Vehicle Scrappage Policy of India: Everything You Need to Know

The Vehicle Scrappage Policy, 2021, focuses on getting rid of outdated and inoperable automobiles. It intends to deregister individual automobiles older than 20 years and business vehicles older than 15 years.

What is India’s Vehicle Scrappage Policy?

The Vehicle Scrappage Policy is a government-funded initiative that scraps old and inoperable automobiles and replaces them on Indian roads with modern and new vehicles. The policy’s major purpose is to develop an environment for phasing out unsuitable and polluting automobiles to reduce the country’s carbon footprint.

Heavy Commercial Vehicles (HCVs) will only be tested for fitness through Automated Testing Stations from April 1, 2023. (ATSs). Fitness testing for various types of Commercial Vehicles (CVs) and Private Vehicles (PVs) will also be undertaken through the ATS. They will commence on June 1, 2024.

Commercial and private automobiles that are more than 15 and 20 years old must be demolished if they fail the fitness test. When a vehicle fails the fitness test, it is classified as an ELV (End-of-Life Vehicle).

Highlights of the Announcement of the Vehicle Scrappage Policy

Since the latter part of 2019, the Indian car industry has been in turmoil. The subsequent COVID-19 outbreak exacerbated the issue. Although post-Diwali sales in 2020 have helped the sector, the situation remains serious. The scrappage strategy is believed to benefit India’s beleaguered vehicle industry. As older cars are phased out, greater demand for new automobiles will be greater. Scrapping old automobiles is also good for the environment.

Here’s a rundown of the important points from the Vehicle Scrappage Policy release.

• The strategy aims to create a mechanism in India for scrapping defective automobiles.
• The actual scrapping procedure will be governed by rules and regulations, which will be outlined in the MoRTH statement.
• Vehicle owners will be compensated for scrapping obsolete cars.
• Unfit automobiles will be scrapped, significantly cutting air pollution (subjective as per location).
• People will be excited to purchase environmentally friendly, safe, and technologically sophisticated automobiles.

What is the goal of the 2021 Vehicle Scrappage Policy?

The primary goal of the Vehicle Scrappage Policy 2021 is to detect and scrap outdated, inefficient, and polluting cars. Here are some of the most important takeaways from the auto scrappage plan.

• Reduce pollution by discarding automobiles that do not have appropriate insurance and registration.
• Enhance passenger, road, and vehicle safety.
• Create jobs in the car industry.
• Make the present informal auto scrappage sector more official.
• Improve fuel economy and save car maintenance expenses.
• Make more low-cost raw materials available to the automotive, steel, and electronics industries.

The Advantages of the Vehicle Scrappage Policy

Here is a summary of potential economic, automotive, and car owner benefits from the new vehicle scrap policy.

• Unfit automobiles will be scrapped, resulting in fewer emissions and better air quality.
• As old cars are trashed, the demand for new vehicles rises since the old ones must be replaced with new ones. Over 51 lakh light motor vehicles (private and commercial) are over 20 years old.
• Overall, the new scrappage policy will assist the vehicle industry by creating additional work possibilities. New automobile scrapping facilities, for example, will require labour.
• Newer, more modern automobiles will be safer. New automobiles, for example, have greater safety features.
• The recycling business will also become more active, resulting in more income.
• Car owners may be eligible for tax breaks as an incentive to trash an outdated vehicle.
• Vehicle owners may also receive the greatest price for vehicle scrappage for usable parts like tyres.

On Indian roadways, several sorts of cars are driven. Because of this variety, the same principles cannot apply to all vehicles. As a result, there is a requirement for vehicle categorization in scrappage. Here are the specifics.

Government Vehicles

The government automobile scrappage policy was authorized in January 2021. According to this authorisation, vehicles owned by the Centre and State Governments that are more than 15 years old must be destroyed. A similar regulation will be implemented the following year. The implementation date for this regulation is April 1, 2022.

