The Supreme Court Monday issued notice on petitions of four cement manufacturers contesting an order of the Competition Appellate Tribunal (COMPAT) asking them to deposit a part of the penalty slapped on them for alleged cartelisation and manipulation of cement prices.
The apex court bench of Justice Gyan Sudha Misra and Justice Sudhansu Jyoti Mukhopadhaya issued notice after senior counsel Abhishek Munu Singhvi and others appearing for cement manufacturers told the court that the order passed by the Competition Commission of India (CCI) imposing a penalty of Rs.6,200 crore on 11 companies was based on assumption of alleged cartelisation.
As counsel appearing for the CCI defended the decision, Justice Mukhopadhaya said you could have reduced the prices by five percent but by imposing the penalty the money would go to exchequer and would not result in any benefit to the people.
Cement manufacturing companies UltraTech Cements Ltd, Jaiprakash Associates Ltd., Century Textiles and Industries Ltd. and Madras Cement Limited have challenged the May 17 interim order of the COMPAT asking them and seven other cement manufacturers to deposit 10 percent of Rs.6,200 crore penalty imposed on them by watchdog Competition Commission of India (CCI).
The CCI by its June 20, 2012, order imposed the penalty on 11 cement manufacturing companies for allegedly forming a cartel to manipulate the market price of cement.
The cement manufacturers contended that COMPAT failed to consider their plea that the competition watchdog CCI's order imposing hefty penalty was contrary to the material facts and factors which flew into the findings of the cartelization.
The tribunal had asked the companies to deposit 10 percent of the penalty imposed by the watchdog.