Vehicle Scrappage Policy In India: Overview, Explanation, And Benefits

Imagine trying to navigate a flip phone today, when people unlock doors with facial recognition and pay bills through a tap on their smartwatches. It would feel archaic, no? That flip phone was once a wonder, yet today it can hardly keep pace with modern usage. Changes did not just stop there. Think of the millions of vehicles on India's roads that have become similarly anachronistic. These old, polluting cars are such flip phones—they were so useful once but now hold people back in a cleaner, more efficient future. That's what India's Vehicle Scrappage Policy is all about.

The Vehicle Scrappage Policy goes way beyond just removing old vehicles from the road; it is an overhaul.  It's as if you have a garage full of broken-down appliances, old tools, and obsolete electronics cleared out. Once you eliminate the clutter, you create room for new, better, and superior alternatives. This Vehicle Scrappage Policy is about clearing all those metaphorical old appliances from the Indian roads for vehicles that no longer have any more useful time left on earth, thereby ensuring the creation of abundant, environment-friendly alternatives.

Below, we outline the Vehicle Scrappage Policy, including its benefits to vehicle owners and the environment, and why such Vehicle Scrappage Policy is important for India's future.
 

What Is Vehicle Scrappage Policy In India?

India's Vehicle Scrappage Policy is the new initiative taken by the government to scrap all the inefficient vehicles that do not conform to the existing standards and replace the old ones with modern new vehicles. This scheme seeks to lower the emission levels and carbon footprint by scrapping polluting vehicles from the roads. that are no longer roadworthy and beyond which this environment is not sustainable for them.

From April 1, 2023, Heavy Commercial Vehicles(HCVs) have been under the rigour of fitness testing exclusively at Automated Testing Stations(ATSs). Other Commercial Vehicles (CVs) and Private Vehicles' (PVs) fitness testing commenced at Automated Testing Stations from June 1, 2024.

However, those who fail these fitness tests and are -

• Over 15 years old for commercial vehicles, or
• 20 years old for private vehicles

will be regarded as End-of-Life Vehicles (ELVs) and thus have to be scrapped.
 

Highlights Of The Vehicle Scrappage Policy Announcement

The automobile sector of India has been in a severe crisis since the end of 2019, and COVID-19 has only hastened the process. Even though the sector under stress did experience a brief uptick late in 2020, it remains rather vulnerable to pressures. Thus, as part of its effort to bail out the struggling sector, the Vehicle Scrappage Policy was designed to boost demand for new vehicles by scrapping the old ones - an investment in the economy as well as the environment.

Let’s look at some of the key highlights of the Vehicle Scrappage Policy:

• The Vehicle Scrappage Policy looks toward a systematic arrangement for the retirement of unfit vehicles in the country of India.
• The Ministry of Road Transport and Highways (MoRTH) will also issue detailed guidelines and regulations pertaining to the scrapping process.
• Owners of vehicles will qualify for various benefits under this policy for scrapping their old vehicles.
• Removal of unfit vehicles will significantly improve air quality depending on  local conditions.
• The Vehicle Scrappage Policy encourages the purchase of environment-friendly, safe, and technologically advanced vehicles.
   

What Is The Objective Of Vehicle Scrappage Policy 2021?

The Vehicle Scrappage Policy aims to detect old, unfit, and polluting vehicles and remove them. Key takeaways from the policy are as follows:

• Pollution Reduce: Scrapping those vehicles without a valid registration or fitness certification is aimed at reducing the level of emissions.
• Safety Improvement: Removing unsafe, outdated vehicles from the roads will improve passenger, road, and vehicle safety.
• Job Creation: Job opportunities within the automobile industry are created through scrapping.
• Formalisation Of The Industry: The informal vehicle scrappage sector is brought into a formal and organised sector.
• Efficiency Improvement: Indirectly improve fuel efficiency and maintenance costs for car users by encouraging newer and fuel-efficient vehicles.
• Raw Material Supply Improvement: Increase the availability of low-cost raw materials to industries such as automotive, steel, and electronics.
   

