1. The present information was filed by Association of Indian Mini Blasts Furnaces (hereinafter referred to as 'Informant'), seeking inquiry under Section 19(1)(a) of the Competition Act, 2002, (hereinafter referred to as the Act) alleging abuse of dominance by National Mineral Development Corporation Limited (hereinafter referred to as the Opposite Party/OP), with respect to its mining activities and production of iron-ore in State of Karnataka. The informant represents the interests of Steel/pig iron manufacturers in Karnataka, i.e. the industries engaged in production of steel/pig iron and other associate products through blast furnace procedure. The members of the Informant association are primary consumers of the iron-ore produced/excavated by the OP from its mines. The OP is a fully owned public enterprise and is under the administrative control of the Ministry of Steel, Government of India. The Informant has alleged that OP was engaged in exploration and production of minerals in the states of Chhattisgarh and Karnataka and was the single largest producer and supplier of iron ore in the country.

2. The Informant alleged that the OP got exclusivity/monopoly in iron ore mining due to a Supreme Court order dated 05, August, 2011, in Samaj Parivartan Samudaya v. State of Karnataka [Writ Petition (Civil) No. 562 of 2009], by which the previous ban imposed on all mining activities in Bellary district was relaxed, permitting only the OP to exclusively resume and continue its mining activities in its 2 mines and sell the produce/output in Karnataka and adjoining regions through e-auction. The stockpile of 25 million tonnes, extracted before the ban was imposed, and lying with the closed mines, was allowed to be sold under the supervision of Supreme Court appointed Monitoring Committee i.e. Centre Empowered Committee. The OP abused this monopolistic situation.

3. The informant stated that to ensure supply of iron-ore to industrial consumers, Supreme Court further directed that iron-ore from NMDC and non-NMDC mines be made available to industrial consumers to the tune of 1 million tonnes and 1.5 million tonnes per month respectively. The price of iron-ore from non-NMDC mines was to be determined by Monitoring Committee, whereas OP was free to determine and fix the price of iron-ore produced from its mines. The Centre Empowered Committee, appointed by the Supreme Court, surveyed and inspected all iron-ore mines and categorized them into 3 categories, A, B and C. The Supreme Court through its order dated 13.04.2012, permitted 18 category A mines to resume operations, but only 4 of these mines resumed operations by December 2012/January 2013, producing 1.96 million tonnes per annum, as against the requirement of 25 lakh tonnes per month. As such, since August 2011, OP was enjoying exclusive privilege of carrying out mining operations in the State of Karnataka.

4. The Informant contended that after the removal of ban by Supreme Court, the total market share of OP as supplier of iron-ore increased from 29.43% to 61.54% and share of iron ore lumps increased from 44.76% to 96.39% within a period of one year. Apart from the dominant position enjoyed by OP in the relevant market, the OP also enjoyed a major market share of 36% in 2010-11 and 40.30% in 2011-12, in India. The informant further highlighted that operating margins of OP increased massively in the financial years 2010-11 and 2011-12 and reached 74.98% and 78.13% respectively. These were higher by 36% and 35% compared to the nearest company.

5. It is alleged by the Informant that the OP adopted arbitrary and excessive pricing mechanism. As per the Supreme Court order dated 02.12.2011, the OP was given liberty to fix its prices, however, it was constantly changing the basis adopted for determining the prices to maximise its profits. The OP had previously adopted 'Net Back Calculation Pricing Mechanism' on basis of which prices were determined with reference to international prices pr