Commercial Vehicles

Commercial vehicles are utilized for commercial reasons, such as vehicles. After 15 years, the commercial vehicle will be subjected to a fitness test. If the vehicle is deemed unsuitable, it must be scrapped following the commercial vehicle scrap policy requirements.

Private Vehicles

Private vehicles are those used by residents to go from one location to another. The minimum age to take a fitness test for a private car is 15 years.

Vehicles from the past

Vintage automobiles and motorcycles are often older than the average vehicle. They are, however, driven relatively less and are maintained highly. As a result, this is a different category, and the character of such vehicles must be examined when it comes to scrapping instructions.

Fitness Tests for Vehicles

The major elements of an old vehicle fitness test are under the Vehicle Scrappage Policy 2021.

• Fitness testing is a thorough assessment to evaluate the vehicle’s roadworthiness.
• The test also assesses if the car contributes to pollution.
• In the same way that you must verify your vehicle’s emissions levels using the Pollution Under Control test, you must also check the vehicle’s fitness using authorized Automated Testing Stations.
• The fitness test should be valid for five years, after which the vehicle shall be subjected to fitness testing.
• Vehicles that fail the fitness test will not be able to renew their registration.

Where should I take the car to be inspected or scrapped?

If your vehicle’s registration is up for renewal, you should keep a few things in mind.

• If you want to keep the car, go to an authorized Automated Testing Station (ATS).
• Go to the nearest authorised scrapping plant if you wish to scrap the car.
• You must wait till the ATSs are working before disposing of your car. They should be accessible through the VAHAN database.

What are the benefits of scrapping old cars?

Here are the benefits of scrapping outdated automobiles.

Get a discount: After scrapping the car, the owner may obtain a 4 to 6% reduction on the cost of a new vehicle.

There are no registration fees: The registration payments for the new car are waived when the Certificate of Deposit is declared.

Concession on road tax: State governments may provide a reduction in the new vehicle’s road tax. The discount can be 25% for non-transport cars and 15% for transport vehicles.

Discount on a new car: Vehicle manufacturers have been asked to provide a 5% discount when purchasing a new vehicle with a Certificate of Deposit. This reduction is in addition to the scrap value of your car.

What are the disadvantages of owning an old car?

Here are some of the drawbacks of owning an ancient automobile.

Fee increases: The fees for the fitness test and the issuance of the Fitness Certificate (FC) for commercial vehicles older than 15 years are higher.

Increased re-registration fees: The fees for renewing the RC for private cars that are more than 15 years old are higher.

Green Cess: In addition to the road tax, such older cars will be subject to 10 to 15% green cess.

Vehicle registration renewal fee

The pricing schedule for renewing car registration charges for private automobiles over 15 years old is follows.

Metric	Vehicle Category	Current fee structure	Revised Fee Structure
Renewal of RC	Light Motor Vehicle	Rs 600	Rs 600 (for New Vehicle) Rs 5000 (renewal of RC after 15 years)
Fitness test for new or renewed Fitness Certificate (FC) issuance – Vehicles older than 15 years	Light Motor Vehicle	Rs 600	Rs 1000 (Automated Fitness Station

The pricing schedule for renewing commercial vehicle registration charges for cars older than 15 years is below.

Fitness test

Vehicle category	Current fee structure	Revised fee structure
LMV	Rs 600	Rs 1,000 (Automated Testing Facility)
Passenger Vehicle/Medium Goods	Rs 1,000	Rs 1,300 (Automated Testing Facility)
Passenger Vehicle/Heavy Goods	Rs 1,000	Rs 1,500 (Automated Testing Facility)

Issuance or renewal of RC (15 years Old Vehicle)

Vehicle category	Current fee structure	Revised fee structure
LMV	Rs 200	Rs 7,500
Passenger Vehicle/Medium Goods	Rs 200	Rs 10,000
Passenger Vehicle/Heavy Goods	Rs 200	Rs 12,500

Under what circumstances would my automobile be scrapped?

Old, inefficient, and polluting automobiles contribute to the country’s carbon impact. According to the new Vehicle Scrappage Policy 2021, a few norms and regulations are in place to assist in the renewal of registration or scrapping of older cars. The following are the requirements for scrapping an old automobile.

