On January 3, 2022, pursuant to a complaint filed by Mr. Kalpit Sultania, the CCI ordered an investigation against IREL (India) Ltd. (‘IREL’) over allegations concerning abuse of dominant position.^[1]

The informant alleged that IREL: (i) indulged in prohibitive increase in the Sillimanite prices; (ii) followed discriminatory pricing against the interests of the Micro, Small & Medium Enterprises (‘MSMEs’) in the domestic market, while favouring multinationals and/or foreign parties; and (iii) fixed the supply of Sillimanite as per its whims and fancies and forced its customer to accept arbitrary quantity.

On the contention of IREL that it is not an ‘enterprise’ as defined under the Competition Act, and therefore cannot be proceeded against under the Competition Act, the CCI observed that one of the functions of IREL includes extraction and sale of Sillimanite in India and abroad. Accordingly, since IREL is engaged in non-sovereign functions, it will fall within the ambit of an ‘enterprise’ under the Competition Act.

In its analysis, the CCI prima facie found IREL to be dominant in the market for ‘mining and supply of beach sand Sillimanite in India’. CCI further observed that IREL sold Sillimanite to foreign entities at a significantly lower price in comparison to the sales made to local MSMEs. A similar discriminatory trend was observed by the CCI in terms of the quantities supplied to foreign entities and local MSMEs despite Expression of Interest issued by the local MSMEs.

Based on the above, the CCI formed a prima facie view that IREL has violated the provisions of Section 4 of the Competition Act and thus, directed the DG to conduct an investigation.

[1] Case no. 22 of 2021