Competition Commission of India (CCI) has imposed a penalty of Rs 397.51 crore on Shree Cement for indulging in restrictive trade practices. ). "The Commission has also imposed a penalty on Shree Cement Ltd at the rate of 0.5 times of its profits for the years 2009-10 and 2010-11 aggregating to Rs 397.51 crores," CCI said in a statement.
The CCI has imposed the penalty on Shree Cement while issuing final order in the case against cement manufacturers and their trade body Cement Manufacturers Association (CMA). The CCI passed its final order in a restrictive trade practice inquiry against cement manufacturers and their trade association CMA.
The Commission found eleven cement manufacturers including Shree Cement Limited and CMA in contravention of the provisions of the Competition Act, 2002 which deal with anti-competitive agreements including cartels. As the cement companies (except Shree Cement Limited) were already found to be in cartel in Case No. 29 of 2010 and penalized by the Commission vide its order dated 20.06.2012, the Commission decided not to order remedies including imposition of penalty on such companies again for the same period of contravention.
Last month itself, CCI had imposed a whopping Rs 6,307 crore fine on 11 leading cement makers, including ACC, Ambuja Cements, UltraTech, India Cements, Binani Cement, JK Cement, Madras Cement, LaFarge and Jaypee Cement. Industry body CMA was also fined with Rs 73 lakh.
However, the cement companies have taken CCI for a ride despite the heavy penalty laid on them. They have further increased prices by Rs 40 per bag (50 Kg) in July after being penalized of Rs 6,307 crore collectively by the CCI in June as The Pioneer reported last week.
Shree Ultra is Shree Cement’s flagship brand, contributing to more than half of its sales volume. Its two variants, Shree Ultra OPC and Shree Ultra Jung Rodhak Cement are distinctly positioned in the market. Shree Ultra Jung Rodhak Cement through its unique rust prevention properties, has high acceptance amongst brand influencers and high brand recall value.