Allegations of Subsidy Misuse Prompt Government’s Contemplation of Legal Action Against Major Electric Vehicle Companies
The Indian government is contemplating legal action against leading electric vehicle (EV) manufacturers, including Hero Electric, Okinawa Autotech, and Benling India, for their alleged failure to reimburse subsidies obtained under the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME) scheme. This decision follows the Ministry of Heavy Industries‘ unsuccessful attempts to recover disputed amounts from these entities, as per reports from ET.
It is estimated that Hero Electric may owe around INR 155 crore, Okinawa Autotech INR 125 crore, and Benling India INR 50 crore, making them among the primary offenders accused of wrongfully claiming subsidies under the FAME scheme. Additionally, recovery notices have been served to other EV manufacturers, including Ampere EV, Revolt Motors, Lohia Auto, and AMO Mobility, who have resolved the issue by repaying the subsidies along with penal interest.
Benling India’s CEO, Amit Kumar, maintains the company’s adherence to the FAME II scheme’s guidelines and requirements. However, discrepancies arose due to fewer subsidy payments received compared to the number of vehicles sold, resulting in pending subsidy amounts with the government.
Hero Electric has actively engaged in discussions to resolve the matter, presenting various proposals and evidence of compliance with FAME guidelines to the Ministry of Heavy Industries over the past 18 months. Meanwhile, Okinawa Autotech has acknowledged the issue’s complexity, stating that the matter is currently sub judice, awaiting further instructions from the honorable high court.
This development underscores the government’s commitment to transparency and accountability in implementing the FAME scheme, aimed at promoting electric mobility while ensuring compliance with regulatory standards.
