu Case No. 06 of 2020 39
29.11.2017, 01.03.2018, and 17.07.2018 were received by OP-6. In the e-mails
dated from 05.08.2017 till May 2019, 20% share has been allocated to OP-6.
In fact, in the e-mail dated 10.08.2017, Ms. Shanta Sohoni even provides OP-6
the rate to be quoted by it in the upcoming tender. Hence, the argument of OP-
6, that it was not a part of the cartel arrangement between the OPs any time
before September 2019, when it became a Part I vendor, cannot be accepted.

• Thereafter, in reply to the e-mail dated 11.11.2019, Mr. Venkata
Subramanyam, vide e-mail dated 12.11.2019, stated that allotment should be
considered only from the date of OP-6's entry in the cartel group, and tenders
quoted prior to its entry should not be considered. Thereafter, multiple e-mails
dated 15.11.2019 (for meeting), 03.02.2020, 16.03.2020, 29.06.2020, etc.,
were received by OP-6.

• OP-6 has argued that even if it was informed about any rate to be quoted, it
flatly ignored the same and quoted independent and competitive rates to the
Indian Railways, which is evident from the e-mails whereby complaints
regarding OP-6 undercutting is made. However, in the opinion of the
Commission, even by merely receiving the e-mails relating to allocation of
tenders and prices to be quoted from its competitors, the independence of the
OPs was compromised while giving quotations to the Railways. OP-6 was
indeed a part of the cartel arrangement, as a percentage share and multiple
tenders were allocated to it, and by receiving e-mails from its competitors, OP-
6 was privy to the information contained in these e-mails, which also at times
related to prices to be quoted by other vendors in the tenders floated.

(e) OP-7

• There are several e-mail communications received by OP-7 from competitors
from July 2019 to June 2020. In the e-mail dated 25.07.2019 sent by Ms.
Shanta Sohoni of OP-1 to competitors, it is clearly stated that OP-7 has got
approval (as Part I vendor), and it can be seen that 16.67% share is allocated to
it. This share continues in an e-mail dated 20.09.2019. Prior to this, whenever
a tender was allotted by the Indian Railways to OP-7, Ms. Shanta Sohoni used
to make a remark in her allocation tables regarding the same. However, from

Suo Motu Case No. 06 of 2020 40
July 2019 onwards, a specific share and specific tenders were allocated to OP-
7 in the allocation tables of Ms. Shanta Sohoni, which were also sent to OP-7.

• Thereafter, again, in the e-mail dated 07.10.2019, the share of OP-7 remains
the same and was revised to 14.30% in the e-mail dated 11.11.2019. The e-
mail dated 15.11.2019 (regarding meeting) was also sent to OP-7. In the e-mail
dated 03.02.2020 also, the share of OP-7 remained the same, at 14.30% which
continued to remain the same in the e-mail dated 16.03.2020.

• In light of such clear evidences of communication between the OPs relating to
tender allocation and prices which compromised independent bidding, it is
inconsequential as to whether any other party(ies) were examined by the DG
or not. Mere receipt of such e-mails by OP-7 compromised the independence
of the OPs while giving quotations to the Railways.

• It is irrelevant as to whether or not the information contained or the share
allocated in the said e-mails was implemented by OP-7. It is also
inconsequential that OP-7 never replied to such e-mails or sent any such e-
mails to any of its competitors. OP-7 was clearly a part of the cartel
arrangement post July 2019, when it became a Part I vendor as a percentage
share and multiple tenders were allocated to it, and by even receiving such e-
mails from its competitors, OP-7 was privy to the information contained in
these e-mails, which also at times related to prices to be quoted by the vendors
in the tenders floated.

