Is your vehicle more than 15 years old? Irrespective of if you are the first owner of the car or had bought it second-hand with a
used car loan, you must comply with the government’s newly drafted voluntary car scrappage scheme. Now, the permit to drive old cars will be dependent upon the car's condition and not the car's age. And, for re-registration of vehicles, you have to shell out eight times more than what it was earlier. Yes. And, there are more surprises in the kitty.
Read on for everything you must know about the newly drafted vehicle scrappage policy.
What if My Used Car is Getting Close to 15 Years of Age?
The newly drafted vehicle scrappage policy aims to phase out the old, polluting and unfit cars. As per the new policy, the scrappage policy will apply to all those cars that are older than 15 years. Personal vehicles after 15 years and commercial vehicles after 10 years should undergo a compulsory fitness test. If your vehicle passes the fitness test, the relevant authority will issue a renewal certificate with a validity of 5 years. The revised fees prescribed under the voluntary vehicle scrappage scheme are:
- In the case of a personal car older than 15 years, you have to pay Rs 5,000. Previously, the renewal price was set at Rs 600.
- The renewal fees for heavy vehicles such as buses or trucks have been raised from Rs 1,500 to Rs 12,500.
- If you own an older motor or passenger vehicle, you will need to set aside Rs 10,000 for renewal.
- If you have an imported car, the renewal charge as per the new car scrappage policy is Rs 40,000.
Keep in mind, if your car fails the inspection, the authority in charge will allow you to take another test. Re-testing is permitted once your vehicle has undergone necessary repairs. If it fails the re-test, it will be classified as an ELV or end-of-life vehicle, and no renewal certificate will be provided.
If you choose to scrap your car instead of saving it in your garage, you will receive the following benefits:
- Under the car scrappage scheme, you will be provided with a scrap value ranging from 4% to 6% of the car's ex-showroom price.
- Another advantage of opting for this scheme is that you can get a maximum of a 25% rebate on the road tax.
- The new policy advices the car manufacturers to offer a 5% discount on the purchase of new cars against a car scrapping certificate.
- If you own a scrapping certificate, you don't have to pay the registration fees for a new car purchase.
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Many people wrongly believe that a car's age is the only determining factor that will make a car eligible for the vehicle scrappage policy. Below is the list of all the conditions under which your old cars will be phased off the road.
- If you possess a car with an expired registration certificate, you can send it in for scrapping under the car scrappage scheme.
- In case the car you have in the garage fails to pass the fitness or inspection test at one of the authorised inspection centres, your petrol car validity or diesel car validity in India to run on the roads stands void.
- According to the new rules, if your second-hand car in Delhi NCR or any other region is irreparably damaged in an accident or a natural disaster, you are eligible for a vehicle scrappage policy.
- Impounded cars are also eligible for the car scrappage policy.
- Also, any decommissioned government cars, as well as abandoned cars, will be phased off the road under the car scrappage policy.
Points You Must Know About Car Scrappage Policy Process
To scrap your car, you need to follow a specific process outlined in the pointers below. However, to avoid any hassle and legal complications, it is always a good idea to check whether your said car was actually scrapped by the dealer or if it was passed on to the illegal hands.
- As the first step, the car's owner must go to the RTO and inform them of their intention to scrap the car. As the owner of the car, you also have an option to deregister your vehicle.
- To scrap your car that was purchased way back on a second-hand car loan, visit the authorised scrap dealer. The authorised dealer will initiate the scrapping safely and securely.
- At the authorised centre, the dealer will conduct a thorough inspection of your car. Following the inspection, the dealer will quote the scrappage price for your car based on its weight.
- As soon as you quote and sign the agreement, the scrap dealer will start disassembling your car and sorting it into plastic, rubber, iron, and other materials.
- When the dealer scraps your car, he or she takes out the chassis number before sending it for recycling.
- If you believe that a few of your car parts such as tyres and battery are in good working condition, you can negotiate for those parts separately. If you drive a CNG unit fitted vehicle, negotiate for it separately.
- When opting for the vehicle scrappage policy, furnish your RC's photocopy. Submission of original RC is not required.
- Don't forget to take some snaps of your scrapped vehicle. This will serve as proof and will make the RTO process smoother.
How Will Valuation be Done Under the Car Scrappage Scheme?
When opting for a scrappage scheme, every used car owner who bought the vehicle on a second-hand car loan has only one question in mind—"What is the scrappage value of my car?" To know the answer, follow the pointers below:
- If your car is damaged irreparably or is no longer functional, you will receive the amount at the rate per kilogram of metal parts. As per the current car scrappage policy, the minimum rate is fixed at Rs 15 per kilogram for the car's metal parts.
- If your car is in proper working condition, you can negotiate with the scrap dealer and can get a better bargain on the deal. Since the dealer gets the better value on selling the spare components that are in working conditions, you could also benefit from it.
Scraping and Deregistration of Older Cars or Used Cars Are Governed by RTO Regulations
To complete the de-registration process, you need to follow the guidelines prescribed by the RTO.
- Before you go ahead with your car scraping decision, you must first notify the appropriate Regional Transport Office (RTO) in writing.
- Following your intimation, surrender your original car registration certificate (RC) to the concerned RTO. Submission of the chassis number provided by your scrap dealer at the time of scrapping is also mandatory.
- You must also submit the snaps of your snapped car along with the scrap dealer's confirmation in writing on letterhead that mentions the dealer’s address, regarding car scrap
- To complete the process, make sure you submit the affidavit with the duly filled application form for de-registration and scrap with the RTO. The affidavit will include information about car loan or used car loan clearance (if any), insurance claims, and court proceedings (if applicable), as well as some other information.
- Once you submit all your documents, the RTO will begin the verification process. The verification process will include the gathering of reports and data from the National Crime Records Bureau (NCRB) and traffic police.
- The RTO will also conduct intra-departmental verification and validation checks using the purchase and sales records that they keep.
- After the successful verification, the RTO will de-register your car.
What Happens to the Scrapped Car's Registration Number?
- Following the successful de-registration of your vehicle, the registration number that was previously assigned to your car will be made available to others. There are no restrictions on new car owners being assigned an old car registration number.
- To avoid any legal complications, don't forget to notify your insurer regarding the de-registration of your car.
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When your car's registration certificate is about to expire, following the car scrappage policy might save you a lot of money. Failure to comply with the new regulations will result in not just legal complications but also a severe penalty. Check the list of the authorised fitness centres and scrap dealers in your city to undergo the fitness test or to begin the scrapping process for your old car.
