FADA red flags sales of 2-wheelers by unauthorised multi-brand outlets
May 09, 2023
New Delhi [India], May 9 : The Federation of Automobile Dealers Associations (FADA), along with the Delhi and Mumbai State Transport Department, has expressed concerns over the illegal practices of unauthorised multi-brand outlets (MBOs) selling two-wheelers.
FADA has reported that these MBOs are acquiring unregistered vehicles in bulk from dealers and reselling them to customers at discounted rates, higher than the prices offered by original equipment manufacturers (OEMs) through authorized dealers, without any commitment to after-sales service.
This has not only impacted the legitimate dealerships but has also shaken customers' confidence in the brand and dealer partners, according to a statement released by FADA on Tuesday.
It said these MBOs indulge in evasion of goods and services tax (GST), income tax, issuance of fake/ undervalued insurance policies, delivery of vehicles without registration/ High Security Registration Plates (HSRP) and helmets, resulting in revenue loss on various fronts.
FADA has reached out to Eknath Shinde, Chief Minister of Maharashtra; Vinod Aggarwal, SIAM President, and the transport commissioners of Mumbai and Delhi, urging them to take stringent action against these MBOs and ensure their compliance with industry standards and regulations.
The chief minister of Maharashtra and transport commissioners of Mumbai and Delhi have initiated action against this illegal practice, FADA said, adding that the Delhi transport department was also taking stringent action against the outlets operating such illegal trade practices. The authorities had already issued notice on Trade Certificate cancellation to such business units.
Kailash Gahlot, Transport and Environment Minister, Delhi, said, "Delhi government will not tolerate any such illegal activity or corruption. We are committed to take action against any such instance".
Ashish Kundra, Principal Secretary and Transport Commissioner, Transport Department of NCT Delhi, said, "FADA has been working closely with the dealer fraternity and the government to maintain a healthy and lawful business environment in the region. A legal notice has been issued to all the involved parties, and their respective trade certificates have been put under the scanner."
