CCI rejects bid-rigging allegations against Godrej & Boyce in institutional furniture tenders

The Competition Commission of India (“Commission”) has refused to order an investigation into allegations of bid rigging and abuse of dominance against Godrej & Boyce Mfg. Co. Ltd. in the institutional furniture segment. The Commission held that neither the structure of the market nor the evidence on record justified a finding of prima facie contravention of Sections 3 or 4 of the Competition Act, 2002.

The case arose from an Information filed under Section 19(1)(a) by two advocates alleging systemic manipulation of public procurement in institutional furniture through tender specifications that allegedly mirrored Godrej’s proprietary designs. Multiple public sector bodies and government entities were arrayed as opposite parties along with Godrej.

Background of the complaint

Informants and opposite parties

The Information was submitted by Adv. Aditya Tripathi and Adv. Arun Gaur (“Informants”) against:

  • Godrej & Boyce Mfg. Co. Ltd. (OP-1)
  • Various government departments and PSUs as procuring entities (OP-2 to OP-16), including:
    • National Buildings Construction Corporation Limited
    • HII Infra Tech Services
    • RITES Limited
    • Public Works Department (Delhi)
    • National Projects Construction Corporation Limited
    • Airports Authority of India
    • National Thermal Power Corporation
    • Delhi Metro Rail Corporation
    • Life Insurance Corporation of India
    • Indian Oil Corporation
    • Hindustan Petroleum Corporation Ltd.
    • Bharat Heavy Electrical Limited
    • Bharat Petroleum Corporation Limited
    • Water and Power Consultancy Services (WAPCOS)
    • Indian Institute of Technology, Delhi

Collectively, OP-2 to OP-16 were treated as public “procuring entities”.

Core allegations

The Informants alleged a systematic distortion of competition in public procurement for institutional furniture. Their central assertions were:

  • Tender documents issued by the procuring entities incorporated:

    • Technical specifications
    • Line drawings
    • Photographs

    which, according to them, were exact replicas of OP-1’s proprietary catalogue.

  • Instead of neutral, function-based criteria, the tender terms were claimed to be custom-built to suit Godrej’s designs, thereby:

    • Foreclosing effective competition
    • Denying market access to rival manufacturers
    • Producing appreciable adverse effect on competition (AAEC)

They relied on the Supreme Court’s observation in Excel Corp Care Ltd. vs. CCI (2017) 8 SCC 47 that bid-rigging may taint the entire process from the Notice Inviting Tender (NIT) onward and that manipulation of NIT terms itself can amount to rigging “from inception”.

Market analysis relied upon by the Informants

The Informants annexed a “Market Intelligence” or MIS-based analysis covering:

  • Calendar year 2024 (01.01.2024 to 31.12.2024)
  • A separate exercise for calendar year 2023

2024 data (as alleged by Informants)

They claimed that in 2024:

  • OP-1 participated in 201 tenders valued at Rs. 1072.81 crores
  • OP-1 allegedly:
    • Won 88 contracts
    • With a total awarded value of Rs. 301.02 crores
    • Reflecting an approximate 43.7% win rate

By contrast, they asserted that:

  • Certain competitors like Life Care System and Warsi Medico System:
    • Participated in 17 tenders each
    • Secured zero contract awards
  • A large competitor like Methodex Systems:
    • Participated in 32 tenders
    • Won only one tender (about 3.13% win ratio)

The Informants treated this as evidence of systematic exclusion.

2023 data (as alleged by Informants)

For 2023, their analysis suggested:

  • OP-1 allegedly captured 98.9% of the total awarded value in the relevant tenders.
  • Even where OP-1 did not win, it:
    • Participated in 71 tenders
    • With a combined participation value of Rs. 139.49 crores

They argued that OP-1’s “lost value” (value of tenders where it bid but did not win) alone was higher than the total participation value of most rival manufacturers, showing its outsized footprint.

Economic arguments advanced

On the basis of this data, the Informants contended that:

  • The “win gap” between OP-1 and its competitors was too wide to be explained by normal competitive efficiency.
  • Such a pattern signalled:
    • Institutional bias or
    • “Closed door” agreements between OP-1 and procuring entities
  • The resultant lack of competition allegedly led to:
    • Higher procurement costs funded through public money
    • Adverse impact on consumer and assessee interest

They requested the Commission to intervene to restore competitive conditions in the furniture procurement sector.

Alleged relevant market and abuse of dominance

Relevant market as suggested by Informants

The Informants proposed the relevant market as:

“Public Procurement of Furniture in India”

They treated public procurement tenders as a distinct space where competition takes place, different from retail or private furniture transactions.

Allegations of abuse under Section 4

The Informants alleged that OP-1 was abusing a dominant position, particularly under: