The Competition Commission of India (CCI) has modified the agreement between DLF group and apartment owners in its two projects in Gurgaon for abuse of dominance, sending a strong message to realtors indulging in such practices.
It may be recalled that fair trade regulator, CCI, had imposed a penalty of Rs 630 crore on DLF for abuse of dominance in August last year, which the realty major had challenged in COMPAT.
Recently, CCI was directed by Competition Appellate Tribunal to modify the buyer-seller agreement.
Accordingly, the Apartment Buyers Agreement has been amended so that the abusive and unfair conditions in the original one-sided agreement have been removed.
The agreement between DLF and apartment owners has been modified through a supplementary order.
The Commission also considered the relevant provisions of the laws applicable to the development of group housing projects in Haryana, particularly the mandatory requirements which must be followed by every developer/builder, but which were not followed by DLF Ltd. in this case.
The CCI had passed its original order on August 12, 2011 wherein it had held that DLF Ltd was a dominant enterprise and violated the provisions of the Competition Act “by entering into an agreement with apartment allottees that was one sided, abusive and unfair to the allottees.”
CCI had passed its order against DLF following its inquiries into complaints filed by flat buyer associations of two DLF projects in Gurgaon, DLF Park Palace and The Belaire, alleging delays in the project and increase in the number of floors than planned earlier, among other things.
According to competition lawyers and experts, CCI is investigating around 70 real estate developers across the company for entering into one-sided agreements with buyers and for allegedly colluding with each other to arm-twist them.
CCI had earlier sent notices to several builders seeking details about their operations and agreements with buyers. DG investigation is probing into the practices, including probing into one-sided clauses through which a developer can delay completion of projects, increase or decrease the size of apartments, and change building plans mid-way through projects, among others.