Even as the government is working out the modalities of the FAME III scheme, it is awaiting refunds worth Rs 300 crore ( with interest) from companies that have allegedly flouted the norms of the previous edition of this subsidy scheme.
FAME India scheme is a government-backed subsidy scheme under the National Electric Mobility Mission Plan (NEMMP). FAME stands for Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India.
A senior official from the Ministry of Heavy Industries (MHI) revealed that among the electric vehicle (EV) manufacturers that the government had pulled up for violations of the FAME-II policy, Revolt Motors, Ampere Electric (acquired by Greaves Cotton) and Amo Mobility have refunded the subsidies they had earlier received from the government. Companies such as Hero Electric Vehicles, Okinawa Autotech, and Benling India Energy and Technology are yet to repay the penalties (with interest) to the government.
Dr. Hanif Qureshi, Additional Secretary, MHI told Moneycontrol that Greaves Mobility has returned about Rs 139 crore. Revolt Motors and AMO mobility paid back Rs 50 crore and Rs 90 lakh respectively (including interest).
The matter came to the fore in 2022 when the MHI received complaints from whistleblowers that several registered OEMs were selling vehicles without meeting localisation norms under the FAME II scheme and were indiscriminately importing parts. The ministry investigated 13 companies and fined six of them, including Hero Electric, Okinawa Autotech, Ampere Vehicles (Rs 124.91 crore), Benling India, AMO Mobility (Rs 83 lakh). These companies were collectively fined a total of Rs 470 crore (excluding interest rates). Ampere is owned by Greaves Cotton.
“Basically, it is a subsidy which was paid by the government to them, which they have to return with interest. We are yet to receive the dues from Hero Electric, Okinawa Autotech and Benling,” Qureshi told Moneycontrol. He stated that Hero Electric is due to pay Rs 135 crore, Okinawa Autotech Rs 117 crore, and Benling India Rs 50 crore (all excluding interest).
What OEMs say
Revolt Motors and Greaves Cotton confirmed to Moneycontrol that they have refunded the subsidies to the tune of Rs 50.2 crore and Rs 124 crore (along with interest) respectively to the government. The Amo Mobility spokesperson didn’t respond to queries sent by Moneycontrol.
To be sure, OEMs which are yet to repay the government, have contested the government’s claims and some of them have already taken legal recourse to resolve the issue.
One of the sources affiliated with the company stated that there are certain gaps in policy implementation, selective interpretation of policy guidelines and lack of uniformity in decision making by MHI and testing agencies.
For instance, Benling has filed a writ petition in court for recovering their subsidy of Rs 65 crore from MHI.
A Hero Electric spokesperson stated that it has been actively engaged in discussions regarding this matter for over 18 months.
“While the matter is subjudice, our stance is publicly available, and we remain committed to resolving this issue. We have proposed solutions for an amicable settlement. On the matter of non-compliance, we have provided the MHI with necessary information demonstrating that the order in question does not apply to us for the specified timeframe.”
The Okinawa Autotech spokesperson stated, “We have filed a writ petition in Delhi High Court to recover our pending subsidy of Rs 424 crore from MHI. The matter is subjudice.” The company clarified that Rs 424 crore is its pending subsidy withheld by MHI and it does not take into account penalty imposed of Rs 117 crore.
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