India's Vehicle Scrappage Policy — A Plain-English Guide
What it is, who it applies to, how RVSFs and the Certificate of Deposit work, and what you actually get when you scrap an old vehicle and buy a new one.
The policy in 30 seconds
- Vehicles must pass a fitness test — compulsory after 15 years for private vehicles, sooner for most commercial vehicles. Fail it, and the vehicle can't be re-registered: it becomes an end-of-life vehicle that must be deregistered and scrapped.
- Scrap it at a Registered Vehicle Scrapping Facility (RVSF) and you get a Certificate of Deposit.
- That certificate buys you, on your next vehicle: a road-tax rebate (up to ~25% private / ~15% commercial, set per state), a registration-fee waiver, and often a ~5% manufacturer discount.
- You're also paid the scrap value of the metal — separate from all of the above.
How the process works, step by step
- Fitness test (if applicable). Take the vehicle to an Automated Testing Station (ATS). Pass and you can re-register (with a fee that rises steeply with age); fail and it's end-of-life.
- Choose an RVSF. RVSFs are private scrapyards authorised by the transport department. Only an RVSF can deregister your vehicle with VAHAN and issue the Certificate of Deposit — an ordinary kabadi cannot.
- Hand over the vehicle + papers. Original RC, photo ID, and a financer NOC if it was on loan. The RVSF photographs the vehicle, deregisters it, dismantles it, and recycles the materials.
- Get paid + get the certificate. You receive the scrap value (negotiated up front) and a digital Certificate of Deposit. The certificate is transferable and valid for two years.
- Use the certificate. Present it when you buy a new vehicle to claim the road-tax rebate and registration-fee waiver, and ask the dealer about the manufacturer discount.
RVSF vs. a regular scrap dealer — which do you need?
If your goal is the tax rebate and a clean deregistration, you need an RVSF. If you just want to sell an old vehicle for what the metal is worth and don't care about the certificate, any verified scrap dealer works — and you'll often get a comparable price with less paperwork, though the vehicle stays on the RTO's books until you deregister it yourself. On ScrapRates.in, our city pages list verified vehicle-scrap dealers; ask whether a given dealer is an RVSF or partners with one if you want the certificate.
State incentives vary — check your RTO
The Vehicle Scrappage Policy is national, but the size of the road-tax rebate is set by each state and is updated from time to time. Most states offer somewhere between 15% and 25% for private vehicles and around 15% for commercial ones against a Certificate of Deposit; some also waive or reduce other state levies, and a few run extra rebates of their own. For the exact figure that applies to you, check your state transport department / RTO or the VAHAN portal before you buy — the dealer issuing your new RC will apply it.
States & UTs we cover
What you get for the scrap itself
Independently of the policy benefits, the RVSF or scrap dealer pays you the recovery value of the materials. A two-wheeler (mostly steel, plus aluminium, copper wiring, plastic and a lead battery) typically yields ₹2,000–₹8,000; a car (steel body, aluminium, copper, glass, tyres, battery and a catalytic converter) typically yields ₹25,000–₹60,000, with running vehicles 30–70% above non-running ones. Get a figure based on today's metal rates:
Find scrap dealers / RVSFs by city
Frequently Asked Questions
Which vehicles must be scrapped under the policy?
There is no blanket nationwide age cut-off for private vehicles, but a vehicle that fails its mandatory fitness test (compulsory after 15 years for private vehicles, sooner for many commercial vehicles) cannot be re-registered and becomes an "end-of-life vehicle" that must be deregistered and scrapped. Government and PSU vehicles older than 15 years are scrapped by rule. Several cities (e.g. Delhi-NCR) enforce stricter age limits — 10 years for diesel, 15 for petrol.
What is an RVSF?
A Registered Vehicle Scrapping Facility — an authorised scrapyard that deregisters your vehicle with the RTO/VAHAN, dismantles it responsibly, and issues a Certificate of Deposit. Only RVSFs can issue that certificate; an ordinary kabadi/scrap dealer cannot.
What is the Certificate of Deposit and what is it worth?
A digital certificate you receive when you scrap at an RVSF. Presenting it when you buy a new vehicle gets you: a road-tax rebate (commonly up to ~25% for private vehicles and ~15% for commercial, set by each state), a waiver of the registration fee, and frequently a discount of ~5% from the manufacturer. The certificate is transferable and valid for two years.
What documents do I need to scrap a vehicle?
Original Registration Certificate (RC), valid photo ID, and a No-Objection Certificate from the financer if the vehicle was on loan. The RVSF handles the deregistration paperwork with the RTO.
How much money do I get for the scrap itself?
Separate from the policy benefits, you are paid the scrap value of the materials — typically ₹2,000–₹8,000 for a two-wheeler and ₹25,000–₹60,000 for a car, depending on weight, condition and current metal prices. Use our estimators below for a figure based on today's rates.
Do I have to scrap at an RVSF?
Only if you want the Certificate of Deposit and its benefits. If you just want to sell an old vehicle for scrap value, any verified scrap dealer works — but you won't get the tax rebate, and the vehicle stays on record until you deregister it.
This guide is general information, not legal or tax advice. Policy details and state rebates change — confirm current rules with your RTO / state transport department before acting.