30. Hence, as observed by the DG, the above evidences clearly show the active engagement
and participation of the OPs in discussing the bids and controlling the supply and
allocation of market for polyacetal protective tubes in various Railway tenders, leading
to manipulation of the bidding process of the Indian Railways. The period of
involvement of each OP in the cartel seems to be as follows:

S. No. Name of Opposite Party Time Period
1. Polyset Plastics Pvt. Ltd. November 2015 to June 2020
2. M/s Anju Techno Industries November 2015 to June 2020
3. M/s Power Mould November 2015 to June 2020
4. Jai Polypan Pvt. Ltd. November 2015 to June 2020
5. M/s Rama Engineering Works June 2019 to June 2020

Suo Motu Case No. 06 of 2020 41
August 2017 to July 2018 and again
6. M/s Polymer Products of India
from October 2019 to June 2020
7. M/s Hari Narayan Bihani July 2019 to June 2020
31. The OPs have argued that the cartel conduct of the OPs did not lead to any AAEC in
the market as there were no entry barriers for new entrants, nor were competitors driven
out of the market, nor prices increased for the Indian Railways.

32. In this regard, firstly, the Commission notes that the provisions of Section 3(1) of the
Act not only proscribe the agreements which cause an AAEC in the market, but also
forbid agreements which are likely to cause an AAEC in the market. Secondly, the
Commission notes that, once an agreement of the types specified under Section 3(3) of
the Act is established (including cartel), the same is presumed to have an AAEC within
India. Thus, it is axiomatic to presume in the present matter that the impugned conduct
of the parties has caused AAEC within India.

33. No doubt, as per the ratio of the decision given by the Hon'ble Supreme Court of India
in the matter of Rajasthan Cylinders and Containers Ltd. v. Union of India and Others,
2018 (13) SCALE 493, the presumption of AAEC in a case involving contravention of
the provisions of Section 3(3) of the Act can be rebutted by the parties by placing
evidence to the contrary on record; however, it is noted that it is upon the contravening
parties to rebut the presumption of AAEC by showing positive effects emanating from
the cartel activity such as accrual of benefits to the consumers (in the instant case, the
Indian Railways), improvement in production or distribution of goods or provision of
services or promotion of technical, scientific, and economic development by means of
production or distribution of goods or provision of services.

34. In this regard, the relevant excerpts of the Hon'ble Supreme Court decision in
Rajasthan Cylinders (supra) are as follows:

"We may also state at this stage that Section 19 (3) of the Act mentions the
factors which are to be examined by the CCI while determining whether an
agreement has an appreciable adverse effect on competition under Section
3. However, this inquiry would be needed in those cases which are not
covered by clauses (a) to (d) of sub-Section (3) of Section 3. Reason is
simple. As already pointed out above, the agreements of nature mentioned
in sub-Section (3) are presumed to have an appreciable effect and,
therefore, no further exercise is needed by the CCI once a finding is

Suo Motu Case No. 06 of 2020 42
arrived at that a particular agreement fell in any of the aforesaid four
categories. We may hasten to add, however, that agreements mentioned in
Section 3(3) raise a presumption that such agreements shall have an
appreciable adverse effect on competition. It follows, as a fortiori, that the
presumption is rebuttable as these agreements are not treated as
conclusive proof of the fact that it would result in appreciable adverse
effect on competition. What follows is that once the CCI finds that case is
covered by one or more of the clauses mentioned in sub-section (3) of
Section 3, it need not undertake any further enquiry and burden would
shift upon such enterprises or persons etc. to rebut the said presumption
by leading adequate evidence. In case such an evidence is led, which
dispels the presumption, then the CCI shall take into consideration the
factors mentioned in Section 19 of the Act and to see as to whether all or
any of these factors are established. If the evidence collected by the CCI
leads to one or more or all factors mentioned in Section 19 (3), it would
again be treated as an agreement which may cause or is likely to cause an
appreciable adverse effect of competition, thereby compelling the CCI to
take further remedial action in this behalf as provided under the Act. That,
according to us, is the broad scheme when Sections 3 and 19 are to be
read in conjunction."
35. The Commission notes that, in the present matter, the OPs have been unable to show
any positive effects emanating from their cartel activity, such as accrual of benefits to
consumers, improvement in production or distribution of goods or provision of
services, or promotion of technical, scientific, and economic development by means of
production or distribution of goods or provision of services. On a holistic evaluation of
the submissions made by the parties and in light of the factors enumerated in Section
19(3) of the Act, the Commission is satisfied that, in the present matter, the parties have
not been able to dislodge the statutory presumption of AAEC by adducing cogent
evidence to the contrary, as required.

