This follows Revolt, Greaves and Amo returning wrongfully claimed subsidies to the government while Hero, Okinawa and Benling India are still to do so and have instead taken the government to the court.
The government after an initial probe into violation of vehicle localisation norms mandated under the Faster Adoption & Manufacturing of Electric Vehicles in India (FAME India) scheme issued notices for recovery of ₹469 crore subsidy distributed to these companies for sales made between 2020 to 2023.
Hero, Okinawa and Benling have challenged the recovery notices.
"The process is underway to blacklist these errant companies from all government schemes. They have already been debarred from all schemes under the Ministry of Heavy Industries (MHI)," the official told ET.
A spokesperson for Okinawa said, "We have filed a writ petition in Delhi High Court to recover our outstanding FAME II dues of upwards INR 425 crore and our case is subjudice. Okinawa Autotech always has been compliant with the scheme guidelines and the same was observed by MHI's committee headed by Joint Secretary, Mukta Shekhar".
"Okinawa has not availed incentives from the beginning of the last financial year and we believe the electric two-wheeler industry has reached a stage where it is self-sufficient," the spokesperson said.
According to MHI officials, the report by Joint Secretary Mukta Shekhar has not been accepted by the Centre and a fresh probe into the FAME scheme has been ordered. Further, the new investigation did not concur with findings of the Shekhar report.
"Since the matter is subjudice, we cannot comment on this," a Hero Electric spokesperson said.
Amit Kumar, CEO, at Benling India said, "The whole matter is under the scrutiny of the Delhi High Court. We would not like to comment on any matter that is subjudice".
On restoring subsidy benefits to some electric two-wheeler makers, the official cited above said the heavy industries ministry is awaiting the finance ministry's nod on the matter. "Process to bring them back under the subsidy fold is underway," the official said, adding Revolt, Greaves and Amo Mobility have paid back around INR 170 crore to the government.
The government launched the first FAME scheme in 2015 with a budget of ₹895 crore. FAME II, an expanded iteration of the programme, was rolled out in 2019 with an outlay INR 10,000 crore. These schemes were aimed at supporting the sale of locally produced electric vehicles (EV).
Subsidy disbursals under the scheme were tied to a phased manufacturing programme (PMP) in line with a progressive increase in localisation levels over time.
As per the government, companies did not adhere to the PMP, but continued seeking FAME subsidy, defeating the scheme's intent.
FAME II was in force from 2019 to 2024. It was successful in supporting sales of nearly 1.4 million e-2W, 161,000 e-3W, and 20,556 electric four-wheelers. FAME II centred on a PMP which gradually increased the localisation content in EVs made in the country.
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