BS4 Vehicle Registration: FADA Draws Supreme Court’s Ire

The SC has now asked FADA to furnish details of the BS4 vehicles sold since its order dated March 27

• Earlier, the BS4 stock was supposed to be sold off completely by March 31, 2020.
• Due to the coronavirus pandemic, the deadline was extended, allowing a 10-day grace period.
• But the SC allowed manufacturers to sell only 10% of the unsold BS4 stock in this period.
• The dealers reportedly sold more than that.

The Indian auto industry was supposed to graduate to BS6 emission norms by April 1, 2020. This meant that the remaining stock of BS4 vehicles were supposed to be cleared off by March 31, 2020. Coronavirus then threw the entire auto industry off the rails with virtually zero sales thanks to the strict lockdown to contain the pandemic. So, thanks to the appeal from Federation of Automobile Dealers Associations (FADA), the Supreme Court allowed a grace period of 10 days to sell off the remaining stock, provided they sold off only 10 per cent of their unsold inventory. This amounted to 1.05 lakh vehicles. But FADA reportedly sold 2.55 lakh vehicles, drawing the Supreme Court’s ire.

The court has given FADA until June 19 to come up with all details about the sale and registration of those excess BS4 vehicles. It said, “Where is the affidavit? What will happen to the vehicles that you have already sold? Do you think this is a game?" The Supreme Court has also asked the central government to furnish necessary details on the sale and registration of the BS4-compliant vehicles during the grace period. 

Some bikemakers like Royal Enfield cleared off its BS4 stock well before the deadline but a lot of other manufacturers had unsold BS4 vehicles left in their inventories. It looks like a lot of manufacturers failed to learn from the chaos that ensued when the industry switched from BS3 to BS4 emission regulations. Even though many brands launched BS6-compliant iterations of their existing lineup well ahead of the deadline, they seem to have failed to clear their BS4 stocks on time.

The Supreme Court’s ruling to clear 10 per cent of the stock in the matter of just 10 days post lockdown also came across as challenging. It was especially tough on the dealers because the entire world was facing a pandemic unlike anything before. This was then followed by a wave of job losses and buying a vehicle would’ve been the last thing on the minds of a consumer. Despite this, dealers managed to sell more than what was allowed. If only they had done this sooner than wait until the last moment. What do you guys think?

Source: PTI