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(M. L. Tayal) Member Sd/-

(S. L. Bunker) Member New Delhi Date: 11/12/2013 Order under Section 26(1) of the Competition Act, 2002 ( Minority) The information in the present case has been filed by the Informant against the Opposite Parties under section 19(1)(a) of the Competition Act, 2002 ("Act") alleging inter alia contravention of the provisions of sections 3 and 4 of the Act by forming a cartel engaged in collusive bidding for contract of liaison work for movement of coal.

6. Based on the above allegations the Informant contended that OPs 2 to 4 have violated clauses (c) and (d) of sub-section (3) of section 3 of the Act as they had engaged in collusive bidding for projects with OP1 thereby scuttling any competition among themselves. The Informant further claimed that OPs 2 to 4 have entered into an anti-competitive agreement among themselves to divide the market area in Maharashtra and thereby have made exorbitant quotation for their bids.

On the one hand OP1 is unable to finalise a tender with OPs 2 to 4 as bidders and on the other hand work orders were being renewed in favour of OPs 2 to 4 continuously for over two years at the rates quoted by B.S.N Joshi at the time of initial bid. In the light of the above, it is apparent that OPs were indulging in collusive behaviour and foreclosing competition by hindering entry of other participants in the market. Further, based on the material provided along with information, it is apparent that OPs 2 to 4 have formed a cartel and also geographically distributed market in a manner as agreed between them; the result is that OP2 was continuing to be the agent for Chandrapur and Nasik power stations, OP3 for Koradi, Khaperkheda and Parli power stations and OP4 for Paras and Bhusawal power stations. As such, prima facie, the conduct of OPs 2 to 4 was in contravention of section 3(3) of the Act. The conduct of OP1 (procurer) and OPs 2 to 4 (bidders) also prima facie appeared to be covered within the ambit of section 3(4) of the Act. In the instant case, the overall conduct of Opposite Parties amounted to a refusal to deal with other players. The repeated ad hoc renewal of agreement for services was likely to oust certain persons or classes of persons who had offered services at competitive rates.

12. Cancellation of tenders time and again and ad hoc contract allotment to OPs 2 to 4 and consistent renewal of work orders in favour of OPs 2 to 4 prima facie results in driving out competition amongst bidders. The participants other than OPs 2 to 4, who may be able to offer more competitive rates and terms, are unable to participate as „liaisoning agents for supply of coal‟ to OP1. Hence from the allegations made in the information, actions of OP1 prima facie appear to result in denial of market access to participants other than OPs 2 to 4 to bid for tenders issued by OP1, thereby resulting in violation of section 4(2)(c) of the Act.