The country's anti-monopoly watchdog Monopoies and Restrictive Trade Practices Commission has issued notices to 14 cement firms including Grasim [Get Quote], ACC and Ultratech, after its investigative arm DGIR pointed toward cartelisation and slammed Cement Manufacturers' Association for the 'exorbitant' increase in prices.

The director general of investigations and registration, in its 30-page report submitted to MRTPC, said that industry body CMA was instrumental in fixing prices in the sector.

"Cement manufacturing companies have got a forum of CMA to meet together and discuss marketing strategies, including prices, so as to increase the prices without any fear of competition from other members of CMA," DGIR said in its preliminary investigation report.

"It amounts to an informal agreement among the cement manufacturing companies on the terms and condition of sale of cement to consumers," DGIR said.

Admitting the report, MRTPC issued notice of enquiry to 14 companies, asking them to file replies within four weeks. The companies include ACC, Binani Industries [Get Quote], Birla Corporation [Get Quote], Dalmia Cement, Grasim Industries, Gujarat Ambuja [Get Quote], J K Cement [Get Quote], Indian Cement Ltd, NCL Industries [Get Quote], OCL Industries, Saurastra Cement, Ultratech and Zuari Cement.

MRTPC's action is among a series of measures taken by the government and the commission to rein in cement prices. In fact, Finance Minister P Chidambaram had in April admitted the presence of a cement cartel and its inability to deal with them without effective competition law in the country.

"There are well known cartels, especially in tyre and cement industry... I don't deny that there are many unseen cartels in India's economy," he said on April 24.