New Regulations Proposed For Second-Hand Car Dealers In India

As per a report by Times of India, the Ministry of Road Transport and Highways (MoRTH) is working on a proposal that aims to regulate the sales of used car by used car dealers. All used car dealers will have to get themselves registered with the state transport departments and notify authorities once the sales process for a used car is completed. The idea is to make the sale and purchase of registered vehicles more transparent and protect the interest of used car customers. In the past, several examples of the new owner(s) of the used car were held responsible for crimes and violations committed by the previous owners of the used car, and vice-versa. The new set of rules and regulations aim to stop this.

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The used car dealers will be deemed ‘owners’ of pre-owned cars and that will protect customers from legal hassles and any other untoward incidents when the cars are in possession of dealers. The seller will have to notify the State RTO when he/she hands over their car to the registered dealer for resale. Then, the used car dealer will have to accept the same and can apply for documents like RTO, fitness certificate, transfer of ownership and so on.

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The used car dealers will not be able to run the car on public roads except for test drives for potential customers. Plus, they will be allowed to carry out basic maintenance and paint job. The used car dealers will also have to maintain a trip register and other details of the car in question. Once the final sale of a used car happens, the used car dealer will transfer the ownership to the new customer. If the used car dealers are found violating the new laws then their license can be revoked as well, along with other punishment.

Also Read: Used Car Market In India To Surpass 8 Million Unit Sales By FY2027

Sources suggest that the new proposal is being worked on and could be implemented nationwide by the end of the year, as a part of the Central Motor Vehicle Rules (CMVR) 1989. The new rules for selling of used cars will be designed in a way that there will be no link between the old owners and the new owners. The used car dealer will be responsible for updating the details of the new owner with the authorities, which in this case, will be the State Transport Department.

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