Competition Act: Mere inclusion of common arbitrary clauses in the contract for sale of residential flats by builders couldn’t be said to be anti-competitive
In the absence of any evidence of meeting of minds between any two or more developers of real estate with an intention of causing an appreciable adverse effect on competition, there could be no violation of Section 3 as was complained/ informed of by the petitioner/informer. Facts:
a) The petitioner alleged that real estate developers have an understanding amongst them whereby they compel the purchasers of real estate to sign one sided flat buyer’s agreement containing arbitrary clauses which are exploitative of buyer
b) The CCI passed an order under Section 26(1) directing DG to investigate the conduct of residential apartment complex builders and reported that certain practices are being commonly carried on by the developers by way of tacit agreement which caused implications for consumers and resultantly determining the final prices of apartments in contravention of Section 3(3)(a) of the Competition Act
c) The CCI differed from the findings of the DG on issue of contravention of provisions of Sections 3(3)(a) & (b) of the Competition Act and held that sufficient evidence is not available on record which warrants a finding of contravention of the provisions of the Act and accordingly closed the matter.
On writ plea, the High Court held as under: