The Competition Commission of India (CCI) has ordered another probe against state-owned GAIL for alleged abuse of dominant position with regard to supply of natural gas.
This is the second time in less than a week the company has come under the lens of the watchdog for alleged unfair business practices.
The CCI has ordered the probe based on a complaint by Uttar Pradesh-based glass-bottle manufacturer, Mohan Meakin, after finding a prima-facie evidence of violation of Section 4 of the Competition Act.
Section 4 pertains to abuse of dominant market position.
Mohan Meakin had entered into a Gas Sale Agreement (GSA) with GAIL in December 2008.
It was alleged that GAIL had demanded Mohan Meakin to sign a side letter, amending the terms and conditions of the GSA, failing to abide by which, ToP (Take-or-Pay) liability would be raised upon the Uttar Pradesh-based firm
The watchdog noted that as per the GSA, Mohan Meakin had to take 90 per cent of the contracted quantity every year failing which it had to pay for the quantities unlifted.
Last week, the CCI had directed a probe by the Director General (DG), its investigation arm, against GAIL in a similar matter pertaining to supply and distribution of natural gas.
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