CCI slaps penalty of over R25 crore on Adani Gas

Adani Gas is engaged in the business of setting up distribution network in various cities to supply natural gas to industrial, commercial, domestic and CNG customers.

By: ENS Economic Bureau | New Delhi | Published:July 8, 2014 1:30 am

The Competition Commission of India (CCI) has slapped a penalty of over Rs 25 crore on Adani Gas, a wholly-owned subsidiary of Adani Enterprises Ltd, for abusing its dominant position in the market.

The penalty pertains to a case filed by Faridabad Industries Association (FIA), which had alleged that Adani Gas had imposed unfair conditions upon the buyers under gas sales agreement (GSA).

According to a statement by CCI, “The commission has imposed a penalty of Rs 25.67 crore at 4 per cent of the average of the turnover for the last three financial years on Adani Gas Ltd for abusing dominant position.”

Adani Gas is engaged in the business of setting up distribution network in various cities to supply natural gas to industrial, commercial, domestic and CNG customers.

Apart from the penalty, the CCI also ordered the company to cease and desist from unfair practices and modify the gas sales agreements. The final order, which was passed on July 3, said that the commission had found the company to be in dominant position in the relevant market of supply and distribution of natural gas to industrial consumers in Faridabad, Haryana.

The FIA had last year complained that Adani Gas was putting ‘unilateral and lopsided’ terms and conditions in GSA with its buyers. The association, which is an umbrella body of industrial units in Faridabad, had also alleged that the company had revised the prices of gas “unilaterally and irrationally”.

“…it is alleged that AGL being in the driver’s seat, is imposing its terms in complete disregard of basic principles of law of contract and has created a situation of ‘take it or leave it’ for the buyer of gas in Faridabad,” CCI had said last year in its order.

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