1. Introduction
The Madhya Pradesh government has established a framework for bike and car rental services to promote organized growth in the sector, enhance urban mobility, and ensure the safety of both service providers and users. These regulations encompass eligibility criteria, documentation requirements, financial obligations, and operational guidelines.
1. Eligibility Criteria for Aggregators:
- Legal Entity: The applicant must be a company registered under the Companies Act, 1955 or 2013, a co-operative society formed by an association of drivers or vehicle owners, or a limited liability partnership under the Limited Liability Partnership Act, 2008.
- Registered Office: The applicant should have a registered office in India.
- Compliance: The applicant must comply with all applicable provisions under the Motor Vehicles Act, 1988, and the Information Technology Act, 2000, including intermediary guidelines.
- Valid License: The applicant must not integrate any driver or represent themselves as an aggregator unless they hold a valid license issued by the State Government.
2. Documentation Requirements:
- Application Form: Submit an application for the grant of a license in the prescribed format, accompanied by proof of payment of the appropriate fee and security deposit.
- Proof of Identity and Address: Provide valid documents verifying the identity and address of the applicant.
- Business Registration: Submit documents confirming the legal status of the business entity, such as incorporation certificates or partnership deeds.
- Financial Statements: Provide audited financial statements for the last three years to demonstrate financial stability.
- Operational Plan: Submit a detailed operational plan outlining the scope of services, technology infrastructure, and safety measures.
3. Financial Obligations:
- License Fee: Pay the prescribed license fee as determined by the State Government.
- Security Deposit: Furnish a security deposit in the form of a bank guarantee or as specified by the authorities.
- Insurance: Ensure that all vehicles are covered under comprehensive insurance policies, including third-party liability.
- Operational Costs: Bear the costs associated with vehicle maintenance, driver training, and technology infrastructure.
4. Operational Guidelines:
- Vehicle Standards: Ensure that all vehicles meet the safety and emission standards prescribed under the Central Motor Vehicles Rules, 1989.
- Driver Qualifications: Employ drivers who possess valid driving licenses, undergo background checks, and complete mandatory induction training programs.
- Technology Platform: Operate through a user-friendly mobile application or website that facilitates booking, payment, and customer support.
- Pricing Mechanism: Implement transparent pricing policies, including surge pricing algorithms, and ensure that all charges are clearly communicated to users.
- Safety Measures: Equip vehicles with necessary safety features, conduct regular vehicle inspections, and provide drivers with emergency response training.
- Compliance Reporting: Maintain records of operations and submit regular compliance reports to the State Transport Department.
- Customer Support: Establish a 24/7 customer support system to address user grievances and feedback.
- Renewal and Audits: Apply for license renewal as per the stipulated timelines and cooperate with periodic audits conducted by the authorities.
2. Eligibility Criteria
To rent a bike or car in Madhya Pradesh, individuals must meet the following eligibility requirements:
- Age Requirement: Minimum of 18 years for bike rentals and 21 years for car rentals.
- Driving License: A valid driving license appropriate for the vehicle category.
- Riding/Driving Gear: Mandatory use of helmets for bike riders; appropriate footwear and attire are recommended.
1. Age Requirement
- For Bike Rentals:
Minimum age is 18 years. - For Car Rentals:
Minimum age is 21 years.
2. Driving License
- For Bike Rentals:
Must have a valid driving license that covers the category of vehicle being rented (e.g., motorcycle). - For Car Rentals:
Must have a valid driving license that covers the category of vehicle being rented (e.g., car).
3. Riding/Driving Gear
- For Bike Rentals:
- Helmet: Wearing a helmet is mandatory for all bike rentals.
- Footwear and Attire: Suitable footwear and clothing are recommended for safety.
- For Car Rentals:
- Appropriate Attire: While there is no mandatory footwear requirement, comfortable and safe attire is recommended for driving.
3. Documentation Required
Renters are required to provide the following documents:
- Identity Proof: Government-issued ID (e.g., Aadhaar card, passport).
- Address Proof: Utility bills, rental agreement, or any official document indicating current residence.
- Driving License: Original and a photocopy of a valid driving license.
Step 1: Identity Proof
- Document Required: Government-issued ID.
