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Have you ever experienced the stress of purchasing a used car or the cumbersome process of selling one? Whether you’re on the buying end or selling, it’s not just about the car; it’s also about the paperwork, the trust in the transaction, and so much more.

The new rules require dealers to get an authorisation from the state transport departments and notify authorities once the sales process for a used car is completed. The dealers will also be deemed as the owners of the vehicles until they are transferred to the buyers.

The idea is to make the sale and purchase of registered vehicles more transparent and protect the interest of used car customers. But what if I told you things are about to get a whole lot smoother?

New Regulations Deemed For Second-Hand Car Dealers and Buyers

The Changing Landscape of Car Transactions

Ever felt like you needed a degree to understand the intricacies of temporary number plates or the nuances of the use of FasTag? Well, you’re not the only one. Luckily, the Indian Legal System is here to clear the fog with its latest regulation.

The Ministry of Road Transport and Highways, in its recent mandate on December 22, 2022, unveiled the Central Motor Vehicles (Twenty-Sixth Amendment) Rules, 2022. The principal agenda? To ensure every 2nd-hand car dealer and buyer has an authorized and verified trail of the transaction, thereby securing both parties in the deal.

Sounds too good to be true? Let’s dive deeper!

What’s the Buzz About?

The legislation’s primary objective is to instill a sense of responsibility and transparency in the pre-owned car dealers industry. How, you ask?

From April 1, 2023, anyone dealing with the resale of vehicles, be it a business or an individual, needs to obtain ‘authorization’ from the Regional Transport Office. Yes, you read that right! So if you’re a dealer, you’ve got some paperwork heading your way.

Breaking Down the New Norms

For all second-hand car dealers out there, here’s what you need to know:

  • Driving Permissions – Dealers can’t freely use the purchased cars on public roads. Exceptions? Only for test drives, exhibitions, maintenance, and inspections.
  • Electronic Record Keeping – An electronic trip register and an inventory record must be maintained for every vehicle in possession.
  • Validity of Authorization – This authorization will be valid for 5 years from the date of issue or renewal.
  • Role of Form 29C – On delivering a vehicle to an authorized dealer, both the registered owner and the dealer need to file Form 29C. With this, the dealer becomes the “deemed owner” of the car, ensuring that they are accountable for any incidents related to the vehicle until it’s sold again.

“What’s a deemed owner?” you might ask. Imagine you’ve just sold your car to a dealer, but the final ownership hasn’t been transferred to the new buyer yet. In such cases, the dealer acts as the temporary owner, shielding you from any liabilities during this interim period.

How Does This Change Benefit You?

If you’re a buyer: Your purchase is protected since your dealer is verified.

For sellers: Once you sell your car to an authorized dealer, you’re free from future liabilities. The dealer, now the “deemed owner,” assumes responsibility.

To illustrate, consider this hypothetical: Ridham sells his car to Ritesh, a dealer. Ritesh then sells it to Amit. If Amit meets with an accident and decides to run, who’s held responsible? With the new rules, the liability falls on the dealer (Ritesh), ensuring Ridham doesn’t face any repercussions for a car he no longer owns.

This regulation not only shields previous car owners but also tackles issues like delayed vehicle registration transfers and wrongly issued e-challans.

Frequently Asked Questions (FAQs)

  • Who’s Responsible for Vehicle Ownership Transfer in India?

Both buyer and seller are accountable. However, if a vehicle is sold through e-commerce platforms, they can also facilitate the ownership change process.

  • Can Someone Else Transfer My Car Ownership?

As per the 2022 Amendment Rules, only after filing Forms 29B and 29C is the ownership officially transferred.

  • Is Online Ownership Transfer Possible?

Absolutely! You can utilize the Parivahan Sewa portal managed by the Ministry of Road Transport & Highways for this purpose.

Wrapping It Up

The Indian automobile resale market is evolving, and with these new regulations, it’s moving towards a more transparent, accountable, and hassle-free ecosystem. So, whether you’re diving into the world of used cars or waving goodbye to your old ride, rest assured, the process is now smoother than ever!

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