Home / Business and Economy / Mumbai RTO Cracks Down on Luxury Car Registration Fraud
Mumbai RTO Cracks Down on Luxury Car Registration Fraud
26 Oct
Summary
- Mumbai RTOs issued notices to 19 dealers for fake rental agreements.
- Luxury car buyers could face tax demands or registration issues.
- Tax evasion on a Rs 2 crore car could save Rs 14 lakh.
Mumbai RTOs have initiated a crackdown, issuing show-cause notices to 19 car dealerships. These dealers are accused of facilitating tax evasion by registering luxury vehicles in Diu and Daman, which have lower motor vehicle taxes than Maharashtra. The alleged scheme involved using fabricated rental agreements to falsely establish residency in the Union Territory, thereby avoiding significantly higher taxes in Maharashtra.
On a luxury petrol car valued at Rs 2 crore, the tax difference between Maharashtra and Diu and Daman could amount to approximately Rs 14 lakh. Investigators found that multiple unrelated buyers' vehicles were sometimes registered at the same fictitious address, while their permanent addresses remained in Maharashtra. Transport Commissioner Rajesh Narvekar stated that dealers misled buyers about tax liabilities.
The investigation has flagged 287 luxury vehicles across Mumbai. The 19 dealers have been given seven days to respond to the notices, facing potential suspension or cancellation of their trade licences if their explanations are unsatisfactory. This action raises concerns for customers who purchased vehicles through these dealerships, as they might be liable for applicable Maharashtra motor vehicle taxes or face registration irregularities.
