Deepika v. Calcutta Electric Supply Corporation and Others

COMPETITION COMMISSION OF INDIA

Case No. 02 of 2025

In Re:

| Deepika B-201, Flat No. 103, Golden Heights Apartments, Rajendra Marg, Bapu Nagar,

And

| 1. | Calcutta Electric Supply Corporation CESC House, #1, Chowringhee Square, Kolkata, West Bengal – 700 001. | Opposite Party No. 1 | | 2. | Haldia Energy Limited First Floor, 2A, Lord Sinha Road, Kolkata, West Bengal – 700 071. | Opposite Party No. 2 | | 3. | Sheesham Commercial Private Limited 1st Floor, 2A, Lord Sinha Road, Kolkata, West Bengal – 700 071. | Opposite Party No. 3 | | 4. | Adani Enterprises Limited Adani Corporate House, Shantigram, Near Vaishnodevi Circle, SG Highway, Khodiyar, Ahmedabad, Gujarat – 382 421. | Opposite Party No. 4 | | 5. | Adani Power Limited Adani Corporate House, Shantigram, Near Vaishnodevi Circle, SG Highway, Khodiyar, Ahmedabad, Gujarat – 382 421. | Opposite Party No. 5 | | 6. | MP Natural Resources Private Limited Adani Corporate House, Shantigram, Near Vaishnodevi Circle, SG Highway, Khodiyar, Ahmedabad, Gujarat – 382 421. | Opposite Party No. 6 | | 7. | MH Natural Resources Private Limited Adani Corporate House, Shantigram, Near Vaishnodevi Circle, SG Highway, Khodiyar, Ahmedabad, Gujarat – 382 421. | Opposite Party No. 7 | | 8. | Cavill Mining Private Limited Ground Floor 1, Heritage Tower B/H Visnagar Bank, Ashram Road Usmanpura, Ahmedabad, Gujarat – 380 014. | Opposite Party No. 8 | | 9. | Hindalco Industries Limited 21st Floor, One Unity Center, Senapati Bapat Marg, Prabhadevi, | Opposite Party No. 9 | | | Mumbai, Maharashtra – 400 013. | | | 10. | UltraTech Cement Limited B-Wing, 2nd Floor, Ahura Centre, Mahakali Caves Road, Andheri East, Mumbai, Maharashtra – 400 093. | Opposite Party No. 10 | | 11. | Vedanta Limited 1st Floor, C Wing, Unit 103, Corporate Avenue, Atul Projects, Chakala, Andheri East, Mumbai, Maharashtra – 400 093. | Opposite Party No. 11 | | 12. | Sesa Resources Limited Sesa Ghor, 20 EDC Complex Patto, Panaji, Goa – 403 001. | Opposite Party No. 12 | | 13. | Jindal Power Limited Tamnar, Raigarh, Chattisgarh – 496 107. | Opposite Party No. 13 | | 14. | Mandakini Exploration and Mining Limited Habitat India, C-3, Qutab Institutional Area, Katwaria Sarai, New Delhi, Delhi – 110 016. | Opposite Party No. 14 | | 15. | Adicorp Enterprises Private Limited Ground Floor 1, Heritage Tower, B/H Visnagar Bank, Ashram Road, Usmanpura, Ahmedabad, Gujarat – 380 014. | Opposite Party No. 14 |

CORAM

Ms. Ravneet Kaur
Chairperson

Mr. Anil Agrawal
Member

Ms. Sweta Kakkad
Member

Mr. Deepak Anurag
Member

ORDER UNDER SECTION 26(2) OF THE COMPETITION ACT, 2002

1. Information in the present matter has been filed by a public spirited individual Ms. Deepika (the ‘Informant’), against (i) RP-Sanjiv Goenka Group entities - Calcutta Electric Supply Corporation (‘OP-1’), Haldia Energy Ltd. (‘OP-2’) and Sheesham Commercial Pvt. Ltd. (‘OP-3’), (ii) Adani Group entities - Adani Enterprises Ltd. (‘OP-4’), Adani Power Ltd. (‘OP-5’), MP Natural Resources Pvt. Ltd. (‘OP-6’), and MH Natural Resources Pvt. Ltd. (‘OP-7’), (iii) Cavill Mining Pvt. Ltd. (‘OP-8’) and its sister concern Adicorp Enterprises Pvt. Ltd. (‘OP-15’), (iv) Aditya Birla group entities - Hindalco Industries Ltd. (‘OP-9’) and UltraTech Cement Ltd. (‘OP-10’), (v) Vedanta Limited (‘OP-11’) and Sesa Goa Iron Ore (‘OP-12’) of Vedanta Group, (vi) Jindal Power Ltd. (‘OP-13’), and (viii) Mandakini Exploration and Mining Limited (‘OP-14’), alleging cartelisation and bid-rigging in contravention of the provisions of Section 3(3) of the Competition Act, 2002 (the ‘Act’).