Benefits Of The Vehicle Scrappage Policy

The Vehicle Scrappage Policy has many advantages for the economy, the automotive industry, owners of vehicles, and the environment at large:

• Reduced Air Pollution: It will contribute to lowered emissions and improved air quality by phasing out unfit vehicles.
• Scrapping the Old: Scrapping the old fleet will increase the demand for new vehicles. More than 5.1 million light motor vehicles—private and commercial—have been running for more than 20 years.
• Boosting the Automotive Industry: The Vehicle Scrappage Policy will boost the automotive industry by creating employment in new vehicle scrapping centres.
• Increased Security: The newer cars are likely to be more secure and safer compared to the older ones.
• Boost For The Recycling Sector: The Vehicle Scrappage Policy can boost the recycling sector while increasing earnings from the reuse of recycled materials.
• Tax Incentives For Vehicle Owners: Old automobile owners will benefit from tax incentives for scrapping them.
• Perfect Pricing Of Salvageable Parts: Car owners would be in a better position to negotiate perfect prices for salvageable parts like tyres.
   

Environmental And Economic Benefits Of The Vehicle Scrapping

Vehicle scrapping offers a wide array of environmental and economic advantages. Let’s have a breakdown of each for better understanding:

The Economic Benefits:

The process of car scrap policy in India proved to be a growth catalyst for the economy, allowing for an increase in production and job opportunities, saving the environment, and accelerating technological development. This is how this process affects the different economic aspects positively:

1. Boosting The Automotive Industry

Automakers' car scrapping programs encourage consumers to scrap old cars and replace them with the newest ones while cutting taxes or other rebates and benefitting from discounts. Increasing demand for new vehicles translates directly into an increase in manufacturers' demand for the production of such vehicles. As old cars, which are polluting and less fuel-efficient, are scrapped, the average age of vehicles decreases, thereby also refurbishing the entire automobile industry. This encourages technological advancement, increases the competitiveness of the market, and, therefore, grows the automotive industry.

2. Improving Production And Employment

Scrap incentives for old vehicles fuel new vehicle demand, thereby driving higher production volumes. In line with this demand, manufacturers expand their facilities and create exciting employment prospects in the automobile industry by revolutionising the vehicle scrapping process. From the assembly lines to management and beyond, it helps reduce unemployment and improve living standards in the industry. The government, in most cases, provides incentives and policy support to the scrapping programs. In doing so, this encourages investment in the manufacturing, technology, and human capital bases necessary for sustained economic growth.

3.  Improving Metal And Spare Parts Industries

Car scrapping comprises valuable recyclable materials such as steel, aluminium, and copper. This way, the scrap dealers can broaden their inventory of a myriad of car part components as well as materials to include in their market, thus creating a wider customer base. Car scrapping helps scrap dealers remain competitive through the provision of reasonable prices for recycled materials and components, thus nurturing a flourishing and sustainable recycling industry. It further helps in business expansion and adherence to environmental standards.

4. Revenue Generation For The Government

Car scrapping programs can fetch government revenue through inspection fees, recycling taxes, and auctioning incomes for salvaged material. This source of additional revenue can then be invested in infrastructure development and healthcare programs for public welfare, which also benefit the greater society.

5. Encourage Innovative And Technological Adoption

Car scrapping shapes innovation in the automobile industry; manufacturers have to look at improving their products and bringing in innovative features in the form of security systems, fuel efficiency, and much more. Automakers invest in research and development based on new market demands and environmental concerns like connectivity and sustainability. This involves incorporating eco-friendly materials and crafting vehicles with recycling in mind, minimising the environmental footprint of end-of-life automobiles.

6. Environmental Cost Reduction

The older the vehicles are, the higher the pollution, which contaminates the air and subsequently increases healthcare expenses. Scrapping of aged vehicles and subsequent replacement with new environment-friendly models leads to improved air quality, thus reducing associated healthcare costs due to respiratory and other pollution-related diseases.

7. Compliance With Regulatory Requirements

As governments impose tighter emission standards that directly address environmental concerns, scrapping old vehicles contributes to fulfilling these new standards by disposing of all old cars that cannot match the present emission parameters. This proactive measure further satisfies India's international commitments as it earns a better reputation as a responsible global player.

Let’s dive into the advantages vehicle scrapping provides environmentally!

The Environmental Benefits:

The environmental benefits of the Vehicle Scrappage Policy address issues concerning ageing and unfit vehicles. Here's how the Vehicle Scrappage Policy helps conserve the environment:

1. Reduction Of Air Pollution

The removal of old, outdated vehicles from the environment significantly helps curb emissions since these vehicles are usually less efficient and pollute more. Newly manufactured cars come with stronger standards of emission, with most of them causing lesser pollution, thus cleaning up the air and reducing smog and harmful gases in the atmosphere.

