Car dealers monopoly in Himachal Pradesh

himachal carsDecision of Himachal Pradesh Government to impose 5% entry tax on vehicles purchased from outside the state is pinching the pockets hard. This decision has resulted in dealers getting a complete monopoly and buyers are now left completely at the mercy of the dealers.

Earlier there was an option to buy cars from Chandigarh, Punjab or Haryana as the dealers there used to offer handsome discount and freebies when buying a car. This used to pressure the dealers in Himachal also to offer schemes. Once the said decision was implemented, the dealers in Himachal have got a virtual monopoly and have stopped all schemes, discounts etc and are minting money at the cost of the buyer.

The government was not loosing any money as all central taxes like VAT etc. were already being charged by the dealers outside the state. As these vehicles used to get registered in Himachal and govt was getting it’s due in form of road tax etc.

This move has been done clearly to benefit the car dealers in the state. These dealers now give two hoots to the customer service. Goyal Motors customer service in Shimla is legendary. I underwent worst experience of my life when I went to buy an Alto car for my father. I vowed then and there never ever to enter this show room again in my life. Though I have been a fan of Maruti cars, my family later bought Toyota and TATA cars owing to third rate nightmarish experience with Goyal Motors, Shimla.

It is not that all other dealers provide great experience. They refuse to budge while negotiating for discounts. It is an open loot here in Himachal as the same car outside the state is available for a discount upto 20-30 thousand while we Himachalis are forced to shell out full amount for the same product.

This is a highly monopolist directive issued by the Himachal Government just to please it’s favorite dealer lobby. The state government is now doing business where as it should focus on it’s key area of governance. Even charges for choice numbers have been hiked beyond proportion. Earlier, a four digit choice number used to cost Rs. 2500/ which has been hiked to Rs. 20,000/

I fail to see the logic behind this hike. Buying a car is a life time decision and people used to associate any number associated with their lives with the car. What was the need for the government to nudge it’s finger in the matter and hike the rates?

I am sure that overall collections of the government has gone down once the new rates were announced. Why the bloody government has to intervene in each and everything when so many issues regarding governance are in a mess in the state.

Has anyone in the government seen the conditions of road in entire Himachal Pradesh?

Another intersting phenomenon I have noticed that Himachal Government has brought Luxury cars from Karantaka and Gujarat for it’s ministers and bada babus. These cars are running with Karnataka and Gujarat numbers within the government.

As such Himachal Government is itself evading the entry tax because once these cars are registered in Himachal, they will have to pay the entry tax.

Imagine the absurdness where a state government is itself involved in evasion of tax imposed by itself!!

It is high time that the chief minister Mr. Dhumal sheds the Musharraf style mindset of  ‘My way or the highway’  and brings some sort of rationale to his decisions.

If any lawyers happen to read this article, I would like to hear point of view from consumer side. Can government create such monopolist policies?

Let’s discuss this in the comments below.


25 thoughts on “Car dealers monopoly in Himachal Pradesh

  1. Take the case of Anand Toyota in Solan. The dealership refuses to provide the base D model Innova car and only sells the higher G model car where the price difference is over 1 lakh. If you check the Toyota India site, the D model car is available for sale but this particular dealership flatly refuses to take bookings for this model. Being the only Toyota dealership in Himachal and thanks to Mr. Dhumal one is forced to buy the higher model car as there is no alternate to buy the car from outside the state…!!

    The problem is more compounded in a state like Himachal where there are very few showrooms and this directive of the government is god sent to them to loot the customers. The only tax levied on cars is VAT, which is a central tax and state has nothing to do with it. So why is the govt hell bent to force people to buy cars from Himachal? Simply there is some hanky panky in the whole deal. As these cars are registered in HP, the govt gets the road tax. Clearly, the govt is directly involved in looting the people of state with the car dealers.

  2. I am going through this right now, I bought a car for my dad from Gurgaon as the particular model was not available in Shimla, now I need to pay 5% entry tax. Thats what happens when dealers and poloticians come together to fill each others pockets.

    • Thanks for the comment Rajnish. This is the problem we all are facing. While one can negotiate good discounts outside the state, we are being looted here by being forced to buy cars within Himachal. This is a monopolistic trade policy of which Himachal government is a party.

