Be Prepared to Shell Out 8X More to Retain Your Age-Old Car

Posted on: May 5, 2022 | | Written by:

Be Prepared to Shell Out 8X More to Retain Your Age-Old Car

As a proud vehicle owner, it’s no wonder that your endearing vehicle gradually becomes an integral part of your family. But, now it's time to reconsider your decision of retaining it for over 15 years. The Ministry of Road Transport and Highways has issued a new circular mentioning to hike up the re-registration fees of vehicles older than 15 years by up to eight times from April 2022 onwards. The principal motive behind such drastic change in fees seems to target at gradual phasing out of the old, polluting vehicles based on the renewed scrappage policy of the government. When combined with the car insurance renewal costs, it with become an enormous burden to continue in the long run, amidst such inflation status.

● How much will it cost me to get renewed fitness/registration certificate for my 15+-year-old car?

As per the previous norms, it took no more than a mere INR 600 to obtain a renewed registration certificate. However, from April 2022 onwards, the same would cost you INR 5000 for the same vehicle. When compared to the previous INR 300, it will cost INR 1000 for two-wheelers. The same rule is applicable for fitness certificate renewal too. The fitness certificate renewal cost INR 1500 for heavy commercial vehicles previously and will now cost INR 12000. For light commercial vehicles, it has changed from INR 1500 to INR 10000. If you wish to obtain a renewed registration certificate for old two-wheelers, it will cost you between INR 10000 and INR 40000, depending on the make, model, variant, and specifications of the concerned vehicle. However, there will be a minimal impact of this amended new rule on the vehicle owners of Delhi, as the state government has already banned diesel vehicles older than 10 years and above and petrol vehicles of 15 years and above.

● When will these rules be implemented?

The notification clearly stated that the renewed scrappage policy will be implemented in full force throughout the country from April 1, 2022, onwards, renamed Central Motor Vehicles. If you decide to hold on o your old vehicle, get ready to shell out 8x more for fitness certificate renewal for private vehicles and 62X more for commercial vehicles. Apart from that, every individual state will implement a compulsory Green Tax, applicable over the existing road tax.

● Is there any penalty?

If you still decide to ignore these rules and do not bother to obtain the relevant new documents, you will be charged a levy of INR 50 per day after the expiry of the previous fitness certificate. If the registration certificate is a smart card type issue, then an additional cost of INR 200 will be charged. For all existing private vehicles, any delay in application for the renewed registration certificate, a monthly extra fee of INR 300 will be accounted for. For the commercial vehicles, this amount will be INR 500. A compulsory fitness test for heavy commercial vehicles is more likely to be enforced from the 1st of April 2023, and this policy will work in a phased manner for other categories from June 1, 2024, onwards.

The National Automobile Scrappage Policy aims at offering a boost to the country’s automotive and manufacturing sectors. It will also effectively help in plummeting the fuel import bills of India and expertly reduce harmful carbon emissions. This particular policy also targets fulfilling India’s commitment to the Paris Agreement, generating over 50,000 jobs and attracting an investment of over INR 10,000 crore in this country. Apart from that, the regulated and punctual disposal of old vehicles will substantially contribute toward salvaging tons of metals from various landfills, returning them to the automotive industry. All vehicles are prepared from several kinds of ferrous and non-ferrous metals, and sometimes even precious metals are also involved. Recycling then will automatically bring a wave of the green revolution, maintaining the ecological balance and observing a sustainable approach

● Incentives on scrapping your old car:

The government has declared has proposed to incentivize the voluntary vehicle scrapping strategy:

The owners of unhealthy vehicles, willing to scrap them voluntarily, will receive compensation with a scrap value equal to 4% t 6% of the declared ex-showroom price of the new vehicle they wish to buy. While buying a new vehicle, no registration fees will be charged if one produces a Certificate of Deposit. The central government has asked the individual state government for offering concessions on on-road taxes, which can run up to 25% for non-transport vehicles and 15% for transport vehicles. The government has also asked all the vehicle manufacturers to allow a 5% discount while purchasing a new vehicle on providing a Certificate of Deposit.

Conclusion

With the successful implementation of scrappage policy in countries like Europe and the USA, we have observed significant environmental development. Moreover, with intense recycling practices, a parallel circular economy has also developed, improving both the environment and the financial status of the country. Without undertaking such heavy expenditure of re-registration and car insurance renewal, it is best to timely dispose of your vehicle and save yourself and the environment at large.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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