Second-hand car market to be regulated, dealers to play a bigger role

When the vehicle is received for reselling by the dealer, it will be registered for sale. The dealer will then become the sole responsible person for any untoward incident like theft etc

Dealers who sell second-hand vehicles may soon be regulated in India. Under the new rules, they will have to notify the authorities about the sale process. According to a report by Economic Times (ET), the information will have to be shared as soon as the dealers take up the vehicle for resale. 

The intermediaries, both online and offline, will have to register with the state transport departments. 

"It will be mandatory for all used car or bike dealers to notify authorities about any vehicles they intend to resell…A used vehicle dealer will also have to register their organisation with the state transport department," an official told ET. 

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The resellers will also be issued a license by the government. It will be revoked if they are found violating the rules. It is aimed at protecting the customers, the official further added. 

When the vehicle is received for reselling by the dealer, it will be registered for sale. The dealer will then become the sole responsible person for any untoward incident including theft, and other crimes. Currently, there are no set rules in place to enlist such vehicles. 

The report further added that there have been several cases in the past when the new owner of the vehicle was rounded up for the violations committed by the old owner of the vehicle.  

With new rules, the sale of the vehicle will take place through the dealer and there will be no link between the old and the new buyers. The dealer will be responsible for updating the details of the new owner in the transport office.

In FY21, around 3.5 million used cars were reportedly sold in India. By 2026, the used car market may touch 7 million, according to several studies.