Maharashtra road tax refund when your car is sold, scrapped or moved to another state

By Arjun Ramanarayanan, IndiCar · Published 2 November 2026 · Tips

Maharashtra refunds 97.2% of one-time road tax if less than a year has passed since you paid it and your car is removed from the state or its registration is cancelled. Here is the proof you need, the forms and the deadline.

If you paid one-time road tax in Maharashtra and your car later leaves the state or is scrapped, you can claim part of that tax back. The refund is a share of the tax you paid, and the share shrinks as the car ages. If less than a year has passed since you paid, you get 97.2% of the one-time tax. You need proof that the car has left the state or cannot be used again. For an inter-state move, the claim is made at the RTO of original registration.

Where the refund right comes from

The refund comes from Section 9(6) of the Maharashtra Motor Vehicles Tax Act, 1958. A registered owner who paid one-time tax is entitled to a refund at the rates set in the Act's Second or Third Schedule.

The Act gives two grounds for a refund:

• Removal to another state, where the car moves out of Maharashtra on transfer of ownership or change of address.
• Scrapping, where registration is suspended or cancelled because the car was scrapped, whether after an accident or for any other reason.

Each ground needs its own kind of proof. The proof is what decides whether your claim succeeds.

The proof you must show

For a move, the usual condition is that the car is registered in the new state or its old registration is cancelled. Guides to the process say you first pay road tax in the new state under that state's slab, and only then apply to the previous RTO for the refund.

How much comes back

The Act's refund table is keyed to the time since you paid one-time tax on the car. If less than one year has passed, the refund on removal, suspension or cancellation is 97.2% of the one-time tax paid. Later years carry lower rates in the same table.

The refund follows the Act's schedule. It is not worked out by comparing what you paid in Maharashtra with what you pay in the new state. One published guide gives a formula of original tax times years remaining divided by 15 years. Treat that as an approximation; the Act's schedule is what the RTO applies.

There is also an age limit, and the copies of the Act do not agree on it. The current India Code text carries a note that no refund is admissible for a vehicle more than 14 years after its first registration. An older copy of the Act gives nineteen years. If your car is near either age, the 14-year limit in the current text is the one to plan around.

Forms and documents for a state transfer

The move starts with a no-objection certificate. You apply for it on Form 28 at the original RTO, together with the RC, insurance, PUC certificate and a chassis imprint.

Once the car is registered and taxed in the new state, the refund application commonly needs:

• The NOC for transfer to the other state
• The road tax receipt from the new state
• The road tax receipt from Maharashtra
• RTO Form 16, duly signed, and Form DT as the application forms
• A copy of Form 28

You file the claim at the RTO of original registration, not in the new state. It has been reported that there is no way to claim a car road tax refund online, so plan on applying in person. Once the RTO verifies the claim, the refund is credited to your bank account.

Deadline and who can claim

Apply within six months. A Maharashtra RTO can decline a refund application filed more than six months after the state transfer NOC, and guides similarly advise claiming within six months of registering the car in the new state. Missing that window is the easiest way to lose the refund, so register in the new state promptly and apply as soon as you have its tax receipt.

The claim belongs to the owner who paid the tax. If you buy a car from another individual, you cannot claim the refund on the seller's tax. For an inter-state move, the owner's name must stay the same, or the claim becomes invalid. If you are selling a car that is leaving the state, settle who claims the refund before the name changes.

The 15 per cent concession for voluntary scrapping

Scrapping can also cut the tax on your next car. The Maharashtra cabinet approved a 15 per cent tax concession on vehicles that pay lump sum tax, for owners who voluntarily scrap an old vehicle. This is separate from the refund on the old car's tax.

• The scrapping facility (RVSF) issues a Certificate of Deposit, which is valid for two years.
• The concession applies when you register the same type of vehicle, including a light motor vehicle such as a car.
• The old vehicle must be scrapped voluntarily within three years of the date the notification is published.

Earlier, a 10% rebate applied to non-transport vehicles scrapped within 15 years of registration and transport vehicles within 8 years.

Worked example: the tax line on a Scorpio N

The registration and road tax line on the cheapest Mahindra Scorpio N is Rs 1,68,436. That is for the Z2 Petrol Manual 7-seater, registered to an individual in Mumbai, from IndiCar's price list dated 12 October 2026.

Of the Rs 2,85,791 between ex-showroom and on-road, the tax line is the largest part. IndiCar gives you the written breakup before you book.

Across the 27 Scorpio N variant and powertrain combinations, on-road prices run up to Rs 31,30,136 for the Z8 L 4WD Diesel Automatic 7-seater. You can see each variant's breakup on the Scorpio N prices and configurator page, and check any other model with the on-road price calculator.

What to do if a move or scrapping is likely

The refund starts high and falls each year, and the six-month window after the NOC is short. If you expect to move out of Maharashtra, or your car has been written off, act early.

• Keep the original road tax receipt from the day of registration.
• For a move, get the Form 28 NOC, register in the new state, pay its tax, then apply at the original RTO with Form 16 and Form DT.
• For a write-off, get the insurer's certificate that the car is beyond repair.
• For voluntary scrapping, keep the RVSF Certificate of Deposit and use it within two years on your next car.

Sources: THE MAHARASHTRA MOTOR VEHICLES TAX ACT., 1958 : LXV] 1 THE MAHARASHTRA MOTOR VEHICLES TAX ACT, Road Tax Refund - Know Documents & How to Apply at RTO

Buying a new car through IndiCar

IndiCar arranges new-car purchases in Mumbai, Navi Mumbai and Thane. You book a new car on IndiCar at the on-road price shown on its car page, with the full price breakup: ex-showroom, RTO registration, insurance, TCS and FASTag. You book online with a refundable reservation, and IndiCar sources the car from partner dealer stock and handles the registration, insurance, paperwork and delivery.

You deal only with IndiCar from quote to delivery. Your phone number is never passed to a dealer, and you do not need to take the quote to a showroom to negotiate. See on-road prices and book or get a WhatsApp quote on +91 85916 41004.

Frequently asked questions

How much road tax does Maharashtra refund if my car leaves the state in the first year?

If less than one year has passed since you paid one-time tax, the refund is 97.2% of the tax paid. The Act's schedule sets lower rates as more time passes.

Where do I claim the refund after moving my car to another state?

At the RTO of original registration in Maharashtra. Guides say you first register and pay road tax in the new state, then apply to the old RTO with the NOC, both tax receipts, RTO Form 16, Form DT and a copy of Form 28.

Is there a deadline for the refund claim?

Yes. A Maharashtra RTO can decline an application filed more than six months after the state transfer NOC. Guides also advise claiming within six months of registering the car in the new state.

Can I get a refund if my car is scrapped after an accident?

Yes. The Act allows a refund when registration is suspended or cancelled because the car was scrapped, after an accident or for any other reason. You need a certificate from the insurance company, or other documentary evidence that the car is beyond repair and cannot be used again.

Can I claim the refund if I bought the car second-hand from someone else?

No. A buyer of a car from another individual cannot claim the refund. For an inter-state move, the owner's name must stay the same or the claim becomes invalid.

Is there an age limit on the refund?

The current India Code text of the Act carries a note that no refund is admissible beyond 14 years from first registration. An older copy of the Act gives nineteen years.

Tags: road tax, maharashtra, road tax refund, vehicle scrappage, rto