DLF pulled up for unfair Contract Clauses by CCI

[BlessU]

quiet possible as it is the biggest player in Faridabad

[shubhohere]

Biggest player in what term?
Do they (BPTP) mentioned anywhere in any document that they are largest player in Faridabad ?

[AAN111]

1800 acres and counting in Faridabad alone.
Ownership of several sectors.
That is common knowledge.
In fact, they gave some land to Era Divine to build floor complex in sector 76 (if I remember right)
Ask any broker in Faridabad...

Regards

[dheerajjain]

Telegraph Calcutta, August 19, 2011

http://www.telegraphindia.com/1110819/j ... 396014.jsp

I believe BPTP buyers in Faridabad should use CCI route as it is dominant player. This will benefit all residents in Faridabad. Also, CCI talked about having real estate regulator. I once again request all members to sign petition for Real Estate Regulation.

http://www.myfaridabad.in/petition/real ... atory-body

DLF stares at Rs 900cr more penalty
JAYATI GHOSE

New Delhi, Aug. 18: Real estate giant DLF may have to pay Rs 900 crore extra penalty if the Competition Commission of India (CCI) finds it guilty of abusing its dominant market position in three more projects in Gurgaon.

The CCI stunned the housing market on Tuesday when it slapped a Rs 630-crore fine on DLF for unfair practices at its Belaire project in Gurgaon. The competition regulator is now investigating charges of market dominance and anti-competitive practices in the Park Place, Magnolias and New Town Heights projects.

Officials said apart from DLF, the commission was also investigating 10 to 11 cases involving other real estate players where complaints under sections 3 and 4 of the Competition Act 2002 had been lodged. Sections 3 and 4 deal with anti-competitive agreements and abuse of dominant position, respectively.

Sources said next in CCI’s line of fire were cement companies such as Ultratech, ACC and Ambuja Cement, who might have misused dominant market positions.

“Complaints have come from buyers of residential properties in Park Place, Magnolias and New Town Heights against DLF. We will issue an order soon,” said commission officials.

The commission can charge a penalty of up to 10 per cent of three-year average turnover of a company in each case of abuse of market dominance and anti-competitive practices. DLF posted an average turnover of Rs 9,006 crore between 2009 and 2011. In Belaire, the fine was 7 per cent of the average turnover.

The CCI will also initiate “suo-motu” investigation into other real estate players, including Lavasa and DB Realty, as anti-competitive practices have become a norm in the real estate sector.

“Buyers in general are facing problems such as escalation of property price, change in build-up area and delay in getting possession. It is, therefore, appropriate to look into the general practice along with specific complaints,” said officials.

The commission, which was set up two years back, is currently investigating around 140 cases.

The commission feels a real estate regulator will “ensure the amount collected from customers is utilised for the specific project, bring transparency in information relating to work progress and end the practice of built-in hidden costs other than the initial set price”.

Analysts said in the absence of a market regulator the commission should be careful during its investigation. “The commission should see to it that it does not become a tool in the hands of irate consumers. It should be circumspect when dealing with complaints,” said Abhishek Goenka, partner (real estate) at BMR Advisors.

A Real Estate Regulation Bill 2011, which will bring transparency in the sector and protect consumers from fraud, is yet to be introduced in Parliament. If the bill becomes law, all developers will have to register with the regulator and provide details of their projects before starting promotional activities.

[shubhohere]

This is most important. What I have understood from this portal that GFWA already raised a voice for a Regulatory body. This may be the right time, when even GFWA can approach CCI on behalf all the consumers of New Faridabad. Case filling may not be reqd, but a petition submission would be enoug!


AAN111: BPTP has nearly 1500 acres in Faridabad, but is there any source of information from where we can also get what the other builders having and who all are the other builders?

[dheerajjain]

COMPAT has asked CCI for instructing DLF to modify its buyer agreement. I belive buyer agreement is the document that builders use to make buyers captive and loot them. Once DLF removes unfair terms and conditions, then it will set an example for other developers to do the same since DLF is the largest real estate developer.

Source: Hindustan Times, 1st April

http://www.hindustantimes.com/business- ... 34001.aspx

The Competition Appellate Tribunal (Compat) has directed anti trust body Competition Commission of India (CCI) to determine “the extent and manner,” in which DLF needs to modify buyer agreements in its ultra-luxury projects Belaire and Park Place at Gurgaon. “... For this purpose, the draft modified terms and conditions submitted by both the parties be duly considered,” Compat said in its order dated March 29, 2012.

The case relates to an August 2011 order by the CCI wherein the anti-trust body, on a complaint filed by buyer association Belaire, had imposed a fine R630 crore on DLF and ordered it (DLF) to modify buyer agreements such that they become more buyer-friendly.

CCI had said that DLF violated Section 4 (2) of the Competition Act, 2002, which refers to direct and indirect imposition of unfair conditions by a company with respect to sale of goods or services. CCI had then said that buyer friendly practices coming from market leader DLF could be followed by other smaller developers.

On DLF’s appeal, Compat in its order in November 2011 had stayed the R630 crore fine imposed by CCI. However, in its latest order, Compat directed CCI to formulate and determine the terms and conditions by which buyer agreement needs to be modified by DLF and ordered it (CCI) to take suggestions both from buyer associations and the developer.

“The association’s application for handing over possession without payment of due amounts and without completion of paperwork has been dismissed by Compat, ,’’ a DLF spokesperson told Hindustan Times.

“It is our understanding that the issue of modification in clauses can be reviewed and if required only after compat has adjudicated on the numerous issues of jurisdiction, relevant market, dominance in relevant market and abuse of dominance in relevant market. The order thus needs to be reviewed to this extent and our legal counsels are working accordingly,’’ the spokesperson said.

Since August last year, DLF has found itself knocking on the CCI doors for three of its ultra-luxury residential projects at Gurgaon — Belaire, Park Place and Magnolia. In all three cases CCI has rapped DLF for abuse of its dominant market position to the disadvantage of apartment buyers