Coal india to again appeal against CCI penalty order

KOLKATA: Coal India may once again appeal to the Competition Appellate Tribunal (COMPAT) against the `591-crore penalty imposed by the Competition Commission of India (CCI) on it last week.

“Coal India will take up the case at the appropriate forum,” a senior Coal India executive said. “We have the option of going back to COMPAT or moving Supreme Court.”

The state-run miner is likely to move court of approach COMPAT within 60 days since the recent order has directed the monopoly to pay the penalty within two months.

However, if COMPAT or the Supreme Court issues an interim stay on CCI’s order, it may not have to pay the penalty within the 60-day time-frame.

The new ruling comes after COMPAT ordered a fresh investigation into the case involving Coal India and three of its subsidiaries.

In 2012, CCI had levied a Rs 1,773-crore penalty on the company and asked it to scrap allegedly biased clauses from fuel supply agreements.

The ruling was challenged by Coal India at the COMPAT.

Fuel supply agreements (FSAs) are contracts signed by subsidiaries of Coal India and power companies for supply of coal and includes several clauses.

The Competition Commission of India, a judicial body for ensuring fair and healthy competition, passed its order on information filed by Maharashtra State Power Generation Company and Gujarat State Electricity Corporation against Coal India and its subsidiaries Mahanadi Coalfields, Western Coalfields and South Eastern Coalfields. CCI had earlier concluded that Coal India and its subsidiaries abused their dominant position and contravened provisions of the Competition Act, 2002 by imposing discriminatory conditions in the FSAs. It was also asked to ensure parity between old and new power producers as well as between private and staterun power producers, as far as practicable.

Coal India is further directed to incorporate suitable modifications in the FSAs to provide for a fair and joint sampling and testing procedure. Coal India will have to consider and examine the feasibility of sampling at the unloading-end in consultation with power producers besides adopting international best practices.

Coal India Ltd