COMPETITION COMMISSION OF INDIA Case No.

76 of 2012 In Re: Shri Nirmal Kumar Manshani

Informant And 1. M/s Ruchi Soya Industries Ltd. Opposite Party No. 1 2. M/s Betul Oils Ltd. Opposite
Party No. 2 3. M/s Ganganagar Commodity Ltd. Opposite Party No. 3 CORAM Mr. Devender Kumar Sikri
Chairperson Mr. S. L. Bunker Member Mr. Sudhir Mital Member Mr. Augustine Peter Member Mr. U. C.
Nahta Member Dr. M. S. Sahoo Member Mr. Justice G. P. Mittal Member C. No. 76 of 2012 Page 2 of 62
Appearances: Shri Sharad Gupta and Shri Ved Jain, Advocates for the Informant. Shri A. N. Haksar, Senior
Advocate with Shri R. Sudhinder, Shri Ujjal Banerjee and Siladitya Chatterjee, Advocates for OP-1 and
Shri Dinesh Shahra, MD of OP-1. Shri Ramji Srinivasan, Senior Advocate with Ms. Khushboo Jain,
Advocate for OP-2 and Shri Shreans Daga, Director of OP-2. Shri Jatin Kumar and Shri Ashish Sharma,
Advocates for OP-3. ORDER 1. The present information has been filed under section 19(1) (a) of the
Competition Act, 2002 (‘the Act’) by Shri Nirmal Kumar Manshani (‘the Informant’) against M/s Ruchi
Soya Industries Ltd. (‘the Opposite Party No. 1’/ OP-1), M/s Betul Oils Ltd. (‘the Opposite Party No. 2’/
OP-2) and M/s Ganganagar Commodity Ltd. (‘the Opposite Party No. 3’/ OP3) (collectively, ‘the Opposite
Parties’/ ‘OPs’) alleging inter alia contravention of the provisions of sections 3 and 4 of the Act. Facts 2.
Facts, as stated in the information, may be briefly noticed. 3. As per the information, the Opposite
Parties are involved in futures trading of agricultural commodities in India, besides other business
activities. The Informant has stated that the conduct of the Opposite Parties appears to be that of a
cartel with regard to trading of Guar Seeds and Guar Gum in various commodity exchanges in India. C.
No. 76 of 2012 Page 3 of 62 4. The Informant has alleged that the OPs have inflated the prices of Guar
Seeds and Guar Gum by artificially increasing the demand through selftrading, circular trading etc. which
caused huge loss to traders, hedgers and farmers. 5. It has been stated in the information that trading in
Guar Seed and Guar Gum has been fair and transparent since 2004 till 2010. During this period, the
prices of both the commodities were discovered as per sowing, harvesting, supply and demand scenario
and were well within the range of Rs. 20 to Rs. 30 per Kg for Guar Seed and Rs. 50 to 60 per Kg for Guar
Gum. 6. The Informant has alleged that the OPs have formed a cartel in the year 2011 which artificially
made the prices of Guar Gum and Guar Seed to rise against all economic norms of trading. Even if the
trading volume went down and open interest was negligible, still the prices of Guar Gum and Guar Seed
increased during April 2011 to March 2012. The prices of Guar Seed have increased by almost 10 times
from Rs 27 in April, 2011 to Rs. 299 in March 2012. Similarly, the prices of Guar Gum have gone up by 12
times from Rs. 78 to Rs. 959 per Kg. during the same period. 7. The Informant has stated that the
volume of trading of Guar Seed went down from an average trading of 2,00,000 tons per day for April
2011 to an absurd level of 2,500 tons per day for April, 2012. It has also been stated that while there
was hardly any trading and scanty open interest, the prices of Guar Gum and Guar Seed went up by
almost 4% every trading day which is abnormal in the commodity futures market. 8. It has been alleged
that OPs have left their cartel after making huge profit from it; which caused the prices of Guar Seed and
Guar Gum to fall by almost 800 % within a period of 6 months i.e. from April, 2012 to September, 2012.
The said conduct of OPs again caused irreparable financial losses to thousands of traders, hedgers,
exporters and farmers