      The basic problem is the attitude of the government which still believes in mai-baap mode of governance. Confront them with real issues in the state and they will start the blame game…

  3. More on the subject above.. Here is a sample of HP transport deptt website and Punjab transport deptt website about registering a vehicle

    While Himachal website is full of rules and regulations which is extremely difficult to understand, the Punjab website still gives you an idea about what one is searching about. Also do not forget to check the charges for choice numbers on Punjab website. Makes one wonder what sort of idiots are running the transport deptt in Himachal. Why is it so difficult for the government to put things on the site in a language which can be understood??

  4. Idiots… decide for self. I purchased 20 ambassador cars – went to RTO Shimla for registartion. -some Bhardwaj, he asked me why did i purchased ambys- I said my wish- he refused to register the cars saying i need to pay additional 5% reg. amount- i said fine- he said i should hve asked him before buying cars- me wondering why, still I said have consulted his supritendent, his ego got hurt. went to his boss i.e STA some mr raghhooo.

    He said cant regiseter bla bla… i said you already had registered one vehicle last month with same status- he said may be by mistake, me still wondering whose miastake (of course raghoos)- went to principal sec. tpt with the case, officer got convinced with my enteprenur skill, called commisioner tpt. directed him to do the job, commissionert tpt. said ofcourse its a genuine case come over to me I will do the job. Next day went to officer, officer called raghooo…., raghu called RTO. BACK TO SQUARE ONE.

    PHASE II. I went to middleman told him the story. He laughed at me, asked for the document and something else, my vehicles are now legally registered. COMMENT PLEASE

    • Agents are a way of life at RTO Shimla. Consider this.. Last Jan went to the RTO to register my Innova. Filled up the forms myself and thought it would be a day’s affair to get the registration number. Alas.. the MVI, said this model is not approved so cannot be registered and asked me to go to Solan to get the documentation from the dealer. Was zapped as another guy who had bought the same model with me got his number the previous day.
      Meanwhile the agents around the office started courting me to get the vehicle passed without me approaching them and they knew all about my problem… Your guess is as good as mine…

      I was talking to a guy there in the office who was actually an agent but the way he would do all his work sitting in the office on a desk of a babu made me beleive he was a babu. He runs a mobile office from his Maruti Car parked outside the office.

      I finally managed to take a print out of this link of approved vehicles from transport deptt site and asked the concerned official to put on file that this model was not approved where as on the website link it was mentioned as an approved vehicle.

      Finally he had to relent and I got the work done without approaching the agents. RTO has a big racket of agents and the babus in the office prefer the file comes to them through agents for obvious reasons. These agents also guarantee you a particular number within the series for money of course.

      AND all these things happens right under the nose of an IAS and HAS officer sitting in the office. Are they also a party to this open langar at the RTO office??

    • Hello Sanjeev, can you give me contact number of some middleman of rto in Shimla. I need to sell my Gypsy 1997 King in Shimla, it has a Shimla number. Thanks in advance.

  5. i want to know that the desision of govt. to levy 5% entry tax on vehicles purchased from outside himachal or registration of vehicle transferd to himachal is challanged by some one in law of court.

  6. What the c**p?. Regarding Govt guys, they must be getting money from these dealers. Why will a Himachali (doing regular job at other state) spend days in booking, loan etc (cost much awaited leaves and a lot of money) which can be done in their working state? This is insane.
    HP is too rough for its own Himachalis.. wow….

  7. my car is registered in hp, but everytime i go from delhi to hp i have to pay entry tax at una.
    is this a govt law or the private contractors there are taking on their on.
    please advice on this issue.
    why a himachal registered vehicle has to pay entry tax to enter our own state?

    • The tax which you are talking is applicable for all vehicles entering Himachal Pradesh irrespective of where they are registered. Why this is levied, no one knows! This is probably ‘Helicopter Tax’ of the Chief Minister of Himachal Pradesh so that they can travel in style in the sarkari chopper paid by the junta class. Be it Congress or BJP every govt has endorsed this tax.

      Why should Himachalis pay the tax for entering their own state? Because if we stop then the CM will have to travel by road and not in the chopper

  8. Is there any thing like if u make an affidavit stating that there is no dealer of the car u purcahsed from other state then u have to pay 1.5% entry tax.

  9. I think the government has applied entry tax on every item.The same has been confirmed by many persons doing business there. Also because of the same reason most of the online shopping sites are not delivering there goods in HP. Situation will change only if GST implemented in India. Till then continue to suffer like this

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