2. The Hon’ble Supreme Court of India, vide order dated 24.09.2014 passed in Writ Petition (Crl.) No. 120 of 2012, held allotment of coal blocks by the Government of India as arbitrary and illegal, and accordingly, cancelled the allocation of 204 coal blocks. Around 42 coal blocks under ‘producing’ and ‘ready to produce’ category were cancelled from 31.03.2015 and the remaining 162 coal blocks were cancelled from 24.09.2014.

3. To re-allocate these 204 coal blocks, a legal framework through the Coal Mines (Special Provisions) Act, 2015 (‘2015 Act’) and the Coal Mines (Special Provisions) Rules, 2014 was laid down. The 2015 Act and the rules framed thereunder provided for allocation of the cancelled coal blocks through Public Auction for Specified End Uses (‘SEU’) or through allotment to Government companies.

4. In the above background, allegations of bid-rigging in the 2015 auction of coal blocks and in the 2023 auction of coal blocks have been made in the present matter by the Informant.

5. In brief, it has been alleged in the Information that:

• 5.1 There was cartelisation and bid-rigging between RP-Sanjiv Goenka Group entities (OP-1, OP-2 and OP-3) and Adani Group entity OP-4 in the e-auction of Sarisatolli coal mine in the 1st and 2nd tranche of coal mine auctions held by the Government of India in 2015.
  • 5.1.1 As per the Informant, the said mine was won by OP-1. This mine’s auction had 05 (five) Technically Qualified Bidders (‘TQBs’) viz. RP-Sanjiv Goenka Group entities OP-1, OP-2 and OP-3, Adani Group entity OP-4, and GMR Chhattisgarh Energy Ltd. 03 (three) of them were group entities, of which one i.e. OP-2 indulged in bid-suppression, while the other two i.e. OP-1 and OP-3 filed bids from the same IP address. Also, OP-3 gave only one Final Price Offer (‘FPO’) despite there being no limit on the number of FPOs one could offer. Furthermore, OP-1, upon winning the bid, diverted the coal extracted by it to an SEU Plant (‘SEUP’) quoted by OP-3 in the bid, which SEUP was in fact, a unit of OP-1 itself. Also, OP-1 had become the holding company of OP-3 (100% shareholding along with OP-1’s own subsidiary Dhariwal Infrastructure Ltd.) only two days before Sarisatolli Coal Block bid was due. OP-1 was also stated to be the previous allottee of Sarisatolli Coal Mine in the year 1996. As far as OP-4 is concerned, it was one of the other two non-group TQBs in the auction. Despite being a company with huge resources, it did not make any FPO, thereby indulging in bid-suppression. Hence, common ownership, bidding from same IP address, shared SEUP, bid-suppression by a big player, etc., taken together suggest cartelisation and bid-rigging in the 2015 auction of Sarisatolli Coal Mine.
  • 5.1.2 Further, all these facts have been noted in the Comptroller and Auditor General’s (‘CAG’) Report No. 20 of 2016 on E-Auction of Coal Mines wherein the CAG has, inter alia, concluded w.r.t. 1st and 2nd tranche of coal mine auctions that “Audit could not draw an assurance that the potential level of competition was achieved during the Stage II bidding of these coal mines”. The Ministry of Coal (‘MoC’) amended Clause 4.1.1 (Eligibility Conditions) of the Standard Tender Document (‘STD’) of the auctions in June 2015 with the stated objective of increasing overall competition for the coal mines which were to be auctioned in the 3rd tranche, noting that, ‘It has been felt that this provision is prone to be misused as the same company may not bid at all or aggressively for its bids placed with different EUPs for the same coal mine. It has also been seen that out of multiple bids, a company has participated in FPO against only one of its multiple bids’.
• 5.2 The Informant has alleged that there may have been cartelisation and bid-rigging in the e-auction of a few other coal mines in the 1st and 2nd tranche of coal mines auctions held in 2015, between OP-9 to OP-14.
  • 5.2.1 It is submitted by the Informant that it was highlighted in the CAG Report that in 11 (eleven) out of the 29 (twenty-nine) coal mines successfully auctioned during the 1st and 2nd tranche, Qualified Bidders (‘QBs’) ranging between 02 (two) and 03 (three) were from the same company/ parent-subsidiary company coalition/ joint-venture coalition, and audit could not draw an assurance that the potential level of competition was achieved during the Stage II bidding of these 11 (eleven) coal mines.
  • 5.2.2 Further, the Informant has submitted that complaints alleging cartelisation in the auctioning of these coal blocks/ mines were also acknowledged by the Ministry of Coal in response to Unstarred Question No. 2263 (answered on 10.03.2016) and Starred Question No. 42 (answered on 23.07.2015) in Lok Sabha as follows:

