Ministry of Road Transport and Highways of India loss of Rs. 11.69 cores, due to not renewed fitness certificate of vehicles and imposition of penalty.

Total 13,284 transport vehicles and 6,045 private vehicles plied without valid fitness certificates and were liable for levy of fitness fee of Rs. 2.03 crore and imposition of penalty of Rs. 9.66 crore. The concerned RTOs/ARTOs did not initiate any action to issue notices to these vehicle owners and cancel the permits in case of transport vehicles.

The MV Act, 1988 and the CMV Rules, 1989 provide that a transport vehicle shall not be deemed to be registered unless it carries a certificate of fitness. A fitness certificate granted in respect of a newly registered transport vehicle is valid for two years and is required to be renewed every year thereafter. The transport authority may cancel or suspend the permit of such vehicles for such period as it thinks fit. Plying a vehicle without a certificate of fitness is
compoundable under Section 192 of the MV Act, 1988 at the rate of 5,000 vide notification dated 07 June 2019.

The CMV Rules prescribe a test fee of Rs. 400 and 600 for three-wheelers/light vehicles and medium/heavy vehicles respectively. In addition to this, a renewal fee of Rs. 200 is also leviable in the case of all categories of vehicles. In case of default, an additional amount equal to the prescribed test fee is also leviable. Further, as per Transport Commissioner’s office order dated 12 December 2005, certificate of fitness is compulsory for Omnibuses (vehicle having more than six seats but up to nine seats excluding the driver).

Previous Audit Reports of 2011-12 to 2016-17 had highlighted the persistent loss of Government revenue due to non-levy of fitness fee and penalty on various categories of vehicles.

Audit test-checked the records of 31 RTOs/ARTOs and noticed (between December 2019 and February 2020) that 13,284 out of 63,180 transport vehicles were plying on road (between December 2016 and January 2020) without valid fitness certificate although the tax due had been realized from vehicle owners. Information relating to the date of expiry of fitness was available in the VAHAN database. In spite of this, these cases were not detected by the Department as necessary application controls to prevent such vehicle owners from paying tax in those cases where fitness had expired was not built into the system. The RTOs/ARTOs also did not initiate any action to issue notices to these vehicle owners and cancel their permits. As a result, the Government was deprived of a fitness fee of Rs. 1.43 crore and a penalty of Rs. 6.64 crore.

Similarly, the Audit test-checked the records of 24 RTOs/ARTOs and noticed (between December 2019 and February 2020) that 6,045 out of 21,953 private vehicles were plying on road (between January 2017 and January 2020) without valid fitness certificate although the tax due was realized from the concerned vehicle owners. As a result, the fitness fee and penalty amounting to Rs. 3.63 crores were not realized. Plying vehicles without the certificate of fitness besides being detrimental to public safety, may also increase pollution levels.

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