New Delhi | 17 December 2025: A Public Interest Litigation (PIL) filed by Towards Happy Earth Foundation came up for hearing today before a Division Bench of the Delhi High Court, comprising Hon’ble Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela. The petition seeks urgent enforcement of key provisions under the Central Motor Vehicle Rules (CMVR), 1989, specifically Rules 55A to 55H, which govern the resale and transfer of used vehicles in India.
The PIL highlights the prolonged delay in implementing these rules—introduced through Notification G.S.R. 901(E) dated December 22, 2022—which were designed to bring structure, transparency, and consumer protection to India’s rapidly growing second‑hand vehicle market.
CARS24, India’s largest autotech platform, has been listed as a related party in the proceedings and was represented during the hearing.
Three Years After Notification, Implementation Remains Minimal
Despite nearly three years since the rules were notified, adoption across states remains extremely limited. According to publicly available data on the VAAHAN portal:
- Fewer than 1,500 authorised dealers of registered vehicles are listed nationwide
- Only 18 states have implemented the provisions in any form
- Major states—including Delhi, Haryana, Uttar Pradesh, Karnataka, and Telangana—have zero authorised dealers registered under these rules
The PIL also referenced the recent Red Fort bomb blast, where the vehicle involved had been sold and resold multiple times across states that have not implemented these provisions—underscoring the public‑safety implications of regulatory gaps.
Why Rules 55A–55H Matter: Fixing Liability & Ensuring Traceability
The intent behind these rules is to address one of the most persistent issues in the used‑vehicle ecosystem:
Who is liable between the time a vehicle is sold and the time the Registration Certificate (RC) is officially transferred?
Under the framework:
- Authorised dealers must report every purchase and sale on the VAAHAN portal using Form 29C
- This creates a legally recognised chain of custody
- The authorised dealer becomes the “deemed owner” during the interim period
- The vehicle’s registration number remains unchanged
For consumers, this mechanism provides immediate protection from:
- Challans
- Accidents
- Misuse
- Legal liabilities
The rules also require authorised dealers to maintain inventory registers and trip registers, preventing unauthorised use of vehicles in their custody.
Barriers to Implementation Highlighted in the PIL
The petition notes several structural and procedural challenges that have hindered adoption:
- Mandatory GST registration, even for dealers below the ₹20 lakh turnover threshold
- Inconsistent documentation requirements across states
- Lack of clear SOPs for RC transfer facilitated by authorised dealers
- No formal process for dealer‑to‑dealer vehicle transfers
- No defined mechanism for insurance claims by authorised dealers
These gaps have prevented the ecosystem from benefiting from the protections envisioned under the CMVR amendments.
CARS24 has been independently engaging with:
- Ministry of Road Transport and Highways (MoRTH)
- Multiple state governments, including the Government of Delhi
The company has advocated for faster, uniform implementation of the rules in the interest of:
- Consumers
- Dealer partners
- Public safety
- Market transparency
CARS24 has already registered itself in states where the process is enabled and is actively working to help its dealer network secure registrations as well.
