CCI dismisses complaint against Coal India, CIMFR

The Competition Commission of India (CCI) has rejected allegations of unfair business ways against Coal India and CIMFR pertaining to a global tender for technical service providers with respect to coal samples. The complaint was filed against CIL, its CMD and the Central Institute of Mining and Fuel Research (CIMFR) as well as its Director. It was alleged that there were unfair conditions in the tender notice, floated by CIMFR. The tender was for hiring technical service providers for collection, preparation and transportation of coal samples from the loading and unloading points to CIMFR or to its research centres.

The conditions, alleged to be anti-competitive for bidders, were depositing of Rs 1 crore earnest money and annual business turnover of Rs 20 crore for last three years. For this case, CCI considered “provision of services relating to collection, preparation and transportation of coal samples in India,” as the relevant market. While noting that Coal India is dominant in the relevant market, CCI, however, ruled out the charges of abuse of dominant position after finding that no entry barrier were created through the conditions in the tender.

“The plea of the informant challenging the pre- qualification conditions that the bidder must have minimum business turnover of Rs 20 crore per annum for last three years as it seeks to debar Indian firms, is misconceived as there are 26 third party samplers enlisted by Central Electricity Authority (CEA) in concurrence with CIL,” CCI said. As far as allegation of deposit of Rs 1 crore earnest money is concerned, CCI said “it is completely misconceived as by no stretch of submission such requirement can be deemed to be abusive”.

Earlier this week, CIL said its Board has approved buyback of 10.89 crore shares worth Rs 3,650 crore. “The company by way of special resolution...has approved the buyback of not exceeding 10.89 crore equity shares of the company...at a price of Rs 335 per equity shares payable in cash for an aggregate consideration of Rs 3,650 crore,” CIL said.