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Govt may slap Rs 1 lakh fine on cos making faulty vehicles

By Motortrend India Staff   |   06 September,2011

The road transport and highways ministry is planning to formulate a stringent policy that will hold manufacturers accountable for making faulty vehicles. An expert committee appointed by the ministry has recommended slapping Rs 1 lakh fine on manufacturers for each faulty vehicle or a three-month jail term or both.

The ministry is working on amendments to Motor Vehicle Act. The ministry is under pressure amid a growing demand to formulate a policy on mandatory product recall like other developed nations.

Sources said new recommendations stipulate that in case a consumer finds manufacturing faults with engine or any other parts, s/he would be able to lodge a complaint with the state transport authority (STA). Consequently, experts would investigate the case and suggest action. Increasing complaints from consumers and rise in instances of recalls by manufacturers have called for new rules. The ministry will hold a meeting with stakeholders to discuss these issues next week. Last year, the government had proposed a penalty of Rs 10 lakh on the manufacturers for each faulty vehicle and introduced a bill to set up National Road Safety and Traffic Management Board. However, the standing committee sent the bill back.

In India, companies like Maruti and Honda, have recalled particular batches of cars after detecting faults in some of their parts.

“The defective vehicles having defects are usually recalled under the product recall mechanism in other countries by the national road safety authority in case the manufacturers failed to voluntarily recall the defective vehicles. This mechanism has been created by the authorities to protect consumer interest,” said S P Singh of Indian Foundation of Transport Research and Training.

He added that due to resistance from vehicle manufacturers and tyre makers, the mandatory recall mechanism has not been enacted by the government even though the world's most saleable vehicle brands are available in the domestic market.

In several letters to the roads transport and heavy industries ministers, the IRTFT has claimed that the vehicle manufacturers in India occasionally recall defective vehicles to “safeguard their image” rather than display their “concern for the safety of vehicle owners and other road users”.

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