- Examples:
- Aadhaar card
- Passport
- Voter ID
- Driver’s license (if not already required separately)
- Action: Submit a clear copy (scanned or photographed) of the identity proof document.
- Examples:
Step 2: Address Proof
- Document Required: Proof of current address.
- Examples:
- Utility bills (electricity, water, gas)
- Rental agreement
- Bank statement
- Government-issued letter
- Action: Provide a recent document (within the last 3 months) showing your current address. Ensure the document has your name and the address clearly visible.
- Examples:
Step 3: Driving License
- Document Required: Valid driving license.
- Action: Submit the original and a photocopy of a valid driving license. Ensure that the license is up-to-date and not expired.
4. Terms and Conditions
The rental agreement includes specific terms and conditions to ensure clarity and mutual understanding between the service provider and the renter.
Terms and Conditions
| Term/Condition | Description |
|---|---|
| Rental Duration | Minimum and maximum rental periods as defined by the service provider. |
| Security Deposit | Refundable deposit collected at the time of rental; amount varies based on vehicle type. |
| Usage Limitations | Restrictions on geographical areas, mileage caps, and prohibited activities (e.g., racing, off-roading). |
| Fuel Policy | Vehicles are provided with a full tank; renters must return the vehicle with a full tank or incur refueling charges. |
| Maintenance Responsibility | Routine maintenance is the responsibility of the service provider; renters must report any issues immediately. |
| Insurance Coverage | Details of insurance provided, including coverage limits and renter’s liability in case of accidents or damage. |
| Late Return Penalties | Charges applicable for returning the vehicle beyond the agreed-upon time. |
| Cancellation Policy | Terms related to booking cancellations, including any applicable fees. |
1. Rental Duration
- Definition: This refers to the minimum and maximum rental periods as determined by the service provider.
- Details:
- The renter can keep the vehicle for a minimum number of days, and the maximum duration is also set by the provider.
- Exceeding the rental period may result in penalties or additional charges.
2. Security Deposit
- Definition: A refundable deposit collected at the time of rental.
- Details:
- The security deposit amount varies depending on the vehicle type rented (e.g., car, bike, etc.).
- The deposit is refunded after the vehicle is returned in good condition, minus any damages or penalties.
3. Usage Limitations
- Definition: Specifies where and how the rented vehicle can be used.
- Details:
- Geographical Restrictions: Limits on where the vehicle can be driven (e.g., within certain regions or cities).
- Mileage Caps: A limit on the number of kilometers the renter can drive.
- Prohibited Activities: Certain activities are not allowed, such as racing or off-roading.
4. Fuel Policy
- Definition: The fuel-related terms in the rental agreement.
- Details:
- The vehicle is provided with a full tank of fuel.
- Renters must return the vehicle with a full tank of fuel.
- If the vehicle is not returned with a full tank, refueling charges will be incurred.
5. Maintenance Responsibility
- Definition: Specifies who is responsible for maintaining the vehicle during the rental period.
- Details:
- Routine maintenance (like tire pressure, oil changes) is handled by the service provider.
- Renters must report any mechanical issues or damages immediately.
- If any damage occurs due to the renter’s negligence, they may be responsible for repairs.
6. Insurance Coverage
- Definition: Describes the insurance coverage provided by the service provider.
- Details:
- The rental agreement includes a certain level of insurance coverage (e.g., collision damage, theft protection).
- Renters are liable for damages or accidents up to a certain amount, depending on the insurance policy.
- Coverage limits and renter’s liability should be clearly defined.
7. Late Return Penalties
- Definition: Charges applied if the vehicle is returned after the agreed-upon time.
- Details:
- If the vehicle is returned late, the renter is liable for additional charges based on how much later the return is.
- The rate for late returns is typically outlined in the rental agreement.
8. Cancellation Policy
- Definition: Terms related to canceling a booking.
- Details:
- Renters must provide a notice of cancellation within a certain time frame to avoid penalties.
- Cancellation fees may apply depending on how close to the rental date the cancellation occurs.
- Refund policies for cancellations are also included (e.g., full refund, partial refund).
