Competition panel scanner on DDA for unfair business practices

The Competition Commission has ordered an investigation against the Delhi Development Authority (DDA) for allegedly abusing its dominant position and imposing unfair terms on buyers of its flats.

Ordering a detailed probe, the fair trade watchdog said it has found “prima facie” evidence that DDA violated competition norms with respect to its Housing Scheme 2010.

In this scheme, DDA had offered 16,000 flats of various sizes in different parts of the national capital.

The probe follows a preliminary inquiry by the Competition Commission of India (CCI) into a complaint by Sunrise Resident Welfare Association about alleged market abuse by the DDA.

In its order, the regulator said various provisions in the DDA’s brochure for the particular housing scheme, including a promise regarding stage of construction of flats and collection of conversion charges, “prima facie appear to be unfair and, therefore, abusive” in violation of the competition norms.

CCI’s investigation arm would investigate the matter.

According to the order, the size and resources of DDA are huge and being the statutory authority according to the DDA Act, 1957, consumers in the relevant market are completely dependent on it.

The regulator said it had taken a prima facie view in an earlier case that DDA was in a dominant position in the relevant market, which is considered “provision of service for sale and distribution of residential flats in the territory of Delhi”.