DLF business conduct again found 'unfair, abusive'

Realty major DLF has been found to have indulged in "unfair and unjust" business practice again by the country's anti-trust body that, nevertheless, said it was not imposing any fine due to a Rs.630 crore penalty that had already been slapped on the company in a similar case.

In a 49-page order delivered on Wednesday but made available a day later, the Competition Commission of India directed DLF and its group companies to "cease and desist from indulging in the conduct which is found to be unfair and abusive" in terms of the provisions of prevailing anti-trust laws.

It also said that since a penalty of Rs.630 crore had already been imposed on DLF in what is referred to as the Belair's case -- as also for the same period for which the contraventions in the present cases were made -- no financial penalty was required.

"In view of the totality and peculiarity of the facts and circumstances, the commission does not deem it necessary to impose any penalty on the Opposite Party in these cases," said the order of the Competition Commission, chaired by Ashok Chawla.

Earlier, the Competition Appellate Tribunal (COMPAT) had dismissed DLF's appeal against the Rs.630 crore penalty levied by the Competition Commission, finding merit in what the resident welfare association had said -- that company had abused its dominant position in the Gurgaon market.

As per the case filed, the two original appellants had booked an apartment each in "DLF New Town Heights" in 2008 since they had found the rates, as mentioned in the scheme's pre-launch, attractive. They were allotted one apartment each.

Subsequently they received reminders for payments. But they alleged it was clear that the construction work had not started and DLF was only collecting huge amounts from the allotees and buyers who had booked the apartments with them.

The appellants also sought cancellation of the allotments and a refund. But they were told that the only option before them was to sell the apartments. Subsequently, two years after the booking, they were told by the builder that the foundation work had been completed and that they should pay up.

In view of what they thought were unfair and onerous terms, the appellants sought an inquiry.

A third complainant had also approached the anti-trust commission alleging that DLF abused its dominant position with practices like allotment of back-to-back parking on compulsory payment of Rs.150,000, non-transparent calculation of advance payment rebate and payments toward external development charges.