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Competition panel levies Rs.6,000 crore penalty on cement firms
Thursday June 21, 2012 05:24:01 PM,
IANS
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New Delhi: The
Competition Commission of India (CCI) Thursday imposed penalties
amounting to over Rs.6,000 crore ($1.06 billion) on 11 cement
companies including Ambuja Cements, ACC, Ultratech and India
Cements, terming them guilty of forming a cartel and fixing
prices.
The CCI has asked the 11 cement firms to pay as penalty 50 percent
of their profits recorded in financial year 2009-10 and 2010-11.
"The penalty amount so worked out amounts to more than Rs.6,000
crore," according to a statement issued by the ministry of
corporate affairs.
The cement manufacturers who have been penalised for cartelisation
are ACC, Ambuja Cements Limited, Ultratech Cements, Grasim Cements
now merged with Ultratech Cements, JK Cements, India Cements,
Madras Cements, Century Cements, Binani Cements, Lafarge India and
Jaypee Cements.
The commission has also imposed penalty on the Cement
Manufacturers Association.
"While imposing penalty, the Commission has considered the
parallel and coordinated behaviour of cement companies on price,
dispatch and supplies in the market," the statement said.
The Commission has found that the cement companies have not
utilised the available capacity so as to reduce supplies and raise
prices in times of higher demand.
The Commission has also observed that the act of these cement
companies in limiting and controlling supplies in the market and
determining prices through an anti-competitive agreement is not
only detrimental to the cause of the consumers but also to the
whole economy since cement is a crucial input in construction and
infrastructure industry vital for economic development of the
country.
The penalised cement manufacturers have been asked to deposit the
penalty amount within 90 days.
They have also been directed to "cease and desist" from indulging
in any activity relating to agreement, understanding or
arrangement on prices, production and supply of cement in the
market.
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