The government is actively considering legal action against electric two-wheeler companies that have allegedly failed to comply with the norms of the Faster Adoption and Manufacturing of Electric Vehicles (FAME II) scheme, a senior government official said. Has disclosed.
The Central government has taken steps to recover ₹469 crore from seven electric two-wheeler manufacturers accused of claiming incentives without following the FAME II scheme norms. The government is seeking refund of incentive amount from Hero Electric, Okinawa Autotech, Ampere EV, Revolt Motors, Benling India, Amo Mobility and Lohia Auto. Notices have been issued to the companies, Revolt Motors is so far the only company which has expressed willingness to return the amount.
The official said the deadline for response was approaching and the government was prepared to take further action in the coming weeks.
When the officer was asked about his thoughts on possible action, he said, 'We are considering legal options. Investigation by the Ministry of Heavy Industries revealed that these companies had allegedly availed financial incentives under the scheme in violation of prescribed norms.
The rules of the FAME II scheme allowed incentives for the production of electric vehicles using domestically manufactured components. However, investigation revealed that these seven companies had allegedly used imported components in their electric vehicles.
The investigation was prompted by anonymous emails alleging that several electric vehicle manufacturers were claiming subsidies without following Phased Manufacturing Plan (PMP) rules, designed to promote domestic manufacturing of electric vehicles. The ministry had suspended the distribution of subsidies in the last financial year.
Seven electric two-wheeler manufacturers have suggested that the government consider the possibility of requiring customers to pay additional rebates received on their vehicle purchases.
According to the Society of Manufacturers of Electric Vehicles (SMEV), these companies collectively suffered a loss of over ₹9,000 crore last year due to outstanding payments and market losses after subsidies were discontinued.
The FAME-II scheme, launched in 2019, includes a ₹10,000 crore program to promote electric and hybrid vehicles. This represents an expansion of the initial FAME scheme, which was launched on 1 April 2015 with a total allocation of ₹895 crore. While the incentives in the three-wheeler and four-wheeler segment primarily apply to vehicles used for public transport or registered commercial purposes, the focus in the two-wheeler segment is on private vehicles.