Dealers have been given a strict seven-day deadline to explain why their trade credentials should not be suspended or permanently revoked
The Mumbai RTOs on Saturday announced they have now issued show-cause notices to 19 car dealers across the city, asking why their licences should not be cancelled for alleged involvement in an illegal luxury car registration racket. The RTO in South Mumbai caught 68 high-end vehicles, while 104 such cars were intercepted in the eastern suburbs between Kurla and Mulund/Mankhurd, and 115 luxury vehicles were found violating rules in the western suburbs between Bandra and Dahisar. Instead, their official legal paper trail leads to tiny, quiet tenements situated hundreds of kilometres away in the Union Territory of Diu and Daman, revealed an RTO official involved with the probe.
Mumbai: On paper, many luxury sports utility vehicles and high-end sedans navigating Mumbai’s congested traffic do not belong to Maharashtra at all. This elaborate illusion—a systematic scheme devised to evade steep state motor vehicle taxes—operates on a surprisingly simple modus operandi. Dealerships across Mumbai first register newly purchased high-end vehicles on a temporary basis locally before quietly transferring the final, permanent registration to Diu and Daman, where transport levies are significantly lower.
official applications submitted to the RTO revealed a glaring contradiction: the buyers’ primary identity credentials, including their Aadhaar cards , clearly confirmed their permanent addresses in Maharashtra, where the vehicles were actually delivered and driven daily While showrooms submitted these spurious lease papers to claim out-of-state residency.
“These fake tenancy agreements were intentionally created to trick transport authorities into believing that affluent buyers resided or operated businesses within Diu and Daman,” said another senior RTO official. “Showrooms deliberately misled buyers regarding tax liabilities under the Maharashtra Motor Vehicles Tax Act, 1958, effectively depriving the state treasury of substantial revenue,” Narvekar said, adding that the department plans to cancel licences of some of these dealers if their replies to the notices are not satisfactory. At the very core of this multi-crore revenue drain lies a widespread network of forged legal documentation. Following a crackdown directed by transport commissioner Rajesh Narvekar, official records scrutinised by RTOs in Mumbai exposed how a section of car dealers had generated fabricated Leave and Licence agreements. In multiple glaring instances, investigators uncovered that dozens of luxury cars purchased by completely unrelated buyers were registered under the exact same rental address, he added.
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