• Commercial and private cars over 15 years old must be tested for registration renewal.
• If the vehicle is judged to be unsuitable, the owner can repair it and re-test it.
• If the vehicle fails the fitness test, it is classified as an End-of-Life Vehicle (ELV) and may be scrapped.

Also Read, BH Series Number Plate: Everything you Need Know about It

What effect does the policy have on you as a two-wheeler owner?

Here’s how the bike scrap policy affects a two-wheeler owner.

Fitness exam: A fitness test is required for all two-wheelers above 15. The bike’s fitness will be evaluated. If the car is deemed unsafe, owners can have it fixed and re-tested. If the two-wheeler is declared unsuitable, it will be classified as an ELV and scrapped.

Fitness exams are currently done by hand. However, with the implementation of the Vehicle Scrappage Policy, the vehicle will be subjected to an automated fitness test without human participation to obtain reliable findings.

End-of-Life Vehicle (ELV) certification is required: If your two-wheeler fails the computerized fitness test, it is judged unfit, and the ATS issues an ELV certificate. You cannot cover your bike with the necessary Third-party Bike Insurance since the machine is not roadworthy.

In India, how do you scrap a car?

Here is the procedure for scrapping a vehicle in India.

Step one: Make contact with the scrapyard.

• Contact the authorized recycler by phone or on their websites.
• Once you’ve received the appointment, you can either drive the automobile to the scrapyard or have them come to you. Please keep in mind that there may be towing costs if you request that they collect your vehicle.

Step 2: Finish the paperwork.

• A copy of the car owner’s Permanent Account Number.
• The vehicle’s original registration certificate.
• The Automated Testing Station issued an End-of-Life Vehicle certificate.
• The check was cancelled.
• If the car owner is unavailable to submit the vehicle to the Automated Testing Station, a letter of authorization on stamp paper is required for the authorized person.
• Identity evidence (passport, driving licence, Aadhaar, voter card, or picture identity card issued by the State Government or the Central Government).
• Address proof (electricity bill, water bill, landline telephone bill, piped gas bill, etc.) of the vehicle owner
• A digital image of the car owner or an authorized person holding the ELV is required.
• An agreement from the vehicle owner stating that all information provided is truthful and correct to the best of their knowledge.

Step 3: Allow the scrappage to begin.

• Typically, the recycler will remove the tyres, batteries, and CNG kit (if any). The air-conditioning unit’s refrigerant is drained and delivered to the de-pollution station. All liquids are emptied, including engine oil, gearbox oil, petrol, brake fluid, steering fluid, windshield washer fluid, and engine coolant. The recycler removes the vehicle’s exhaust system and fuel tank.
• The body panels, boot lid, bonnet, fenders, doors, headlights, and bumpers are physically removed once all fluids have been removed from the vehicle. The steering wheel, seats, floor mats, dashboard, roof lining, and other interior components are removed by hand. The vehicle’s electrical system is also dismantled.
• The vehicle’s running gear is removed, the car is raised, and the engine, brakes, and suspension are removed. The VIN (Vehicle Identification Number) plate is then removed.

Step 4: The leftover car components are recycled or utilized.

• Only the body shell remains after all automotive components have been removed.
• A crane lifts the car’s body shell and drops it into a crusher facility. The crusher produces a steel bale, which is sold for smelting.
• The remaining pieces will either be sold or scrapped into a steel bale.
• To avoid pollution of the environment, the recycler guarantees that no AC fumes or oil are released into the air or the soil.

Step 5: Obtain the certificate of scrappage.

• The recycler will provide a ‘certificate of destruction after the automobile has been demolished.
• The certificate can be used to have the vehicle de-registered at the appropriate Regional Transport Office (RTO). The scrap value will be given to you in a check or electronically.
• Aside from being used for de-registration, the certificate may also be used to obtain a discount from the car manufacturer on the purchase of your next vehicle and a reduction on road tax and total remission of vehicle registration payments.

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