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The Competition Commission of India (CCI) has imposed a penalty on four firms in two bid-rigging cases related to tenders floated by the Pune Municipal Corporation. The corporation had floated the tender for “Design, Supply, Installation, Commissioning, Operation and Maintenance of Municipal Organic and Inorganic Solid Waste Processing Plant(s)” in 2013-14 and 2014-15.
‘Lesser penalty’ regulations
These cases were taken up by CCI suo motu under Section 19 of the competition law. The penalty was imposed under the ‘lesser penalty’ regulations. All firms in these cases had approached the CCI as ‘lesser penalty’ applicants.
A ‘lesser penalty’ applicant is someone who has provided vital disclosure and relevant information, documents and evidence as may be required by the Commission in a case. He enjoys a priority status in the queue of applicants and is granted a reduction in penalty.
A penalty amount of ₹46.45 lakh was imposed on Saara Traders Pvt Ltd (Saara), ₹33 lakh on Ecoman Enviro Solutions Pvt Ltd (‘Ecoman’), ₹11 lakh on Fortified Security Solutions (‘Fortified’) and ₹26.40 lakh on Raghunath Industry Pvt Ltd (‘Raghunath’).
Penalty on individuals
Penalty was also imposed on individual officials of three firms, namely Saara, Ecoman and Raghunath at the rate of 10 percent of their average income for the same three years.
No penalty was imposed on individual officials of Fortified as it is a proprietorship firm. Further, no penalty was levied in case involving tender floated in financial year 2014-15 in view of the penalty already imposed. Keeping in view the modus operandi of the cartel, the stage at which the lesser penalty application was filed, the evidences gathered by the DG independent of lesser penalty application and cooperation extended in conjunction with the value addition provided in establishing the existence of cartel, CCI granted 50 percent reduction in penalty to Saara and its individuals than otherwise leviable.
Owing to the reduction, penalty imposed on Saara was ₹23.22 lakh and ₹74,513 on its individual, an official release said.
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