March 29, 2016

RTO RC Hypothecation Removal Process, Documents Required

Removing hypothecation (HP) from RC book is quite simple process. RTO has introduced a new cancellation procedure to ease the existing removal request. The vehicle owners need not to spend so much money from their pocket because the charge is very less. Here after, the car and bike owners need not to search for a driving school or depending an agent to process their request. They can directly approach their RTO office under where the vehicle was registered to get the things done. The owners have to just spend some little time in their busiest work schedule which won't consume more than half an hour.

Any two wheeler or four wheeler purchased through Bank loan will be hypothecated in RC Book. It has to be removed immediately after the closure of loan. It is necessary for transferring the ownership in the event of sale. It is also important while claiming the insurance due to complete damage to the vehicle. The following documents are required to process your removal request.
  1. Original copy of Registration Certificate (RC) Book
  2. Xerox copy of PUC Certificate
  3. 2 copies of No objection certificate (NOC) from bank
  4. Xerox copy of current insurance policy
  5. 2 copies of FORM 35 – original
The owner has to keep ready all the listed documents in hand before going to their RTO office. You can follow these step-by-step process for removing hypothecation.

Step 1: Visit the RTO office under which your vehicle was registered. The registered office of the vehicle is mentioned on your RC book.
Step 2: Pay just Rs. 100 at cash counter (The charge may vary depends upon latest rules. Please inquire cash counter before you pay). The recipient will get two copies of fee recipient.
Step 3: Attach one fee receipt along with 5 mandatory documents mentioned above. Keep the another fee receipt as a copy of acknowledgement.
Step 4: Submit the documents to respective counter. The officer will inform you the date and time for collecting back your original RC book.

After submitting the required documents, the removal process will take at least 3 - 4 working days. Please carry your acknowledgement slip or copy of fee receipt for collecting back your original RC book. The original RC book will carry the endorsement mentioned with hypothecation removed. The existing printed status will not be deleted whereas the small receipt of endorsement pasted on original your RC book with signature and stamp of the Authority is enough for confirming the cancellation status.

Important Frequently Asked Questions (FAQ) given here are useful for you to know more about the required documents and how to prepare those before approaching your RTO office.

What is PUC? How to obtain it?

The Pollution Control Certificate (PUC) can be obtained from any Service Station authorized by the Transport Department. The service station is mostly found in Petrol refueling bunks. It may be located nearer to the RTO office. In order to obtain the PUC, the vehicle has to be inspected to know the percentage of CO emission. The computerized device will be connected to the muffler for few minutes to test the percentage of CO. The charges for the test and certificate may vary depends upon the vehicle type. If the vehicle type is 3 cylinders with 4 stroke, you need to pay Rs. 50 approximately. The obtained PUC is valid for up to 6 months.

What is FORM 35?

The FORM 35 is an formal application for removing the hypothecation. The Bank declares the termination of an agreement of Hire Purchase/ Lease/ Hypothecation through FORM 35. The Bank may send FORM 35 with authorized signature and stamp to the vehicle owner's address immediately after the closure of loan. The two copies of FORM 35 may be printed together on the same sheet. The endorsement of cancellation shall be sent back to the Bank or Financier through Registered Post. You can download FORM 35 in PDF format from the following link.

What is NOC? How to get it?

The No Objection Certificate (NOC) is issued from the financier/ Bank to RTO office for confirming the loan agreement between the financier and car owner/ loan borrower has been terminated. It is possible to issue only when the outstanding amount of loan against the particular vehicle is settled without any arrears. It should be mentioned with the details of Vehicle Registration Number, Engine Number and Chassis Number which was furnished in RC book. The NOC is valid for 3 months from the date of issue. It can be issued again to customer from the Bank.

Why NOC is not issued after closing loan?

The customer has to submit the RC book to Bank after the disbursal of loan amount and vehicle delivery. The bank will update the details of vehicle on the basis of furnished information in the RC book. The same furnished information will be mentioned in NOC. In case the NOC is not issued after closing the loan, the customer can approach their Loan center to submit the copy of RC book along with the necessary loan documents. In the event that the customer is unable to come to the Bank directly, they can send their authorized person along with the authority letter, self-attested ID Proof and RC.

If the customer has not received the NOC even after closing the loan, they have to check whether any dues are still pending. The customer has to pay the pending dues such as cheque bounce charges and penalty fee in case if that was missed. If the same car has been refinanced, you should also check the dues of the refinanced car loan for clearance. You can contact the concern Bank customer care through Phone or email to know more details. You can click on the following link to download the NOC format for closed car and bike loans.

Is the same procedure is followed across all States of India?

Yes. The same procedure is being followed across all States of India. You are requested to inquire your RTO office at least once before processing your request. The process explained here is followed at Chennai. The same process may be followed across all Indian states such as Kerala, Karnataka, Orissa, Gujarat, Maharashtra, Andhra Pradesh and Telangana and West Bengal.

Is there any online facility is available at present?

No. There is no online facility is available at present.