Non-implementation of Fly-ash Notifications and order of NGT does not raise competition issues: CCI

Competition Commission of India (CCI):  The bench comprising of Sudhir Mital, Chairperson and Augustine Peter, U.C. Nahta and G.P. Mittal, Members while closing a matter filed for the contravention of Section 4 of the Competition Act, 2002 stated regarding the matter that the remedy for non-implementation of fly ash notifications and non-compliance of the order of NGT does not come under the ambit of CCI due to non-raising of competition issue.

The present matter has the following factual matrix; the Informant has filed the application against PWD, U.P. for contravening the provisions of Section 4 of Competition Act, 2002. It has been stated by the informant that more than 30 to 40 % of public construction activities are carried out by the opposite party in State of U.P. The OP is the designated nodal agency with respect to civil construction agencies/departments and their regulation and also the designated nodal agency for fly as product utilization.

Various notifications (Fly ash Notifications) have been issued by Ministry of Environment, Forests and Climate Change in order to use fly ash bricks and fly ash based construction products mandatory for the government and private agencies. Informant’s major grievance was of the non-implementation of Fly ash Notifications by the OP. OP being a nodal agency of State of UP and issuing circulars on utilization of fly ash bricks was yet prescribing usage of only standard clay bricks and due to which the use of fly ash bricks was absolutely restricted and denied.

The commission took up the said matter and analysed the facts of the case while seeking additional information on the same. It was observed that both fly ash, as well as clay bricks, can be used in construction activities interchangeably. Commission reiterated its decision as stated in, Flyash Based Bricks Manufacturers and Promoters Association, In re, Case No. 22 of 2017 that both the bricks can be used substitutably. Further, it was also noted that brick is a product of high volume and low value, proportion of transportation cost in the total cost is high, users prefer to procure bricks only from kilns spread across the geographical area of a particular State, which in the present case would make State of U. P. as the relevant geographical market. In regard to the issue of dominance of market, OP does not enjoy a dominant position in the relevant market as a procurer. Thus, the case was closed under Section 26(2) of the Act. [Sanjay Agarwal v. PWD, Govt. of U.P., 2018 SCC OnLine CCI 78, Order dated 30-08-2018]