Purpose of Vehicle Scrappage Policy 2021

• This Policy goal is to bring out of condition vehicles from roads of India.
• Its goal to lessen harmful effects of emissions by unfit and old Vehicles whether they are commercial or private.
• This Policy will involve all types of vehicles like Taxi, Passenger, Commercial purpose vehicles also.
• New start ups will come up to execute this policy in the Investors Summit of Gujarat.
• Its goal is to bring out sustainable development in India.
• Vehicles will be discarded in a very scientific and nature friendly way.

Benefits of Vehicle Scrappage Policy

• Owners, who will decide to throw away their vehicles under this structure, will be given incentives in order to buy new vehicles.

• The value of the early showroom price will be provided to the owner from 4 to 6 percent at the time of vehicle scrapping.
• If you will throw away your old vehicle and will buy a new one, you will get a refund of 25% on the road tax which is pretty stunning. The percentage is 15% for commercial vehicles,
• Moreover, only given to those who are having the scrapping certificate as you will get a discount of 5% on the purchase of your new vehicle.

Vehicle Scrappage Policy 2021 Environmental Benefits

In this Policy, all the unfit vehicles in the country will be transformed to scrap in a pretty scientific way.

• Owners of Vehicle will be given extra benefit in the form of cash incentive which will be 5-6% Value of Showroom Price.
• In the Investor Summit being held in Gujarat, many start-ups will come up to setup Scrapyard to transform unfit vehicles into scrap.
• This will lead to pretty slight emissions of harmful gases like carbon Monoxide.

Vehicle Scrappage Policy – 2021

Process: –

• A Vehicle older than 20 years, if found out of condition or registration certificate is not renewed, will be De-registered
• Registered owners to deliver such vehicles to a Registered Vehicle Scrapping Facility with their Pandetails, registration certificate, Certificate of the vehicles and other documents.
• Scrapper need to check vehicles records from database of the Stolen vehicles and then he will issue a Deposit certificate, required for the vehicle owner to get incentives
• The Certificate once used will be printed “Cancelled” by the agency
• Government will build a Database of the vehicles scrapped every year.

Financial incentives: –

• Scrap value: Scrapping centre will provide scrap amount upto 4-6% of the price of ex-showroom for the new vehicle to the vehicle owner.
• On the purchase of a new vehicle, Vehicle Manufacturers are directed to give 5% discount against the scrapping certificate.
• For road tax, it is recommended by State governments that they will offer of up to 15% for commercial vehicles and up to 25% for personal vehicles.
• To purchase new vehicle, Registration fees will be waived off against the scrapping certificate.

Scrapping centres: –

• Inspire private and public participation in opening Registered Vehicle Scrapping Facility (RVSF).
• Inspire setting up of Automated Fitness Centres on a PPP model by automobile companies, state government, private sector, etc.

Registration and fitness tests: –

• As per the Central Motor Vehicle Rules, 1989, Criteria to determine vehicle fitness will foremost be braking, emission tests, and safety equipment, among many other tests.
• Guidelines for fitness tests and scrapping centres to be eligible from October 1, 2021, while scrapping of PSU vehicles and government which are older than 15 years to come into effect from April 1, 2022.
• The compulsory fitness testing for heavy commercial vehicles to be active from April 1, 2023, and the similar will be in place in a phased manner for other categories from June 1, 2024.
• fees for fitness certificate is increased and for commercial vehicles as they need to clear the test above 15 years from the date of initial registration and in case they fail to obtain the fitness certificate, then these kind of vehicles will be de-registered.
• Also reneweal fees is increased for private vehicles above 15 years from the date of initial registration. These vehicles fail to obtain renewal of RC after 20 years if found not in good condition or in case of a failure to renew the registration certificate.
• A vehicle failing to get registration certificate renewal or failing the fitness test to be declared as ‘End of Life Vehicle’.

Significance: –

• Creation of Scrap yards: It will lead to creation for more scrap yards in the nation and effective recovery of waste from old vehicles.
• Employment: In the new fitness centers, an investment of Rs 10,000 crores will be pumped in and 35 thousand individuals will get employment too.
• Improved Revenue: This will boost sales of medium and heavy commercial vehicles. The government income through GST is expected to increase from Rs 40,000 to 60,000 crores from this policy.
• Fall in Prices: Prices of auto components would reduce substantially with the recycling of plastic and metal parts. As scrapped materials will get low-priced, the production cost of the vehicle manufacturers will also fall.
• Reduce Pollution: It will support improve reduce pollution and fuel efficiency. As older vehicles pollute the environment 15 times more, and estimated that 17 lakh heavy and medium commercial vehicles are more than 15 years old.

Incentive Program under Vehicle Scrappage Policy 2021

• 4-5% Showroom price will be provided as cash return.
• Tax rebate will also be provided upto 25% for new vehicle  registration.
• Commercial shop owners and vehicle dealers also offer some discounts after showing scrappage certificates of Old Vehicles.

Is that all vehicles which are ahead of the limit will be scrapped?

• No this policy will not inplicited on all vehicles, for the commercial vehicles, the age limit is 10 years and for personal vehicles, the age limit is of 15 years.
• After the vehicles’ on road time limit turn off, the vehicle requires to go through a fitness test which will display if a vehicle is alright to walk on the road or not.
• If the vehicle provided a passed certificate, then it definitely walk on the road afterwards, but if it does not provided the passed certificate, then that vehicle will no longer walk on the road.
• After offering the passed certificate, the vehicle require to go through this fitness test after every 5 years.
• If your vehicle is not getting a passed certificate, then you have to dispose your vehicle as it becomes unable to walk on the road.

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