FADA approaches court seeking extension of sale

Business Bureau :

AUTOMOBILE dealers’ body FADA on Tuesday said it has filed an application with the Supreme Court seeking extension of sale and registration of BS-IV vehicles till May 31, 2020 -- an extension of two months from March-end deadline to clear the stock of such models. The Federation of Automobile Dealers Associations (FADA) on behalf of its members has once again approached the Supreme Court, and has filed an interlocutory application along with an application seeking modification in writ petition dated October 24, 2018. In the petition, in the matter of M C Mehta versus Union of India and others, the apex court had directed that no motor vehicle conforming to emission standard BS-IV shall be sold or registered in the entire country with effect from April 1, 2020.

“We have submitted an application with the Supreme Court for extension of registration process of BS-IV vehicles till May 31, 2020. We are now seeking an urgent hearing on the matter,” FADA President Ashish Harsharaj Kale said. The two-wheeler BS-IV inventory at dealerships across the country stood at around 8.35 lakh units valued at around Rs 4,600 crore, he added.

“The situation in the passenger vehicle and commercial vehicle segments is much better as compared to two-wheelers,” Kale said. FADA had filed an application earlier as well which was rejected by the apex court on February 14 this year. “Post our initial application, necessitated due to huge unsold BS-IV inventory and slowing sales, getting rejected by the apex court on February 14, 2020,” he said. , there has been a drastic change in circumstances in conducting business as usual,” Kale said.

The spread of coronavirus has led to a drastic drop in sales and customer walk-ins have reduced to a trickle, he added. “As caution sets in due to fear of spreading of the virus, counter sales has fallen by 60-70 per cent across auto dealerships in these past few days,” Kale said. The situation has worsened in the past three-four days with partial lockdown situation in many towns and cities and few district magistrates have started issuing notices of closure of shops and establishments including auto dealerships to stop the spread of virus, Kale said.

“Owing to situations which are beyond our control and the fact that many of our members may face dealership closures if left with unsold BS IV stocks, FADA has once again approached the apex body with a request for permission of sale and registration of BS-IV vehicles till May 31, 2020,” he said. It hopes to get an urgent hearing in the Supreme Court owing to the criticality of the issue and the deadline of March 31, he added. On Monday, auto industry body SIAM had said that it has filed an application in the Supreme Court seeking sale and registration of BS-IV vehicles till March 31, 2020. Society of Indian Automobile Manufacturers (SIAM) said that some state governments have recently issued circulars directing that no application for registration of BS-IV vehicles would be accepted on or after certain dates, which are much ahead of March 31, 2020.

“The cut-off dates range from February 29, 2020, to March 25, 2020, from state to state, though BS-VI emission compliance is mandated from April 1, 2020,” he had said. These circulars have put customers, dealers and vehicle manufacturers in severe discomfort as each of them are racing against time to exhaust the BS-IV stocks which are with the dealers, SIAM President Rajan Wadhera had said. In the current circumstances, any unsold BS-IV vehicle would end up as scrap after March 31, 2020. From April 1, only BS-VI compliant vehicles will be registered in the country.