    “A few complaints were received regarding cartelization in bidding, The Government has not approved the bids in case of 4 coal mines namely Gare Palma IV/2&3, Gare Palma IV/I and Tara as final closing bid price was not found to be reflecting fair value. In order to prevent the possibility of cartelization/ price manipulation, auction design has been slightly modified whereby multiple bids submitted by a Company or a Group in initial price offer (IPO) for a coal mine would be counted as one for the purpose of determining the eligibility to participate in final price offer (FPO).”

• 5.3 Cartelisation and bid-rigging also took place in the 16th tranche of coal mines auction w.r.t. at least 02 (two) coal mines viz. North West of Madheri and Gondbahera Ujheni, between Adani Group entities OP-6 and OP-7 on the one hand, and OP-8 (whose sister concern is OP-15) on the other, since there were multiple personnel relationships as well as financial dealings between OP-6, OP-7 and OP-15.
  • 5.3.1 As per the Informant, for the auction under the 16th tranche, an Empowered Committee of Secretaries (‘ECoS’) comprising Secretary (Department of Economic Affairs), Secretary (Department of Legal Affairs), Secretary (Ministry of Petroleum and Natural Gas), and Secretary (Coal), as members, was constituted. In 2015, after the CAG Report, MoC had tightened the rules to prevent a company from submitting multiple bids, which could stifle competition in the FPO. Thus, bids by subsidiaries and joint ventures were counted as a single bid. In 2021, the rules were tweaked by MoC, citing poor response and the minimum number of QBs required for an auction to take place were reduced, from 03 (three) to 02 (two).
  • 5.3.2 Further, as per Rules in case of less than 02 (two) TQBs for a coal mine, the first attempt of the auction for that mine was to be annulled and the second attempt of the auction may be initiated with the approval of the Competent Authority. However, in case of participation of only one bidder again in the second attempt, the matter shall be referred to the ECoS for appropriate decision with respect to the allocation of the mine.
  • 5.3.3 In this background, the auction process of 141 coal/ lignite mines was launched by the Nominated Authority, MoC under the 16th tranche. Adani Group companies won 04 (four) of these viz. North West of Madheri, Purunga, Dahegaon Gowari and Gondbahera Ujheni mines. In Purunga coal mine, Adani Enterprises subsidiary CG Natural Resources Pvt. Ltd. participated against Power Mech Projects Ltd., a Hyderabad-based construction engineering firm that reportedly received orders worth more than ₹6,000 crores from the Adani Group. In Dahegaon Gowari, Adani Group owned Ambuja Cements Ltd. outbid Gangaramchak Mining Private Limited, the only other company that had bid for the coal mine. In the remaining two blocks, OP-8, a private limited company, sister concern of OP-15 (as Late Shri Utkarsh Shah was the effective owner of both companies), competed against Adani Group companies. In Gondbahera Ujheni, OP-6, a subsidiary of Adani Enterprises won the bid against Gujarat Mineral Development Corporation (‘GMDC’), a state government owned company, and OP-8; and in North West of Madheri, Adani Enterprises subsidiary OP-7 won the bid against OP-8.
  • 5.3.4 As per the Informant, there were numerous financial dealings between certain Adani group entities and OP-15 and they also had a few common personnel. As per the Informant, it can be deciphered from such dealings that OP-8, the sister-concern of OP-15, submitted the bid security for the tender in relation to North West of Madheri coal mine and Gondbahera Ujheni coal mine out of the funds provided by Adani Logistics Ltd., Adani Estates Pvt. Ltd. and Adani Port & Special Economic Zone Limited.
  • 5.3.5 Further, as per the Informant, OP-8 only had a paid-up capital of ₹1 lakh, had no mining experience, was registered only on 25.04.2022, but competed with Adani subsidiaries OP-6 and OP-7, for the mining rights of North West of Madheri and Gondbahera Ujheni coal mines. This suggests that the main purpose of participation of OP-8 was in furtherance of the strategy of bid suppression and successful allotment of coal mines to Adani group entities otherwise there would have been only one sole bidder (for North West of Madheri coal mine) and the auction would have been annulled.
  • 5.3.6 Also, in relation to 2023 auction for coal mines, the average revenue share of the Government was 22.12%, but in relation to coal mines allotted to Adani Group of companies, it was mere 5.5%-7%. The same would not have been possible unless it would have been a result of bid-rigging arrangement/ concert between the participating bidders.

