Asked July 08, 2016

private car registration

  • 1 Answer

If I want to rent my personal car to some people, what are the legal procedures for doing the same? I want to rent out my car to some people in my city. They wanted to get extra car for going to other city on vacation. That means I won’t be driving the vehicle and they would just be renting out my car. I want to understand how can I do it legally and what are the things to keep in mind. Thanks.

Answer 1

As on date, the Indian laws do not permit renting out of private vehicles. It's a strict No! Renting a car or providing a car that is privately registered is not allowed in India as per the Motor Vehicles Act. The cars on rent - any form should be commercially registered.  The Government of India is also planning to bring laws for all cab aggregators and have separate permits for Radio Cabs, Contracted Vehicles, Self-Drive Rentals and Tourist Vehicles. India has strict laws and commercially registered cars have to follow strict state laws to ply on the road. The car owner needs to obtain a national permit to ply in India and pay state taxes annually. The commercial cars come with comprehensive insurance which covers the passengers / drivers and third party damages. The commercial car needs to go through an annual fitness check to ensure the safety of the passengers. Beside the passenger safety, since the number of commercially registered vehicles are increasing in India the emission norms are also getting strict. In areas of high density of the cars commercial vehicles meeting BSIV norms can only be registered.  Even self-drive cars on rent are required to be registered commercially and get permits / taxes as per the law. The Government is doing is bit by regulating the car rental market. The regulations control unwanted pollution and ensures safety of the people who are using these rented cars. To start renting self-drive cars the company needs to also obtain a license from the state authorities. After the successful award of the license the organisation will be able to get the cars registered under the self-drive scheme.

Hence, all this means that you cannot legally enter into contract with any other party for renting your private vehicle. However, if you do so on your own accord and good faith, you will not be entitled to any legal relief. Also, in matters where your vehicle meets with any accident and you are unable to give sufficient reason as to the existence of relationship with the occupier, then too getting insurance cover in such cases might become next to impossible.

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