Volkswagen India in December 2015 announced the recall of 3,23,700 lakh vehicles in India.
A four-member committee formed by the National Green Tribunal has recommended Rs 171.34 crore fine on German auto major Volkswagen as "health damages" for causing air pollution in Delhi due to excess nitrogen oxide (NOx) emissions.
The expert committee in its report has estimated that Volkswagen cars released approximately 48.678 tonnes of NOx in 2016 in the national capital.
"Estimated cost of heath damage due to additional NOx emissions from the Volkswagen group vehicles is approximately Rs 171.34 crore using a metro city i.e Delhi as a base. The value may be considered conservative due to lack of methodologies for calculating the overall impact of nitrogen oxide on environment in India and hence only health damages are valued.
"Further the valuation is for Delhi city considering that the value of NOx is 435 tonnes is released in the city. This is assumed because lack of data on the geographical locations and plying regions of Volkwagen vehicles which have caused the damage and for all the years which have been considered for damage," the committee has said in its report.
Nitrogen oxide is a smog-forming pollutant linked to heart and lung disease.
The four-member panel comprised ARAI director Rashmi Urdhwareshe, Dr Nitin Labhsetwar, who is chief scientist of CSIR-NEERI, Ramakant Singh director, Ministry of Heavy Industries and Prashant Gargava, member secretary of CPCB.
The panel was formed by the NGT on November 16 last year to give its expert opinion on the subject whether the manufacturer has exceeded the prescribed environmental norms and fair estimate of the damage caused to the environment.
The committee has told the NGT that automobiles are a major source of nitrogen oxide emissions and nitrogen dioxide is the most prevalent source form of nitrogen oxide.
It said that longer exposures to elevated concentrations of nitrogen dioxide may contribute to the development of asthma and potentially increase susceptibility to respiratory infections and nitrogen oxide gases react to form smog and acid rain and are central to the formation of fine particles (PM) and ground-level ozone, both of which are associated with adverse health effects.
The panel calculated the morbidity by using the estimates of the cost of treatment and related expenses under the heading of cost of illness and the disability-adjusted life years (DALY) from the WHO database.
"The valuation is based on per capita income of the individuals in the city. For mortality, value of statistical life is used for monetary estimation," it said.
The penalty was determined on the basis of the 3.27 lakh Volkswagen cars in India that had deceit software installed.
"The total health damage due to air pollution in city is around Rs 157.80 crore. Further, if this cost was to be charged bin 2018, an average inflation of 4.2 per cent is to be applied for two years (after 2016), which comes out to be Rs 171.34 crore," the committee said in its report.
The matter is scheduled to come up for hearing on January 17 before a bench headed by NGT Chairperson Justice Adarsh Kumar Goel.
The green panel had earlier said the use of ''cheat device'' by Volkswagen in diesel cars in India leads to inference of environmental damage and asked the German car maker to deposit an interim amount of Rs 100 crore with the Central Pollution Control Board.
The NGT said that even though the standards may be stricter in other countries, "the very fact of deceit devices being installed by the manufacturers calls for an inference of prima-facie violation of environment".
It had said that even if there is 100 per cent recall, for the past violation of norms, the auto manufacturer cannot avoid its responsibility.
The tribunal was hearing pleas filed by a school teacher, Saloni Ailawadi, and a few others seeking ban on sale of Volkswagen vehicles for alleged violation of emission norms.
A ''cheat'' or ''defeat device'' is a software in diesel engines to manipulate emission tests by changing the performance of the cars globally.
Volkswagen India had in December 2015 announced the recall of 3,23,700 lakh vehicles in India to fix the emission software after ARAI conducted tests on some models and found that their on-road emissions were 1.1 times to 2.6 times higher than the applicable BS-IV norms.
The automobile giant had admitted to the use of ''defeat device'' in 11 million diesel engine cars sold in the US, Europe and other global markets to manipulate emission test results.
After the tests by ARAI, Volkswagen India had undertaken to rejig the software by recalling around 3.23 lakh vehicles fitted with EA 189 diesel engines which were in alleged violation of emission norms.
The company, however, had said that the recall in India was purely voluntary in nature as it did not face any charges regarding violating emission norms in India unlike in the US.