Competition Commission of India (CCI): The Coram of Ashok Kumar Gupta (Chairperson) and Sangeeta Verma and Bhagwant Singh Bishnoi (Members) addressed a matter wherein it was alleged that certain Car Companies were abusing their dominant position and denying the cashless claim to consumers if the insurance policy had not been obtained through them, their dealers or their insurance broking companies.

Manav Seva Dham (Informant) alleged contravention of provisions of Sections 3 and 4 of the Competition Act, 2002 by Maruti Suzuki India Limited (OP 1/Maruti), Tata Motors Ltd. (OP 2/Tata), Hyundai Motor India Limited (OP 3/Hyundai), Hero Moto Corp Limited (OP 4/Hero), Mahindra and Mahindra Limited (OP 5/Mahindra) and Toyota Kirloskar Motor Private Limited (OP 6/Toyota).

It was stated that the OP were enjoying a dominant position in the market for automobiles and motor insurance in India, which enables them to operate independently of competitive forces.

Further, it was added that there had been apparent monopoly and cartelization by the OPs in selling insurance policies through their fully owned insurance broking or subsidiary companies and servicing and repairing motor vehicles in respect of the insurance policies sold by them, which is detrimental to the insurance policyholders.

Due to the above stated, the informant has received several complaints from the insurance companies as well as insurance policyholders about the monopolistic practices of the OPs.

OPs even ensure that the genuine spare parts are only available with their authorised dealers, and their authorised dealers continue to charge arbitrary high prices from the consumers, who are forced to avail the services for repairing and maintaining their motor vehicles since the genuine spare parts, diagnostic tools, and technical information required to service their cars are not made available to independent repair workshops, failing which, the warranty of the vehicle would lapse.

Hence, the OPs have created a monopoly over the motor insurance and repair services for their motor vehicles.

Analysis of the Commission

Primarily, the Informant was aggrieved by the alleged conduct of the OPs of disallowing of the cashless claim to consumers if the insurance policy has not been obtained through them, their dealers, or their insurance broking companies.

Whether the Opposite Parties are in a position of dominance and have abused their dominant position, as alleged?

Commission noted that nothing concrete has been submitted in the regard to the allegations made.

Further, the Coram expressed that,

Consumers have a choice to purchase their vehicle from various manufacturers and the same also is true in respect of availing insurance facility for vehicles.

Informant had alleged regarding some arrangement of OPs with their insurance broking companies for the provisions of insurance services to customers who buys vehicles from them.

Commission observed that, even if dealers offer to sell insurance policies to customers, the customers may yet have the option to buy such policy from alternative channels should they want.

“…facility of cashless claim may be an additional benefit extended by certain brokers and may not be confined to the broking arms of the aforementioned Opposite Parties alone.”

Hence, no prima facie case existed. [Manav Seva Dham v. Maruti Suzuki India Ltd., 2022 SCC OnLine CCI 17, decided on 22-3-2022]

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