Appeal No. 02/2016. Case: Ess Cee Securities Private Limited and Ors. Vs Competition Commission of India and Ors.. COMPAT (Competition Appellate Tribunal)
| Case Number | Appeal No. 02/2016 |
| Counsel | For Appellant: Rajshekhar Rao, Chaitanya Puri, Nishit Agarwal and Varun, Advocates |
| Judges | G.S. Singhvi, J. (Chairman), Rajeev Kher and Anita Kapur, Members |
| Issue | Competition Act, 2002 - Sections 19(7), 2 (r) (s), 26(1), 4, 4(2) |
| Judgement Date | December 09, 2016 |
| Court | COMPAT (Competition Appellate Tribunal) |
Order:
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Having failed to satisfy the Competition Commission of India (for short, 'the Commission') to form a prima facie view under Section 26(1) of the Competition Act, 2002 (for short, 'the Act'), to order an investigation by the Director General, the appellants have preferred this appeal against the Commission's order dated 26.08.2015.
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Brief facts drawn from the information and appeal memo are as follows:
"1. Appellants Ess Cee Securities Private Limited and Signature Securities Private Limited are associated companies, who, believing in the strong reputation of the respondents, booked apartments in their project DLF Capital Greens Phase-III, which was launched in 2010. The preliminary booking amount was paid on 28.10.2010 by Ess Cee Securities Private Limited and on 28.09.2010 by Signature Securities Private Limited. Both companies have till the date of information paid Rs. 3,86,54,205/- and Rs. 3,40,39,756.72/-, respectively.
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The respondents had not taken prior necessary approvals and sanction for the construction of the project. This information was concealed from the appellants and yet payment was demanded from them. Moreover delayed interest charges were levied despite the substantial delay in the construction of the project.
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The respondents informed that they received building plan approvals from the competent authority on 15.02.2013 when the appellants for the first time got to know that the respondents had no intention to give the possession of their flats in 33 months i.e. by 25.07.2013.
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The appellants/informant have stated in the information that the relevant product market for DLF Capital Greens Phase-III is 'luxury residential project in Delhi' which according to the information must have atleast the following features:
(a) 100% power backup and secured gated community with access control at entrances and CCTV for parking and entrance lobby.
(b) High speed elevators
(c) Club and sporting facilities such as gym, swimming pool.
(d) Party lawns and large green areas.
Also, projects may or may not have the following features depending upon the scope & extent of luxury factor:
(a) Fully equipped modular kitchen with hob, chimney, oven, microwave, dishwasher and refrigerator.
(b) Imported marble floors in Living/Dining and lobby,
(c) Modular wardrobes in bedrooms and Jacuzzi in bathroom,
(e) Air-conditioned apartments with energy efficient VRV system,
(f) Steam sauna,
(g) Restaurant and banquet hall.
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It has been stated that total luxury residential apartment projects of DLF span 41.61 acres in Delhi. The informant further gave figures of land under residential apartment projects of other builders.
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In the information they also mentioned as to why they did not book apartments with other builders mentioned in the information and instead chose to book apartments in the DLF Capital Greens Phase-III.
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The informant/appellants stated that all other residential apartment projects in Delhi are society based and fulfill only basic living needs. Also, market for DDA flats is different as it provides houses to people of lower income groups and weaker sections of society. In respect to DDA they stated as follows:
Also, market for DDA flats is different as it provides houses to people of lower income groups and weaker sections of society. DDA allots houses by introducing schemes from time to time in which people fill up forms to register their names and then a draw is organized. The successful persons are then allotted a flat under DDA scheme. In the draw there are reservations for SC/ST/OBC/PH. DDA comes under the Ministry of Urban Development, Government of India. Therefore, they do not fulfill the criteria of relevant product market. Also, in 2010 DDA had offered HIG flats in Vasant kunj, which have higher floor area. These flats were offered by DDA on lottery basis as well. These flats are in very poor state till now. Buildings still do not have lifts and window panes. Construction is still on and flat owners have themselves hired private contractors to complete work faster than to wait for DDA to finish the work of their flat. Hence, DDA flats cannot be termed as luxury residential projects and DDA flats are not openly offered by DDA and one has to be lucky enough to be selected in the lottery. Those who were successful in getting a DDA HIG flat are facing a huge shock by poor condition of the flats such as heavy leakage in the drainage pipes, sewage water flooding the buildings, lifts either not installed or not working, defective telephone wiring, broken tiles and glasses, no boundary walls constructed for safety. Looking into the quality DDA offers, seems that DDA is not the one who could offer a luxury living to its flat owners [Annexure C-30 (COLLY)]. Further, it was duly acknowledged in the appeal made by DLF at Competition Appellate Tribunal against CCI, Belaire Owners Association and others that DDA apartments cannot be termed as luxury as the public sector builders like DDA offer residential accommodation to the general public at affordable prices [Annexure C-31]
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The informant/appellants have traced DLF's long history as the first real estate developer in Delhi who is credited with developing 21 prominent residential colonies. The information deduced that DLF has the largest market share in luxury residential...
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