5. Financial Obligations
Renters should be aware of the following financial responsibilities associated with vehicle rentals:
Financial Obligations
| Charge Type | Responsibility |
|---|---|
| Fuel Costs | Borne by the renter; vehicles must be refueled as per usage. |
| Interstate Taxes | Applicable if the vehicle is driven across state borders; the renter is responsible for any such taxes. |
| Parking Charges | All parking fees incurred during the rental period are the renter’s responsibility. |
| Toll Taxes | Renters must pay all toll charges encountered during their journey. |
| Security Deposit | Refundable deposit to cover potential damages or violations; amount varies by vehicle type. |
| GST | Goods and Services Tax applicable on rental services as per prevailing rates. |
Step 1: Fuel Costs
- Responsibility: The renter is responsible for the fuel costs.
- Details: Renters must refuel the vehicle based on their usage, ensuring that the fuel level is the same as when the vehicle was first rented.
Step 2: Interstate Taxes
- Responsibility: Renters are responsible for any taxes that apply when driving the vehicle across state borders.
- Details: If the vehicle is driven into a different state, the renter must pay any taxes that are applicable based on the destination state’s laws.
Step 3: Parking Charges
- Responsibility: Renters are responsible for all parking charges incurred during the rental period.
- Details: This includes any fees paid for parking in public or private parking lots or spaces, whether metered or non-metered.
Step 4: Toll Taxes
- Responsibility: Renters must pay for any toll charges encountered during their journey.
- Details: If the route involves toll roads, expressways, or bridges, the renter is obligated to cover these charges.
Step 5: Security Deposit
- Responsibility: Renters must provide a refundable deposit to cover potential damages or violations.
- Details: The deposit amount varies depending on the type of vehicle rented, and it is refunded at the end of the rental period, provided the vehicle is returned in good condition and no violations are noted.
Step 6: Goods and Services Tax (GST)
- Responsibility: Renters are subject to GST on the rental services.
- Details: GST will be applied to the rental charges according to the prevailing rates set by the government. This tax is included in the total cost of renting the vehicle.
6. Inclusions and Exclusions
Understanding what is included in the rental package and what is not is crucial for renters.
Table 3: Inclusions and Exclusions
| Aspect | Details |
|---|---|
| Inclusions | Basic insurance coverage, one helmet for bike rentals, routine maintenance, and breakdown assistance within city limits. |
| Exclusions | Fuel costs, fines for traffic violations, additional accessories (e.g., extra helmets, GPS devices), interstate taxes, parking and toll charges, and damages arising from negligent use or violations of the rental agreement. |
1. Inclusions
These are the services or items that are provided as part of the rental package:
- Basic Insurance Coverage
- Renters are provided with basic insurance, ensuring coverage for any unforeseen events or accidents during the rental period. However, additional coverage may be available for purchase.
- One Helmet for Bike Rentals
- Every bike rental includes one standard helmet to ensure the rider’s safety. If additional helmets are needed, they would come at an extra cost.
- Routine Maintenance
- The rental provider will perform regular maintenance on the vehicles to ensure they are in good working condition. This typically includes checks for engine performance, tire pressure, and other essential functions.
- Breakdown Assistance Within City Limits
- If the rented vehicle breaks down, the rental company provides assistance within city limits. This could include help with repairs or towing to a nearby location.
2. Exclusions
These are the costs or services that are not covered in the rental package and need to be borne by the renter:
- Fuel Costs
- The cost of fuel is not included in the rental price. Renters are expected to refuel the vehicle during their rental period and return it with a similar fuel level as when it was rented.
- Fines for Traffic Violations
- Any fines incurred due to traffic violations (e.g., speeding tickets, parking tickets) are the responsibility of the renter. The rental company will not cover these expenses.
- Additional Accessories
- If the renter requires extra accessories like additional helmets, GPS devices, or any other rental equipment, these are not included in the package and would incur extra charges.
- Interstate Taxes
- If the renter takes the vehicle outside the city or state, any interstate taxes or charges are not covered by the rental. Renters must pay for these separately.
- Parking and Toll Charges
- Any parking fees or toll charges encountered during the rental period are not included in the rental package. Renters are responsible for covering these costs.
- Damages Arising from Negligent Use or Violations of the Rental Agreement
- If the vehicle is damaged due to the renter’s negligence or violation of the terms in the rental agreement (e.g., driving recklessly, improper use), the renter will be liable for the repair costs or any additional charges.
