Supreme Court of India
Skoda Auto Volkswagen India … vs The State Of Uttar Pradesh on 26 November, 2020Author: V. Ramasubramanian

Bench: Hon’Ble The Justice, A.S. Bopanna, V. Ramasubramanian







V. Ramasubramanian, J.

1. Aggrieved by the refusal of the High Court to quash a First

Information Report (FIR for short) registered against them for the

offences punishable under Sections 34, 471, 468, 467, 420, 419

and 406 IPC, the petitioner has come up with the above Special

Leave Petition.

2. We have heard Dr. Abhishek Manu Singhvi, learned senior

counsel appearing for the petitioner. Mr. Maninder Singh, learned

senior counsel appears for the 3rd Respondent, who is the de facto
Signature Not Verified

Digitally signed by
Sanjay Kumar
Date: 2020.11.26
17:03:17 IST

3. The petitioner is a Company headquartered in Pune and is

engaged in the business of manufacture, import and sale of

passenger vehicles in India. It is claimed that the petitioner has

been formed by the amalgamation of three Companies by name

Skoda Auto India Private Limited, Volkswagen India Private Limited

and Volkswagen Group Sales India Private Limited. The petitioner

claims that they are responsible for the business operations of five

automobile brands namely, Skoda, Volkswagen, Audi, Porsche and


4. The Automotive Research Association of India, which is a

research institution of the automotive industry attached to the

Ministry of Heavy Industries and Public Enterprises of the

Government of India issued a notice dated 04.11.2015 to the

Managing Directors of Skoda Auto India Private Limited,

Volkswagen India Private Limited and Volkswagen Group Sales

India Private Limited, calling upon them to show cause as to why

they should not come to the conclusion that the vehicles

manufactured and sold by them in India, are in violation of the

requirements of the Central Motor Vehicles Rules. It was alleged in

the said notice that the study carried out by them on limited vehicle

models fitted with Diesel EA 189 Engines led them to believe that

the vehicles manufactured by Volkswagen, when tested on road,

indicate 3­9 times more NOx pollution compared with the tests

carried out in the laboratory on Modified Indian Driving Cycle

(MIDC). It was also alleged in the said notice that they had reason

to believe that Diesel EA 189 Engines fitted in BS­IV vehicles are

equipped with what are called ‘defeat devices’.

5. At about the same time, two original applications came to be

filed before the National Green Tribunal (NGT for short), Principal

Bench. Both the applications were primarily against Skoda Auto

India Private Limited, Volkswagen India Private Limited and

Volkswagen Group Sales India Private Limited. Apart from these

three companies, the Union of India (UOI), the Central Pollution

Control Board (CPCB) and a few others were also made parties to

the original applications.

6. The particulars of these original applications are presented in

a tabular column for easy appreciation:­

O.A.No. Name of the Names of Respondents Reliefs sought
509 /2015 SaloniAilawadi 1. Union of India 1. Directing
through its Secretary, Respondents 1­3 to
Ministry of Heavy disallow the
Industries & Public manufacturing,
Enterprises. assembly and sale of
the vehicles of
2.Ministry of Respondents 4­6 in
Environment, Forest India till it is
and Climate Change, established that they
Through Secretary are not employing any
deceit devices or
3.Central Pollution technology; Control Board, Through
its Chairman 2. To direct the
Respondents 1­3 to
4. Volkswagen India Pvt; inspect and check all
Ltd., Through its the vehicles
Managing Director manufactured and sold
in India to ensure that
5.Skoda Auto India no deceit devices are
Private Limited, Through used;
its Managing Director
3.To direct respondents
6. Volkswagen Group 4­7 to stop production,
Sales India Private assembly and sale of
Limited, Through its those vehicles; and
Managing Director
4. To direct respondents
7. Volkswagen AG, 4­7 to rectify the
Through Chairman of engines of vehicles
the Board of already sold in India at
Management their cost.527/2015 1. Mr. Satvinder 1. Volkswagen India 1. To restrain
Singh Sodhi Private Limited, Respondents 1­6 from
Maharashtra selling any further
2. Mr. Vellore automobile with the
Ramesh Neelakantan 2. Volkswagen Group defeat device which
Sales India Private violated the applicable
3. Mr. Deepit Limited, Maharashtra emission norms;

3. Volkswagen AG, 2. To direct
4. Sara Germany Respondents 106 to
International Limited disgorge all the profits
4. Skoda Auto India made by selling
Limited, Maharashtra automobiles with
cheat devices from the
5. Skoda Auto AS, Czech year 2008; and
3. To direct
6. Dr.Ing. h.e.F.Porsche Respondents 1­6 to
AG, Germany pay damages for
restoration of
7. Central Pollution environment.
Control Board, Delhi.

