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Monday, Mar 11, 2002

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Change ordered in enquiry notice to chemical cos

Richa Mishra

NEW DELHI, March 10

THE Monopolies & Restrictive Trade Practices Commission has directed modification of the notice of enquiry (NoE) issued against some chemical companies.

The companies are Modi Alkalies & Chemicals Ltd, Shri Ram Consolidated Ltd, Punjab Alkali & Chemical Ltd, Kanoria Chemicals Ltd, Ballarpur Industries Ltd, Gujarat Alkali Ltd, Grasim Industries Ltd, Shriram Ind Enterprises Ltd, D.C.M Chemicals Works and All Chlorinated Paraffin Wax Plants (HCL by-product), located at Loni, Ghaziabad.

Considering the maintainability of the proceedings initiated as a result of issuance of NoE, the commission said that while the NoE was not maintainable with respect to charge of "cartelisation'', there was sufficient material pertaining to manipulation of conditions of delivery or price under Section 2(o)(ii) of the MRTP Act, 1969.

An anonymous complaint was received by the commission that some of the leading undertakings in the North have formed a cartel for hiking the prices of their products.

The prices of chlorine gas and hydrochloric acid were stated to have registered an increase of 277 per cent and 200 per cent within six and four months respectively in 1992.

The same was contended to be a result of an agreement among the parties to create an artificial scarcity in order to raise the prices of the products.

Since the prices of the main raw materials, namely, sodium chloride, and the cost of electricity had more or less remained the same, fictitious crises were stated to have been created to take advantage of the market position where the demand exceeded supply.

On the strength of these submissions, the commission had directed the Director-General (Investigation & Registration) [DG(I&R)] to carry out a preliminary investigation, which found a prima facie case and the NoE was issued.

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