36. Hence, the Commission observes that there was a clear understanding between OPs 1,
2, and 3 and OP-4 w.r.t. the determination and revision of prices in regard to tenders
floated by the Railways for procurement of polyacetal protective tubes from at least
November 2015 to June 2020 (with OP-6 joining from August 2017, OP-5 from June
2019, and OP-7 from July 2019), which is in contravention of the provisions of Section
3(3)(a) of the Act. Further, there were also e-mails exchanged between the OPs, where
one OP can be seen pressuring another to quote only the decided prices and not lower,

Suo Motu Case No. 06 of 2020 43
and where OPs can be seen asking other OPs to withdraw their offers. This amounts to
an act of controlling supply and market by regulating who will supply and when they
shall supply the products, which is in contravention of the provisions of Section 3(3)(b)
of the Act. There was also clear allocation of tenders amongst the OPs qualifying as
sharing of market amongst them in terms of percentage with addition and reduction
with each tender and in terms of monetary amount as well, wherein the balance sheet
was displayed for each player, which is in contravention of the provisions of Section
3(3)(c) of the Act. However, looking at the modus operandi of the cartel and the
evidences available on record, the Commission finds that the conclusion of
geographical allocation of market amongst the OPs cannot be reached, as concluded by
the DG. Such modus operandi of the OPs amounts to bid rigging in contravention of
the provisions of Section 3(3)(d) of the Act by eliminating competition and
manipulating the bidding process by forming a pool or cartel of vendors, even for
developmental vendors (Part II vendors) who were entering the market and were in the
initial phases of manufacturing.

37. Though some OPs have also argued that they were forced to indulge in such pool
arrangement and cartel activity due to the market structure and monopsonist position of
the Indian Railways, in order to avoid losses and get their fair share of business, the
Commission is of the opinion that the same does not bestow a right upon the OPs, i.e.,
the suppliers/vendors, to collude and fix prices, allocate quantities, and indulge in the
illegal conduct of bid rigging in violation of the provisions of the Act. Further, with
regard to Indian Railways being a monopolistic player with the power to determine
prices/quantity, the Commission notes that the said contention of the OPs is also
misconceived. Firstly, in the presence of overwhelming documentary evidence as
adumbrated supra, it is futile for the parties to take recourse to such a plea. Merely
putting emphasis on market conditions in isolation, ignoring the actual conduct in the
teeth of overwhelming evidence meticulously pieced together by the DG, the Parties
have been selective in projecting their submissions. Further, as a consumer, the Indian
Railways is free to make a choice as far as selection of goods or services provider are
concerned. This also has to be considered in view of the direct accrual of benefits to the
consumer, i.e., the Government of India and the passengers using railway services.
Negotiating terms and conditions with the OPs to procure polyacetal protective tubes

Suo Motu Case No. 06 of 2020 44
on the best possible bargain price amounts to nothing but ensuring benefit to itself and
its end consumers, i.e., railway passengers. Therefore, the Indian Railways cannot
allow the OPs to fix any arbitrary prices and/or quantities. Negotiations/bargaining
made by the Indian Railways does not detract from the factum of bid rigging indulged
in by the vendors in flagrant violation of the provisions of the Act.

Liability under Section 48:

38. Once the contravention of the provisions of the Act by the OPs has been established,
the Commission now proceeds to determine and analyse, in the subsequent paragraphs,
the role and liability of the respective individuals (directors, officers, and employees)
who would be liable for such anti-competitive acts of the OPs in terms of Section 48 of
the Act.

