CCI orders second probe against DLF

A day after ordering a probe against DLF, the Competition Commission of India (CCI) ordered a second probe against the company on Tuesday, for allegedly abusing its dominant position in “provisioning of services for development and sale of residential units in Gurgaon”.

In the application filed by Vijay Kapoor against DLF Universal Limited, CCI observed that various clauses in the buyer’s agreement were in violation of the competition norms.

CCI said the terms of the ‘Agreement’ appear one-sided, depicting how DLF has misused its dominant position to mould the ‘Agreement’ in its favour.

“It is also apparent that the company (DLF) has coaxed various sums of money from Shri Vijay Kapoor at various occasions by threatening cancellation of the allotment,” CCI said in its order.

The applicant alleged that many clauses in the ‘Agreement to Sell’ — with respect to apartments in the residential township ‘The Skycourt’ at Sector 86, DLF Gardencity, Gurgaon — were extremely harsh and had one-sided terms and conditions.

Monday’s order came after the application filed in a similar case against DLF, pertaining to the buyer’s agreement in the residential township ‘Regal Gardens at DLF Garden City’ in Sector 90, Gurgaon.

In its order on Tuesday, the CCI said such conduct by the company appeared to be violating Section 4 (2)(a)(i) of the Competition Act, which pertains to the abuse of dominant position by a company or a group of companies.

Noting that it has already held DLF to be dominant in the geographic market of Gurgaon, the CCI said the issues raised by the applicant were similar to the Commission’s orders in earlier cases, which were filed against three DLF projects - Belaire, Park Place and Magnolia.

For the Belaire case, the CCI slapped a hefty penalty of Rs 630 crore on the realty firm for violating fair trade norms in 2011.

The penalty was challenged by DLF before the Competition Appellate Tribunal, which upheld the CCI order and the company moved the Supreme Court. The apex court, on

November 28, 2014, asked DLF to pay full penalty in instalments of Rs 75-crore each, as DLF cited financial difficulties.