SC bans sale, registration of BS-III vehicles from April 1

Automobile manufacturers have just two days — Thursday and Friday — to clear their stock of BS-III compliant vehicles, with the Supreme Court on Wednesday refusing to extend the March 31 deadline.

The health of the citizen is more important than the commercial interests of the automobile industry, the apex court observed while banning sale and registration of BS-III vehicles from April 1.

“On and from April 1, such vehicles that are not BS-IV compliant shall not be sold in India by any manufacturer or dealer, that is to say that such vehicles, whether two-wheeler, three-wheeler, four-wheeler or commercial vehicles will not be sold in India by any manufacturer or dealer on and from April 1,” a Bench of Justices Madan B Lokur and Deepak Gupta ordered.

The Court further prohibited all the vehicle registering authorities from registering BS-III vehicles on and from April 1 under the Motor Vehicles Act, 1988.

“All the vehicle registering authorities under the Motor Vehicles Act, 1988 are prohibited from registering such vehicles on and from April 1, 2017 that do not meet BS-IV emission standards, except on proof that such a vehicle has already been sold on or before March 31,” the Court directed.

When the verdict came for this almost decade-long contentious issue, there was a mixed reaction from the auto industry. While some supported the move, some said the government should give manufacturers some more time to clear the inventory. Some also said that the oil industry should be ready with the BS-IV fuel first.

“Auto industry has been ready with BS-IV manufacturing since 2010. However, the sale of BS-IV vehicles was not possible, nationwide, due to lack of BS-IV fuel. Auto industry is law abiding and is in full compliance with the emission norms set by government that stipulates date of ‘manufacturing’,” said Vinod K Dasari, President, Society of Indian Automobile Manufacturers (SIAM).

Running a BS-IV vehicle with BS-III fuel can cause severe problems to some vehicles, Dasari said.

Auto manufacturers had argued that they were entitled by law to manufacture BS-III vehicles till March 31, 2017. They had not violated the law. So, the sale and registration of these vehicles should not be prohibited after April 1 and that they should be given reasonable time to dispose their stocks. They submitted that they were saddled with a stockpile of 8.24 lakh BS-III compliant vehicles.

But the Court did not pay heed to this. The Court, in fact, asked why manufacturers decided to sit back and not take proactive steps despite knowing way back in 2010 that BS-IV norms would kick in by April 2017.

Some of the companies like Maruti that had already started preparing since 2010 will be at an advantage. Tata Motors said it is assessing the impact of the order on its BS III inventory at both the company’s and dealers’ end.

“We have reduced our inventory significantly in the past few months with the aim to minimise our stakeholder losses. However, environmental protection will take precedence over temporary financial benefits,” said Pawan Munjal, Chairman, Managing Director and Chief Executive Officer, Hero MotoCorp.

The Supreme Court also observed that SIAM had submitted data on the manufacturing and sale of BS-III vehicles on a monthly basis from January 2016 and told the court that the companies were holding stock of around 8.24 lakh such vehicles, including 96,000 commercial vehicles, over six lakh two-wheelers and around 40,000 three-wheelers.

The Centre too had favoured aloowing companies to sell the existing stock of BS-III vehicles.

However, the Court agreed with the arguments of its amicus curiae , who said that allowing their sale after April 1 would be a cause for “potential health hazard” for millions of people. The Court pointed out that the new fuel was “cleaner” and the oil refineries had spent about ₹30,000 crore since 2010 to produce it.

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