7. Renter’s Liability
Renters are liable for:
- Traffic Violations: Any fines or penalties incurred during the rental period.
- Vehicle Damage: Costs associated with damages not covered by insurance, including those resulting from negligence or unauthorized use.
- Accidents: Liability as per the terms of the insurance policy and rental agreement.
1. Traffic Violations
- Responsibility: The renter is responsible for any fines or penalties incurred during the rental period.
- Examples: Speeding tickets, parking violations, or running red lights.
- Procedure:
- The rental company will provide details of the fines (if any) to the renter.
- The renter must pay these fines directly, or in some cases, the rental company may charge the renter’s credit card.
- If the fine is unpaid by the renter, the rental company may report it to the authorities.
2. Vehicle Damage
- Responsibility: The renter is liable for any damage to the vehicle that is not covered by insurance.
- Types of Damage:
- Accidental damage (e.g., hitting a curb).
- Negligence (e.g., not following traffic rules, reckless driving).
- Unauthorized use (e.g., using the vehicle off-road or for commercial purposes without consent).
- Procedure:
- If the vehicle sustains damage during the rental period, the renter should immediately report it to the rental company.
- The renter may be required to pay the cost of repairs, minus any coverage under the rental insurance.
- The rental company may charge for repairs or deduct from the security deposit if applicable.
3. Accidents
- Responsibility: The renter’s liability in case of accidents is determined by the terms of the rental agreement and insurance policy.
- Insurance Coverage:
- Collision Damage Waiver (CDW): Often offered as an optional add-on. It limits the renter’s liability for damages to the rented vehicle.
- Third-Party Insurance: If the accident damages another person’s property or injures someone, the renter may be liable based on the insurance type.
- Procedure:
- The renter must immediately report the accident to the rental company and local authorities.
- The rental company will assess the accident’s impact on insurance and liability.
- If insurance coverage applies, the renter’s liability may be limited. However, if the renter was negligent or breached the rental agreement (e.g., driving under the influence), they may be fully liable.
Additional Notes:
- Security Deposit: The rental company may hold a security deposit, which can be used to cover any unpaid fines or damage costs.
- Rental Agreement Terms: It’s essential for the renter to read the rental agreement carefully to understand all liabilities, including any exclusions from coverage.
- Insurance Options: Renters should consider purchasing additional insurance if they are unsure of coverage limits.
8. Vehicle Return Policy
Upon returning the vehicle, the following conditions apply:
- Inspection: A thorough check for damages, fuel levels, and cleanliness.
- Late Returns: Penalties may be imposed for delays beyond the agreed rental period.
- Security Deposit Refund: Processed after deducting applicable charges, if any.
1. Inspection of the Vehicle
- Purpose: To ensure the vehicle is returned in the same condition as when rented.
- Checklist:
- Damages: Look for any new dents, scratches, or other damage to the vehicle.
- Fuel Levels: Check if the fuel tank is at the level specified in the rental agreement (typically full-to-full).
- Cleanliness: Assess the cleanliness of the vehicle, ensuring no major dirt or trash is left behind.
2. Late Returns
- What Happens if Late: If the vehicle is returned after the agreed-upon time, penalties may apply.
- Penalty Details:
- Hourly/Day Charges: Charges for the extra time the vehicle is kept.
- Additional Fees: In some cases, additional fees may be applied for excessive delay.
- Notification: The rental company will notify you of any late fees incurred.
3. Security Deposit Refund
- Process: The security deposit will be refunded after the vehicle has been inspected.
- Deductions: Any applicable charges for damages, cleaning, or fuel discrepancies may be deducted from the deposit.
- Time Frame: Refunds are typically processed within a few business days.
- Final Amount: The amount refunded will be the security deposit minus any charges.
9. Payment Procedures
Payments can be made through various modes, including:
- Digital Payments: Credit/debit cards, UPI, or online banking.
- Cash: Accepted by some service providers; however, digital payments are encouraged.
1. Payment Modes
- Payments can be made through digital payments or cash.
Digital Payments include:
- Credit/Debit Cards
- UPI (Unified Payments Interface)
- Online Banking
Cash is accepted by some service providers but is less common. Digital payments are encouraged for convenience and safety.
