I believe it's very common. My only experience of this is Landscape Photographer of The Year. From what I remember when I entered a few years ago they allow light manipulation in line with what you can do in a darkroom, i.e. cropping, local dodging / burning / colour balance and so on, but wholesale removal of objects from a scene is considered a no no. Finalists must agree to submit raw files so that the extent of modification can be verified.
I guess the idea is you're supposed to be capturing a representation of the natural world, so adding or removing things isn't really true to that, so I suppose you've got to draw the line somewhere.
I guess at some point, after a certain amount of manipulation the image stops being a representation of reality and becomes art, which is a much broader canvas.
I think Thomas Heaton recently did a video on what's considered "cheating" in competitions. Some are really strict, others less so, but also some of the examples he shows really did deserve to be disqualified.