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Tata Motors v. GNCTD : Delhi High Court observations

December 06, 2021
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This article is written by Rishika Rathore, from the school of law, Jagran Lakecity University. This article explores different schemes and administrative associations of the Delhi government as well as the Central government, incorporated to tackle the growing air pollution considering the view of Tata Motors vs GNCTD case. 

Introduction 

Air pollution is the prominent cause of premature disease and death, and the largest environmental health threat around the globe. Apart from jeopardized life and diminishing lifespan, air pollution negatively affects economic productivity. It would not be startling to know that one of the main sources of ambient particulate matter pollution in India is transport vehicles. On that account, India needs state-specific strategies that could lead to substantial benefits for public health as well as the economy, along with a successful reduction of air pollution.

The air quality of India’s Capital Delhi is the worst among all the major cities in India. Thus, reckoning this increment in air pollution, the Delhi government has introduced Delhi Electric Vehicle Policy, 2020. Following this decision of the Delhi government, many automobile manufacturing companies started producing Electric Vehicles, including India’s biggest automobile manufacturer, Tata Motors. But, soon it came out as a faux pas for the company, and the concerned matter went to the doorstep of the Delhi High Court, as opposed to the Government of National Capital Territory of Delhi (Amendment) Act, 2021. This article will answer the questions like, what is Delhi EV policy and its matter with Tata Motors, what circumstances lead Tata Motors towards the Delhi High Court, what was the Court’s decision and finally conclude all the scenarios.  

Background of the case

In February, an owner of Tata Nexon EV complained to the government about the mileage issues. The matter was posted on Twitter by Kailash Gahlot, Delhi Transport Minister, announcing the delisting of the car after receiving complaints from an owner of the said model. The owner’s complaint had arguments concerning that despite the company claiming a mileage of 312 km on a single charge, he hardly got more than 200 km. Moreover, he claimed that he went to Tata dealerships multiple times to get the issue resolved but got no relief. Therefore, he eventually turned to the Delhi government by sending his complaint, as he bought the vehicle under the Delhi Electric Vehicle Policy, 2020. Consequently, the Transport Department of Delhi issued a show-cause notice to Tata Motors and sought its reply in the matter.

Before jumping on issues involved in the case, one must know about the aforementioned Act, policy, and association.   

The Government of National Capital Territory of Delhi India (Amendment) Act, 2021

The Government of National Capital Territory of Delhi Act 1991 was validated to “add-on provisions of the Constitution relating to the Legislative Assembly and a Council of Ministers for the National Capital Territory of Delhi”. In previous days, the Supreme Court appreciated the 1991 developments, saying that the main idea behind the Constitution (69th Amendment) Act, 1991 is the establishment of a democratic set-up and representative form of government wherein the majority has a right to incorporate their opinions about laws and policies concerning to the NCT of Delhi conditional to the limitations imposed by the Constitution.

In March 2021, the Act got altered by giving priority to the Lieutenant Governor (L-G) over the elected government in the city. This alteration came into force as the Government of National Capital Territory of Delhi (Amendment) Act, 2021. 

Key Provisions of the Act  

  1. It amended Sections 21, 24, 33, and 44 of the 1991 Act, stating that the “government” in the National Capital Territory of Delhi meant the Lieutenant-Governor of Delhi.
  2. It gives discretionary powers to the Lieutenant-Governor including the matters where the Legislative Assembly of Delhi is authorized to make laws.
  3. It forbids the Assembly or its committees to conduct inquiries about administrative decisions and from making rules to taking up matters concerning routine management. 
  4. It looks forward to ensuring that the Lieutenant-Governor is “certainly granted an opportunity” to give her/his opinion before any decision taken by the Delhi Cabinet gets implemented.

Delhi Electric Vehicle Policy, 2020

In its 2018-19 budget, the Government of NCT of Delhi had introduced the “Green Budget” to reduce vehicular emissions to tackle air pollution in the region. Among all the mobility policies present in the Green Budget, one of the key initiatives was Delhi Electric Vehicle Policy, 2020.

