Shri Shiv Ram Sharma and Ors Vs Kalptaru Buildtech Corporation Limited and Ors.

Competition Commission Of India10 November 2016

Citation74/2016

Ratio decidendi

The rule this decision rests on

The Commission may close an information under Section 26(2) of the Competition Act, 2002 where no contravention of Section 3 or Section 4 is made out on the averments. Allegations that the opposite parties cheated and defrauded depositors by failing to pay sums due on maturity of bonds or policies, without any averment touching on competition, do not raise a competition issue and fall outside the ambit of the Act.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

COMPETITION COMMISSION OF INDIACase No. 74 of 2016In re:1. Shri Shiv Ram SharmaPrahlad Nagar, Lalsot, Dausa, Rajasthan Informant No. 12. Ms. Mamta Devi SharmaPrahlad Nagar, Lalsot, Dausa, Rajasthan Informant No. 23. Shri Kishan KhandelwalAluda, Dausa, Rajasthan Informant No. 34. Shri Shyam Sunder DadhichBarundhan, Talera, Bundi, Rajasthan Informant No. 45. Shri Narayan Lal SharmaNaya Bazar, Gangapur City, Rajasthan Informant No. 56. Mrs. Guddi Devi SharmaNarauli Chod, Bamanbass,Sawaimadhopur, Rajasthan Informant No. 67. Shri Mukesh Kumar JainMandoli, K. Patan, Bundi, Rajasthan Informant No. 78. Shri Surendra Kumar BairwaPachala, Uniara,Tonk, Rajasthan Informant No. 8Case No. 74 of 20169. Shri Babu Lal SainiGandhipura Lakheri,Bundi, Rajasthan Informant No. 910. Shri Badri Lal SainiGaneshpura Lakheri, Bundi, Rajasthan Informant No. 1011. Shri Surendra Kumar GautamSugar Mili Chauraha,Keshav Rai Patan, Bundi, Rajasthan Informant No. 1112. Shri Mohan Lal GoswamiCharigaon Road, Baran, Rajasthan Informant No. 1213. Shri Ganesh YadavManas Gaon, Ladpura, Kota, Rajasthan Informant No. 1314. Shri Ramesh GoswamiShivaji School Ke Pass,Keshav Rai Patan, Bundi, Rajasthan Informant No. 1415. Shri Surendra Singh ChaudharyNolada (Dharawan), Indergarh,Bundi, Rajasthan Informant No. 1516. Mrs. Madhu DadhichNear Mandoli Tehsil, Bundi, Rajasthan Informant No. 1617. Shri Shiv Ram SainiNear Tool Tax Masalpur Road,Case No. 74 of 2016Karoli, Rajasthan Informant No. 1718. Shri Badri Lal YadavManas Gaon, Ladpura, Kota, Rajasthan Informant No. 1819. Shri Hansraj MeenaH. No. 336, Santoshi Nagar,Kota, Rajasthan Informant No. 1920. Shri Giriraj SharmaNarauli Chod, Bamanbass,Sawaimadhopur, Rajasthan Informant No. 2021. Shri Roop Chand MalavRaithal, Tehsil Mangrol, Baran, Rajasthan Informant No. 2122. Shri Sunil KhandelwalAluda, Dausa, Rajasthan Informant No. 22And 1. Kalptaru Buildtech Corporation LimitedJ. D. Business Centre,Near Sachdeva Engineering College,NH 2, Mathura, U.P. Opposite Party No. 12. Shri Jai Krishana Singh Rana, Managing Director,LAQ-1, Veterinary College, Mathura, U. P. Opposite Party No. 2Case No. 74 of 20163. Shri Bharat Jain, Director,E-46, Highway City, C/o M D Jain School,Aurangabad, Nawada, Mathura, U. P. Opposite Party No. 34. Shri Vishvanath Pratap Singh, Director,Kalptaru Food, Aurangabad,Agra, Mathura, U. P. Opposite Party No. 45. Shri Bipin Singh Yadav, Director,J. D. Business Centre,Near Sachdeva Engineering College,NH 2, Mathura, U. P. Opposite Party No. 5CORAMMr. Devender Kumar SikriChairpersonMr. S. L. BunkerMemberMr. Sudhir MitalMemberMr. Augustine PeterMemberMr. U. C. NahtaMemberJustice G. P. MittalMemberCase No. 74 of 2016Order under Section 26(2) of the Competition Act, 2002

