Charges against real estate firm Vatika Group alleging abuse of dominant market position, dismissed

Competition Commission of India (CCI): While observing that real estate developer Vatika Group does not appear to be in a dominant position in the relevant market, CCI rejected charges against the Company alleging abuse of dominant market position in market of services for development and sale of its commercial units in Gurgaon. The Commission was hearing complaint filed by a person who had purchased a commercial unit in Vatika Professional Point Sector in Sector 66 of Gurgaon, Haryana. It was alleged in the complaint that Vatika Group delayed construction of the project for more than a year from date of booking and even before starting of construction, took payment of Rs. 35,25,000/- i.e. more than 33% of the total consideration under the threat of forfeiture of amount already paid and further demanded payment of Rs.8,43,750/- i.e., around 42.5% of the total consideration. It was further alleged that the Company committed to complete the project within three years of booking but the project was not completed on time and subsequently allotment of the Informant was terminated unilaterally by the Company. After perusal of relevant documents, CCI observed that there are a number of real estate developers in the relevant market offering commercial projects such as Raheja, DLF, Unitech, Vatika, Ansal, Emaar MGF, etc. which indicates that the buyers have the option to choose developer of their choice in the relevant geographic market. CCI further noted, “Since there is no information available on record and in the public domain to show the position of strength of the Opposite Party (Vatika Group) which enables it to operate independently of competitive forces prevailing in the relevant market, prima facie, the Opposite Party does not appear to be in a dominant position in the relevant market. In the absence of dominance of the Opposite Party in the relevant market, its conduct cannot be examined under the provisions of Section 4 of the Act.” While observing that, “no prima facie case of contravention of the provisions of the Competition Act, 2002 is made out against the Opposite Party (Vatika Group) in the instant matter,” CCI closed the matter under the provisions of Section 26(2) of the Act. Dominic Da’Silva v. Vatika Group, 2015 CCI 6, decided on April 1, 2015