8. Automotive Research
Association of India,

9. Union of India
Through Ministry of
Heavy Industries and
Public Enterprises,
New Delhi

10. Government of
National Capital
Territory of India,
Through Delhi
Pollution Control
Committee, Delhi

7. On 16.11.2018, the NGT recorded a prima facie finding that

the claim of the manufacturers that they had not caused any

damage to the environment, was not acceptable. The Tribunal

constituted a joint team to give an expert opinion and in the mean

time directed the manufacturers to deposit Rs. 100 crores with the


8. The manufacturers filed appeals before this Court in C.A. Nos.

11928 and 11929 of 2018, against the preliminary finding and the

interim direction issued by the NGT. During the pendency of those

appeals, the Expert Team filed a Report.

9. Therefore, this Court disposed of the aforesaid Civil Appeals

giving liberty to the manufacturers to file objections to the Report of

the Expert Team and directed the Tribunal to consider those

objections and to pass orders.

10. Pursuant to the said order of this Court, the NGT allowed the

manufacturers to file objections and heard both the original

applications and disposed of the same by order dated 07.03.2019.

Some of the findings and directions by the Tribunal were:­

(i) That the manufacturers had in fact used cheat
devices to suppress the laboratory tests;

(ii) That NOx emission was higher by Portable Emission
Measurement System (PEMS);

(iii) That Volkswagen vehicles gave much less NO x
emission under the Warm Test Cycles after recall;

(iv) That the emissions measured on PEMS were higher
than BS­IV limit;

(v) That the manufacturers are liable to pay damages to
the tune of Rs.500 crores; and

(vi) That the CPCB shall consider initiation of
prosecution in the light of applicable statutory

11. Challenging the said order dated 07.03.2019 of the NGT, two

Civil Appeals were filed in C.A.Nos. 4069 and 4086 of 2019. On

06.05.2019 these appeals were taken up along with another Civil

Appeal filed by the Inter­Continental Association of lawyers and this

court ordered the issue of notice in the appeals. In the mean time,

this Court directed that no coercive steps shall be taken against

Volkswagen India Private Limited.

12. While things stand thus, the 3rd Respondent herein lodged a

complaint with the S.H.O., Gautam Budh Nagar, on 10.07.2020,

alleging that he had bought 7 Audi Brand cars from the authorised

dealers of the manufacturing Companies; that at the time of

purchase, he got it clarified from the Company that they had not

installed any cheat devices in the vehicles sold in India; that

however, the authorities in India found out a higher emission of

NOx; that even the NGT imposed a fine; that the complainant

thereafter realised that he had been duped by the Company; that

knowing fully well that their vehicles have been installed with cheat

devices, the manufacturer had prepared wrong records and

documents; that the manufacturers and the officers of the

manufacturers are therefore guilty of various offences under the IPC

and that therefore action should be initiated against them.

13. Contending that as per the particulars mentioned in the

VAHAN Portal of the Government, the 3rd Respondent herein had

purchased only 3 and not 7 vehicles; that the complaint lodged by

the 3rd Respondent after more than 2½ years of the purchase of the

vehicles, was malicious and full of false particulars; and that the

FIR is based entirely upon the order of the NGT, which is the

subject matter of two civil appeals before this Court, the petitioner

filed a Criminal Miscellaneous Writ Petition No.9233 of 2020 before

the High Court of Judicature at Allahabad. In the said Writ Petition,

the petitioners sought quashing of the FIR.

