Competition Watchdog Finds DLF Guilty of 'Unfair and Abusive' Business Yet Again

New Delhi: In a fresh order against DLF, Competition Commission has found the realty giant guilty of indulging in "unfair and abusive" business practices in sale of apartments in a Gurgaon housing project.
 CCI has asked DLF Gurgaon Home Developers Private Limited and its group companies to "cease and desist" from such unfair trade practices, but did not impose any fresh monetary penalty as Rs 630 crore fine has already been slapped on DLF for similar violation during the same period in a separate case.
 "... the Commission directs the Opposite Party and its group companies operating in the relevant market to cease and desist from indulging in the conduct which is found to be unfair and abusive," the fair trade regulator said in its order.
 The direction follows complaints filed with CCI against DLF Gurgaon Home Developers, wherein it was alleged that the company had lured home buyers to book apartments at "very attractive" rates in DLF New Town Heights project under a pre-launch scheme.
 After the complainant booked the apartments and made the initial payments, they were asked to make payments under an installment plan and were asked to pay the money on different dates as per the demand.
 However, they did not make the payments as "there was no sign of construction/development at the Project site..."
 Later, they sought cancellation of allotment and requested for refund of the amounts paid by them, which the developer refused to do, saying that applications signed by buyers were irrevocable and the request for cancellation cannot be acceded to.
 The buyers were also told that the only option available with them was to sell the property in open market, as per the CCI order.
 After two years of booking, that is in February 2010, the company informed the buyers that the foundation work had been completed and they were required to make payments as per the plans.
 Subsequently, the complainants approached CCI alleging abuse of dominant position by the company and the fair trade regulator ordered a probe by its investigative arm.


CCI's investigative arm found merit in the allegations regarding forfeiture of booking amount in case a buyer wishes to cancel the allotment.
 The developer imposed unfair financial pressure on buyer by subjecting them to heavy penalties in case of defaults, the fair trade regulator noted.
 It was noted that realty major burdened the apartment buyers with unfair financial pressure on account of increasing the number of floors and demanding additional payments pursuant to increase in the super area.
 Accordingly, CCI found the developer guilty of 'unfair and abusive' business practice.
 However, the fair trade regulator has not slapped any penalty on the company.
 "... the Commission is of the view that since a penalty of Rs 630 crore has already been imposed on the Opposite Party in the Belaires Case for the same time period to which contravention in the present cases belong, no financial penalty under... is required to be imposed," CCI said in its 49-page order.