On Saturday, the Centre issued recovery notices amounting to Rs 249 crore to Hero Electric and Okinawa Autotech for the misappropriation of subsidy under the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME) II. The Ministry of Heavy Industries issued the notice, demanding that Hero Electric and Okinawa repay Rs 133 crore and Rs 116 crore, respectively, to the central government. Senior officials stated that both companies were “deregistered” from the FAME II scheme, and the “recovery of incentives claimed from 2019–20 (FY20) will be done within a month”. The ministry notice stated that “further action, according to law, will be taken” if no representation was filed by Hero Electric and Okinawa Autotech within seven days from the date of issue of the letter. While Hero Electric acknowledged receiving the notice, Okinawa did not respond at the time of going to press.
Hero Electric claimed that its vehicles fully complied with the FAME certification in the subject period, and that the ministry’s letter made no reference to the checks and audits conducted on its current range of bikes, unlike those for other original equipment manufacturers. Okinawa stated that the company had always adhered to government policies and that it expected the government to resolve the issue of pending subsidies, which have been on hold for the past 12 months. The action against the two-wheeler manufacturers came after the ministry’s investigation report found that they had violated the Phased Manufacturing Programme guidelines by using imported parts.
The ministry asked both companies to deposit the amount within 21 days from the date of the notice, and the amount will be recovered with interest calculated at the three years marginal cost of funds-based lending rate of State Bank of India prevailing as on the date of respective disbursement.
Meanwhile, Ola Electric informed the Ministry of Heavy Industries on Sunday that it would reimburse Rs 130 crore to about 100,000 vehicle owners of the S1 Pro model, which it had received from its customers for ‘off-board chargers’. The company also urged the ministry to release pending claims of Rs 500 crore, which the ministry had withheld after allegations of misappropriation. Ola has already added the off-board charger as part of the ex-factory scooter price since March 31.
