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Volkswagen agrees to comply with NGT order to deposit Rs 100 crore

The tribunal appointed expert committee recommended a fine of Rs 171.34 crore on Volkswagen for causing environmental damage but the automaker has moved Supreme Court.

twitter-logoBusinessToday.In | January 17, 2019 | Updated 17:38 IST
Volkswagen agrees to comply with NGT order to deposit Rs 100 crore

The National Green Tribunal (NGT) today slammed German auto major Volkswagen for not depositing Rs 100 crore in accordance with its previous order for causing "serious environmental damage", and directed it to submit the amount by 5 pm on Friday. The company has said that it will comply with the court's orders.

"The Volkswagen Group reiterates that all cars from the group are compliant with the emission norms in India. The order of the honourable NGT is already under challenge before the honourable Supreme Court. However, the Volkswagen Group India will comply with the order of honourable NGT and deposit the money, as directed," a Volkswagen Group India spokesperson said this afternoon.

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Earlier in the day, a bench headed by NGT Chairperson Adarsh Kumar Goel had taken strong exception to the non-compliance of its November 2018 order and subsequently deferred the matter for hearing after it was informed that the automaker has moved Supreme Court. "Why have you not complied with our order when there is no stay? We will not give you any further time," the bench had stated. The apex court will reportedly hear the matter on January 21.

So, what is the case about?

The tribunal is hearing pleas filed in 2015 against Volkswagen vehicles for alleged violation of emission norms in the wake of the Dieselgate scandal in the US. Volkswagen had admitted to the use of a ''defeat device'' in 11 million diesel engine cars sold in the US, Europe and other global markets. A ''cheat'' or ''defeat device'' is a software in diesel engines to manipulate emission tests by changing the performance of the cars.

After Pune-based Automotive Research Association of India (ARAI) conducted tests on some Volkswagen models and found that their on-road emissions were 1.1 times to 2.6 times higher than the applicable BS-IV norms, Volkswagen India had undertaken to rejig the software by recalling around 3.23 lakh vehicles fitted with EA 189 diesel engines which were in alleged violation of emission norms. The company, however, had said that the recall in India was purely voluntary in nature as it did not face any charges regarding violating emission norms in India unlike in the US.

On November 16 last year, the tribunal had said that the use of 'cheat device' by Volkswagen in diesel cars in India led to inference of environmental damage and had asked the German auto major to deposit an interim amount of Rs 100 crore with the Central Pollution Control Board (CPCB).

A four-member committee was also formed to look into whether Volkswagen has exceeded the prescribed environmental norms and arrive at a fair estimate of the damage caused to the environment.

The panel comprised ARAI director Rashmi Urdhwareshe, Dr Nitin Labhsetwar, chief scientist of CSIR-NEERI, Ramakant Singh director, Ministry of Heavy Industries, and Prashant Gargava, member secretary of CPCB. This quartet estimated that in 2016 Volkswagen cars had released approximately 48.678 tonnes of nitrogen oxide (NOx) - a smog-forming pollutant linked to heart and lung disease - in the national capital.

So the panel has recommended a fine of Rs 171.34 crore on the auto company. "The value may be considered conservative due to lack of methodologies for calculating the overall impact of NOx on environment in India and hence only health damages are valued," the committee added in its report. The penalty was determined on the basis of the 3.27 lakh Volkswagen cars in India that had deceit software installed.

"There are certain recommendations in the report which Volkswagen Group India seeks to object; the issue is presently pending before the Supreme Court and the National Green Tribunal," the Volkswagen Group India spokesperson said yesterday.

"The VW case in India has only emerged after the scandal was detected and penalised in Europe and North America. In the case of India, several other manufacturers have, in the past, been tested, and it has been found that real-world emissions on the road far exceed the permissible standards," Polash Mukerjee, senior research associate (Clean Air and Sustainable Mobility) at the Centre for Science and Environment, told Down To Earth magazine.

Significantly, the Motor Vehicle Amendment Bill, 2017, pending in the Parliament for over two years, reportedly includes a provision for mandatory recall of defective vehicles by the manufacturer, along with a provision for penalising manufacturers for vehicles that fail to meet standards.

With PTI inputs

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