Kshitij Srivastava And M/s Arthur Flury India Private Limited · Case No. 40 of 2025

Case No. 40 of 2025

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COMPETITION COMMISSION OF INDIA Case No. 40 of 2025 In Re: Kshitij Srivastava Informant

M/s Arthur Flury India Private Limited Opposite Party

CORAM

Ravneet Kaur Chairperson

Anil Agrawal Member

Sweta Kakkad Member

Deepak Anurag Member

Order under Section 26(2) of the Competition Act, 2002

1. The Information has been filed by Shri Kshitij Srivastava (‘Informant’) under Section 19(1)(a) of the Competition Act, 2002 (‘the Act’) against M/s Arthur Flury India Private Limited (‘Opposite Party’/ ‘OP’) alleging contravention of Section 4 of the Act in the supply of Short Neutral Section Assemblies (‘SNSA’).

2. The headquarters of the OP are in Switzerland and it has operations in 40 countries worldwide through its subsidiaries. In India, the OP is established as Arthur Flury India Private Limited with office in Gurgaon at Ground Floor, Plot No 115, Sector 5, IMT Manesar, Gurugram, Haryana 122052 India.

3. The Informant has stated that SNSA constitutes a critical safety component used in Overhead Equipment (‘OHE’) traction systems of Indian Railways. Owing to its criticality, SNSA has been classified as a Railway Designs and Standards

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Organisation (‘RDSO’)-controlled item, thereby mandating procurement only from RDSO-approved sources.

4. The Informant has stated that historically, M/s Arthur Flury, Switzerland and M/s Galland, France were RDSO approved global suppliers of SNSA. Consequent upon the enforcement of the Government of India's Make in India (‘MII’) Policy, these entities were treated as "Non-Local Suppliers". As per clarification in reply to FAQ No. 6 of DPIIT OM No. P-45014/19/2021-BE-II (E-54692), dated 02.11.2022, procurement from such Non-Local Suppliers became permissible only through the Global Tender route. The Informant further stated that at the same time, para 3(b) of the DPIIT OM No. P-45021/2/2017-PP (BE-Il), dated 16.09.2020 stipulated that global tenders normally cannot be issued for procurement valued below Rs. 200 crore. The Informant has alleged that almost all tenders floated by Zonal Railways are valued below this threshold for issuance of a global tender. Consequently, both these foreign suppliers effectively became ineligible to participate.

5. The Informant has stated that to overcome this situation and to retain its market share, M/s Arthur Flury Switzerland established a wholly owned subsidiary in India, i.e., OP, ostensibly for indigenous manufacture of SNSA. The Informant alleges that instead of genuine localization, this entity imported all nine components and merely undertook assembly within India, thereby defeating the spirit and intent of the MII Policy.

6. The Informant has stated that on 06.05.2023, RDSO granted approval to OP as an indigenous source. The Informant has alleged that upon receiving this approval from RDSO, OP became the sole indigenous approved source eligible to participate in tenders floated by Zonal Railways. The Informant has stated that although technically three sources were approved, the two foreign entities, being Non-Local Suppliers, were ineligible under the MII Policy restrictions. Further, Informant has alleged that as issuance of global tenders for items below Rs. 200 crore was barred, the foreign entities could not participate. Thus, for all practical purposes, the OP enjoyed a monopoly in supply of SNSA to Indian Railways.

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7. The Informant has alleged that after attaining this monopoly position, the OP indulged in practices amounting to abuse of dominant position by engaging in profiteering, extortionate pricing and discriminatory practices thereby abusing its dominant position within the meaning of Section 4 of the Act. The Informant provided the following evidence:

(i) Price escalation after approval: Prior to obtaining RDSO approval, the OP had consistently quoted Rs 10.25 lakh per unit (without GST) in at least 11 tenders between February, 2022 and March, 2023. However, immediately after approval as the sole eligible source, the firm raised its price to Rs 12.90 lakh (July 2023) (prices without GST) and thereafter quoted consistently higher rates i.e., In a tender with North Frontier Railway, opened on 28.11.2024, OP quoted as much as Rs 13.89 lakh (without GST).

(ii) Sudden reduction after competition: The Informant has stated that in December 2024, RDSO approved another indigenous source, thereby ending the OP`s monopoly. Immediately thereafter, the OP reduced its quoted rates to Rs 9.65 lakh despite increase in the Swiss Franc (‘CHF’) -Indian Rupee (‘INR’) exchange rate. The Informant alleged that the natural expectation would have been a price increase in line with higher import costs. The Informant has further stated that the reduction in prices by OP demonstrates that earlier quotations during monopoly regime were exorbitantly inflated.

(iii) Adverse exchange rate ignored: The Informant has alleged that OP quoted lower rates, even when the exchange rate of INR to CHF moved adversely post approval of an indigenous vendor. The Informant has pointed out that OP had quoted a high price of INR 13.89 lakh in Tender No 40240634 issued by railway division Stores/NFR on 28.11.2024. The exchange rate at the said particular time was 1 CHF = 95.72 INR, while OP was the sole approved vendor. However, upon the entry of another indigenous vendor as its competitor, OP quoted INR 9.65 lakh in Tender No KRCOMMRCE L-2025-04 by the KRCL railway zone, even when

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the exchange rate had risen to 1 CHF = 110.91 INR. The Informant has stated that as all nine components of SNSA are imported as per the approved Bill of Material (‘BOM’), the expectation would naturally have been of an increase in price. According to the Informant, the reduction of prices by the OP establishes that the earlier monopoly-era prices were inflated, arbitrary and extortionate.

(iv) Dual pricing: The Informant has also alleged that the OP also adopted discriminatory pricing practices. Against tenders issued directly by Indian Railways, it quoted higher rates in the range of Rs 11.99 lakh to Rs 13.89 lakh (without GST), whereas for the same item supplied to Engineering, Procurement, and Construction (‘EPC’) contractors of Indian Railways (where MII Policy restrictions were not applicable), it quoted substantially lower rates in the range of Rs 9.50 lakh to Rs 11.50 lakh (without GST). As per the Informant, that dual pricing demonstrates exploitation of OP`s monopoly status to the detriment of Indian Railways, even though in both cases, Indian Railways was the ultimate end-user.

8. The Informant in his prayer has sought appropriate punitive action against the OP, including imposing financial penalty and/or banning of business or both.

9. The Commission considered the present matter in its ordinary meeting held on 29.01.2026 and decided to pass an appropriate order in due course.

10. The Commission noted that the Informant has made allegation of violation of Section 4 of the Act by the OP without specifying the specific clause, of which contravention has occurred. The Informant has also not provided any submission with respect to the relevant market as is required for analysis under Section 4 of the Act.

11. The Commission, in the facts of the present case, finds the relevant product market to be the market for SNSA. There is no substitute for this product as it is a critical safety component. The Informant has stated in the Information that: