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Legal COD Compliance

Everything You Need to Know About the Certificate of Deposit (COD) and Its Benefits

Nov 27, 2025
5 min read
Team Mariinox
Everything You Need to Know About the Certificate of Deposit (COD) and Its Benefits

A Certificate of Deposit (COD) is an official proof that your vehicle has been submitted to an authorized scrapping facility. It serves as a digital and legal acknowledgment that your vehicle is ready for dismantling under the Vehicle Scrappage Policy 2021. Without it, the deregistration and incentive process cannot begin.

What is a Certificate of Deposit (COD)?

COD is a government-recognized document issued after your vehicle is handed over for scrapping. It confirms the vehicle’s ownership transfer to an Authorized Vehicle Scrapping Facility (RVSF) and triggers eligibility for benefits such as rebates and tax incentives.

Key Details:
  • Issued digitally through VAHAN.
  • Links the owner, vehicle number, and RVSF.
  • Acts as the first step toward deregistration.

Why COD Was Introduced Under the Vehicle Scrapping Policy

COD was introduced to ensure transparency and eliminate illegal scrapping. Earlier, many vehicles were dismantled informally without deregistration. COD now creates a traceable record, verifying that the vehicle is scrapped legally.

Objectives:

  • Curb vehicle identity fraud
  • Enable government tracking through VAHAN.
  • Protect vehicle owners from post-scrap liabilities.

Who Issues the COD and When Do You Receive It?

The COD is issued by the Registered Vehicle Scrapping Facility (RVSF) after document verification. Once ownership, RC, and identity documents are verified, the RVSF generates the COD through VAHAN and hands it to the vehicle owner.

Typical Timeline:

Issued within 24-48 hours of vehicle handover.

Delivered as a digital copy or printed certificate.

Difference Between COD and CVS (Certificate of Vehicle Scrapping)

COD confirms acceptance of the vehicle for scrapping, while CVS confirms that scrapping is completed. COD is the starting proof of handover; CVS is the final proof of dismantling and deregistration.

Parameter COD CVS
Issued When At the time of handover After scrapping & deregistration
Purpose Proof of vehicle submission Proof of complete dismantling
Issued By Authorized Scrapper RTO/VAHAN post-update
Use Claim incentives Legal closure

How COD Helps in Purchasing a New Vehicle

COD acts as a discount voucher when buying a new vehicle. It allows you to claim OEM-backed benefits, tax concessions, and registration fee waivers during a new vehicle purchase.

Benefits:

  • Rebate on road tax for private vehicles.
  • OEM discount on ex-showroom price.
  • Priority processing for registration.

How Long Is a COD Valid?

COD remains valid for three years from the date of issue. Within this period, you can redeem incentives and complete deregistration. After expiry, the certificate becomes invalid for claims but remains proof of scrapping submission.

Common Misconceptions About COD

Many assume COD is optional or issued after scrapping - both are incorrect.

Myth: "Cash dealers can give COD."

Reality: Only authorized RVSFs issue COD.

Myth: "COD and CVS are the same."

COD = handover proof; CVS = completion proof.

Steps to Get a COD Through an Authorized RVSF

Steps:

  • Choose an authorized RVSF listed on the VAHAN portal.
  • Provide RC, owner ID, and bank details.
  • RVSF verifies documents and vehicle condition.
  • Sign handover and consent form.
  • COD is generated digitally via VAHAN.

Where COD May Get Delayed or Rejected

COD may be delayed if ownership or document details don’t match government records.

Common Reasons:

  • RC or chassis number errors.
  • Unresolved hypothecation (loan not cleared).
  • Missing KYC or PAN/Aadhar mismatch.
  • Unauthorized dealer submission.

How COD Prevents Future Legal or Ownership Issues

COD ensures your ownership ends legally at the time of handover.

Legal Protection Benefits:

  • Prevents misuse in accidents or crimes.
  • Stop new fines, challans, or taxes in your name.
  • Serves as evidence if any dispute arises later.

Why You Should Only Scrap Through an Authorized Facility

Authorized RVSFs are the only entities legally permitted to dismantle vehicles and issue valid COD and CVS recognized by VAHAN. Scrapping through an authorized facility ensures that your vehicle is deregistered, dismantled, and recorded under MoRTH rules. Unauthorized dealers cannot update VAHAN, cannot issue COD/CVS, and leave you legally responsible for a vehicle you no longer own.

Verification Checklist:

Dealer listed on VAHAN or state transport portal

  • Confirms the scrapping centre is officially approved.
  • Ensures the dealer is linked to the national vehicle database.
  • Prevents dealing with unauthorized local scrap vendors.

Displays valid RVSF license number

  • Every authorized facility has a MoRTH-issued RVSF ID.
  • You can cross-check this ID online to confirm authenticity.
  • Prevents fraud where local dealers falsely claim authorization.

Provides GST-compliant invoice

  • Ensures transparency in scrap valuation and payment.
  • Acts as financial proof in case of disputes.
  • Verifies that the business is legally registered and traceable.

Shares COD digitally within 48 hours

  • COD is mandatory proof that your vehicle is legally accepted for scrapping.
  • It must be generated through the VAHAN system, not on paper formats made by local dealers.
  • Without COD, you cannot access tax rebates, OEM discounts, or RC deregistration.

Ready to Scrap Your Vehicle?

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Conclusion

The Certificate of Deposit (COD) is the backbone of India’s legal scrapping framework. It proves lawful handover, enables government incentives, and safeguards owners from post-scrap complications.

Take control of your vehicle's future now. Scrap old car or any vehicle with authorized vehicle scrap dealers.

FAQs

No. Only government-approved RVSFs can issue COD.

Yes. RTO requires COD as proof before marking your RC as “scrapped.”

Check the status on the VAHAN portal using the vehicle number and RVSF details.

Clear hypothecation first; COD can’t be issued for loan-bound vehicles.

Yes. COD is tradable and Can be transferred to family members or friends.

Yes. COD is compulsory under MoRTH’s Vehicle Scrappage Policy 2021. Without COD, your vehicle’s deregistration and benefits cannot be processed. Unauthorized dealers cannot legally issue it.

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