Auto makers heave a sigh of relief as the Supreme Court on Friday lifted the existing diesel ban in Delhi-NCR region and allowed the vehicles back on road. Diesel cars and SUVs with engines over 2000cc were banned in the capital in December 2015 following the concerns expressed by the Green Tribunal as a measure to prevent further air pollution
This came as a huge shocker to the big car makers like Mercedes, Mahindra and Toyota who earned a major portion of their revenue from the diesel segment vehicles in the Delhi- NCR.
Following this, a joint petition was made by the Mercedes, a Toyota dealer and SIAM to remove the existing ban stating that they were ready to pay a cess until a judgement has been made on the Diesel engine's contribution to air pollution in the capital. They appealed on the ground that the pollution was not caused by the diesel vehicles alone and the right reason need to be figured out soon.
On Friday , a bench headed by Chief Justice of India T.S.Thakur modified the ban stating that the auto companies will be charged a 1% of the ex-showroom price on all diesel vehicles as 'Environment Protection Charges' towards the compensation for the pollution that their vehicles are likely to cause.
This judgement was opposed by the Central Government claiming that any right to levy tax was the right of the legislative and not to be done by any court. The Supreme Court is said to have agreed to consider this opposition positively.
Meanwhile, the environment charges will have to be paid by the manufacturers to a private bank in the state. Whether this tax will be passed on to the customers is yet unknown, but the automobile giants seemed to have been completely relieved after the removal of the ban. A top official from Mahindra said that they can now focus better on producing vehicles that comply with BS 6 norms.