On August 7, 2020, Delhi Government took the initiative to tackle growing air pollution in the territory by introducing the Delhi Electric Vehicle Policy 2020 to promote the adoption of electric vehicles, making the city of Delhi, the EV capital of India. The policy has an intention to deploy 25% of all new vehicles to be battery-operated, by 2024. Along with this, it has the ultimate goal of putting 5 lakh electric vehicles on the roads of Delhi. The current percentage of moving electric vehicles in Delhi is 0.2 percent. 

Motives of the policy

The motives of this policy were constructive in addition to the central government’s FAME II scheme, resulting in the establishment of an EV cell to ensure the ground-level implementation of this scheme. Delhi EV policy had motivated electric buyers by providing premiums up to Rs. 30,000 on electric scooters, e-rickshaws, and e-good carriers. Moreover, it provides interest-free loans on commercial EVs along with free registration to all-electric vehicles. The funding for these motives would be supported using the State EV Fund’ with contributions from various sources such as pollution cess, road tax, congestion fee, and from the Environment Compensation Charge (ECC).

EV based Infrastructure

The Delhi Government has also been concerned about the development of EV-based infrastructure and awareness, thus it made plans on setting up 200 EV-charging stations in the city over the coming years. Adding to the positives of this scheme, a 100 percent subsidy was offered by the government on using charging apparatus, which was restricted to Rs.6000 for 30,000 units. New infra was thrust towards the new employment. Being mindful of this, the Delhi government carried out training courses especially for youths, impacting skills and generating new jobs in the sector of electric vehicles. This policy is coincidentally India’s first announced scrappage policy.

Automotive Research Association of India (ARAI)

The Automotive Research Association of India was established in 1966 as a leading automotive Research and Development organization initiated by the Automotive Industry along with the Government of India. It is one of the prominent Testing and Certification agencies reported under Rule 126 of Central Motor Vehicle Rules, 1989, by the Government of India. It is recognized as a Scientific and Industrial Research Organization (SIRO) by the Department of Scientific and Industrial Research as well as by the Ministry of Science and Technology. 

The ARAI is an independent body affiliated with the Ministry of Heavy Industries and Public Enterprises. It has its registered office at Kothrud, Pune. It has two divisions namely, Homologation and Technology Centre (ARAI-HTC) and Forging Industry Division (ARAI-FID), both situated in the industrial hub of Chakan, Pune. ARAI plays a major role in assuring less polluting, safe, and more efficient reliability of vehicles.

FAME II Scheme

Faster Adoption and Manufacturing of (Strong) Hybrid and Electric Vehicles (FAME) in India Scheme 2021 was launched out of the concern of increasing pollution, occurring due to diesel and petrol operated vehicles. The second phase of this scheme was inaugurated providing 670 electric buses to the states of Maharashtra Goa Gujarat, and Chandigarh. Additionally, 241 charging stations were planned to be made on the streets of Madhya Pradesh, Tamil Nadu, Kerala, Gujarat, and Port Blair.  The goal of the second phase of the Fame India Scheme 2021 is to support approximately 7000 e-Buses, 5 lakh E-3 Wheelers, 55000 E-4 Wheeler Passenger Cars, and 10 lakh E-2 Wheelers by providing subsidies on such vehicles.

The ultimate motive of this scheme is to encourage Indians to buy electric vehicles. Through this scheme, the government is going to provide subsidies on the purchase of new electric vehicles which will promote electric mobility. Previously this scheme was launched from 2019 to 31st March 2022, but the government extended it for 2 years, making it applicable till 31st March 2024. Under this scheme, necessary charging infrastructure will also be set up for electric vehicles. The government has also increased the subsidy incentives from Rs 10000 per kWh to Rs 15000 per kWh. Thus, the scheme will be helped in the encouragement of the interlinking of renewable sources of energy which will be empowered through charging systems. 

Issues involved 

Considering the chaos regarding Tata Nexon EV, the Deputy Commissioner of GNCTD ordered the removal of the said vehicle from the list of eligible vehicles for subsidy. Subsequently, Tata Motors filed a writ petition under Delhi High Court. 