39. As per the investigation report, the DG has found the following individuals of the OPs
to be liable in terms of Section 48 of the Act for the anti-competitive conduct of the
OPs:

OP Person Liability u/s
Mr. Bhupesh Bafna, Managing
48(1) & 48(2)
Polyset Plastics Pvt. Ltd. Director
Ms. Shanta Sohoni, Employee 48(1) & 48(2)
M/s Power Mould Mr. Bhupesh Bafna, Partner 48(1) & 48(2)
M/s Anju Techno Industries Mr. Bhupesh Bafna, Partner 48(1) & 48(2)
Mr. Vishal Baid, Director 48(1) & 48(2)
Mr. Rajesh R., Senior Manager 48(2)
Jai Polypan Pvt. Ltd.
Mr. Rajeev Dudhani,
48(2)
Consultant/Advisor
Mr. Vishnu N. M., Managing
48(1)
Partner
Mr. Venkata Subramanyam,
M/s Polymer Products of India 48(1) & 48(2)
Managing Partner
Mr. Harsha Gumballi, Manager
48(2)
Administration
M/s Rama Engineering Works Mr. V. Chakrapani, Partner 48(1) & 48(2)
M/s Hari Narayan Bihani Mr. Keshav Bihani, Partner 48(1) & 48(2)

Suo Motu Case No. 06 of 2020 45
40. The role and liability of each is discussed below.

(1) Mr. Bhupesh Bafna, Director of Polyset Plastics Private Ltd. and Partner of M/s
Power Mould and M/s Anju Techno Industries

41. The DG has noted that Mr. Bhupesh Bafna was one of the three directors in the private
limited company OP-1. Further, the DG has noted that Mr. Bafna is also a partner in
partnership firms OP-2 and OP-3, which Mr. Bafna has stated before the DG are sister
entities of OP-1. Hence, his position in all the three OPs makes him in-charge of and
liable for the conduct of the business of the said OPs, which has not been denied by
him.

42. Further, Mr. Bafna has acknowledged before the DG that an informal market
understanding existed amongst the approved bidders of polyacetal protective tubes that
they should all have reasonable rates and get a reasonable share of the overall business
to recover investments. He was also the person responsible for filing the bids and
deciding the prices to be quoted by all three OPs.

43. Hence, in view of the above, the Commission finds Mr. Bhupesh Bafna liable in terms
of both Section 48(1) and 48(2) of the Act for cartel conduct of OP-1 as well as OP-2
and OP-3.

(2) Ms. Shanta Sohoni, Employee at Polyset Plastics Private Ltd.

44. The DG has noted that Ms. Shanta Sohoni was an employee at OP-1, who was also
working on behalf of OP-2 and OP-3. She was the kingpin of the cartel, who allocated
forthcoming tenders amongst the OPs and informed them about the prices to be quoted.
Ms. Sohoni was responsible for co-ordination amongst the members of the cartel. As
detailed above, there are several e-mail communications to and from the other OPs
sent/received by Ms. Shanta Sohoni with respect to the cartel arrangement.

45. Hence, in view of the above, the Commission finds Ms. Shanta Sohoni liable in terms
of Section 48(2) of the Act for the cartel conduct of OP-1.

(3) Mr. Vishal Baid, Director of Jai Polypan Pvt. Ltd.

46. The DG has noted that Mr. Vishal Baid was one of the three directors of the private
limited company OP-4. In the suggestions/objections to the DG Report, it is not denied

Suo Motu Case No. 06 of 2020 46
that he had knowledge of the cartel activities of OP-4. In fact, he is also one of the
individuals named by OP-4 in the lesser penalty application.

47. Hence, being in-charge of and responsible for the conduct of business of OP-4, the
Commission finds Mr. Vishal Baid liable in terms of Section 48(1) of the Act for the
cartel conduct of OP-4.

(4) Mr. Rajeev Dudhani, Consultant/Advisor at Jai Polypan Pvt. Ltd.

48. As detailed above, multiple e-mail communications to and from the other OPs have
been sent/received by Mr. Rajeev Dudhani with respect to the cartel arrangement.

