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Competition Commission of
Case Analysis Report
Rajarhat Welfare Association & Anr
DLF Commercial Complex Ltd & Ors
Case No. : 10/2011
Intern (November, 2015)
NEF law College,
The Case Analysis Report is in the Format as Prescribed under
Regulation No. 23(1) of the CCI (General) Regulations, 2009.
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In the matter of: Rajarhat Welfare Association & Anr Vs. DLF
Commercial Complex Ltd & Ors
1. Rajarhat Welfare Association (Juristic Person; Registered Society)
2. Mr. Rajendra Kumar Vidhawan (Natural Person; President of
Informant No. 1)
1. DLF Commercial Complex Ltd (Juristic person; Subsidiary of DLF
Group of Companies)
2. DLF Retail Developers Ltd (Juristic Person; Subsidiary of DLF Group
3. State/Government of West Bengal (Juristic Person; Instrumentality
of the State of West Bengal)
4. Mr. Sudhir Seghal (Natural Person; Director of Opposite Party No. 2)
5. Mr. Sanjay Pandey (Natural Person; Director of Opposite Party No.
6. Mr. Kushal Pal Singh (Natural Person; Marketing Head of Opposite
Party No. 2)
7. Mr. Rajiv Singh (Natural Person; Control the Business & Affairs of
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8. Mrs. Priya Singh (Natural Person; Control of the Business & Affairs
Facts of the Case
1) The Informant No. 1 is the Society registered under the Society
Registration Act, 1860 and its members comprise of the intending
purchasers of commercial unit of different multi-storied projects
developed in Rajarhat area. The Informant No. 2 is the President of
the Informant No. 1.
2) The OP No. 1 and 2 are engaged in the business of real estate
development. The OP 4 to 6 are working for the gain of OP 1 and 2
were responsible for conducting business and affairs of OP No 1
and 2. The OP No. 3 is the State of West Bengal.
3) Contention of the Informant:
i. OP No 1 and 2 have misrepresented the facts and by these
OP has abused of its Dominant Position.
ii. It has been alleged that even though 90% of the members of
the Informant No 1 have made payments in excess of 35% of
their unit cost within 6 periods of four months from the date
of issuance of allotment letter but no construction activity
was started on the construction site even after a lapse of four
months from the date of issuance of allotment letter.
iii. Furthermore Informant alleged that the terms and conditions
are one sided and onerous and there is no scope of
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negotiating the said terms and conditions. Thus, imposing on
the buyers to unfair and one sided terms and agreements by
leaving no option them to sign the agreement is abusive of
dominant position. The alleged terms and conditions by the
Informant which are one sided and unfair in application form
are reproduced as under:-
a) Exclusive discretion upon the respondent company
with regard to the provisional and/or final allotment
and specifically reserved a right unto the company to
reject the provisional and final allotment without
assigning reason thereof.
b) Intending Allottee has seen and accepted the plans,
designs, specifications which are tentative and the
Intending Allottee Authorizes the company to affect
suitable and necessary alterations/modifications in the
layout/building plans, designs and specifications as
the company may deem fit or as directed by any
c) In the event of DLF failing to deliver the possession,
the Apartment Allottee shall give notice to DLF for
terminating the agreement. DLF thereafter has no
obligations to refund the amount to the Apartment
Allottee, but would have right to sell the Apartment
and only thereafter repay the amount in the process
DLF is neither required to account for the sale
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proceeds nor even has any obligations to pay interest
to the Commercial Unit Allottee.
4. Based on the facts and allegations, the Informants have prayed to
the Commission to initiate enquiry against OP 1 and 2 for, inter alia,
abuse of dominant position; to direct the OPs to produce the relevant
records involving the decision making process culminating into the
grant of sanction/approve of the building plans/layout plans as well as
the increase of building up to 12th
floor; to pass order directing
discontinuation of all the arbitrary clauses in the agreement forthwith; to
pass appropriate orders restraining the opposite parties from the
arbitrary cancellation of allotment; to pass order providing exit option to
an allottee with full refund of money paid along with 18% interest p.a.
as well as compensation.
The questions to be resolved to hold OP 1 and 2 blameworthy of
conferring any demonstration which is in repudiation to Section 4 of the
Competition Act, 2002 are as underneath:-
Q-1) Whether OP 1 and 2 enjoy Dominance Position in relevant
Q-2) If yes, then whether the OP 1 and 2 have abused his Dominant
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Analysis No 1
The allegation made under point 6 of the information is reproduced as
The general public including the Petitioner and the members of the said
Association at all material times have been identified the Respondent
Nos. 1 and 2 as forming part of DLF Group. The Respondent Nos. 1
and 2 as DLF Group entitles claimed to have developed various
properties in India and also claimed to be the largest developer
operating in India.
The allegation is not adequate in determining the dominant position.
The dominant position is to be determined in the relevant market of
Rajarhat, New Town, Kolkata and not in the reference to whole India.
It might be laid out that commercial unit of different multi-storied project
were available by many builders in the relevant market and also by
leading builder like Unitech, Godrej Properties, Astra etc. which is
sufficient to show that there is good numbers major players competing
with each other in the relevant market.
Thus, the OP No 1 and 2 are not dominant in the relevant market.
While determining the dominant position in the relevant market, the
following data may also be taken into account.
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Unitech Infospace is 45.4 Acres of Land, bought from WBHIDCO
Master Plan sanctioned by WBHIDCO. Principal Architect was RMJM Hong
Kong. Unitech Infospace is located in the heart of central business district of
action area and it is just 8 kms away from NSCB Airport and nearest Metro
station coming up near to HIDCO Bhavan which is less than a kilometer away
from Infospace and is surrounded by projects like Eco Park, Rabindra Tirtham,
City Centre I, Axis Mall, DLF Mall, Home Town Mall, Road Network, Police
Station etc. Thus, Unitech Infospace would have a healthy mix of Office-Goers
and retail walk-ins.
Since, OP 1 and 2 have not been found to be dominant in the relevant market,
there is no need to examine the “abused of dominant position” in terms of Section
4 of the Competition Act.
Hence, based on the above analysis it is clear that OP 1 and 2 does
not enjoy dominance in the relevant market. The Informant had an
option to purchase commercial shop or office from any other builder in
the relevant market like Unitech, Godrej Properties or Local Builder like
Astra. To abuse the dominant position a party or player must be
dominant in relevant market. Furthermore author would like to give
opinion that constructing a building without clearance is illegal but it
does not violate or attract any provision of the Competition Act.