Arguments by Tata Motors 

  1. Tata Motors submitted its reply on the matter, stating that the said mileage of 312 km is based on the Automotive Research Association of India (ARAI) testing, the nodal agency that is responsible for vehicle testing ahead of launches. 
  2. The mileage figure for Nexon EV, given by ARAI, is a verified figure achieved under the standards established by law.
  3. The said the vehicle meets the eligibility criteria for the central’s government FAME II scheme as it touches the minimum range of 140 km
  4. As far as the complaint regarding certified mileage of 312 km is concerned, Tata claimed that like any other vehicle, Nexon EV will also deliver mileage less than, or occasionally, more than the claimed number because the mileage is affected by driving style, roads, etc. 
  5. The Nexon EV has become one of the renowned cars and India’s first eco-friendly car. Thus, if the order not gets stayed, it would hamper the sales of the said car

Responses by GNCTD

  1. The single test result by ARAI cannot overturn the claim by the complainant who has witnessed a consistent 200 km range in real-life conditions on the roads. 
  2. Tata Motors never made efforts, neither voluntarily nor dutifully, to verify the complaint despite knowing the fact that there were more of such complaints.
  3. The government cannot subsidize untrue products and if such products came into the market, it will be contemptuous of the subsidy policy. 
  4. If the government will not entertain such complaints, the public will lose trust in Original Equipment Manufacturer stated range figures that act as an important factor in car-buying decisions. 

Concurrent with the events, the Government of Delhi constituted a 5-member committee panel to verify the claims of complainants and thrust out the final decision on the matter while suspending the perks on Nexon EV with instant effects. 

Court’s observation 

The Delhi High Court observed that the disputed order, passed by Delhi Government, lacks the process of verification. The order that came before constituting a committee highlights the fact that there was no concrete material with the officer prior to the order. Moreover, the Court stated that an inspection committee cannot take the place of the statutory testing agency specified under the Central Motor Vehicle Rules, 1998. The inspection committee can submit a report to a statutory agency for consideration but cannot create a foundation for discarding the certification. 

Judgment 

By considering the issues involved, the court observed that case and came up with the judgment. The Honourable Court of Delhi issued a notice on the company’s writ petition and granted interim relief by grading a stay order against the delisting of Tata Nexon EV from the Delhi government’s subsidy-qualified list of vehicles under EV policy, 2020. As per Court orders, the interim stay was concrete otherwise irrevocable loss or damages will be incurred towards both the government and their policy. Furthermore, the Court granted time to the Delhi government to file the counter-affidavit. 

Conclusion 

For a few years, the Capital of India has been counted as the most polluted state in the country. Air pollution has become such a big issue in the city that many times the government had to shut down schools and colleges due to fear of certain respiratory diseases. The government of Delhi has taken many initiatives to cope up with the emerging pollution by its innovative schemes like odd-even, Red light on Gaadi off campaign, banning of disposable generators, etc. Continuing this custom, the government of Delhi introduced the Delhi Electric Vehicle policy 2020, which promoted the usage of electric vehicles. Tata Motors, known for its strongest and efficient cars, introduced its Tata Nexon EV. 

The major benefit of electric cars is the contribution that they can make towards improving air quality in towns and cities. In over one year, just a single electric car on the roads can save an average of 1.5 million grams reduction in CO2. These cars do not have tailpipes, thus pure electric cars produce no carbon dioxide emissions when driving. This reduces air pollution considerably. But, a customer is a god and if we fail to satisfy the god, we should be ready to face the consequences. Thus, it is the responsibility of all the citizens to move towards electric vehicles, and the government of India, with the help of automobile companies, must provide us with efficient and reliable EVs. This process should go simultaneously.

References 

  1. https://www.google.co.in/amp/s/m.timesofindia.com/auto/cars/tata-motors-vs-delhi-govt-court-grants-interim-relief-over-delisting-of-nexon-ev/amp_articleshow/81434686.cms
  2. https://www.google.co.in/amp/s/www.firstpost.com/tech/news-analysis/tata-nexon-ev-range-controversy-delhi-high-court-grants-interim-relief-to-tata-motors-9404061.html/amp.

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