49. Hence, in view of the above, the Commission finds Mr. Rajeev Dudhani liable in terms
of Section 48(2) of the Act for the cartel conduct of OP-4.

(5) Mr. Rajesh R., Senior Manager, Operations at Jai Polypan Pvt. Ltd.

50. Mr. Vishal Baid, Director of OP-4, has submitted before the DG that Mr. Rajesh R.,
Senior Manager, Operations at OP-7, was the authorised person for filing bids on behalf
of OP-4 in the tenders floated by the Indian Railways for protective tubes and he is also
authorised to take pricing decisions and quote price in tenders relating to protective
tubes. As detailed above, several e-mail communications to and from the other OPs
sent/received by Mr. Rajesh R. also show his clear involvement in the cartel
arrangement.

51. Hence, in view of the above, the Commission finds Mr. Rajesh R. liable in terms of
Section 48(2) of the Act for the cartel conduct of OP-4.

(6) Mr. V. Chakrapani, Partner of M/s Rama Engineering Works

52. Mr. V. Chakrapani is the partner of OP-5. As such, he was in-charge of and responsible
for the conduct of business of OP-5, which responsibility has not been denied by Mr.
Chakrapani in his suggestions/objections to the DG Report. Further, as detailed above,
certain e-mail communications to and from the other OPs have been sent/received by
Mr. V. Chakrapani with respect to the cartel arrangement.

53. Though it has been submitted in the suggestions/objections to the DG Report that Mr.
V. Chakrapani was not examined on oath by the DG and, as such, he has been denied a
fair opportunity to present his case, the Commission notes that, at the stage of enquiry

Suo Motu Case No. 06 of 2020 47
before the Commission, Mr. Chakrapani was given a fair opportunity to make his
defence both in writing as part of suggestions/objections to the DG Report as well as
during the oral hearing.

54. Hence, in view of the above, the Commission finds Mr. V. Chakrapani liable in terms
of both Sections 48(1) and 48(2) of the Act for the cartel conduct of OP-5.

(7) Mr. Vishnu N. M., Managing Partner of M/s Polymer Products of India

55. The DG has noted that Mr. Vishnu N. M. was one of the Managing Partners of the
partnership firm OP-6.

56. Hence, being in-charge of and responsible to OP-6 for the conduct of its business,
which responsibility has not been denied by Mr. Vishnu in his suggestions/objections to
the DG Report, the Commission finds Mr. Vishnu N. M. liable in terms of Section
48(1) of the Act for the cartel conduct of OP-6.

(8) Mr. Venkata Subramanyam, Managing Partner of M/s Polymer Products of India

57. The DG has noted that Mr. Venkata Subramanyam was also one of the Managing
Partners of the partnership firm OP-6. As such, he was in-charge of and responsible for
the conduct of the business of OP-6, which responsibility has not been denied by Mr.
Subramanyam in his suggestions/objections to the DG Report. Further, as detailed
above, few e-mail communications to and from the other OPs have been sent/received
by Mr. Subramanyam with respect to the cartel arrangement.

58. Hence, in view of the above, the Commission finds Mr. Venkata Subramanyam liable
in terms of Sections 48(1) and 48(2) of the Act for the cartel conduct of OP-6.

(9) Mr. Harsha Gumballi, Manager (Admin) at M/s Polymer Products of India

59. The DG has noted that Mr. Harsha Gumballi was the Manager (Admin) at OP-6. As
detailed above, there are several e-mail communications to and from the other OPs
sent/received by Mr. Harsha Gumballi with respect to the cartel arrangement.

60. Hence, in view of the above, the Commission finds Mr. Harsha Gumballi liable in
terms of Section 48(2) of the Act for the cartel conduct of OP-6.

Suo Motu Case No. 06 of 2020 48
(10) Mr. Keshav Bihani, Partner of M/s Hari Narayan Bihani

61. Mr. Keshav Bihani is the Partner of OP-7. As such, he was in-charge of and responsible
for the conduct of business of OP-7, which responsibility has not been denied by Mr.
Bihani in his suggestions/objections to the DG Report. Further, the DG has noted that
e-mails, as detailed above, sent to OP-7, were to the e-mail ID of Mr. Keshav Bihani.
The DG has also noted that Mr. Bihani decided the final price to be quoted by OP-7 in
the protective tube tenders.

