President instigates investigation into Vehicles Lanka assembly operations
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Stacks of vehicle body parts at a Kandy shop
A top level investigation will get underway on the directions of President Maithripala Sirisena into legal issues faced by Vehicles Lanka Pvt Ltd in carrying out vehicle assembly operations with used spare parts imported from Japan since 2003, official sources disclosed.
The company has been given Board of Investment (BOI) approval for the assembly of an initial quota of 2025 cars during the tenure of the then BOI Chief Arjuna Mahendran in 2002.
The President who expressed his concern on legal and environment issues relating to the vehicle assembly operations being carried out by Vehicles Lanka at its plant at the Minuwangoda Industrial zone has directed the relevant authorities to conduct an indepth investigation , a senior official of the Transport Ministry told the Business Times.
The Cabinet Committee on Economic Management (CCEM) has directed an investigation into various legal issues pertaining to Vehicles Lanka operations and submit a detailed report soon discussing this matter with the Attorney General.
It has been revealed that around 400 Emperor cars of Vehicles Lanka were produced and sold but the owners who bought those vehicles had to face problems in legally registering their vehicles as the Commissioner General of Motor Traffic Department (MTD) has refused permission for this purpose.
Then the matter went to courts and since then it has become a pillar- to-post affair involving the courts, the cabinet of Ministers, the Attorney General, the BOI, the Commissioner General of Motor Traffic (CGMT) and the Police.
In April last year, the company filed a case at the Supreme Court alleging contempt against the CGMT for refusing to abide by an earlier court ruling and register the Emperor cars.
Vehicles Lanka was under legal battle since 2002 following a Ceylon Motor Traders Association’s (CMTA) threat of legal action against the company alleging that vehicles were made by used cars brought in two halves and welded at the assembly plant, former Chairman of the CMTA, Tilak Gunasekera told the Business Times.
At that time there was another allegation against the company for selling those vehicles under the reputed brand names of Toyota and Nissan, he added.
The then Industrial Policy and Investment Promotion Ministry Secretary has issued a statement after repeated submissions of the CTMA raising questions and concerns on the Vehicles Lanka business.
The then Investor Facilitation Committee directed the cancellation of the BOI approval following this statement in January 2003.
Thereafter the company filed a Fundamental Rights application at the Supreme Court and the BOI has reversed its decision to cancel the initial approval. Vehicles Lanka says this decision is valid even today and that is why they continue their operations.
Making matters more controversial, a special police team from the Walana Central Anti Frauds Bureau in a joint operation with Sri Lanka Customs Central Investigation Bureau raided a vehicles assembly plant in the Minuwangoda Industrial Park and seized 54 Vehicles assembled with parts imported illegally on January 31 this year.
The raid was conducted by the Police on a complaint received by them alleging that Vehicles Lanka had deprived the government of nearly Rs. 325 million in Customs duties by importing vehicles parts illegally to locally assemble vehicles.
Clarifying the issue of releasing the Vehicles parts consignment, the Finance Ministry said in a statement that a decision made by the cabinet of ministers to release eight containers of used vehicles parts from the Customs to its consignee was based on the legal advice given by the Attorney General.
| Motor traders concerned over motor vehicle assemble plants | |
| The Ceylon Motor Traders’ Association (CMTA) has expressed concern over the recent decision by the government to allow the assembly of motor vehicles using imported used spare parts.This move by the authorities, the association, the apex body representing the manufacturers of the global automobile brands in Sri Lanka, says will jeopardise the safety of motorists, the public and also contravenes an existing customs regulation, which only permits the import of vehicles that have been used up to a maximum of 3 years, from the date of 1st registration.CMTA, in a statement issued through the Ceylon Chamber of Commerce, says the move also contradicts state policies which encourages the re-export of motor vehicles that has been used for a period of maximum of five years in Sri Lanka to reduce the impact to the environment. The danger of allowing this to go ahead is that the unsuspecting motor vehicle buyer would not know the year of manufacture of these so-called assembled vehicles and a car manufactured 10 years ago can be issued with the latest registration number plates from the RMV, the association said. A 10 year-old car will also not have the relevant spare parts necessary for repairs and maintenance of a vehicle as the guarantee of spare parts from the manufacturer is valid only between 10-15 years from the date of manufacture. In the event of a major accident, the engine number and the chassis number would not be able to be related to manufacturers’ records, thereby even causing security concerns. The status of registration will also be ambiguous, and will therefore cause further complications legally, CMTA warned. The association has urged the intervention of President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe to look into this matter and take appropriate action to rectify the issue. |