14. By an order dated 01.10.2020, the Allahabad High Court

rejected the prayer for quashing of the FIR. However, the High

Court protected the officers of the petitioner against arrest till the

submission of the Report under Section 173(2) Cr.P.C. subject

however to the condition that they shall cooperate in the

investigation and also appear as and when called upon to assist in

the investigation.

15. Not satisfied with a mere protection against arrest and the

refusal of the Allahabad High Court to quash the FIR, the petitioner

has come up with the above SLP.

16. The main contentions of the petitioner are:­

(i) That the Police cannot investigate an issue, the
substratum of which is sub judice before this Court
in the civil appeals arising out of the order of the
NGT; and
(ii) That the High Court failed to take note of the long
delay on the part of the 3 rd Respondent in lodging
the complaint and also the fact that the VAHAN
Portal of the Government shows the purchase of
only 3 vehicles as against the claim of the 3rd
Respondent to have purchased 7 vehicles.

17. Let us take up the second contention first, since it is capable

of being dealt with, without much ado. The second contention has
two parts namely (i) that there is a long delay in lodging the

complaint and (ii) that the 3rd Respondent­complainant, appears to

have purchased only 3 vehicles as against his claim to have

purchased 7 vehicles.

18. The question whether the 3rd Respondent­complainant

purchased 3 vehicles as revealed by the VAHAN Portal of the

Government or 7 vehicles as claimed by him in his complaint, is a

question of fact which has to be established only in the course of

investigation/trial. In a petition for quashing the FIR, the Court

cannot go into disputed questions of fact.

19. The mere delay on the part of the 3 rd Respondent­complainant

in lodging the complaint, cannot by itself be a ground to quash the

FIR. The law is too well settled on this aspect to warrant any

reference to precedents. Therefore, the second ground on which the

petitioner seeks to quash the FIR cannot be countenanced.

20. The first contention revolves around the pendency of the Civil

Appeals arising out of the order of the NGT and the interim order

passed by this Court in the Civil Appeals.

21. As stated earlier, two original applications came to be filed

before the NGT in the year 2015, alleging that the manufacturers of

the vehicles in question were employing deceit devices. The filing of

the original applications coincided with the issue of notice by the

Automotive Research Association of India to the manufacturers.

We have already indicated broadly, in paragraphs 5­10 above as to

what transpired before the NGT.

22. The applicants before the NGT did not seek any relief for

themselves, as purchasers of vehicles. The reliefs sought by the

applicants before the NGT were broad and general. This is why the

NGT, by its final order dated 07.03.2019 directed only the CPCB to

consider the initiation of prosecution in the light of the applicable

statutory regime, while ordering the manufacturers to deposit

Rs.500 crores as compensation for the damage caused to the


23. Therefore, the order of the NGT, passed on the applications

filed by certain individuals not claiming as purchasers of vehicles,

cannot be taken as an impediment for an individual who

purchased cars from the manufacturers, to lodge a complaint, if he

has actually suffered on account of any representation made by the


24. The interim order passed by this Court on 06.05.2019 in Civil

Appeal Nos. 4069 and 4086 of 2019, while issuing notice reads as

“In the meantime, no coercive steps shall be taken
against the appellant viz., Volkswagen India Private

25. The aforesaid interim order correlates only to the directions

issued by the NGT in paragraphs 29, 30 and 32 of its order dated

07.03.2019. The direction contained in Paragraph 30 of the order of

the NGT dated 07.03.2019 reads as follows:­

“We leave it open to the CPCB to consider initiation of
prosecution in the light of applicable statutory regime.”

26. In paragraphs 29 and 32 of its order, the NGT directed the

manufacturers to deposit compensation to the tune of Rs.500

crores within 2 months.

27. Therefore, the interim order passed by this Court not to take

any coercive steps has to be understood only in the context of the

aforesaid directions of the NGT which became the subject matter of

the Civil Appeals. Hence it is futile to contend that the pendency of

the Civil Appeals and the interim order passed by this Court should
be taken as a deterrent for anyone else to lodge a police complaint

and seek an investigation.