62. Hence, in view of the above, the Commission finds Mr. Keshav Bihani liable in terms
of Sections 48(1) and 48(2) of the Act, for the cartel conduct of OP-7.

63. It has been argued on behalf of OP-7 that no finding against Mr. Bihani can be given in
terms of Section 48 of the Act before a finding of contravention against the firm OP-7
has been given. In this regard, it is noted that, in the paras above, OP-7 has already been
found guilty of contravention of the provisions of the Act. Hence, only after
determination of guilt of the firm OP-7 has the Commission proceeded to analyse the
liability of Mr. Keshav Bihani in terms of the provisions of Section 48 of the Act.

Conclusion:

64. Hence, the Commission holds OP-1 to OP-7 guilty of contravention of the provisions of
Sections 3(3)(a), 3(3)(b), 3(3)(c), and 3(3)(d) read with 3(1) of the Act.

65. As far as individuals' liability is concerned, the Commission holds the following
individuals of the OPs liable under Section 48 of the Act for anti-competitive conduct
of their respective companies:

(i) Mr. Bhupesh Bafna, Director of Polyset Plastics Private Ltd. and Partner of M/s
Power Mould and M/s Anju Techno Industries;
(ii) Ms. Shanta Sohoni, Employee at Polyset Plastics Private Ltd.;
(iii) Mr. Vishal Baid, Director of Jai Polypan Pvt. Ltd.;
(iv) Mr. Rajeev Dudhani, Consultant/Advisor at Jai Polypan Pvt. Ltd.;
(v) Mr. Rajesh R., Senior Manager, Operations at Jai Polypan Pvt. Ltd.;
(vi) Mr. V. Chakrapani, Partner of M/s Rama Engineering Works;
(vii) Mr. Vishnu N. M., Managing Partner of M/s Polymer Products of India;

Suo Motu Case No. 06 of 2020 49
(viii) Mr. Venkata Subramanyam, Managing Partner of M/s Polymer Products of
India;
(ix) Mr. Harsha Gumballi, Manager (Admin) at M/s Polymer Products of India;
(x) Mr. Keshav Bihani, Partner of M/s Hari Narayan Bihani.

Penalty and lesser penalty:

66. Once contravention of the provisions of the Act has been established, the Commission
now proceeds to determine the penalty, if any, to be imposed upon the contravening
parties under the provisions of Section 27(b) of the Act.

67. Under Section 27(b) of the Act, where, after inquiry, the Commission finds that any
agreement referred to in Section 3 or action of an enterprise in a dominant position is in
contravention of Section 3 or Section 4 of the Act, as the case may be, it may impose
upon each such person or enterprise which is party to such agreements or abuse such
penalty as it may deem fit, which shall be not more than ten per cent of the average of
the turnover for the last three preceding financial years.

68. With regard to the imposition of penalty, certain Parties have submitted that, as
penalties have already been imposed upon them in another similar case bearing Ref.
Case No. 03 of 2018 (supra), the Commission ought not impose further penalty upon
them in the present matter, as the period of contravention in both the matters overlap
with each other.

69. In this regard, the Commission observes that the products involved in the present case
and Ref. Case No. 03 of 2018 (supra) are two entirely different products. OP-1, OP-2,
OP-3, and OP-6 and their concerned individuals were part of two separate cartels, even
if during the overlapping period of contravention. The revenues earned by these OPs
from the sale of these different products during the period of contravention were
entirely separate, and penalties in Ref. Case No. 03 of 2018 (supra) were calculated
only on the basis of the revenues earned by these OPs from the sale of High
Performance Polyamide Bushes/ Self Lubricating Polyester Resin Bushes and not
protective tubes.

