Import of Vintage Motor Vehicles into India: Interplay Between FTP, Customs and Motor Vehicle Rules.

The Government of India has amended the import policy governing vintage motor vehicles under Chapter 87 of the ITC (HS) 2022, Schedule-I (Import Policy), through DGFT Notification No. 58/2024-25 dated 7 February 2025. The amendment is significant because it replaces the earlier date-of-manufacture criterion with the definition of a "Vintage Motor Vehicle" under the Central Motor Vehicles Rules, 1989 (CMVR).

The amendment needs to be understood not in isolation, but as part of the interaction between three distinct regulatory regimes: Foreign Trade Policy (FTP)/DGFT, Customs law, and the Motor Vehicles Act and Rules.

From a Pre-1950 Test to the CMVR Definition

Prior to the amendment, Policy Condition 1(III) of Chapter 87 permitted cars manufactured before 1 January 1950 to be imported freely by Actual Users. Thus, eligibility was determined primarily by the vehicle's manufacturing date.

The amended provision takes a fundamentally different approach. It provides that cars classified as "Vintage Motor Vehicles" under the Explanation to sub-rule (1) of Rule 81A of Chapter IIIA of the Central Motor Vehicles Rules, 1989, as amended, are free for import by Actual Users.

Consequently, the relevant question is no longer simply whether the vehicle was manufactured before a particular date. The importer must examine whether the vehicle satisfies the statutory definition of a Vintage Motor Vehicle under the CMVR.

This represents a shift from a fixed historical cut-off to a statutory classification based on the characteristics and age of the vehicle.

The FTP and DGFT Perspective

Under the Foreign Trade Policy framework, goods are generally classified as free, restricted or prohibited for import. Where an item is classified as "Free," it may ordinarily be imported without an import authorisation, subject to the conditions prescribed against the relevant ITC (HS) entry and compliance with other applicable laws.

The amended Policy Condition 1(III) therefore provides a special import-policy route for qualifying vintage motor vehicles. However, the expression "free for import" must not be confused with "free from customs duty."

The DGFT notification deals primarily with the policy permissibility of import. It does not, by itself, grant an exemption from customs duty, IGST or any other statutory levy applicable to the import.

Similarly, the phrase "by Actual Users" is important. The benefit is not expressed as an unrestricted facility for every importer or trader. The importer must satisfy the applicable Actual User requirement under the FTP framework.

Thus, from the DGFT perspective, the sequence is:

• Vintage Motor Vehicle under CMVR Free import under ITC (HS) subject to Actual User condition and other applicable laws.

Why the Reference to Rule 81A is Important?

The most important feature of the amendment is the incorporation of the CMVR definition into the import policy. Chapter IIIA of the Central Motor Vehicles Rules, 1989 was introduced to create a specific regulatory framework for vintage motor vehicles. Rule 81A provides the relevant definition and regulatory framework.

Broadly, the definition concerns qualifying two-wheelers and four-wheelers which are more than 50 years old, while also requiring the vehicle to retain its original form and restricting substantial overhaul or modification of important components such as the chassis, body shell or engine.

Therefore, age alone is not necessarily sufficient.

For example, a vehicle manufactured in 1965 may potentially qualify under the amended policy if it satisfies the applicable Rule 81A requirements. Under the earlier DGFT provision, such a vehicle would have been outside the special import category because it was not manufactured before 1 January 1950.

This demonstrates the practical significance of the amendment. The Government has effectively aligned the import-policy classification with the classification already prescribed by the Ministry of Road Transport and Highways under the CMVR.

The Role of Customs

The next regulatory layer is Customs. Once the vehicle is eligible for import under the DGFT policy, it does not simply enter India without further formalities. The importer must comply with the Customs Act, Customs Tariff Act and other applicable customs legislation.

The importer will ordinarily be required to file a Bill of Entry, upon which Customs will examine matters such as:

• classification of the vehicle under the Customs Tariff;
• assessable value;
• applicable Basic Customs Duty;
• IGST and other applicable levies;
• availability of any exemption;
• valuation and supporting documents; and
• compliance with restrictions or prohibitions under applicable law.

Therefore, the expression "Free" in the ITC (HS) only addresses the import-policy status. It does not automatically eliminate customs duty or other import taxes.

This distinction is critical.

For example, if a 1960 vintage car qualifies under Rule 81A and is consequently "Free" under DGFT Policy Condition 1(III), the importer must still approach Customs, file the necessary import documents, undergo assessment and pay the applicable duties and taxes unless a separate exemption is available.

In simple terms:

DGFT determines whether the import is permissible under the Foreign Trade Policy; Customs determines the fiscal and clearance consequences of that import. The Bill of Entry as the Link Between Customs and Registration. The interaction between the Customs and Motor Vehicle regimes becomes particularly evident at the registration stage. For an imported vintage motor vehicle, the CMVR framework requires the Bill of Entry to be furnished as part of the documentation for registration.

This is logical from a regulatory perspective. The Bill of Entry establishes the customs history of the imported vehicle and provides evidence that it has entered India through the lawful import process. Thus, the Bill of Entry is not merely a Customs document. It also becomes relevant to the subsequent registration process under the Motor Vehicle Rules.

The regulatory chain therefore operates as follows:

• Import policy eligibility Customs clearance Bill of Entry Vintage vehicle registration.

Import Permission Does Not Mean Permission to Ply on Roads

Another important distinction is between importability and road use.

