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GM India crashes into Tavera mess, faces Rs 11 cr fine for corporate fraud

The inter-ministerial fact-finding committee formed to probe alleged non-compliance of emission norms and other violation in production of Chevrolet Tavera multi-purpose vehicles, if any, by General Motors (GM) India has recommended a fine of Rs  11 crore on General Motors (GM) India for corporate fraud.

Kartikeya Sharma   New Delhi     Last Updated: October 24, 2013  | 14:34 IST
GM India crashes into Tavera mess, faces Rs 11 cr fine

The inter-ministerial fact-finding committee formed to probe alleged non-compliance of emission norms and other violation in production of Chevrolet Tavera multi-purpose vehicles, if any, by General Motors (GM) India has recommended a fine of Rs  11 crore on General Motors (GM) India for corporate fraud.

GM India announced recall of 1.14 lakh units of Tavera manufactured between 2005 and 2013 to address emission and specification issues. The report would be forwarded to heavy industries minister Praful Patel for final approval in a day or two.

The report recommends that the government must do away with the system of prior notice which extends to 10 days in the case of testing of conformity to production standards. The committee discovered that GM India provided only better- performing engines for testing.

The report further recommends that testing pool must be increased and staff augmented by the government adding that it should be ensured that same people don't test engines again and again. India should introduce the practice of testing vehicles wholly, not in parts, which is open to manipulation, the report adds. Such testing is the standard practice in the United States and Europe.

The committee members also felt that critical components of a car must have unique identity numbers. In India, only the engine has a unique number, called the chassis number.

Sources said that emission components, brakes and basic security features of a car can be issued such unique identity numbers to prevent manipulation of testing.

The ministry of industries is also preparing a draft Bill on a mandatory recall policy which will allow the government to take suo motu decisions in cases of corporate fraud and non- compliance of standards. This would enable the government to take cognisance of public complaints of individuals, non- governmental organisations, and even cases of accidents would constitute a part of it.

As of now, the mandatory recall policy is being implemented by countries like the United States, Japan and China.

When asked whether any penalty will be considered on the company, Oscar Fernandes, minister of road transport and highways, said that a decision can be taken only after the report is studied in totality.

FERNANDES CLAIMS NEW RECALL FIGURES

OSCAR Fernandes, minister of road transport and highways, has claimed that General Motors (GM) India had recalled 1.6 lakh units of Chevrolet Tavera due to emission norms violation, but the company insisted that the number was 1.14 lakh.

Fernandes said on Wednesday that the auto major has admitted to certain lacunae on its part in maintaining some standards in the report submitted to the road ministry by a three- member panel. "The report has been submitted to us. We have to go through it. There was a lacuna in maintaining certain standards which the company itself admitted and has taken out 1.60 lakh vehicles out of circulation," Fernandes told reporters in New Delhi.

A GM India official said, " As per our records, potentially impacted vehicles after BSIII introduction are 1.14 lakh and we have recalled all of them. If there are more as per records available with the transport department, we will recall them as well being a customercentric organisation."

As appeared in Mail Today dated October 24, 2013



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