ACC Ltd and Ambuja Cements said they will challenge the fine imposed by the Competition Commission of India yesterday, and that a similar order passed by the CCI four years ago had been set aside by the Competition Appellate Tribunal in December last year.
“We await receipt of a certified copy of the CCI Order. The Management believes that the company has a strong case on merits to challenge the CCI order and has accordingly decided to file an appeal before the COMPAT,” the companies said in identically worded statements.
Explaining the history behind the case, ACC said the Competition Commission of India first imposed a penalty of Rs 1,147.59 crores on the company in 2012.
“The Company had subsequently filed an appeal before the Hon’ble Competition Appellate Tribunal (COMPAT) to set aside the said Order of the CCI, responding to which COMPAT had granted an interim stay while directing the Company to deposit 10 per cent of the penalty with the Commission which was complied with by the Company,” it added.
“In December 2015, the COMPAT set aside the CCI order of June 2012 while remanding the matter back to the CCI to be heard again for fresh adjudication and the 10% deposit amount was refunded to the Company.
“After hearing the matter afresh, the CCI published on its website yesterday evening an Order against the same cement manufacturers, including the Company, imposing the same penalty of Rs 1147.59 crores at a rate of 0.5 times of the profit for the years 2009-10 and 2010-11″ on the Company.”
The CCI had yesterday imposed fine of Rs 6,320.6 cr upon ten cement manufacturers for forming independent organization to limit competition by controlling the production and distribution of cement.
The list of companies included ACC Cements, Ambuja Cements, Binani Cements, Century Cements, India Cements, J K Cements, Lafarge, Ramco Cements, UltraTech Cements and Jaypee Group.
ACC Cements (Rs 1,147.59 cr), Ambuja Cements (Rs 1,163.91 cr), Ultratech Cements (Rs 1,175.49 cr) and Jaypee Group (Rs 1,323.60 cr) were the ones penalised with the highest amounts.
It was noted by CCI that the cement companies used the platform provided by Cement Manufacturers Association (CMA) and shared details relating to prices, capacity utilisation, production and dispatch and thereby restricted production and supplies in the market.
CCI also found the cement companies to be acting in concert in fixing prices of cement.