It is well known that people belonging to the state of Tamil Nadu purchase vehicles in the nearby Puducherry to avoid tax. This has been happening for many years.
In the recent times there were also instances of film stars, business peoples buying vehicles from Puducherry to avoid taxes. Soon this wont be possible.
Now a new rule would come into force and according to this amended rule people residing in TN must show their recent gas bills, mobile phone bills, utility bills etc from registered agencies as supplementary proof when they submit their address proof for registration.
To avoid paying taxes many people purchase vehicles using fake addresses in Puducherry and for this the people use a loophole present in the Tamil Nadu Motor Vehicles Rules 1989. It is important to note that an affidavit on the stamp papers could be accepted as proof for address if the vehicle owner did not have ration card, Aadhaar card, driving license or other forms of address proofs. This was confirmed by a senior official belonging to department of state transport.
This address proof affidavit is cheap and not reliable. Moreover this proof could be got easily by the people and could be used to their advantage. This loophole needs to be plugged and for that the registration rules must be changed.
It is now necessary to produce utility bills as supplementary evidences even if these affidavits are to be produced by the person purchasing vehicle in Puducherry.
In Puducherry it is enough to pay 13 percent of vehicle cost as tax whereas people purchasing vehicles in neighbouring states like Kerala and Andhra Pradesh must pay 20 percent of the vehicle cost as tax.
After the upcoming SITCo meeting that would be held in Chennai in 2018 a formal announcement regarding amendments to be adopted in all southern states would be made.