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Government cuts proposed fines on manufacturers for faulty cars

April 10, 2015, 11:06 AM IST by Pratheek Kunder
Government cuts proposed fines on manufacturers for faulty cars

Over the last couple of years, many Indian vehicle manufacturers have recalled their products for various defects and faults. Though sometimes it damages their brand value with the amount of recalls, the ultimate intention is the safety of the passengers.

Until 2012, the country didn’t have a recall policy. But since the time SIAM introduced the recall policy, many cars have had to visit service centres for a fix. Previously, if the manufacturers failed to notify the governing body about a possible defect or a fault, a fine of Rs 5 lakh was imposed on the offenders. However, as per the fourth and the latest Road Transport and Safety bill, these fines are being reduced drastically. If there is a manufacturing defect, the manufacturer will be fined Rs 50,000 and in case of refusing to recall faulty vehicles, they will have to pay Rs 1 lakh. Other than this, the offenders will also face a three-month jail term that has been carried forward from the old draft.

On the other hand, auto manufacturers are arguing that there is no clarity on this proposal. While the national authority may find a small fault that could call for a recall, the same thing for the manufacturers may not be a significant issue for a recall. Also, in case of retro fitment, the bill holds only the original equipment manufacturer liable for the fault. The authorised agency doing the fitment is not held responsible for the same. SIAM wants the fine to be shared by both the parties. 

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