28. Dr. A.M. Singhvi, learned senior counsel appearing for the

petitioner strenuously contended that the contents of the complaint

lodged by the 3rd Respondent­complainant with the Police were

nothing but a reproduction of the contentions made before the NGT

and that actually the substratum of the police complaint, is what is

sub judice before this court. Therefore, he contends that the police

cannot investigate into the same set of allegations which form the

subject matter of proceedings pending adjudication before this


29. But we do not think so. A little elaboration is required to show

why we cannot agree with the above contention of the learned

senior counsel appearing for the petitioner.

30. Section 110(1) of the Motor Vehicles Act, 1988 empowers the

Central Government to make rules, regulating the construction,

equipment and maintenance of motor vehicles with respect to all or

any of the matters enumerated in Clauses (a) to (p). Clause (g) of

Sub­section (1) of Section 110 relates to “the emission of smoke,

visible vapour, sparks, ashes, grit, or oil”.

31. In exercise of powers conferred by Section 110(1), the Central

Government issued a set of rules known as The Central Motor

Vehicles Rules, 1989.

32. Rules 112 to 114 of those Rules deal in general with “smoke,

vapour, spark, ashes, grit and oil”. Rules 115 and 116 deal

specifically with “emissions of smoke, vapour” etc., from motor

vehicles and “test for smoke emission level and Carbon Monoxide

(CO) level for motor vehicles”. These Rules correspond to Clause (g)

of Sub­section (1) of Section 110.

33. Rule 126 mandates every manufacturer or importer of motor

vehicles other than trailers and semi­trailers to submit the

prototype of the vehicle manufactured or imported by him for

testing by the agencies indicated therein. Rule 126A enables the

testing agencies referred to in Rule 126 to conduct tests on the

vehicles drawn from the production line of the manufacturer to

verify whether these vehicles conform to the provisions of the Rules.

34. In order to give effect to the mandate of the statutory

prescription, the Ministry of Road Transport and Highways, issued

a document bearing No. MoRTH/CMV/TAP­116­116, Issue No.4,

which prescribes the test method, testing equipment and other

related procedure for the purpose of testing vehicles for verifying

compliance with Rules 115 and 126A of the Rules for “Type

Approval and Conformity of Production”. The document also

contains the total procedure for checking of the in­service vehicles

for idling CO/HC for vehicles fitted with petrol/CNG/LPG Engines.

This document is divided into 15 parts. Part­XIV contains the

details of standards for Tailpipe Emissions from vehicles and Test

Procedures Effective for Mass Emission Standards.

35. Clause No.2.27 of Chapter­1, Part­XIV of the aforesaid

document defines what is called a “Defeat Device”. It reads as


“Defeat Device means any element of design which
senses temperature, vehicle speed, engine rotational
speed, transmission gear, manifold vacuum or any
other parameter for the purpose of activating,
modelling, delaying or deactivating the operation of
any part of the emission control system, that
reduces the effectiveness of the emission control

system under conditions which may reasonably be
expected to be encountered in normal vehicle
operation and use. Such an element of design may not
be considered a defeat device if
1. The need of the device is justified in terms of protecting
the engine against damage or accident and for safe
operation of the vehicle, or
2. The device does not function beyond the requirements
of engine starting or,
3. Conditions are substantially included in the Type I or
Type VI test procedure.”

36. The allegations in the complaint lodged by the 3 rd respondent

herein, are to the following effect:

(i) that “at the time of purchase and taking delivery of the vehicles,

the complainant got clarified from the accused persons whether the

vehicles in India were also fitted with cheat devices”;

(ii) that despite the clarification issued by them that they had not

installed any cheat devices, in the vehicles meant to be sold in

India, the cars purchased by the complainant were found to contain

such defeat devices; and

(iii) that therefore, the manufacturer is guilty of commission of

various offences.

