The Supreme Court Monday indicated lifting the six-month-old ban on registration of diesel vehicles with engine capacity above 2000cc in Delhi-NCR after levying a green cess even as the central government threw its weight behind the auto industries, saying “diesel cannot be termed as an undesirable fuel”.
A bench led by Chief Justice T S Thakur reserved its order on a clutch of applications that have sought modification of the December 2015 order whereby registration of diesel SUVs and high-end vehicles above 2000cc was prohibited.
“We may ask (automakers/dealers/buyers) to pay one per cent of the cost of the vehicle as cess on diesel vehicle and it could be deposited with the Central Pollution Control Board or with any other body… we will make some arrangement for the time being,” said the bench, also comprising Justice A K Sikri and Justice R Banumathi.
The court’s indication came as Attorney General Mukul Rohatgi argued for the plea by the Ministry of Heavy Industries and Public Enterprises to vacate the ban, contending the central government was ready to conduct a “multi-pronged study” on effect of diesel on the environment and possibility of imposing a green cess on diesel vehicles.
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”As on today, we cannot say that diesel is an undesirable fuel… there is no empirical study. Give us six weeks and we will conduct a comprehensive study on the subject and submit a report in the court. But modify your order since it has been affecting the economy and especially the FDI. There is a sense of uncertainty and industry leaders are complaining about unpredictability of the investments,” the AG argued.
The law officer further submitted it would “not be appropriate” for the court to impose a tax on diesel vehicles and related issues, and that direction could be issued to the government after the report is adduced in the court.
At this, the bench responded, “This place (Delhi) would have been miserable if we had not issued orders for CNG some two decades ago. There were protests but our order has certainly helped people of Delhi. It would have been difficult to breathe if order to run all public transport vehicles on CNG was not passed. We will be happy if there is a study on diesel.”
The court clarified it did not “want to be seen as acting out of impulse” with regard to ban on diesel vehicles. “At the same time, you (government) cannot be seen as protecting someone who is creating pollution… we will hold back our order if you give us a report after a credible study,” the bench told Rohatgi. The AG replied the government would complete the study as soon as possible since the ban on registration of diesel vehicles above 2000cc was posing major hurdles in getting foreign investments.
On being asked, the AG also apprised the bench of a scheme in the offing to scrap old cars by giving compensation in the region of Rs 50,000 for each such vehicle.