Suo Motu Case No. 06 of 2020 50
70. Hence, taking into consideration the revenues earned by the OPs from the sale of
protective tubes in the market, the Commission, in terms of the aforesaid provision,
decides to compute a separate penalty to be imposed upon the OPs in the present
matter. Considering the nature of the cartel arrangement, the mitigating factors
submitted by the OPs, and the fact that some of the OPs are MSMEs, the Commission
decides to impose upon the OPs penalty @5% of the average of their turnover
generated from the sale of protective tubes for the last three preceding financial years.

71. The same is calculated as under:

Polyset Plastics Pvt. Ltd. (OP-1) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 -
2018-19 1,51,200
2019-20 -
Total 1,51,200
Average 50,400
Penalty 2,520
M/s Anju Techno Industries (OP-2) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 1,70,63,550
2018-19 1,41,37,520
2019-20 96,88,334
Total 4,08,89,404
Average 1,36,29,801
Penalty 6,81,490
M/s Power Mould (OP-3) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 13,43,942
2018-19 13,00,068
2019-20 12,42,054
Total 38,86,064
Average 12,95,355
Penalty 64,768

Suo Motu Case No. 06 of 2020 51
Jai Polypan Private Limited (OP-4) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 81,63,604
2018-19 92,19,265
2019-20 14,08,789
Total 1,87,91,658
Average 62,63,886
Penalty 3,13,194
M/s Rama Engineering Works (OP-5) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 -
2018-19 -
2019-20 39,01,101
Total 39,01,101
Average 13,00,367
Penalty 65,018
M/s Polymer Products of India (OP-6) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 -
2018-19 35,69,901
2019-20 17,95,419
Total 53,65,320
Average 17,88,440
Penalty 89,422
M/s Hari Narayan Bihani (OP-7) (In ₹)
FINANCIAL YEAR RELEVANT TURNOVER
2017-18 Not filed
2018-19 Not filed
2019-20 2,30,01,080
Total 2,30,01,080
Average 2,30,01,080
Penalty 11,50,054
72. As far as the individuals of the OPs found liable in terms of Section 48 of the Act for
anti-competitive conduct of their respective companies/firms are concerned, the
Commission notes that certain OPs i.e. OP-1, OP-2, OP-3 and OP-6 have pleaded even
with regard to their individuals that since they have already been penalised in the other

Suo Motu Case No. 06 of 2020 52
similar case i.e. Ref. Case No. 03 of 2018 (supra), the Commission ought not impose
further penalty upon them in the present matter.

73. In this regard, the Commission, taking note of the fact that penalties have already been
imposed upon Mr. Bhupesh Bafna of OP-1, OP-2 and OP-3, Ms. Shanta Sohoni of OP-
1, Mr. Vishal Baid, Mr. Rajeev Dudhani and Mr. Rajesh R. of OP-4, and Mr. Vishnu
N.M., Mr. Venkata Subramanyam and Mr. Harsha Gumballi of OP-6, in Ref. Case No.
03 of 2018 for similar period of contravention, and the fact that the OPs with whom
such individuals are associated are stated to be MSMEs, decides not to impose any
further penalty on them, in the present matter. Such individuals are however, cautioned
to ensure that their future conduct is strictly in accord with the provisions of the Act,
failing which any such future behaviour would be viewed seriously, constituting
recidivism with attendant consequences.

74. Upon the remaining individuals found liable in terms of Section 48 of the Act i.e.
individuals of OP- 5 and OP-7, the Commission decides to impose penalty @5% of the
average of their incomes, for the last three preceding financial years, which is
calculated as under:

Mr. V. Chakrapani of OP-5 (In ₹)
FINANCIAL YEAR INCOME
2017-18 Not Filed
2018-19 11,59,628
2019-20 11,89,400
Total 23,49,028
Average 11,74,514
Penalty 58,726
Mr. Keshav Bihani of OP-7 (In ₹)
FINANCIAL YEAR INCOME
2017-18 1,60,04,421
2018-19 1,62,76,749
2019-20 1,63,72,630
Total 4,86,53,800
Average 1,62,17,933
Penalty 8,10,897

