CCI Dismisses Information filed Against Cholamandalam General Insurance of CCI Act After years [Read Order]

The Competition Commission of India ( CCI ) dismissed the Information filed against Cholamandalam General Insurance under section 19(1) of CCI Act, 2002 after 3 years, which was barred by limitation. The Informant has been unable to provide adequate or convincing reasons that may constitute ‘sufficient’ cause to justify condoning the delay.

The informant, P. R. Ganesan filed the information under Section 19(1)(a) of the Competition Act, 2002 (‘Act’), against M/S Chola- MS General Insurance (‘Opposite Party -1’/ ‘OP-1’) and M/S Central Bank of India (‘Opposite Party -2’/ ‘OP2’) inter alia alleging contravention of the provisions of Sections 3(4) and 4 of the Act.

The Informant had started a micro-unit and operating micro small medium enterprise (MSME) unit of precision engineering. The Informant's micro-unit ('Enterprise') was in the business of contract manufacturing of engineering goods/ materials and executing contract work. For doing the said contract work, the Enterprise usually takes advance payment from the contractors to purchase raw materials and then uses the raw materials to finish the job work.

It is submitted in the information that the Informant had also availed credit facilities from OP-2 in the form of term loan for the purchase of machineries and as over draft facility for the working capital to run the Enterprise for day-to-day operations. Further, OP-2 had insured the said loan account by the OP-1.

It is stated in the information that the parent company of OP-1 is Murugappa Group. Murugappa Group, Mitsui Sumitomo Insurance Group and Ti Financial Holdings Limited formed a joint venture to create Cholamandalam MS General Insurance Company Limited. It has its headquarters in Chennai. The Informant submitted that OP-1 is one of the biggest conglomerates operating in India, especially south India and has presence in all verticals of the financial market. It is further stated by the Informant that OP-1 is one of the leading players in the market of general insurance in India.

The Informant stated in the information that on 02.12.2015, Ambattur Industrial estate was flooded, wherein the Informant's Enterprise was situated and the entire area including the Informant's Enterprise was submerged under flood water continuously for 15 days.

It is further stated in the information that due to the flood, the Informant lost all the files related to the insurance policy details since the water level was seven feet in the locality and in the Informant's factory premises. Thereafter, the Informant approached OP-1 and OP-2 for a copy of the insurance policy documents.

However, both the OPs did not provide a copy of the insurance document immediately to the Informant and provided the copy after taking a long time. Therefore, the Informant could not file his insurance claim to OP-1 on prescribed time. Thereafter, the Informant filed his policy claim only after the prescribed date with delay of 62 days due to the delay caused by OP-2 and OP-1 in providing a copy of the insurance details.

The Informant also alleged that his application was handled by OP-1 in an unfair and anticompetitive manner. It is submitted by the Informant that based on the above, the relevant product market in this case would be the 'market for providing general insurance service'. With respect to the geographic market, the Informant submitted that since he had his business in the city of Chennai, he would not avail the service of big companies outside the jurisdiction of Chennai.

The Informant has also sought interim relief, under Section 33 of the Act, from the Commission that funds are urgently needed for the medical treatment of the mentally retarded wife, to overcome the financial losses caused by the flood, and to repay creditors who have received only part payment. Further relief is sought to restrict the auction of housing and landed properties for the recovery of the due amount.

The Informant has also filed an Interlocutory Application No. 39C of 2025 on 07.02.2025 wherein the Informant requested for condonation of delay in filing the information. It was submitted that the cause of action in relation to a part of the Information arose on 02.12.2015, when the flood occurred, and insurance claim became due.

However, the other part of Information is within the timeline of 3 years as stipulated by Regulation 10 of Competition Commission of India (General) Regulations, 2024, as the cause of action further arose in the year 2023, when the Informant dedicated substantial time and effort to investigate and gather information regarding the tie-in arrangement between Chola MS and Central Bank of India.

The Commission comprising Ravneet Kaur Chairperson, Anil Agrawal, Sweta Kakkad and Deepak Anurag

observed that the information was filed beyond the statutory period of three years from the date on which the cause of action initially arose.

The Informant has been unable to provide adequate or convincing reasons that may constitute ‘sufficient’ cause to justify condoning the delay under the aforesaid proviso. Upon assessing the reasons put forth by the Informant, which (as per the Informant) prevented him from approaching the Commission for a substantial period of almost ten years, the Commission is unable to persuade itself therewith.

Hence, the Commission does not find sufficient cause to condone the delay and consequently, the Interlocutory Application (IA No. 39C of 2025 dated 07.02.2025) seeking condonation stands dismissed.

It is noted that the general insurance market is characterized by the presence of several major competitors of OP-1, viz. Life Insurance Corporation of India (LIC), HDFC Life, SBI Life, ICICI Prudential etc. Therefore, OP-1 does not appear to be dominant in the general insurance market. In the absence of dominance, the issue raised by the Informant does not raise any competition concerns.

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