Cement companies in the mixer again as CCI upholds 6700 crore penalty [Updated]

The Competition Commission of India has upheld its earlier decision imposing a hefty penalty of Rs. 6,700 crore on a number of cement companies for anti-competitive behaviour..In June 2012, on a complaint from the Builders’ Association of India, the CCI had found 11 cement companies guilty of cartelization on the basis of price parallelism, production parallelism and dispatch parallelism, and had imposed a penalty at the rate of 0.5 times of their profit for the years 2009-10 and 2010-11, amounting to upwards of 6700 crore..The companies appealed the order before the Competition Appellate Tribunal (COMPAT); the tribunal subsequently stayed the CCI’s order in May 2013. Back then, the COMPAT had heard the 11 cement companies on the grounds of violation of principles of natural justice and not on merits..Three years later, the COMPAT set aside the order and remanded the case to the CCI for fresh hearing..Therefore, the CCI was tasked with delving into the matter once again. The hearing took place in January this year and yesterday, the Commission, headed by Chairperson DK Sikri, upheld its earlier order. The Commission held,.“In the present case, there is not only evidence available by way of minutes and meetings of CMA to indicate that the cement companies abused the forum of trade association and instead of espousing the legitimate cause of their trade, colluded with each other in indulging in anti-competitive conduct, there is also the parallel conduct exhibited by the parties in determining prices.”.The CCI went on to uphold the imposition of a penalty on the companies, as per Section 27(b) of the Competition Act, 2002. Further, in a separate order, a penalty of 397.51 crore on Shree Cements was upheld..A handful of senior lawyers including Amit Sibal and Meenakshi Arora argued for the petitioners. Law firms like Khaitan & Co, Shardul Amarchand Mangaldas, Luthra & Luthra and Seth Dua & Associates were also involved..Below is table of the counsel who appeared..CompanySenior AdvocateLaw Firm/LawyersBuilders Association of India–Seth Dua & Associates (Vasanth Rajasekaran and Ankush Walia)Cement Manufacturers AssociationKrishnan VenugopalPramod B AgarwalaJK CementAN HaksarPK BhallaBinani CementMeenakshi AroraSiddhesh Kotwal and Raghunatha SethupathyLafarge–Rajshekhar Rao along with Nisha Kaur Uberoi, Bharat Budholia, Arunima Chandra, Kaustav Kundu, Gauri and Smit AndrewJaiprakash AssociatesAmit SibalLuthra & Luthra (GR Bhatia, Kanika Chaudhary Nayar and Tripti Malhotra)UltraTech–PH Parekh & Co (Sameer Parekh, Abhinay Sharma and S Lakshmi Iyer)India CementsCS VaidyanathanAditya Verma, Arti Goyal and K HarishankarAmbuja CementRamji SrinivasanNisha Kaur Uberoi, Anisha Chand and Aishwarya GopalakrishnanACC LimitedRamji SrinivasanShardul Amarchand Mangaldas (Pallavi Shroff, Harman Singh Sandhu, Prateek Bhattacharya and Nitika Dwivedi)Century Textiles–Pramod B. Agarwala and Prashant MehraRamco Cements–T Srinivasa Murthy, Rahul Balaji and Shruti Iyer.Read the CCI’s order:.Corrigendum: The order that was previously uploaded was incorrect. The error stands corrected.