NEW DELHI: TO fix the responsibility of vehicle failures on automobile firms, the government has proposed stringent penaltes to the extent of Rs 100 crores for non-compliance of automobile regulations by auto companies and power to order a compulsory recall within the stipulated time frame in the event of defects being found.
Reimbursing buyers for the full cost of the motor vehicle is also proposed in the amendment to the Motor Vehicle, Act, 1988 by the Ministry of Road, Transport and highways (MoRTH). The amendments have been circulated to all central ministries for feedback as the amendments are proposed to be introduced during the monsoon session of the Parliament.
“Apart from the mandatory recall, a Rs 100 crore penalty has also been proposed and the amount is still nothing much compared to the number of vehicles each company sells annually,” said a senior transport ministry official.
The industry had announced a voluntary code on vehicle recalls in July 2012 and 17.70 lakh cars have been recalled by car makers between 2012 and 2016 so far.
Under the voluntary code, whenever a safety defect which poses risk of accident or harm to the vehicle occupant is recognized, the manufacturers conducts a voluntary recall and offers to rectify the defect free of cost. A testing agency like Automotive Research Association of India (ARAI) will come up with standard operating procedures to be followed for the assessment based on the complaints.
The consent of states has also been taken, with the amendment being based on the recommendation made by a Group of Ministers (GoM) constituted to deliberate on the issues. The move was opposed by car makers in 2014 when the Draft Road Transport and Safety Bill, was floated by the Transport ministry, saying it was arbitrary and unnecessary.