FADA moves SC seeking relief in sale of BS-IV vehicles after April 1 deadline

Automobile dealers' body FADA on Wednesday said it has moved the Supreme Court seeking sale and registry of unsold BS-IV vehicles beyond April 1, 2020.

The Federation of Automobile Dealers Associations (FADA) said it should be allowed to offload inventory purchased before March 1, 2020 which remain unsold by the month-end.

Last year, the Supreme Court had ordered that no Bharat Stage IV vehicle shall be sold in the country with effect from April 1, 2020. The Bharat Stage VI (BS-VI) emission norms would come into force from April 1 next year.

The FADA said that it on behalf of its members has filed an impleadment application in the Supreme Court along with an application seeking modification of the court's order of last year.

"We have appealed to the Honourable Apex Court to protect the inventory and in turn the dealership survival of our members and allow us to sell and register inventory purchased before March 1, 2020, which remains unsold by March 31, beyond the current deadline of April 1,2020," FADA President Ashish Harsharaj Kale said in a statement.

With the current timeline of pan-India BS-VI fuel availability of April 1, most manufacturers will shift to 100 per cent BS-VI vehicle production only by February-end or first week of March 2020, he said.

"Looking at this timeline and the current fluctuating demand situation, despite putting in the best of efforts, there is a possibility that many of our members will not be able to ensure 100 per cent liquidation of BS-IV inventory," Kale said.

He added that FADA members range from large dealership groups to family-run small scale entities operating in the remotest corners of the country operating at 3-5 per cent gross margins.

"Despite their best efforts to sell, if dealers are left with any inventory of BS-IV on April 1, 2020, many of them will face financial hardships which could even threaten the existence of their business," Kale said.

Last year, a three-judge bench headed by Justice Madan B Lokur made it clear that only BS-VI compliant vehicles shall be sold in the country from April 1, 2020.

The bench said the need of the hour was to move to a cleaner fuel. The BS-IV norms have been enforced across the country since April 2017.