The case has been received by the Competition Commission of India (Commission) on transfer from the office of Director General and Investigation and Registration (DGIR), Monopolies and Restrictive Trade Practices Commission (MRTPC) under Section 66 (2) of the Competition Act, 2002 (the Act). The relevant facts of the case are as follows:

1. The Complainant, Rajesh Nandal filed a complaint against LPG Gas Companies before erstwhile MRTPC, It is stated by the complainant that LPG Gas Companies including Bharat Petroleum Corporation Limited (BPC) are allowing their distributers (LPG distributors) to sell gas stoves to consumers along with new connection. It was stated that where a new customer was not willing to take gas stove from them, LPG distributers are charging Rs. 150 as an inspection/testing fee for just noting the ISI code. As per the complaint the LPG distributors are also being allowed to charge an additional sum of Rs. 25 as an installation charge for no reason. In other words, it has been alleged that the LPG distributers are charging many consumers a. total amount of Rs. 175 without rendering any extra service. It was also alleged that these companies had formed a cartel to cheat consumers and make profit by allowing their distributors to indulge in such types of unfair practices.

2. The MRTPC took cognizance of the matter and vide its order dated 15.06.2009 directed the DGIR to investigate into the matter and submit the preliminary investigation report (PIR) to the MRTPC.

2.2 The DGIR initiated a preliminary investigation and issued a probe letter to Ministry of Petroleum and Natural Gas (Ministry) for furnishing information on the following :-

(a)Whether any norms have been laid down by the Ministry regarding the charges to be collected by the gas companies from the consumer.

(b)Whether gas companies had themselves fixed charges and intimated the Ministry,

(c)If Ministry has acceded the proposal of gas companies regarding the charges to be levied on the consumer on release of new connection, what was the basis of it?

2.3 The Ministry in its reply answered the above questions as follows-

(a)The Ministry has not laid down any norms regarding the charges to be collected by the gas companies from the customers. However, the Ministry has constituted several committees to look into the aspects of providing better services to LPG consumers including the Sudha Joshi Committee whose recommended for the inspection of stove was accepted.

(b)The charges to be collected at the time of release of new connections are not intimated to the Ministry nor is this desired by the Minsitry.

(c)In view of the above response, the Ministry stated that the third point in DGIR's prove letter is not applicable. Where the gas stove is purchased from s source other than the OMC distributors for inspection of such gas stoves at customers' premises nominal charges were fixed and revised taking into consideration cost escalation.

2.4 The Ministry also stated that the distributors were not authorized to charge inspection charges where the LPG stove had been purchased from them. An inspection is carried out by the companies if a consumer had purchased the BIS approved LPG stove from a source of their choice to ensure that the hot plate is safe and fit for use. The hot plate inspection charges in such cases are fixed at Rs. 150.

2.5 DGIR MRTP also issued letters to LPG companies namely BPC, Indian Oil Corporation Limited (IOC) and Hindustan Petroleum Corporation Limited (HPC) for furnishing comments on the allegations of the complainant and for submission of other information. These LPG Companies submitted their replies denying the charge.

2.6 IOC submitted its reply vide letter dated 01.09.2009 denying charges and stated that customers are not bound to obtain LPG connection from their distributers. It was submitted that the consumers have a choice to procure it from any Public Sector Organization (PSO) or Private Oil Companies. It was also submitted that IO