State Authorization, Not Just Central Approval, Needed for HSRP Affixation on Old Vehicles: Kerala High Court

Kochi: In a significant ruling regarding the long-delayed implementation of High-Security Registration Plates (HSRP) for vehicles registered prior to April 1, 2019, the Kerala High Court has clarified that possession of a Type Approval Certificate (TAC) issued by a Central agency is not sufficient for a manufacturer or dealer to affix HSRPs on older vehicles. The court reiterated that authorization from the State Government, typically through a transparent tender process, is mandatory for licence plate manufacturers and their dealers under Rule 50 of the Central Motor Vehicles Rules, 1989.

The judgment, delivered by Justice D. K. Singh , disposed of a batch of writ petitions filed by entities holding TACs, who sought directions to be allowed to affix HSRPs on older vehicles (estimated at around 75 lakhs in Kerala) without needing separate authorization from the State. They also challenged Central Government advisories requiring State authorization and a recent State Government order related to the scheme's implementation.

Case Overview

The core dispute revolved around the interpretation and implementation of Rule 50 of the Central Motor Vehicles Rules, 1989, as amended. While Rule 50 mandates the display of HSRPs on all vehicles, the mechanism for older vehicles (registered before 01.04.2019) differs from that for new vehicles. For new vehicles, the responsibility lies primarily with vehicle manufacturers (OEMs) and their dealers. For old vehicles, Rule 50(1)(v) allows affixation by the registering authority, vehicle manufacturers and their dealers, or "approved license plate manufacturers or their dealers."

The petitioners, holding TACs, argued that "approved" by the Central agency is sufficient approval, and no further authorization from the State is required. They contended that the State's insistence on separate authorization violated their right to carry on business under Article 19(1)(g) of the Constitution. They challenged Central Advisories dated June 9, 2023, and January 8, 2024, which clarified that State authorization was necessary for license plate manufacturers.

The State of Kerala, on the other hand, had made little progress in implementing the scheme for older vehicles, despite repeated directions from the Supreme Court since the early 2000s. The State initially attempted to entrust the task to the Institute of Driver Training and Research (ITDR), which declined. Most recently, the State issued G.O.(Rt) No.285/2024/Trans dated July 30, 2024, directing registering authorities (RTOs) to float global tenders for purchasing machinery to set up their own manufacturing plants and obtain TAC.

Court's Analysis and Precedents

Justice D. K. Singh meticulously reviewed the history of HSRP litigation, relying heavily on a series of Supreme Court judgments, including Association of Registration Plates v. Union of India (2005, 3-Judge Bench) and various orders in Maninderjit Singh Bitta v. Union of India (2008, 2011, 2012, 2016).

The court noted that the Supreme Court consistently held that while a TAC certifies the technical competence to manufacture HSRPs, it does not automatically entitle an entity to be the sole supplier or to affix plates without State control. The Supreme Court had upheld the State's right to select capable manufacturers/suppliers through a transparent tender process to ensure the scheme's integrity and security features are maintained.

The judgment cited pivotal excerpts from the Supreme Court rulings, emphasizing that selecting one or more manufacturers via open competition is not creating a monopoly but ensuring effective implementation, data management, and security.

"Selecting one manufacturer through a process of open competition is not creation of any monopoly... The actual operation of the scheme through the RTOs in their premises would get complicated and confused if multi-manufacturers are involved. That would also seriously impair the high security concept..." the High Court quoted from Association of Registration Plates (2005).

The High Court rejected the petitioners' argument that "approved" in Rule 50 refers solely to TAC holders, aligning with the Supreme Court's interpretation that it implies authorization/selection by the State for the purpose of implementation.

The court also examined the State's conduct, observing that Kerala has been exceptionally slow in implementing the scheme for older vehicles despite clear Supreme Court mandates, some dating back over a decade, which had set deadlines as early as 2012.

The State's Delays and Quashed Order

The court expressed strong disapproval of the State's latest notification (G.O.(Rt) No.285/2024/Trans dated 30.07.2024), which proposed RTOs floating global tenders for manufacturing machinery. The court found this plan unrealistic and a thinly veiled tactic to further delay the implementation of the HSRP scheme.

"This Court fails to understand the underlying intent of the State Government for such a notification. This notification is nothing but a devise not to implement the HSRP Scheme in the State of Kerala," the judgment stated.

The court cited the mandatory nature of HSRP implementation for public safety and security, as repeatedly stressed by the Supreme Court.

The Verdict and Implications

Based on its analysis and the binding Supreme Court precedents, the Kerala High Court delivered the following key directions:

1. The plea by TAC holders to affix HSRPs on old vehicles without State authorization/selection is rejected. TAC is a prerequisite, but not a substitute for State selection via tender.
2. The Central Government Advisories dated June 9, 2023, and January 8, 2024, requiring State authorization for licence plate manufacturers on old vehicles are upheld.
3. The State Government's notification G.O.(Rt) No.285/2024/Trans dated July 30, 2024, is set aside and quashed.
4. As an interim measure, until the State Government conducts a transparent tender process to select one or more authorized licence plate manufacturers or their dealers for old vehicles, the Original Equipment Manufacturers (OEMs) and their dealers are permitted to affix HSRPs on vehicles manufactured prior to April 1, 2019 , similar to the arrangement in several other States.

This judgment clears the air on the State authorization requirement in Kerala and puts pressure on the State to initiate a proper tender process for HSRP implementation on older vehicles, while providing an interim mechanism to allow vehicle dealers to start affixing the plates.