The Competition Commission of India (CCI) has dismissed allegations against Coal India Limited (CIL) concerning the company’s 2022 e-auction scheme. The case, filed by Bijay Poddar, accused CIL of imposing terms that were allegedly one-sided, but the Commission concluded there was no merit to warrant further investigation.
Allegations at a Glance
Poddar alleged that CIL’s e-auction scheme required bidders to clear outstanding dues, imposed a fixed bid security with disproportionate impacts, and allowed unilateral auction cancellations. These conditions were deemed by the informant to lack accountability on CIL’s part.
CIL’s Defense
Coal India contended it does not dominate the relevant market, arguing its operations are influenced by global market forces. Highlighting competition from imported coal and adherence to governmental directives, the company maintained that its autonomy is limited. It further noted that the 2022 scheme bore similarities to its 2007 counterpart, which had previously passed CCI scrutiny.
CIL also pointed to pending Supreme Court cases concerning its market dominance, urging the Commission to avoid decisions that could conflict with judicial outcomes.
CCI’s Examination
The CCI reviewed key aspects, including the definition of the relevant market and whether CIL held a dominant position. While Coal India argued for a global market context, the Commission determined the relevant market as the “production and sale of non-coking coal to bidders under the e-auction scheme in India.”
Acknowledging CIL’s significant role in India’s coal production—fulfilling 79% of national needs and commanding over 90% of the e-auction market—the CCI agreed that CIL holds a dominant position.
However, the Commission found no violations of the Competition Act in CIL’s practices. It observed that concerns raised in the 2013 review of a similar scheme had been addressed. Claims of delays in refunds, unfair conditions, and one-sided clauses were found unsupported by evidence or consistent with standard contractual norms.
Final Verdict
The CCI ruled that the 2022 e-auction scheme did not breach competitive practices, dismissing the plea and closing the case. This outcome underscores the regulatory challenges in balancing market dominance with competitive fairness in critical industries like coal.