Suo Motu Case No. 06 of 2020 53
75. Regarding lesser penalty, the Commission notes that OP-4 was the first lesser penalty
applicant to approach the Commission. As such, it is eligible for up to 100% reduction
in the penalty amount imposed upon it. It is noted by the Commission that the order
passed under Section 26(1) of the Act in the present matter was based on disclosures
made by OP-4 in its lesser penalty application. At that stage, the Commission and/or
the DG had no evidence in their possession regarding cartelisation between the OPs.
Full and true disclosures of information and evidence and continuous co-operation
provided by OP-4 not only enabled the Commission to order investigation into the
matter but also helped the Commission establish contravention of the provisions of
Section 3(3) of the Act by the OPs. OP-4 extended genuine, full, continuous, and
expeditious co-operation not only during the course of investigation before the DG, but
also during the subsequent proceedings before the Commission. As such, the
Commission decides to grant OP-4, 100% reduction in the penalty amount imposed
upon them.

76. In view of the above, the Commission passes the following:

ORDER

77. OP-1 to OP-7 are found guilty of contravention of the provisions of Section 3(3)(a), 3(3)(b), 3(3)(c), and 3(3)(d) read with Section 3(1) of the Act. Further, ten individuals of the OPs are found liable in terms of Section 48 of the Act for the anti-competitive conduct of their respective entities.

78. The Commission, in terms of Section 27(a) of the Act, directs the parties to cease and desist in the future from indulging in any practice/conduct/activity which has been found in the present order to be in contravention of the provisions of Section 3 of the Act, as detailed in the earlier part of this order.

79. Further, under the provisions of Section 27(b) of the Act, the Commission directs the following Parties to pay the following amounts of penalty:

S.                                             Amount of
               Name of Party                                         Amount in words
no.                                           penalty (In ₹)
                                                               Rupees Two Thousand Two
1.    Polyset Plastics Private Ltd.               2,250
                                                               Hundred and Fifty Only
2.    M/s Anju Techno Industries                6,81,490       Rupees Six Lacs Eighty One



Suo Motu Case No. 06 of 2020                                                                54
 S.                                         Amount of
               Name of Party                                          Amount in words
no.                                       penalty (In ₹)
                                                             Thousand Four Hundred and
                                                             Ninety Only

Rupees Sixty Four Thousand Seven

3. M/s Power Mould 64,768 Hundred and Sixty Eight Only

4. Jai Polypan Private Ltd. Nil Nil Rupees Sixty Five Thousand

5. M/s Rama Engineering Works 65,018 Eighteen Only Rupees Eighty Nine Thousand Four

6. M/s Polymer Products of India 89,422 Hundred and Twenty Two Only Rupees Eleven Lacs Fifty

7. M/s Hari Narayan Bihani 11,50,054 Thousand and Fifty Four Only Mr. V. Chakrapani, Partner of Rupees Fifty Eight Thousand Seven

8. 58,726 M/s Rama Engineering Works Hundred and Twenty Six Only Rupees Eight Lacs Ten Thousand Mr. Keshav Bihani, Partner of

9. 8,10,897 Eight Hundred and Ninety Seven M/s Hari Narayan Bihani Only

80. The parties mentioned in the table above are directed to deposit their respective penalty amounts within 60 days of the receipt of the present order.

81. It is made clear that all information used in the present order is for the purposes of the Act and, as such, in terms of Section 57 of the Act, does not qualify for grant of confidential treatment.

82. The Secretary is directed to forward a certified copy of the present order to the parties through their respective legal counsel, accordingly.

Sd/-

(Ashok Kumar Gupta) Chairperson Sd/-

(Sangeeta Verma) Member Sd/-

      New Delhi                                                     (Bhagwant Singh Bishnoi)
      Date: 09.06.2022                                              Member




Suo Motu Case No. 06 of 2020                                                                 55

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For Rama Engineering Works And Mr vs Polyset Plastics Private Ltd on 9 June, 2022