By T. Murrali
The Federation of Automobile Dealers Associations (FADA) has secured a significant legal victory on 24 October, compelling the Tamil Nadu and Pondicherry State governments to implement amendments to the Motor Vehicles Act and the Central Motor Vehicles Rules (CMVR). These changes aim to simplify vehicle registration and purchasing processes, benefiting both dealers and the general public.
As part of the 19th edition of FADA Vyapar and the 2nd edition of Vyapar Tamil Nadu, centred around the theme: From India’s Detroit to Its Digital Destiny, the apex body of the automotive dealers organised a special session on the Implementation of New Central Motor Vehicle (CMV) Rules,1989, participated by Mr. Rahul M Shankhar, FADA Legal Counsel & Managing Partner, Chamber 28 and moderated by – Mr. Sai Giridhar, Vice President, FADA & Director, Saisha Motors Pvt Ltd.
Deliberating on the subject, Mr. Shankhar, said, the core of the matter is the mandatory implementation of central government-mandated welfare legislation, specifically amendments to motor vehicle laws, to streamline vehicle acquisition processes, reduce bureaucratic hurdles, and enhance the ease of doing business and public convenience in Tamil Nadu and Pondicherry.
Purpose of the Amendments
The amendments are seen as welfare legislation, designed to protect the interests of all stakeholders, especially the general public, by simplifying existing procedures.
According to Mr. Shankhar, the key simplifications include elimination of requirements like PAN cards or driver’s licenses for vehicle registration; cessation of unnecessary intra-state temporary registrations for buyers and dealers within the same State and introduction of online bidding for fancy registration numbers.
These changes collectively aim to reduce direct interaction with bureaucracy, making vehicle purchases more efficient and transparent, he pointed out.
FADA’s Legal Journey and Outcome
FADA filed a writ petition seeking a directive for the Tamil Nadu and Pondicherry State governments to implement rules that have been in existence since 2019 and 2021.
The Madras High Court swiftly understood FADA’s arguments. After giving the State one opportunity to respond, the court allowed all of FADA’s prayers, ordering the implementation of the reforms. Both the Central Government and the National Informatics Centre (NIC) confirmed their readiness for immediate implementation, while the State government expressed apprehensions.
Subsequently, the Tamil Nadu State government filed an appeal against this order before the Supreme Court, which was dismissed even without notice, marking a huge victory for FADA. Despite the clear court orders, the State government remained hesitant to implement. FADA initiated further proceedings to establish a timeline for implementation. On October 24, 2024, the court issued a stern order, giving the government two weeks to comply with the directive, criticising its disrespect for court orders.
Key Changes and Benefits for Dealers and Customers
Elaborating the changes and benefits of the new rules, Mr. Giridhar, said, the as per the centralised Type Approvals, the State governments no longer have authority over vehicle type approvals. OEMs will obtain these centrally from bodies like ICAT or ARAI. The details will be uploaded to a dedicated Vahan website, allowing States to verify them and dealers to auto-fetch data during registration.
Besides, the registration process becomes entirely faceless, eliminating the need for local RTO office intervention. Dealers upload customer documents to the Vahan portal, an OTP verifies the process, registration charges are paid online, and the vehicle number is auto-generated.
According to Mr. Giridhar, the elimination of Intra-state Temporary Registration (TRC) is no longer required. Dealers can now apply for a customer’s registration in any RTO across the State. For example, a customer in Chennai can receive a Coimbatore registration number with their Chennai address. The auction and allocation process for fancy numbers will be conducted entirely online via the Vahan portal. Besides, the requirement for vehicles to be physically taken to the RTO for inspection is abolished, addressing a long-standing demand.
While Tamil Nadu currently still requires some physical documents post-registration, some States have adopted a fully paperless system, where original documents are returned to the customer, only to be presented to the RTO if specifically requested for events like vehicle transfer, he pointed out.
To ensure a smooth transition and minimise potential resistance from local RTOs, he urged the dealers to strictly adhere to all new norms and regulations; ensure all vehicles are delivered with High-Security Registration Plates (HSRP); avoid delivering unregistered vehicles as any vehicle leaving the dealership must be accompanied by proper documentation, such as Form 90.
This legal triumph is a monumental win for FADA and the general public, promising a much easier, more efficient, and less bureaucratic process for purchasing and registering vehicles in Tamil Nadu and Pondicherry. It represents a significant step towards modernising vehicle administration and enhancing customer convenience.
