Introduction
The Competition Commission of India (CCI) has rejected a complaint that accused Mahindra & Mahindra and one of its authorized dealers of engaging in anti-competitive practices. The complaint alleged that the automobile manufacturer denied warranty coverage because the vehicle owner used engine oil from an external source.
Details of the Complaint
The complaint was lodged by Bharti Sharma, who purchased a Mahindra XUV700 from Sri Durga Automobiles, a Delhi-based authorized dealer, in June 2024. Sharma secured an extended warranty for her vehicle, valid until July 2029. During scheduled maintenance in January 2025 and January 2026, she opted for Pakelo Krypton XT LA-V SAE 5W-30 engine oil. The dealer used this oil without warning her that it might impact the warranty.
Subsequently, after the January 2026 service, the vehicle exhibited a “check engine system” warning and experienced reduced acceleration. A defective turbocharger was diagnosed, with an estimated repair cost of ₹50,000. Sharma’s warranty claim was rejected on the grounds that the engine oil was not sourced from Mahindra’s network. Mahindra informed her that using third-party engine oil could invalidate the warranty.
CCI’s Findings
The CCI examined the terms of the warranty agreement between Mahindra and the consumer, which stipulated that engine oil should be obtained from Mahindra or its authorized dealers. The Commission ruled that these terms do not constitute a vertical restraint under Section 3(4) of the Competition Act. Moreover, the CCI found no evidence of abuse of dominance under Section 4.
The Commission stated, “Such conditions may reasonably require the owner to adhere to specified standards and use recommended consumables.” It concluded that warranty terms, as long as they are clearly communicated and related to safety and performance, are legitimate.
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Conclusion
The CCI emphasized that the dispute was more about the specific warranty conditions applicable to Sharma’s vehicle than a broader issue of market power abuse. It noted that manufacturers can set technical specifications and maintenance requirements to ensure safety, reliability, and vehicle performance. The Commission found no prima facie violation of Sections 3 or 4 of the Competition Act and closed the case.