2. Reduced Greenhouse Emissions

Older vehicles consume much more fuel and emit more carbon. Replacing these with newer, fuel-efficient cars reduces the amount of greenhouse gases emitted. This, in turn, is an effort to fight global warming and climate change.

3. Reduced Resource Waste

Scrapping involves recycling materials like metal, plastic, and glass from end-of-life vehicles. This reduces the consumption of raw materials, promotes the conservation of natural resources, and minimises the impacts of mining and processing on the environment.

4. Boost Recycle Rate

Vehicle scrapping maximises the efficiency of recycling processes to ensure that the materials from old vehicles are sufficiently sorted out and processed. This increases recovery and reuse capabilities while minimising waste and promoting a circular economy.

5. Encouraging Proper Disposal Of Vehicles

It promotes the disposal of harmful materials like fluids and batteries, which, if not effectively managed, can be very hazardous to the environment. Proper scrapping under controlled circumstances minimises the risk of environmental pollution through those substances.

6. Supporting Green Technologies

The replacement of an old car with a new one will shift the technology towards electric or hybrid cars that have a cleaner environmental aspect than the older technology that prevails in the internal combustion engine.

7. Improving Air Quality In Cities

The removal of older high-emission vehicles from urban areas will help keep cities clean and reduce urban pollution. This thus promotes healthier living conditions and benefits public health through a reduction of respiratory and cardiovascular diseases that are linked to poor air quality.

8. Complies With Environmental Regulations

The Vehicle Scrappage Policy will help India meet national and international environmental standards and regulations. The scrapping of vehicles that do not adhere to the recent emission norms will be perfectly aligned with India's international environmental goals and further strengthen its movement towards sustainability.
 

Eligibility Criteria For Vehicle Scrappage

The basic eligibility criteria of such vehicle scrappage programs in India are basically outlined under the Vehicle Scrapping Policy initiated by the government for phasing out old, polluting vehicles and promoting environmental sustainability. The eligibility criteria are mentioned as follows:

• Age of the Vehicle:
  • Passenger Vehicles: More than 15 years.
  • Commercial Vehicles: Commercial vehicles above 15 years of age, focusing on those that do not comply with Bharat Stage-IV norms.
     
• Registration Status:
  It should be registered with the Regional Transport Office (RTO) and is supposed to carry a valid registration certificate (RC).
   
• Vehicle Condition
  The car should be in a condition whereby it can be dismantled safely. Though it does not have to be roadworthy, it cannot be a total wreck or completely ruined.
   
• Evidence Of Ownership
  The owners will be expected to provide evidence of ownership and registration. The owner must be the one under whose name the vehicle is registered.
   
• Meets Emission Norms
  For several types of vehicles, especially commercial, the Vehicle Scrappage Policy is made to scrap the older ones that do not meet the present emission standards.
   
• Benefits Eligibility
  While purchasing a new vehicle on scrapping an old one, the owner can also receive incentives in the form of monetary and tax benefits. These incentives are changeable and have been specified and notified by the latest government notifications.
   
• Environmental Certification
  To scrap a vehicle, it has to be taken to a government-certified authorised Vehicle Scrapping Facility. The facility will issue a certificate of deposit that must be provided by the vehicle owner for the scrappage procedure.
   
• Scrapping Certification
  When a vehicle is successfully scrapped, the vehicle owner is issued a Certificate of Deposit from the scrapping centre. This certificate may typically be used for cancellation of vehicle registration in the RTO.

For the most updated and specific information, it would be ideal to get in touch with local RTOs or seek current government notifications in regard to the Vehicle Scrappage Policy. Implementations and details of the scheme vary in each state and get updated on a regular basis.

 

What Is The Categorisation Of Vehicles For The Scrappage Policy?

The diversity of vehicle types and different usage patterns can be reflected in the categorization of vehicles under India's Vehicle Scrappage Policy 2021. A more refined explanation of categorising vehicles for scrappage is as follows:  

• Commercial Vehicles
  Commercial vehicles, meaning buses, trucks, or other transport vehicles, fall under this category. Such vehicles will be subjected to a fitness test when they reach an age of 15 years. In case the vehicle fails this fitness test, then it will be required to be scrapped based on the rules of the Vehicle Scrappage Policy.
   
