Having wrapped up the probe into allegations of cartelisation by freight operators, the Competition Commission of India (CCI) has sought their financial statements for the past three years before the final hearing on September 24. The CCI order for financial statements has not gone down well with the truckers, who are also challenging the main allegation of cartelisation. “We are a highly fragmented, unstructured industry. We are also market-driven and accordingly tariffs are decided by the play of market forces,” noted Navin Gupta whose All India Motor Transport Congress (AIMTC).
Other trucking sources said the demand for financial statements and the cartelisation charges should not be imposed on an industry that was not ‘closely knit’ and under severe strain due to ever-increasing operating costs.
The CCI has been hearing a complaint by the Indian Foundation Transport Research and Training (IFTRT) which says AIMTC indulged in cartelisation by directing its members to hike truck rentals by 15 per cent after diesel prices were increased by Rs.5 a litre in September 2012.
IFTRT’s S. P. Singh, who filed the complaint, says as per the yellow books of goods transport firms or common carriers, there are about 2.5 lakh entities that accept cargo and it is claimed that they control 85 per cent of the road cargo. “The strict enforcement of the Carriage by Road Act will remove the fly-by-night operators and lead to consolidation of the transport industry,” he stated.
The CCI had, in January last year, asked its Director-General (Investigation) to probe the complaint as “the diktat issued by an association to its members to raise the price of services by certain percentage.... and opined that there a prima facie case of anti-competitive practice exists.”
The report bolstered by a supplementary filing on July 15 this year concluded that alleged move for rental hike was a violation of the law. Subsequently, CCI issued a three-page order for final hearing of the case with suggestions or objections to the report by the CCI’s DG (Investigation) by September 17.
