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Business News/ Companies / News/  FAME II Irregularities: Hero Electric, Okinawa Autotech & Benling India yet to clear fines, not cleared of violations
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FAME II Irregularities: Hero Electric, Okinawa Autotech & Benling India yet to clear fines, not cleared of violations

New committee led by Additional Secretary determines three EV manufacturers breached government guidelines under FAME-II scheme.

The government has set penalties as follows: Hero Electric must pay ₹133.8 crore, Okinawa Autotech ₹116.85 crore, and Benling India ₹48.42 crore. (Representative Image)Premium
The government has set penalties as follows: Hero Electric must pay 133.8 crore, Okinawa Autotech 116.85 crore, and Benling India 48.42 crore. (Representative Image)

An investigation into three electric vehicle (EV) manufacturers — Hero Electric Vehicles, Okinawa Autotech, and Benling India Energy and Technology, has revealed violations of the FAME-II norms, according to a Hindu Businessline report. It added that contrary to speculation, the companies have not been cleared of wrongdoing.

Sources from the Ministry of Heavy Industries (MHI) told the paper that a new committee led by the Additional Secretary has been examining these issues. The committee has determined that the three companies breached government guidelines under the Faster Adoption and Manufacturing of Electric Vehicles (FAME-II) scheme and must pay the stipulated penalties.

Livemint could not independently verify the report.

The government has set penalties as follows: Hero Electric must pay 133.8 crore, Okinawa Autotech 116.85 crore, and Benling India 48.42 crore.

Investigation Into Irregularities

The investigation began after reports suggested that these companies had been exonerated. An officer at the Joint Secretary level was initially tasked with investigating the role of officials in the scheme's irregularities in April 2023, as per the paper, citing a source.

The resulting report, submitted on December 30, 2023, was found to be vague and incomplete in February 2024. It failed to properly consider the scheme guidelines or examine any officials, the source added.

The Competent Authority rejected this report and, on February 20, 2024, assigned the investigation to an independent five-member committee led by an Additional Secretary. This new committee has been diligently reviewing all notifications and guidelines, and concluded that the guidelines were clear and understood by all stakeholders, including testing agencies, original equipment manufacturers (OEMs), and the MHI, as per HBL.

Background of the Issue

The issue began in 2022 when the MHI received complaints about FAME-II scheme violations. The complaints alleged that several registered OEMs were selling vehicles without meeting localisation requirements and importing parts rampantly, as per the report.

The ministry investigated 13 companies, and fined six of them, including Hero Electric, Okinawa Autotech, Ampere Vehicles ( 124.91 crore), Benling India, AMO Mobility ( 83 lakh), and Lohia Auto ( 11 lakh), for violating norms. These companies were fined a total of 469 crore.

Among these six OEMs, AMO Mobility, Greaves Electric Mobility, and Revolt returned the subsidies with interest within a few months. However, Hero Electric, Okinawa, and Benling did not refund the incentives and were deregistered from availing subsidies under FAME in October/November 2023, it added.

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Published: 22 May 2024, 02:40 PM IST
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