2. Digital Payments
- Credit/Debit Cards:
- Ensure you have your card ready (Visa, MasterCard, or any other supported type).
- Enter the card number, expiry date, CVV code, and any other required details.
- Verify your payment through an OTP (One-Time Password) or a 2-factor authentication method, if applicable.
- UPI:
- Use your UPI-linked app (like PhonePe, Google Pay, or Paytm).
- Choose the “Pay with UPI” option and enter the UPI ID or scan the QR code provided.
- Confirm the transaction using your UPI PIN.
- Online Banking:
- Select “Bank Transfer” or “Online Banking” at checkout.
- Choose your bank from the list of available options.
- Log into your online banking portal, and confirm the payment.
- Complete the payment by entering required details and OTP.
3. Cash Payments
- When Cash is Accepted:
- If you choose to pay in cash, confirm whether the service provider accepts cash payments.
- Ensure that you carry the exact amount to avoid any issues with change.
- Hand over the amount to the provider directly.
4. Payment Confirmation
- Digital Payments:
- After a successful transaction, you will receive a confirmation notification via SMS or email.
- Always save the receipt or confirmation for future reference.
- Cash Payments:
- If paying in cash, request a receipt or written confirmation from the service provider.
- Verify that the amount matches the agreed-upon payment.
10. GST Rates for Vehicle Rental Services
The Goods and Services Tax (GST) applicable on vehicle rental services in Madhya Pradesh is as per the rates prescribed by the central government. Renters should verify the current rates at the time of booking.
Step 1: Understand the GST Framework
GST (Goods and Services Tax) is applied to rental services, including vehicle rentals, by the central government. The applicable rate varies depending on the type of service provided.
Step 2: GST on Vehicle Rental Services
The GST rates for vehicle rentals are generally categorized under the following:
- GST Rate for Renting of Vehicles (without driver):
- The rate of GST for renting a vehicle without a driver is typically 5%.
- GST Rate for Renting of Vehicles (with driver):
- The rate of GST for renting a vehicle with a driver is 12%.
Step 3: GST Classification for Different Types of Vehicle Rentals
Different categories of vehicle rentals may have different GST rates. Below are some examples:
- Motorcycles or bicycles (rented):
- Typically 5% GST applies.
- Cars (rented with driver):
- 12% GST applies.
- Renting of vehicle services for tourism, including taxis or rental cars:
- 12% GST applies.
Step 4: Exemptions and Special Cases
There might be certain exemptions or special cases under GST rules. These can include:
- Vehicles used for personal purposes may not fall under the GST provisions in some cases.
- Public transport services such as buses, provided by government bodies or registered entities, may have different GST treatment.
Step 5: Ensure Proper Billing and Compliance
- Ensure that your rental invoices include the proper GST rates (5% or 12%) and that you maintain accurate records for tax filing purposes.
- If you’re renting out vehicles, you should be registered under GST and collect taxes accordingly.
Step 6: Check Latest Updates
GST rates are subject to periodic review, and changes may be made during annual finance bills. Always verify the applicable GST rates at the time of booking, as they may differ based on government changes.
Step 7: Visit GST Portal for More Information
You can always check the official GST portal for the latest updates and any specific conditions related to vehicle rental services. The portal is an excellent resource for clarification on any tax rates, exemptions, or conditions.
11. Insurance and Mechanical Warranty
Rental vehicles come with basic insurance coverage. However, this may not cover all scenarios, and renters are advised to understand the extent of coverage and consider additional insurance if necessary. Mechanical warranties cover routine maintenance, but damages due to misuse are excluded.
1. Basic Insurance Coverage:
- What it covers: Basic insurance typically includes protection against common risks like accidents, theft, or damage to the vehicle caused by third parties.
- Limits: This coverage usually has a set limit, and it may not cover all damage types or rental durations.
2. Understanding the Scope of Coverage:
- Rental Conditions: Review the rental agreement to identify specific terms about insurance coverage.
- Exclusions: Basic coverage may exclude scenarios such as:
- Damage from driving under the influence of alcohol or drugs.
- Damage caused by reckless driving or misuse of the vehicle.
- Damage to the tires, windshields, or undercarriage.
- Geographical Restrictions: Coverage may be limited to certain areas (e.g., it may not apply outside specific countries or regions).
