Delhi Govt Policy To Issue Permits Solely To E-Auto Rickshaws Not Arbitrary : Supreme Court Rejects Bajaj's Plea

On hearing the parties and perusing their affidavits, a bench comprising Justices L. Nageshwar Rao, B.R. Gavai and B.V. Nagarathna concluded that the said advertisement cannot be said to be arbitrary.

"The advertisement issued by Govt NCT of Delhi for grant of permits for 4261 e-autos cannot be said to be arbitrary for the following reasons:

1. The decision is in conformity with FAME II scheme of GOI and EVP 2020;
2. Residents of Delhi are badly affected with air pollution, undoubtedly a part of which is caused; is attributed to vehicles. Even though CNG autos are BS6 compliant still there is some carbon emission.
3. We do not agree…that the fundamental right of the applicant, especially A.14 and A. 19(1)(g) is violated.
4. There are 92000 CNG is on the road, replacement of old vehicles can be done by vehicles manufactured by the applicant.
5. The amendment to the MV Act and Central Motor Vehicle Rules cannot mean the addition of e-autos on the road can be done over and above the 1 lakh autos."

Senior Advocate, Mr. Basava Prabhu S. Patil appearing on behalf of Bajaj Auto apprised the Court that the present application was filed challenging the notification issued by the Govt of NCT Delhi on 18.10.2021 seeking to issue exclusive permits for e-autos.

At the outset, the Bench sought clarity on the legal right that Bajaj Auto intended to exert.

"What is your legal right?"

Mr. Patil submitted that the Court had set a cap of one lakh permits with respect to vehicles plying on the roads of Delhi. Out of these one lakh permits the Delhi Government intends to issue the remaining 4261 permits to the e-auto rickshaws.

"There is a one lakh cap…there are 4261 permits left, they want to issue these to e-auto rickshaws…"

Pointing out a crucial aspect from the affidavit filed by the Central Government, Mr. Patil averred that as per a notification of the Central Government dated 18.10.2018, there is no requirement for permit for e-auto rickshaws.

"One important aspect has come up in the affidavit filed by the Central Government…In the light of notification of 18.10.2018 there is no need of having any permit for e-auto rickshaw…"

In order to contextualise his argument, Mr. Patil took the Court through the background of the matter -

"Earlier there was a two stroke engine when the initial order was passed, which was polluting the city. My lords said that you shall not issue any permits. Thereafter all converted to CNG and LPG my lord said there will be a cap of 5000…My lords raised it to one lakh. Thereafter an application was filed as one lakh was not sufficient and a report was called from….and State Govt. of Delhi. Both said remove the cap as there were no more polluting vehicles."

Mr. Patil argued that the advertisement of the Govt. of NCT of Delhi would be in the teeth of the amendment to Section 66 of the Motor Vehicles Act, whereby the Central Government has removed the requirement of permit for e-autos -

"Now this advertisement has been issued which says we will give you the remaining of one lakh, ie. 4261 permits to only e-autos… in light of amendment to Section 66 of the Motor Vehicles Act if now, no permit is required then the question of this notification..not arise…in addition another application in pending before my lords, for increasing the quota for which ….. and Delhi Govt. has no objection."

However, the Bench refused to accept the argument stating that, the exemption provided by the Central Government cannot be assumed to have a bearing on the removal of the cap imposed by the Court on the consideration of health concerns of the citizens.

"Only because Govt. has exempted, it doesn't mean that we would remove the cap. That is a different issue altogether."

The Court enquired, "We are repeatedly asking you what is your right?"

Responding to the Court, Mr. Patil submitted that giving away the remaining 4261 permits to the e-autos would abridge his client's Article 19(1)(g) rights.

"If there is an order passed in a manner of 4261, they are taking away our right under the one lakh."

The Court emphasised that irrespective of the issue of permit, the increase in the number of polluting vehicles could not surpass the one lakh mark. It noted that though BS6 compliant vehicles had reduced its carbon emission levels, it is not pollution free.

"Now, we want to ask is, permit or no permit would that be added in the one lakh cap fixed by the Court."

It added -

"One lakh for what? For vehicles on the road which was contributing to pollution. Even now, this BS6, even in your I.A. you say there is an improvement of carbon emission by 90%. It is not as if it has vanished. There is a difference between the vehicle operated on CNG and the one on battery."

Mr Patil informed the Court that the concern of the Applicant was that the Delhi Govt. intended to issue permits to e-autos, which already enjoys exemption as per the Motor Vehicles Act and Central Rules.

"One is zero emission and one is 90%. The prayers are that they are wanting to issue permits to e-auto rickshaws, which does not require permits at all."

Standing Counsel for the NCT of Delhi, Mr. Rahul Mehra, clarified that the advertisement did not seek to issue permits, but the payment for fee for registration and renewal. He supplemented the Court's view that the number of cars ought not to go beyond one lakh. He added that if not for pollution, definitely for congestion, the one lakh mark should not be surpassed even for non polluting vehicles.