1. The information in the present case was filed by Mr. Shiv Ram Sharma and twenty one others as listed above (‘Informants’) under Section 19(1)(a) of the Competition Act, 2002 (the ‘Act’) against Kalptaru Buildtech Corporation Limited (‘OP 1’), Shri Jai Krishana Singh Rana (‘OP 2’), Shri Bharat Jain (‘OP 3’), Shri Vishvanath Pratap Singh (‘OP 4’), and Shri Bipin Singh Yadav (‘OP 5’) alleging contravention of the provisions of the Act.

2. It is stated that OP 1 is a public limited company engaged in real estate business and it collects money from the public through its appointed agents for further investment. It is stated that OP 1 runs Kalpataru Mega Mart Shopping Chain, Kalindi Green and Kalpataru multi-trade outlets through which it mobilises savings/ deposits from the public by signing an application form cum agreement. Further, it is stated that OP 2, OP 3, OP 4 and OP 5 are the directors of OP 1.

3. According to the Informant, as per the conditions laid down in the application form or agreement executed with the depositors, OP 1 is required to pay a guaranteed amount to its depositors on maturity of bond/ policy. It is averred that OP 1 is fooling and misleading the public by collecting money from them with a promise to pay them the amount on maturity with agreed returns or to allot them plots of land. It is stated that OP 1 has engaged marketing agents on commission basis to collect money from the public as per the scheme/ policy/ bond and deposit the same with OP 1 and in turn, it issues receipts to such depositors. To receive the final payment on maturity, the depositors have to produce the said receipts before OP 1.

Case No. 74 of 2016

4. It is alleged that the cheques issued by OP 1 to many of its customers on maturity of their policy/ bond have been dishonored due to insufficiency of funds in its account. Further, it is alleged that since April, 2015, OP 1 is not paying to the Informants on maturity of their bond/ policy despite submitting the original receipt. Even though one of the directors of OP 1 vide letter dated 20.10.2015 has assured the Informants to pay all the sums due, till date no money has been received by the Informants. In this regard, the Informants have served a legal notice dated 27.06.2016 to the OPs, but of no avail. It is also alleged that OP 1 has not been paying salary to its employees for the last several months.

5. Based on the above, the Informants, inter alia, have requested the Commission to direct OPs to pay the total amount due to them along with an interest at the rate of 24% per annum. The Informants have also prayed for interim relief in the matter.

6. The Commission has perused the information and other materials available on record.

7. The Commission takes note of the fact that the main allegation of the Informants is that OP 1 and its officials are not paying them money on maturity of their policy/ bond as per the agreement. It is noted that OP 1 had allegedly collected money from the Informants and others by issuing policy/ bonds with a promise to pay the same on maturity along with an agreed rate of return and in some cases, money was collected from the people with the promise to allot land to them. The Commission observes that as per the allegations OP 1 cheated and defrauded the Informants. The Commission is of the view that the averments made by the Informants do not raise any competition issue and therefore, the case does not fall within the ambit of the Act. Case No. 74 of 2016

8. In view of the above, the Commission concludes that no case of contravention of any of the provisions of either Section 3 or 4 of the Act is made out against any of the OPs in the instant matter. Accordingly, the matter is closed under the provisions of Section 26(2) of the Act.

9. The Secretary is directed to inform all concerned accordingly.

Sd/- (Devender Kumar Sikri) Chairperson

Sd/- (S. L. Bunker) Member

Sd/- (Sudhir Mital) Member

Sd/- (Augustine Peter) Member

Sd/- (U. C. Nahta) Member

Sd/- (Justice G. P. Mittal) Member

New Delhi Dated: 10.11.2016

Case No. 74 of 2016

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