A speed governor is a device used to measure and regulate the speed of a machine, such as an engine. A classic example is the centrifugal governor, also known as the Watt or fly-ball governor, which uses weights mounted on spring-loaded arms to determine how fast a shaft is spinning, and then uses proportional control to regulate the shaft speed.

Automobiles are its common application, and modern automobiles are equipped with such a mechanism for various reasons.

There are two types of automobile governors, one limiting the rotational speed of the engine, the other limiting the speed of the vehicle. In small, low power applications, governors are used to protect the engine from damage due to excessive rotational speed, or pushing the engine past its peak abilities. In larger, higher performance engines governors are used to limit the vehicle speed. Many performance cars are limited to a speed of 250 km/h (155 mph)

It is also used to limit insurance costs of the vehicle and reduce the risk of tyres failing. All heavy vehicles in Europe have by law speed governors that limits the speed to 90 km/h (56 mph) (100 km/h for certain buses). Urban public buses often have speed governors which are typically set to between 40 and 55 miles per hour.
A speed governor in New Delhi is estimated to cost Rs 2,860, while in Bangalore it is priced close to Rs 16,000, including VAT.

Source: Wikipedia