6. Making the aforesaid allegations, the Informant has alleged contravention of the provisions of Section 3(3) of the Act by the OPs.

7. The Informant has also filed an Interlocutory Application (‘IA’) bearing No. 30A of 2025 along with the Information seeking condonation of delay w.r.t. the filing of Information in regard to the 1st and 2nd tranche of coal mines auctions, which took place in the year 2015. The Informant has stated that though the cause of action for the same arose on the date when the concerned OPs participated in the auction i.e., on 31.01.2015 (bid due date), Information could be filed only when the names of the bidders who had participated in the 2015 auction of Sarisatolli Coal Mine were disclosed by the MoC in response to an RTI application filed by some third party and came in public domain in February 2023. Before that date, even in the CAG Report No. 20 of 2016 dated 21.06.2016, the names of the colluding bidders were not disclosed but rather referred to as Company ‘A’ to F’. As such, there is sufficient cause for condonation of delay in filing the Information w.r.t. bid-rigging and cartelisation in the 1st and 2nd tranche of coal mines auction.

8. In light of the above, the Informant has prayed to the Commission to:

• (a) declare the above practices of the OPs anti-competitive in violation of the provisions of Section 3 of the Act;
• (b) pass an order under the provisions of Section 26(1) of the Act ordering a thorough investigation by the Office of Director General (‘DG’);
• (c) pass a cease-and-desist order against the OPs, directing them to discontinue their cartel and not to enter such arrangements in future;
• (d) impose such penalty on the OPs under the Act, as the Commission deems fit and proper;
• (e) allow the Informant to adduce any additional information and evidence, if discovered, during the course of its ongoing internal investigation; and
• (f) pass such further order(s) and issue such directions to the OPs as the Commission may deem fit in the facts and circumstances of the present case.

9. The Commission considered the Information in its ordinary meeting held on 23.04.2025 and noting the allegations contained therein, decided to seek the views/ comments of the MoC upon the issues highlighted in the Information, before proceeding further in the matter. The MoC sent its comments on 04.06.2025.

10. The MoC stated that:

• 10.1 With respect to alleged cartelisation in the allocation of Sarisatolli coal mine in the 1st Tranche, the bidding process was conducted through a transparent e-auction platform maintained by MSTC Ltd. The auction process followed the methodology prescribed under the 2015 Act and the STD notified in 2014. The STD included several safeguards to prevent anti-competitive practices including cartelisation. A single bidder could submit only one bid per SEUP and all bidders were to give Affidavits affirming non-involvement in any collusive or unlawful conduct. E-auction was also fully automated. It was also mentioned that the final CAG Report does not specifically mention Sarisatolli coal mine though it does observe that potential competition may have been impacted in Stage II bidding of some coal mines. In its Action Taken Note (‘ATN’) in this regard, the Ministry clarified that there was no deviation from the provisions of the STD, the auction has been upheld by various High Courts, and at least 03 (three) or more independent companies participated in every e-auction including for Sarisatolli, ensuring competitive participation.
• 10.2 With respect to alleged cartelisation in the 6th round of Commercial Coal Mines Auctions, no procedural lapses or indications of cartelisation, collusive bidding, or any restrictive trade practices were observed or reported. The bids were assessed