NOIDA is the sole authority to identify and develop sites for varied land uses #indianlaws

NOIDA is the sole authority to identify and develop sites for varied land uses and to allocate plots/properties in accordance with State policies

The present information was filed against the CEO, NOIDA (OP1), Chairman of the National Association of Software and Services Company (OP 2) and Managing Director of Bharat Heavy Electricals Limited (OP 3) alleging contravention of the provisions of the Competition Act, 2002 (Act).

Informant was one of the allotees of the plots allotted for its corporate office by OP 1, which it had purchased during an auction from OP 1. OP 2 is the industry association for the Information Technology – Business Process Management (IT-BPM) sector in India and OP 3 a Public Sector Undertaking engaged in the design, engineering, manufacture, construction, testing, commissioning and servicing of a wide range of products and services for the core sectors of the economy, viz. Power, Transmission, Industry, Transportation (Railway), Renewable Energy, Oil & Gas and Defence.

Informant alleged OP 1 of abusing its dominant position affecting the interest of corporate plot holders by granting approval to IT plot holder to rent out plot for corporate functions for OP 3, which deprived them from ‘level playing field’. OP 1, as submitted, allotted lands/plots for different purposes through auction to be used for corporate purposes and Information Technology/Information Technology enabled services (IT/ITES) industries etc. The terms, conditions and sale price of plots for corporate offices were different compared to plots allotted for IT purposes. While the corporate office plots were auctioned at much higher rates, the IT/ITES plots were allotted at subsidized rates.

OP 3 allegedly floated a tender for hiring of fully furnished office space for shifting various departments of its Corporate Office. In response to the tender, informant offered its building. One of the essential conditions of the tender was that bidder was required to submit a proof of ownership of the land with “NOC” from OP 1, stating that the property could be used for the purposes prescribed i.e. for Corporate Office. The informant satisfied all the conditions of the tender documents in all other respects.

It was alleged by Informant that OP 1 manipulated the policy of land use and in order to enforce the land use policy had even evicted 118 banks from residential areas. Informant further alleged that the Committee appointed by OP 1 was legally bound to interpret the functions of OP 3 according to the U.P. Information Technology Policy – 2004 and inviting representatives of OP 2 without an approval from a competent authority and decision to grant rent permission based on their recommendation was illegal. The manipulative practices adopted by OP 1 to accommodate corporate offices in IT plots caused prejudice amounting to unfair treatment to the Corporate Office plot holders.

The Commission held that the relevant product market, in the present case would be market for development and allotment of land according to its land use and accordingly the relevant geographical market was region of NOIDA. It was further held that OP 1 was constituted under U.P. Industrial Area Development Act, 1976, to, amongst others, demarcate and develop sites for various land uses, to allot plot/properties as per regulations. Therefore, OP 1 has the sole authority under law to identify and develop sites for varied land uses and then to allocate plots/properties in accordance with regulations and policies of the State Government, which makes OP 1 dominant in the sphere of relevant market for allotment of land in NOIDA according to its land use.

Land in the instant case was allotted as per the policy of the Government of Uttar Pradesh, in place and accordingly, prima facie, as held, the conduct of OP 1 was not violative of any provisions of section 4 of the Act. Any dispute as to the validity of OP 2’s certification of OP 3’s business operations as IT and related services is technical in nature and needs to be dealt with in appropriate for and does not raise any competitive concerns in the relevant market. Accordingly, no prima facie case for causing an investigation to be made by the Director General held to have been made out and accordingly it was closed.

[R & R Tech Mach Ltd. vs. CEO, NOIDA and Ors.]
(CCI, 29.04.2014)