The DGFT notification specifically preserves the applicability of the Motor Vehicles Act, 1988 and the rules made thereunder to vehicles that are intended to ply on public roads. Therefore, obtaining permission to import a vintage vehicle does not automatically confer a right to drive it on Indian roads.

After customs clearance, the owner must comply with the applicable registration requirements under the Motor Vehicles Act and CMVR, including the special provisions applicable to Vintage Motor Vehicles.

The vehicle must therefore pass through a separate regulatory process before it can lawfully be used on public roads. This can be expressed in a simple way:

• Import clearance gives the vehicle entry into India; registration gives it legal recognition for road use.
• These are separate legal events.

Registration Under the Vintage Motor Vehicle Framework

Chapter IIIA of the CMVR establishes a special framework for the registration and use of vintage motor vehicles. The owner of an imported vintage vehicle must comply with the prescribed registration procedure and submit the required documentation, including the Bill of Entry in the case of an imported vehicle. The framework also provides for a special vintage registration mechanism and imposes restrictions on the use of such vehicles.

A vintage vehicle is therefore not simply treated as an ordinary modern passenger car merely because it has been successfully imported and registered. The purpose of the special framework is to preserve historically significant vehicles while regulating their use on public roads.

Restrictions on Use

The distinction between ownership, registration and use is particularly important. A person may legally own and import a vintage motor vehicle, but its use on public roads remains subject to the restrictions prescribed under the Motor Vehicles Act and CMVR. The vintage-vehicle framework is not intended to provide an unrestricted route for using old vehicles as ordinary daily-use or commercial vehicles.

Accordingly, an importer should not interpret the DGFT notification as permitting unrestricted road use merely because the vehicle qualifies as a Vintage Motor Vehicle for import purposes. The road-use question must independently be examined under the Motor Vehicles legislation. The Three-Layer Regulatory Structure

The entire framework can therefore be understood through three questions.

First: Can the vehicle be imported?

This is primarily a DGFT/Foreign Trade Policy question.

The importer must establish that the vehicle falls within the definition of a Vintage Motor Vehicle under Rule 81A and therefore qualifies for the special import-policy treatment under Chapter 87.

Second: Can the vehicle be cleared by Customs?

This is a Customs question.

The importer must complete the Bill of Entry process, satisfy Customs regarding classification, valuation and other requirements, and pay the applicable duties and taxes unless an exemption applies.

Third: Can the vehicle be registered and used on Indian roads?

This is a Motor Vehicles question.

The vehicle must satisfy the applicable requirements of the Motor Vehicles Act and CMVR, including the special requirements of Chapter IIIA governing Vintage Motor Vehicles.

Thus, the three regimes perform different functions:

A Practical Illustration

Consider a person who wishes to import a 1960 Mercedes-Benz into India. Under the old DGFT policy, the vehicle would not have qualified for the special vintage import treatment because it was manufactured after 1 January 1950. Under the amended policy, however, the importer would first examine whether the vehicle satisfies the definition of a Vintage Motor Vehicle under Rule 81A. If it qualifies, the vehicle becomes eligible for the "Free" import policy treatment by an Actual User under Policy Condition 1(III).

The importer must then approach Customs and complete the import clearance formalities. Customs will determine the applicable classification, assessable value and duties/taxes. Once Customs clearance has been obtained, the importer can proceed with the registration process under the Motor Vehicles framework. The Bill of Entry will be relevant to that registration.

Finally, even after registration, the vehicle remains subject to the special rules governing the use of Vintage Motor Vehicles.

Thus, the vehicle moves through three legally distinct stages:

• DGFT eligibility Customs clearance CMVR registration and regulated use.

What the Amendment Does-and Does Not-Do?

The amendment should therefore not be interpreted as saying that all cars more than 50 years old can automatically be imported into India without conditions.

• Nor does it provide a general exemption from Customs duties.
• Nor does Customs clearance automatically confer permission to ply the vehicle on public roads.

What the notification actually does is to align the import-policy classification with the statutory concept of a Vintage Motor Vehicle under the CMVR?

This is an important policy change because it replaces the earlier fixed manufacturing-date criterion with a framework that takes into account the vehicle's age and its conformity with the vintage-vehicle requirements under the Motor Vehicle Rules.

Conclusion

DGFT Notification No. 58/2024-25 represents an important harmonisation between India's Foreign Trade Policy and Motor Vehicle regulatory framework.

Previously, the import policy used a straightforward manufacturing-date test; cars manufactured before 1 January 1950 were eligible for free import by Actual Users. The amended policy instead adopts the concept of a Vintage Motor Vehicle under Rule 81A of the CMVR.

The practical consequence is that the import of a vintage vehicle must now be viewed as a coordinated compliance exercise involving three separate authorities and legal regimes.

DGFT/FTP determines import-policy eligibility. Customs determines clearance, valuation and fiscal liability. The Motor Vehicles authorities determine registration and lawful road use.

Accordingly, the expression "Free for import" should be understood only in the context of import-policy restriction. It does not mean duty-free import, customs-free clearance or unrestricted road use.

The true effect of the amendment is therefore one of regulatory alignment: the same statutory concept of a "Vintage Motor Vehicle" under the CMVR now serves as the basis for obtaining the special import-policy treatment under ITC (HS) Chapter 87. This creates a more coherent framework in which FTP, Customs and Motor Vehicle regulations operate sequentially rather than independently.

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