• Government Vehicles
  The vehicles under the Central or State Government departments and agencies belong to this category. Scrapping of government vehicles older than 15 years was compulsorily implemented starting on April 1, 2022.
   
• Private Vehicle
  Private vehicles are automobiles owned and used by a person for personal transportation. These vehicles are to be deregistered if they are more than 20 years old, found unfit or fail to renew their registration certificate (RC).  To ensure re-registration within time, the policy also brings enhanced charges for re-registration of vehicles above 15 years from their first date of registration.
   
• Vintage Vehicle
  A vehicle that is old but maintained in good condition and is not driven much. A vintage vehicle is treated differently from a regular vehicle. Even though they are older, the service and maintenance is calculated with special guidelines for the scrapping of vintage vehicles considering their unique nature.
   

Fitness Test For Different Vehicles Under The Scrappage Policy

As the Vehicle Scrappage Policy 2021 says, a fitness test for vehicles is a comprehensive check for roadworthiness and environmental conformity. Some of the factors are as mentioned:

• Objectives Of The Test:
  • Roadworthiness: The test checks if the vehicle is roadworthy.
  • Environmental Impact: It checks whether the vehicle follows pollution control standards, such as the Pollution Under Control (PUC) test.
     
• Testing Facilities:
  • Automated Testing Stations: Tests for fitness are carried out at authorised automated testing stations that are equipped to carry out detailed inspections.
     
• Validity:
  • Duration: The validity of the fitness certificate is five years. After that, a retest for fitness is required to continue with registration.
     
• Test Results:
  • Pass: Vehicles that pass the fitness test can be renewed. However,  green cess with an additional amount of 10-15% of the road tax will be levied on aged vehicles that pass the test, which can vary from one region to another.
  • Fail: Vehicles cannot renew their registration in case they fail the fitness test.
     
• Alternative For Unfit Vehicles:
  • Scrapping: Owners of vehicles that are refused re-registration due to failure of the fitness test can have them scrapped.
  • Repairing: They can opt to repair the vehicle so that it meets all requirements when going through the fitness test.
     

Where Should I Get The Vehicle Tested Or Scrapped?

If your vehicle's registration is due for renewal or if you're scrapping it, follow these guidelines:

• For Retention:
  • Automated Testing Station (ATS): Take your vehicle to an accredited Automated Testing Station for a proper fitness test. The stations are designed with the capability of checking roadworthiness and emissions.
• For Scrapping of Vehicle:
  • Authorised Scrapping Facility: Take your vehicle to the nearest designated authorised scrapping facility for disposal. They are places authorised to do proper scrapping and recycling of parts of the vehicle.
• For Disposal:
  • ATS Operations: If you are planning to dispose of the vehicle, make sure that you have functional ATSs. The facilities are supposed to be located through the VAHAN database, which will provide you with a list of authorised testing or scrapping facilities.
     

What Are The Incentives For Scrapping Old Vehicles?

You can avail yourself of a number of benefits when you decide to scrap your old vehicle. Let’s have a look at them-

• Discount On New Vehicle:
  Get a 4 to 6% discount on the ex-showroom price of a new vehicle if your old vehicle is scrapped.
   
• No Registration Charges:
  You can be exempted from the registration fees of the new vehicle against producing the Certificate of Deposit received from the scrapping facility.
   
• Concession On Road Tax:
  The road tax concession available varies by state, offering up to 25% for non-transport vehicles and up to 15% for transport vehicles.
   
• Extra Manufacturer Discount:
  Vehicle manufacturers will be encouraged to offer you an additional 5% discount on the price of the new vehicle you are buying if you display your Certificate of Deposit. This discount is often greater than the scrap value you get from your old vehicle.
   

What Are The Disincentives Of Owning An Old Vehicle?

Old vehicles have several fiscal disadvantages of their own:

• Higher Charge:
  For commercial vehicles over 15 years of age, the fitness test and grant of Fitness Certificate (FC) charges are generally high.
   
• Higher Re-Registration Charges:
  Renewal charges are more for the renewal of the Registration Certificate (RC) of private vehicles over 15 years of age.
   
• Green Cess:
  An environmentally-friendly cess between 10-15% of road tax is charged on older vehicles, which shoots up the cost of ownership furthermore.
   

