In the Vehicle Scrapping Policy, it is proposed to have a system of incentives and disincentives to nudge vehicle owners to discard old and polluting vehicles, which have higher maintenance and fuel consumption costs.         

In this regard, the Ministry of Road Transport and Highways has issued a GSR Notification, 714(E) dated 04.10.2021 and GSR Notification 720(E) dated 05.10.2021 in the Gazette of India, which shall come into force from the 1st day of April, 2022.  Details are as below:

A. Incentive:

  • There will be waiver of the fee for issue of certificate of registration for a new vehicle, purchased against the authority of the Certificate of Deposit (CoD) issued by a Registered Vehicle Scrapping Facility for a vehicle being scrapped.
  • As an incentive for scrapping, concession is stipulated in the motor vehicle tax for a vehicle registered against submission of "Certificate of Deposit", which is issued by a Registered Vehicle Scrapping Facility.  This concession is as below:

    (i) upto 25%, in case of non-transport (personal) vehicles, and

    (ii) upto 15%, in case of transport (commercial) vehicles:

    NOTE: The concession shall be available upto 8 years, in case of transport vehicles, and upto 15 years, in case of non-transport vehicles.

B. Disincentives:

  • Increase in the fee for conducting fitness test and renewal of fitness certificate for motor vehicles more than 15 years old,
  • Increase in the fitness certification fee for transport vehicles more than 15 years old, and
  • Increase in the renewal of registration fee for personal vehicles (non-transport vehicles) more than 15 years old.


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