On January 13, 2022, pursuant to a complaint filed by Mr. Ramesh Kumar, the CCI directed an investigation against Chandigarh Housing Board (‘CHB’) over allegations concerning abuse of dominant position.^[1]

The informant was aggrieved by the failure of CHB to complete the construction of the Self-Financing Housing Scheme (‘Scheme’) floated by it, within the publicized time period i.e. 18 months. The informant alleged that CHB was required to initiate the process of allotment of flats after the completion of construction by the contractor. However, CHB issued an Acceptance-cum Demand Letter (‘ACDL’) advising the schedule of payment of instalments, along with interest @12% p.a. and the last instalment as per such schedule was to be paid within 18 months of issuance of the ACDL. The informant further alleged that his allotment was cancelled by CHB for non-payment of an instalment despite the construction pending completion, and subsequently, CHB excluded his registration. The informant further alleged imposition of unfair rate of interest and other one-sided terms by CHB despite the construction of the Scheme pending completion.

The CCI noted that CHB was engaged in an economic activity i.e., allotment of flats upon consideration. Thus, the CCI held it to be an ‘enterprise’ within the meaning of the Competition Act. The CCI found CHB dominant in the relevant market for ‘the provision of services for development and sale of residential flats in the Union Territory of Chandigarh’. The CCI held that the conduct of CHB, inter alia, the non-disclosure or date of possession by the CHB and the act of levying interest for delay of one day in credit of required instalments prima facie appeared to be abusive and unfair qua the consumers.

Accordingly, the CCI directed the DG to conduct an investigation against CHB in terms of Section 4(1) read with Section 4(2) of the Competition Act.

[1] Case No. 39 of 2021.