Fee For Renewing Vehicle Registration

The charges for renewal of vehicle registration can vary depending on the category of the vehicle type. Let’s have a breakdown of the same -

• For Private Vehicles Over 15 Years
  • Renewal or Issue Registration Certificate (RC)
    • Light Motor Vehicle (LMV) - Non-Transport:
      • Existing Fee: Rs. 600 for fresh registration and renewal
      • New Fee: Rs. 600 for fresh registration, Rs. 5,000 for renewal after 15 years
  • Fitness Test for Issue or Renewal of Fitness Certificate (FC)
    • Light Motor Vehicle (LMV) - Non-Transport:
      • Existing Fee: Rs. 600
      • New Fee: Rs. 1,000 at an Automated Testing Station
         
• For Commercial Vehicles Over 15 Years
  Fitness Test:
• • Light Motor Vehicle (LMV):
    • Existing Charges: Rs. 600
    • New Charges: Rs. 1,000 at the Automated Testing Facility.
  • Passenger Vehicle/Medium Goods:
    • Existing Charges: Rs. 1,000
    • New Charges: Rs. 1,300 at the Automated Testing Facility
  • Passenger Vehicle/Heavy Goods:
    • Existing Charges: Rs. 1,000
    • New Charges: Rs. 1,500 at the Automated Testing Facility
       
• Issuance or Renewal of the RC:
  • Light Motor Vehicle (LMV):
    • Old Fee: Rs. 200
    • New Fee: Rs. 7,500
  • Passenger Vehicle/Medium Goods:
    • Old Fee: Rs. 200
    • New Fee: Rs. 10,000
  • Passenger Vehicle/Heavy Goods:
    • Old Fee: Rs. 200
    • New Fee: Rs. 12,500
       

Under What Conditions Is My Car Liable To Be Scrapped?

Here are the major criteria wherein your vehicle may have to be scrapped:

• Age And Fitness Test Requirement:
  Commercial and private vehicles that are more than 15 years old need to undergo a fitness test for reregistration.
   
• Result Of Fitness Test:
  Any vehicle that has failed the fitness test should be taken through either repair aimed at passing the fitness test or scrapped. The owner has to reapply if any repair works have been undertaken.
   
• End-of-Life Vehicle (ELV):
  If the vehicle fails the fitness test or does not meet the set standards after repair, it becomes an ELV and must be scrapped.
   

How Does The Policy Impact You As A Two-Wheeler Owner?

Here's how the two-wheeler scrap policy plays a role for their owners:

• Compulsory Fitness Test:
  In the case of two-wheelers older than 15 years, there must be a fitness test that will determine whether the vehicle is fit to use on roads. In case a bike fails the test, then this means the owner can repair it and try again for the test, or if it does not become roadworthy, this vehicle falls under the umbrella of an End-of-Life Vehicle (ELV). This means the two-wheeler will fall under the bike scrap policy and will have to get dismantled.
   
• Automated Fitness Testing:
  The fit tests for two-wheelers will be computerised from the traditional manual method. This would ensure no human interference and more accuracy in assessing vehicle fitness.
   
• ELV Certificate:
  In case your two-wheeler fails in the computerised fitness test, you will get an ELV certificate from the Automated Testing Station (ATS). This means that with that certificate, your vehicle will not become roadworthy, and hence, you will be unable to get third-party Bike Insurance, which has been made compulsory.
   

How To Scrap A Car In India?

If you plan to scrap your old car according to the Vehicle Scrappage Policy 2021, then just follow these steps:

• Step 1: Contact a Scrapping Centre
  • Contact Authorised Vehicle Scrapping Facility: Contact an authorised Vehicle Scrapping Facility over the phone or by their website.
  • Book an Appointment: Make an appointment with them to bring your car in for inspection at their facility or have them pick up your car. Of course, you will have to bear in mind that pick-up services might incur an extra towing fee.
     
• Step 2: Assemble Documents
  • Identification: PAN card and other identity proof of the authorised person such as an Aadhaar card, Voter ID, or Passport.
  • Vehicle Documents: Documents such as the original registration number of the vehicle and End-of-Life Vehicle (ELV) certificate.
  • Authorisation: If not handed over personally, authorisation must be given on stamp paper for the representative.
  • Additional documents: A disclaimer or undertaking to the effect that all information furnished is correct, a cancelled cheque, and the vehicle owner’s photograph.
     
