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Set up a Authorized Vehicle Scrapping Facility (AVSF)

The Central Government has notified the guidelines for setting up and operating Authorized Vehicle Scrapping Facility in India. This applies to the vehicles that are no longer validly Authorized under the Motor Vehicle Act or where the owners desire to scrap their vehicles. This facility ensures safe disposal of such vehicles along with protection of environment and promotion of legally compliant vehicle dismantling and scraping industry. Respective state/UT government grants authorization for starting RVS Facility in India.

Essential Terms in respect of Authorized Vehicle Scrapping Facility

There are certain terms that need to be understood in respect of Vehicle Scrapping-

Authorized scrapper

A person, firm, society, trust or company that owns and operates Authorized Vehicle Scrapping Facility.

Authorized Vehicle Scrapping Facility

This refers to an establishment holding any authorization for vehicle scrapping issued under guidelines for performing dismantling and scrapping.

Deposit certificate

A certificate issued by the AVSF to recognize the transfer of vehicle ownership from the Authorized owner to the authorized scrapper.

Vehicle scrapping certificate

A certificate issued by the AVSF to recognize the final disposal of vehicle. It should be preserved by the authorized scrapper.

Scrapping yard

Location where the dismantled parts of the vehicle are processed for treatment.

Which vehicle qualifies for scrapping?

The following vehicles shall qualify for scrapping:

  • Vehicles that have not renewed their original certificate of registration.
  • Vehicles not granted fitness certificate.
  • Vehicles damaged due to fire, riot, natural disaster, accident or any calamity and the owner self-certifies it as a scrap.
  • Vehicles declared obsolete/surplus/beyond economical repair by the Central or state government.
  • Vehicles that have outlived their utility or for projects in mining, highway etc.
  • Manufacturing rejects and test vehicles.
  • Auctioned, impounded and abandoned vehicles.

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Eligibility criteria for obtaining authorization by proposed Authorized Vehicle Scrapping Facility

There are certain eligibility conditions that have to be met in order to get authorization for treatment of end of life vehicles by respective state/UT governments. They are as follows:

  • The AVSF should be owned and operated by a legal entity- whether a person, firm, society or trust established with applicable laws.
  • The entity should have certificate of incorporation, valid GST registration and valid PAN.
  • The entity should have applied for or should possess establishment license from the authority.
  • The entity should fulfill minimum technical requirements for collecting and dismantling centres according to the pollution control board must have the workforce and equipment to perform dismantling activities.
  • The entity should undertake to get required quality certifications in 12 months time of operation commencement.
  • The entity should also provide approved plan layout and building plan. It should have environment management plan for the facility.

The AVSF will be provided connectivity and access to VAHAN database of the vehicle registration with a User ID and password. It must have security certifications for IT system to safely access VAHAN database.

Further, the AVSF should verify the person handing over the vehicle for scrapping in order to determine the actual owner of such vehicle. It should keep the copy of the same for minimum 6 months.

Validity and renewal of authorization

The authorization for starting RVS Facility is valid for 10 years. It can be renewed for another 10 years and the authorization is not transferable.

Minimum Requirements for Authorized Vehicle Scrapping Facility

The facility should have adequate area for movement and storage of vehicles and for installing equipment for de-polluting, de-risking and dismantling end of life vehicles and they must comply with all relevant environmental norms. If AVSF lacks the adequate capability or provisions for recycling of hazardous wastes such as e-waste, lead acid batteries, lithium-ion components or for recovery of rare-earth metals, then such materials has to be sold to duly authorized recyclers agencies.

Procedure to set up a Authorized Vehicle Scrapping Facility in India

The procedure is as follows:

  • The applicant can apply to the registration authority of the state government concerned or the UT Administration, where this facility is proposed to be located along with the specified fee.
  • The state or union territory administration will dispose of the application within 60 days from the application date, including all internal approvals needed from its different departments. After the end of this time period, such application will be deemed as approved.
  • The central government shall operationalise a single window clearance for the registration of this facility within 6 months from the notification of these rules. Until that period, the state government or the union territory administration will process all applications manually.
  • The registration granted to the Vehicle Scrapping Facility will be valid for ten years and can be renewed for another 10 years.

Process of Scrapping

  • A Authorized owner or the authorized representative will give the vehicle to AVSF with necessary Documents and then the AVSF will conduct verifications to know the bona fide of such person before scrapping the vehicle.
  • AVSF will access the VAHAN database to make suitable entries about vehicle scrapping and facilitate the process of submission of the scrapping request electronically and transmission of the registration certificate to road transport or regional transport office (RTO) to deregister the vehicle.
  • It shall issue certificate of deposit to the owner or authorized representative, and it can be used to get benefits and incentives for purchase of new vehicle as determined by the government. The certificate will serve as a proof of transfer of vehicle ownership to the AVSF.
  • The AVSF will pay the amount to the Authorized owner or authorized representative for value of the vehicle scrapped.
  • AVSF will issue a digital certificate of vehicle scrapping after the treatment is completed.
  • AVSF should set up scrapping yard and collection centre to handle, de-pollute and dismantle end of life vehicles in the prescribed manner.

How can we assist you?

We at Corpbiz will help you set up a Authorized Vehicle Scrapping Facility. We will do the paperwork on behalf of you while you can focus on your goal. Contact Corpbiz today.

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