SC stays NGT order in emissions case | VW’s relief might be temporary | Cheat Device Scandal: India Edition
‘No coercive action’ with respect to the ₹500-cr fine, says Supreme Court
“It’s a very unfortunate situation for both parties as in India we didn’t have the stringent rules when it comes to vehicular emissions.” – Anil Sharma, Associate Director, MarketsandMarkets
- The Supreme Court stayed an order of the National Green Tribunal that imposed a ₹500 crore fine on the Indian arm of Volkswagen.
- The NGT had imposed the fine on the German automaker for harming the environment with so-called “cheat device” in its diesel cars sold in India.
- A bench led by NGT chairperson Justice Adarsh Kumar Goel had ordered the car maker to deposit the amount within two months.
- Volkswagen India denied having used any “cheat device” in its diesel cars in India, and moved the SC to challenge the NGT verdict.
- A two-judge Bench of Justice S A Bobde and Justice S Abdul Nazeer stayed the execution of the fine, stating no coercive action be taken.
The Supreme Court also asked the Central Pollution Control Board to respond as well as one Saloni Ailawadi, a Delhi school teacher who, along with few others, had moved the NGT to seek a ban on the sale of Volkswagen cars in India citing alleged violation of emission norms.
On the SC’s verdict, Anil Sharma of MarketsandMarkets opined:
“Now to expect an automaker to make vehicles in compliance with global standards is not a realistic thing to do. So, I think it would be quite a stretch to penalize Volkswagen for their diesel engines in India as they never flouted the Indian emission standards,”
The Cheat Device Scandal from 2015
The development stems from the 2015 emissions cheating scandal that engulfed Volkswagen in the US. The authorities had discovered that diesel vehicles from VW had nitrogen oxide emissions 40 times that of the permissible limits. Volkswagen plead guilty of using a device that showed emissions within permissible limit when they were tested in labs. The company was asked to pay a heavy fine by a US federal court.
The company then initiated a recall of 11 million diesel vehicles produced between 2009 and 2015 fitted with the EA 189 diesel engines across the world.
Diesel VWs were recalled in India too
VW recalled around 323,700 cars in India in December 2015 for technical updates. The brands included Volkswagen, Skoda, and Audi and recalled cars were those fitted with EA 189 diesel engines.