NCLAT Upholds CCI Order on UP Soil Testing Tender

New Delhi, Sep 24 (PTI) Appellate tribunal NCLAT has upheld fair trade regulator CCI's cease & desist order against three firms for cartelisation and bid rigging in the soil testing tenders floated by the Government of UP in 2018.

The Competition Commission of India (CCI) had in April 2022 found that three firms -- Austere Systems, Toyfort and Fimo Infosolutions -- which were related concerns through family as well as business relationships, made concerted efforts and rigged the bids in soil testing tenders for Meerut and Jhansi divisions.

The appellate tribunal had agreed with CCI's findings that they had a common objective to ensure that Austere Systems wins those tenders. The commission said bids submitted by Toyfort and Fimo Infosolutions were not submitted with the intention to compete and win but to create a façade of competition.

This CCI order was challenged by the firms before the National Company Law Appellate Tribunal (NCLAT), which consented with the findings of CCI and upheld its order imposing 5 per cent of the average of their turnover for 2017-18, 2018-19 and 2019-20.

The evidence in this case is direct and is proven from documents on record as well as from the conduct of the individuals involved, the NCLAT said, adding that these make it a clear case of anti-competitive practices.

The appellate tribunal, after going through the statements, found that only three bidders -- Austere Systems, Yash Solutions, and Delicacy Continental -- participated in the 2018 Meerut and Saharanpur tenders.

Yash Solutions and Austere Systems "through an understanding/arrangement between them, had geographically allocated the soil testing tenders issued by the UP government in the year 2017 & 2018 and were either not bidding in each other's area/divisions or submitting supporting bids for each other".