CCI dismisses case against Prathima Industries

New Delhi: The Competition Commission has disposed of a case against Prathima Industries alleging cartelisation by the manufacturer of LPG cylinders in a tender floated by Hindustan Petroleum Corporation Ltd (HPCL).

The matter pertains to a tender floated by HPCL for 14.2 kg LPG cylinders for 18 states and involved 64 bidders. Prathima Industries participated in the tender and allegedly quoted identical prices along with other bidders in Andhra Pradesh, without having a plausible justification for such quotation of prices. While disposing of the case, CCI, which also considered the response of HPCL in the matter, said it is the procurer that decides the price at which the tender has to be awarded.

“Notwithstanding the quotation of prices by bidders, it is the procurer i.e. HPCL which decides the price at which the tender has to be awarded in this kind of a market viz. monopsony/oligopsony,” CCI said.

Consequently, in an order passed on Friday, the fair trade regulator said, “The Commission in the facts and circumstances decides not to proceed against Prathima Industries in this matter’.
Besides, it was alleged that officials of Prathima Industries violated certain provisions of the Competition Act. CCI said since it has decided not to proceed against Prathima Industries, ‘no question of liability of the officers…arises in the present case.”

The officials include directors of the firm, Ch Ramu, B Usharani, Savitri and general manager B L N Murthy. The ruling comes after the Commission decided the matter afresh. Earlier in an order passed in 2014, CCI had noted that the analysis of price bids submitted by vendors for each of the 18 states showed the similarity of the pattern.

After ‘prima facie’ finding that such similar price patterns indicated collusion amongst the bidders to directly or indirectly determine the sale price, CCI directed the director-general to carry out an investigation in the matter.