3. Additional Insurance Options:
- Collision Damage Waiver (CDW): Optional insurance that can reduce or eliminate your liability in case of an accident or damage.
- Personal Accident Insurance (PAI): Offers medical coverage in case of injury during the rental period.
- Supplementary Liability Insurance (SLI): Increases the liability coverage in case of third-party damage.
4. Mechanical Warranty:
- Routine Maintenance: Mechanical warranties typically cover regular maintenance needs, such as oil changes, tire rotation, and brake checks, as part of the rental contract.
- Exclusions: Damages caused by:
- Improper use of the vehicle.
- Negligence, such as failure to follow manufacturer instructions (e.g., overloading the vehicle).
- Accidents or damages caused by the driver’s actions.
- Customer Responsibilities: Renters are expected to take care of the vehicle and avoid actions that could void the warranty, such as:
- Not performing maintenance tasks.
- Using the wrong type of fuel.
- Allowing unauthorized modifications to the vehicle.
5. Reporting Damage or Issues:
- Documenting Damage: Always inspect the vehicle before and after the rental period and report any damage immediately to the rental agency.
- Incident Reporting: In case of an accident or mechanical failure, immediately inform the rental company to avoid incurring full responsibility for the damage.
6. Final Thoughts:
- Review the Rental Agreement: Always check the fine print of your rental agreement to understand exactly what is covered and what is not.
- Consider Additional Insurance: If the rental does not provide adequate coverage, or if you’re planning a trip that might involve higher risk, consider opting for extra insurance coverage.
12. Additional Considerations
- One Helmet Provision: Bike rentals include one helmet; additional helmets can be rented separately.
- Interstate Travel: Prior permission from the rental company is required for interstate
1. Basic Rental Terms
- Helmet Provision:
- Every bike rental includes one helmet as part of the rental package.
- Additional Helmets:
- If the rider needs more than one helmet (for a passenger), extra helmets can be rented at an additional cost.
- Clearly mention the rental price for additional helmets on the booking page.
2. Interstate Travel Requirement
- Interstate Travel Permission:
- Policy Overview:
- Customers wishing to take the bike out of state must receive prior permission from the rental company.
- How to Request Permission:
- Riders must contact the rental company at least 24-48 hours before the intended travel date.
- This can be done via email, phone call, or through the booking platform.
- Approval Process:
- The rental company will verify the details, including the planned route, travel duration, and any additional safety requirements.
- Interstate Travel Fee:
- If applicable, there may be an additional fee for interstate travel, depending on the distance and the rental company’s policy.
- Documentation:
- The renter may need to provide a copy of the ID, travel itinerary, or additional proof of travel for verification.
- Terms and Conditions:
- Clear mention that the renter will be liable for any damage, fines, or other issues arising during interstate travel.
- The rental agreement should specify any restrictions related to where the bike can travel, including restricted zones or highways.
- Policy Overview:
3. Booking & Availability
- Ensure that your booking system reflects these additional policies. If you are using an online platform:
- Helmet Selection: Include a drop-down menu where the renter can choose the number of helmets needed.
- Interstate Permission: Add a checkbox or prompt asking if the renter intends to take the bike out of state and mention that prior approval is needed.
4. Payment & Additional Charges
- Clearly display any extra charges for additional helmets and interstate travel fees.
- Provide an option for renters to prepay for extra helmets or pay upon pickup.
5. Delivery and Pickup
- If your service includes delivery and pickup of the bike:
- Interstate Travel Restrictions:
- Make sure that delivery and pickup services are available for interstate routes, and inform the customer of any extra charges.
- Interstate Travel Restrictions:
6. Customer Communication
- Confirmation:
- Once a customer has booked, send an automatic confirmation that includes the helmet and interstate travel details.
- Reminder for Interstate Travel:
- A reminder email or text should be sent 24 hours before the booking, confirming whether the customer has received approval for interstate travel if required.
7. Terms & Conditions
- Draft the rental agreement that clearly states the policies regarding:
- Helmet provision (one included, extra helmets available at additional cost).
- Permission required for interstate travel.
- The consequences of violating any of these terms.
8. Legal Considerations
- Ensure your legal team reviews the rental agreement, especially the interstate travel clause, to avoid complications in case of accidents, violations, or damages.