37. The question whether such devices are installed in the cars

purchased by the 3rd respondent herein and the question whether

there was any representation in this regard to the petitioner, are all

questions of fact, peculiar and particular to the 3 rd respondent

herein. NGT had no occasion to examine the cars purchased by the

3rd respondent herein. At this stage no one can presume whether

the defence of the manufacturer to the police complaint will be

purely on a question of fact or purely on a question of law or on

mixed questions of fact and law. If the petitioner takes a defence

that no such devices were installed in the cars purchased by the 3 rd

respondent or that there was no (mis)representation in this regard,

it will be a pure question of fact, which cannot be gone into in a

quash petition. If the petitioner takes a defence that the installation

of such devices, though true, does not violate any law, then it will

be a pure question of law. We may be entitled to go into this

question in a quash petition, provided the petitioner comes up with

a categorical admission that they had installed such devices and yet

there was no violation of the law. We do not expect the petitioner to

disclose their defence at this stage nor would we speculate what

type of defence the petitioner would have to the prosecution.

38. It may not be out of context to mention here that the

European Union woke up way back in 2007 to the reality of car

makers installing a software that manipulate exhaust emissions,

depending upon whether the car ran on a test stand or on the road.

After the European Commission’s Joint Research Centre found in

2011 that the levels of harmful NO x emissions far exceeded the

prescribed levels, a study conducted by the International Council

on Clean Transportation (ICCT) revealed similar results in the

United States. In September­2015, allegations of installation of

manipulation devices by car manufacturers emerged from the US

Environmental Protection Agency and this triggered investigations

in several European Union States. After claims were lodged and

legal action initiated, the German Federal Motor Transport

Authority appears to have given permission in June­2016 for the

recall of about 2 million vehicles across Europe. In the light of these

developments, one of the manufacturers entered into an agreement

with the US Environmental Protection Agency in December­2016

giving certain options to the customers. These and the subsequent

developments, which attained notoriety as the diesel­gate

scandal, led to the German Federal Court of Justice

(Bundesgerichtshof­BGH) giving a ruling on May 25, 2020 in favour

of the car owners for damages.

39. It is in the backdrop of what transpired in Europe and U.S.A.,

during the period from 2015 to 2019 that the action initiated by the

Automotive Research Association of India in November 2015 and

the proceedings that went on before the National Green Tribunal

from the year 2015 to the year 2019, have to be seen. All of them

were part of the global outrage that actually concerned the damage

caused to the environment by the emissions from the cars allegedly

fitted with manipulative devices. The proceedings before the NGT

were not intended to address issues relating to individuals, such as

(i) whether any emissions manipulation software, called in common

parlance as ‘defeat devices’ were installed in the vehicles purchased

by certain individuals; and (ii) whether any representation was

made to the purchasers of the cars in which such devices had been

installed, about the emission efficiency level of the cars.

40. Therefore, we are unable to agree with the contention of the

learned Senior Counsel for the petitioner that the substratum of the
police complaint is something that is already the subject matter of

adjudication before this Court in the appeals arising out of the

order of the NGT. As a matter of fact, the High Court has been fair

to the petitioner, by granting protection against arrest till the filing

of the report under section 173(2) of the Code. We do not think that

the petitioner can ask for anything more.

41. It is needless to point out that ever since the decision of the Privy

Council in King Emperor vs. Khwaja Nazir Ahmed1, the law is well

settled that Courts would not thwart any investigation. It is only in

cases where no cognizable offence or offence of any kind is disclosed

in the first information report that the Court will not permit an

investigation to go on. As cautioned by this Court in State of

Haryana vs. Bhajan Lal2, the power of quashing should be exercised

very sparingly and with circumspection and that too in the rarest of

rare cases. While examining a complaint, the quashing of which is

sought, the Court cannot embark upon an enquiry as to the reliability

or genuineness or otherwise of the allegations made in the FIR or in

the complaint. In S.M. Datta vs. State of Gujarat3, this Court again
1 AIR 1945 PC 18
2 (1992) Supp. (1) SCC 335
3 (2001) 7 SCC 659

cautioned that criminal proceedings ought not to be scuttled at the

initial stage. Quashing of a complaint should rather be an exception

and a rarity than an ordinary rule. In S.M. Datta (supra), this Court

held that if a perusal of the first information report leads to disclosure

of an offence even broadly, law courts are barred from usurping the

jurisdiction of the police, since the two organs of the State operate in

two specific spheres of activities and one ought not to tread over the

other sphere.

42. In view of what is stated above, the special leave petition is

dismissed. There will be no order as to costs.



New Delhi
November 26, 2020



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