• Step 3: Scrappage Cycle
  • Item Removal: Remove tyres, battery, and CNG kit first.
  • Air Conditioning Refrigerant: Drain and transport to de-pollution station.
  • Fluids: All the fluids from the vehicle, like the engine coolant, gearbox oil, petrol, brake fluid, steering fluid, windshield washer fluid, and engine oil, should be removed.
  • Fuel Tank and Exhaust System: Disconnect these.
  • Dismantling:
    • Body Panels: Demount panels, boot lid, bonnet, doors, fenders, doors, bumpers, and headlights; usually, these get manually torn apart.
    • Interior Components: Draw out all interior components, including the dashboard, roof liner, seats, floor mats, steering wheel, and wiring system.
    • Running Gear: Raise up the vehicle, therefore removing the engine, the brakes, and the suspension.
  • VIN Removal: The next thing is to remove the Vehicle Identification Number.
     
• Step 4: Recycling The Remaining Parts
  • Crushing: The outer shell of a vehicle is crushed by a crane and processed into steel bales. Items that are removed from dismantling are further crushed in the recycling process.
  • Environmentally Conscious Care: Ensure that no AC gas or oil is released into the environment.
     
• Step 5: Obtain The Scrappage Certificate
  • Certificate of Destruction: Once the vehicle is scrapped, you will receive a "Certificate of Destruction."
  • De-registration: This certificate shall enable de-registration of the vehicle from the concerned RTO in your locality.
  • Receive Scrap Value: Once you have de-registered, the scrap value of your vehicle will be transferred to you either through a cheque or direct credit into your bank account.
     

How Costly Is It Going To Be For Owning Old Vehicles?

With the increasing complexity of being over 15 years old, owning and maintaining an old vehicle can be increasingly costly because of various charges and fees. Here is the list of various costs:

• Fitness Test Fee:
  The fee to undergo a fitness test at an Automated Testing Station (ATS) is much higher for vehicles that are more than 15 years old. This fee will determine if the vehicle passes the safety tests and meets the environmental standards.
   
• Renewal Of Registration Fee:
  Renewal charges for the Registration Certificate are increased for the older vehicles. These include a higher recharge on both new registrations and renewals after 15 years.
   
• Green Cess:
  There is an additional 10 to 15 percent green cess over the normal road tax for older vehicles. The cess is an attempt to retire older, less eco-friendly vehicles.
   
• Road Tax:
  Road tax on old vehicles would be high, and the rate may be hiked every year considering inflation and changes in policy.
   

RTO Rules For Car Scrapping Process In India

Here is an overview of RTO rules for scrapping vehicles:

• Application For Scrapping a Car:
  The owner of the vehicle should present an application to the RTO to scrap his car.
   
• Submission Of Affidavit:
  An affidavit should be submitted through which the vehicle owner assures for the following reasons:
• • No loans are active, and no insurance claims are being made with regard to the vehicle.
  • There are no traffic challans or court cases pending for the vehicle.
     
• Surrender Registration Certificate:
  This would necessitate the surrender of the vehicle's Registration Certificate (RC) to the RTO. The RTO would retain the registration number and cut-out VIN for their record.
   
• Confirmation From Authorised Facility:
  Get a letter from the Authorised Vehicle Scrapping Facility (AVSF) on their letterhead. Make sure that the facility's address is included in that letter. Present a confirmation letter accompanied by photos of the dismantled vehicle to the RTO.
   

RTO Rules For Deregistration And Scrapping Of Old Vehicles

To scrap and deregister an old vehicle, the owners of the vehicles must follow these RTO rules-

• Inform The RTO: With the intention of scrapping the older vehicle, the owner should inform the concerned RTO.
• Hand Over Necessary Documents: The RC of the vehicle and the number plate of the chassis should be produced, which was removed during scrapping.
• Provide Scrapping Facility Confirmation: The confirmation document issued by the vehicle scrapping dealer.
• Submit An Affidavit:
  • An affidavit should accompany the application for deregistration and shall be deemed to state the following:
    • The vehicle does not have any loan or insurance claims.
    • No case of the courts is pending against the vehicle.
• Verification of Documents: The RTO will scrutinise these documents and may draw diligence reports from traffic police and the National Crime Records Bureau (NCRB).
• Check Vehicle Reports: From the review of the vehicle records maintained in their database, the RTO shall verify that no dissimilarity exists with regard to the sale or status of a particular vehicle.
• De-Registration Process: Subject to satisfactory documentation and records, the RTO would go ahead to de-register the vehicle according to old car scrap policy.
   