"..No where are we seeking a permit. It is the payment of the fee for registration. The pertinent question by my lords was can we go beyond 1 lakh, the response is that it is not only pollution… but congestion. Because of congestion we cannot go beyond the cap even if it is zero polluting product. As and when e-policy will be successful, we will come back and …seek that we want to…raise the cap."

He further submitted that the decisions taken by the Govt. of NCT of Delhi were in consonance with FAME II Scheme of the Government of India; Delhi Government's Electric Vehicle Policy, 2020 and the latest advisories and reports on the issue of air pollution.

"Even at pg 27-28, the latest advisory has come from the Commission of Air Quality Management. They have mandated..zero emission vehicles to cut down pollution in NCR…There are 4 things the Govt of Delhi intending to do, conforming to order of my lords, there are two policies of Central Govt. which says you have to go towards hybrid and electric vehicle…We have introduced one of the most progressive e-policy..recommendation of EFTA..should move towards e-vehicles. This all confirms not only to law but advisories given by committees and agencies...One lakh is not for CNG alone…"

The Bench asked Mr. Mehra, "In favour of increasing the cap?"

Mr. Mehra responded, "No. Until and unless there is a study that the confession will not result in any other kind of pollutant."

After making his submissions, Mr. Patil stated that -

"The vehicles today are less than 1% of the vehicles. We have no objections to e-autos coming out on the road,..we are 6 compliant."

The Bench remarked, "6 compliant, but still have carbon emission."

Mr. Patil concluded by stating, "The only difficulty is that they cannot isolate us."

On hearing the parties, the Bench proceeded to dictate the order -

"The Transport Dept, Govt of Delhi invited online applications for registration of 4261 e-auto rickshaws. The Applicant has approached this court to declare the advertisement is ultra virus of A14, 19(1)(g) of the Constitution of India being arbitrary and discriminatory to manufacturers of existing clean fuel/CNG TSRs. On 16.12.1997, this court identified two seater rickshaws using two stroke engines as contributing to pollution in Delhi, therefore a direction was given that the number of TSRs be freezed...On 20.12.2002, permission was granted for registration of 5000 new auto rickshaws…Several applications have been filed to remove the cap of the TSR permits. By an order dated 11.11.2011 the cap…was enhanced to 1 lakh and liberty was given to the parties to move this court for suitable orders, if found necessary.

The applicant submits that CNG autos that are manufactured by it are BS6 compliant and the emission profiles are improved 90% as compared to BS1 models. The restriction of grant of e-permits to battery operated autos would be in restriction of the applicant's fundamental right under A.19(1)(g). The applicant has alleged that vehicles that are manufactured, which are BS6 compliant cannot be sold in view of the advertisement issued on 18.10.2021.

An affidavit has been filed by the Ministry of Road Transport and Highways…brought to the notice of this court that an amendment has been made to S. 66 of the Motor Vehicles Act and Central Motor Vehicle Rules. Battery operated transports vehicles and vehicles running on ethanol fuels have been exempted from registration. NCT of Delhi is opposing the relief sought by the applicant, on the ground that CNG auto rickshaws cannot be compared to e-autos. That is a proposal to switch to electric vehicles with a view to decarbonise the transport sector. The comparison with electric vehicles with no pollution and CNG vehicles with less emission would show that preference to e-autos permits can be granted by Govt, is in order. The decision of the Govt is also supported by the FAME II Scheme of GOI and Electric Vehicle Policy 2020. It has been further mentioned ..that 92000 auto rickshaws have already been registered in NCT which are CNG and there is a continuous process of replacement of old CNG auto rickshaws. The Ld. Amicus submitted that the application deserves to be dismissed, as the amendment ….relates only to the exemption of payment of registration.

There has been a request for removal of the cap of 1 lakh autos…The removal of the cap of the number…will be considered at a later stage. The advertisement issued by Govt NCT of Delhi for grant of permits for 4261 e-autos cannot be said to be arbitrary for the following reasons:

6. The decision is in conformity with FAME II scheme of GOI and EVP 2020;
7. Residents of Delhi are badly affected with air pollution, undoubtedly a part of which is caused; is attributed to vehicles. Even though CNG autos are BS6 compliant still there is some carbon emission.
8. We do not agree…that the fundamental right of the applicant, especially A.14 and A. 19(1)(g) is violated.
9. There are 92000 CNG is on the road, replacement of old vehicles can be done by vehicles manufactured by the applicant.
10. The amendment to the MV Act and Central Motor Vehicle Rules cannot mean the addition of e-autos on the road can be done over and above the 1 lakh autos.

Dismissed."

Mr. Mehra, again, clarified that 4261 were not permits, but registrations. The Court informed him that the Court was primarily on the issue that the numbers cannot be added.

[Case Title: M.C. Mehta v. Union of India, W.P.(C) No. 13029/1985]