Future Of Vehicle Scrappage In India

The future of vehicle scrappage in India seems particularly optimistic if the policies already implemented are to be taken into consideration, along with technological advancement and environmental considerations. Among some of the major aspects that shape the future of Indian vehicle scrappage are:

• More Extensive Implementation Of Scrappage Policies:
  • Increased Application: With the widespread implementation of the Vehicle Scrappage Policy, more vehicles would come under the scrappage process. This would include better adherence to the fitness tests by the owners as well as higher incentives for scrapping older vehicles.
  • Effective Regulation: Expect the policy to continuously update itself to meet emerging issues, including higher environmental standards and enhancements in testing technology on vehicles.
     
• Technological Progress:
  • Automated Testing Stations: Within the near future, you can expect an even further advancement and proliferation of Automated Testing Stations, hence diversification and precision in vehicle testing.
  • Digital Integration: It will integrate into digital platforms such as the VAHAN database, thereby making the scrappage process much more streamlined for the owner in terms of handling documentation as well as compliance online.
     
• Environmental Impact:
  • Reduction in Pollution: The Vehicle Scrappage Policy also reduces pollution since it ensures the removal of old, less efficient vehicles off the roads. Further emphasis on environment-friendly practices in scrapping facilities would further enhance the advantages to the environment.
  • Recycling Initiatives: This will contribute to a culture with much more emphasis on recycling and reusing material from scrapped vehicles for the circular economy and the least generation of waste.
     
• Incentives And Disincentives:
  • Attractive Incentives: The government can encourage scrapping old vehicles by offering attractive incentives like higher discounts on new vehicle purchases and lower road taxes.
  • Higher Disincentives: The costs of maintenance and renewal of old vehicles increase on the cost side with higher fees for renewal fitness tests and registrations.
     
• Impact On The Vehicle Owners And Manufacturers:
  • Consumer Behaviour: With incentives complemented by increases in the cost of old vehicles, more consumers will think their old vehicles are no longer worth their while and have them scrapped to take advantage of new, more efficient versions.
  • Manufacturer Involvement: Vehicle makers may provide added incentives and accept trade-in schemes for the scrapping of the old ones and later replace them with a new one.
     
• Infrastructure Development:
  • Expansion Of Scrapping Facilities: Authorised vehicle scrapping facilities are expected to increase, giving better access and enhancing efficiency in the process of scrapping.
  • Improved Standards: Scrap facilities will have to pursue higher environmental protection standards in addition to safety standards; they will handle and recycle vehicle parts appropriately.
     

How Does Scrapping Affect Vehicle Insurance Policy?

Scrapping your vehicle can impact your insurance coverage in the following ways:

• Inform Your Insurer:
  You have to inform the scrapping of your vehicle to the insurance provider. As the registration of the vehicle gets cancelled if scrapping happens, the insurance of your bike or car will also get terminated.
   
• Cancellation Of Insurance:
  Once the vehicle has been scrapped, your insurance will automatically get cancelled. This means you can stop paying for your premiums.
   
• Refunds:
  Anything refundable on premiums paid before scrapping will be done on a pro-rata basis. This means that you will get a refund for the amount that went unused.
   
• Claims Effect:
  If you had filed a claim in the preceding year before scrapping your vehicle, you would not experience an immediate cancellation of an insurance policy. The policy might remain until the expiry of the existing insurance policy period or until the filed claim is cleared, whichever occurs first.
   

Summing It Up!

A step towards an ecologically healthier tomorrow—the Vehicle Scrappage Policy stands out as one of the most important landmarks on the way to clean and safe India. This policy will encourage the scrapping of old vehicles, which will ensure the purchasing of newer and more efficient models for a much greener future. This policy resonates with you if you drive a car, ride a bike, or are in need of upgrading your vehicle. So, if your car is reaching the end of its life cycle, think about what best happens when you scrap your vehicle.  Further, know how you can buy insurance— two wheeler insurance or car insurance for securing your new ride!

The old vehicle scrap policy doesn’t just apply to vehicles but scrapping those old habits and getting towards a cleaner, greener future for India.
 

FAQs