Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 14th June 2012, 16:55   #61
Senior - BHPian
 
selfdrive's Avatar
 
Join Date: Apr 2010
Location: Pune
Posts: 2,558
Thanked: 1,758 Times
Default Re: Why handling charge is collected from customers?

Quote:
Originally Posted by patelhemals View Post
Quick Update -
Just got a call from the Spectra Motors Sales Guy.
Saying this is a cost of the dealer and Not MARUTI SUZUKI, and it cannot be waived off. We cannot issue a invoice to you for the same amount. We can issue a debit note.
One of my friends is looking for a diesel car. One of the cars he considered was the Dzire but he finalised a Punto. While negotiating with them, he asked for their best price and we walked out of the showroom without a booking. The SA called back and offered to waive 3K of the 5.5K handling charges.

Not sure what is to be done as once you have already booked it, they wont offer any other discounts. The best you could do is threaten to cancel booking and walk out. If you can actually afford to do that or want to do that is another point you have to answer yourself.

This may at least reduce part if not waive off all handling charges
selfdrive is offline   Reply With Quote
Old 14th June 2012, 18:22   #62
BHPian
 
mohandasnikhil's Avatar
 
Join Date: Aug 2008
Location: Mumbai
Posts: 273
Thanked: 238 Times
Default Re: Why handling charge is collected from customers?

In my Car Buying Experience I have found the following charges with which Dealers fleece Customers:

1. Handling/ Logistical Charges: They claim this the monies required for logistics, stockyard rentals, transportation, fuel etc. I have managed to convince my Renault dealer to waive off these charges while buying the Fluence, but the Suzuki dealer wouldn't budge while we got out Swift VDi.

2. Registration Charges: This is kind of inbuilt into the Registration Tax. Usually dealers charge anywhere between 0.5 to 1percent more than what is the ACTUAL Road Tax. They claim it is RTO Agent Charges. From my experience an RTO Agent doesn't charge more than 3,000 for Registration in Mumbai. You can fight with the Dealer and convince them that you want to do the registration yourself. The dealer might or might not agree.

3. Insurance Charges: The Insurance Premium Charged by dealers is usually 20 to 30
% higher than what you coud get in the market after discounts. A lot of Dealers now are beginning Buyers to buy the Insurance themselves.

4. Special Number Charges: Numbers totalling to 9 and VIP Number Reservations are often Value Added Services offered by Dealers, but they usually charge a heavy premium (3k to 15k) over and above the Official Amount for this service. I have reserved my number on one occassion myself, and it was pretty straightforward and I didn't pay a single rupee over and above the official amount.

5. Accessories: A Dealer tries to scare you into buying Accessories from them and installing it from their end so as not to void the Manufacturer Warranty. These accessories are usually 20% more expensive than the market price. Most accessories offered by Dealers themselves aren't Manufacturer approved. Seat Covers, Sun Films, Matting, Mudflaps can all be ideally installed elsewhere.
mohandasnikhil is offline   (1) Thanks Reply With Quote
Old 14th June 2012, 20:00   #63
BHPian
 
Join Date: Aug 2009
Location: Anand, Gujarat / Virginia Beach, US
Posts: 457
Thanked: 175 Times
Default

Quote:
Originally Posted by rishi_kapoor
I paid 25000 as handling charges to BMW dealer Deutsche Motoren, as per them this is governed by BMW India. I was only given a account statement sort of paper but no receipt for this amount. I additionally paid 5000 for temp registration (cost is 150) and another 3000 extra for permanent registration. It is sad but a fraudulent practice supported by car manufacturers themselves.
Did you even check with BMW that it is supported by them or not? AFAIK, handling charges are not supported or imposed by any manufacturers in India, BUT they are imposed by dealer and you can get it knocked off either by raising your voice to dealer or by raising complain to manufacturer. But, if your Beemer was not available with dealer and he sourced it for you from another dealer, then the dealer may charge you for handling fee as long as it was mentioned before hand.
Nitrous Power is offline   (1) Thanks Reply With Quote
Old 15th June 2012, 13:55   #64
Distinguished - BHPian
 
supremeBaleno's Avatar
 
Join Date: Dec 2005
Location: Weekdays@Chennai, Weekends@Kerala
Posts: 5,104
Thanked: 1,492 Times
Default Re: Why handling charge is collected from customers?

Yes, as Nitrous_Power mentioned, this is a fraud by the dealer. It is not manufacturer supported. Fight it out, is what I would say.

And mohandasnikhil is absolutely on the spot about the places where dealers fleece us.
Only thing he missed is the extended warranty. Especially with Maruti, this is useless for 2 reasons ;
- the cars are very reliable and dont need any extra warranty
- and if at all you have an issue after standard warranty expires, the dealer will in all probability not give you the benefit citing some clause.

Dont go for the MSIL extended warranty. Period !!! BTW, the dealer will tell you that Maruti insists on this - dont fall for it. I have got it waived off for my car and for a colleague - you just need to put your foot down.

On the other hand, Tata dealers seem to honour the extended warranty well from what I read on the forum. So, if you are buying Tata, go for it without fail.

I got an invoice recently for the Ertiga and Dzire from Indus Motors, Kerala and they have put 3500 as handling for both cars. In fine print, they mention that this is for "driver expenses, petrol expenses, transportation charges, transit risk coverage & other incidental expenses".

That's a load of bull - they should be covering those expenses, if at all.
supremeBaleno is offline   Reply With Quote
Old 15th June 2012, 20:32   #65
BHPian
 
Vijayraj1890's Avatar
 
Join Date: Nov 2009
Location: New Delhi
Posts: 58
Thanked: 74 Times
Exclamation The Handling Charges Scam.

The Supreme Court of India on the 20th of April, 2012 has issued a directive to car dealers striking down and handling charges the dealers charge over and above the amount required to register the vehicle.

This means that if you find any fishy or illogical amount in your final bill, you have the right to ask what its for and refuse to pay if it is over and above the registration charges already mentioned to you.



HISTORY:
In the year 1996, an amendment was made to the Delhi Motor Vehicles Rules which authorized Car dealers to register the cars for the convenience of the general public. The rule clearly stated that the dealers are not to charge the customers A SINGLE RUPEE over and above the amount it takes to register the vehicles. The dealers are required to issue and undertaking to the Government of India saying that they will not charge anything more that the price of the vehicle, registration charges and road tax.

However, just like a lot of other things in our beloved country this is not followed and dealers easily demand an extra sum of money disguised in the form of "Misc charges", "Holding Charges", "Handling Charges" etc.
This has been going on for years and the lack of any mechanism to deal with such cases has left customers with no choice but to bite the bullet and pay whatever the dealer asks them to. Hence a PIL was filed challenging this practice.


The million dollar question:-

Where does this money go?

Good Question, the dealer is already making money by selling you the car, why would he charge a measly (compared to the price of the car) sum over and above the registration?

What Dealers Unofficially Claim:-
The unofficial answer to this question is that the Officers in the Transport and Registration departments take money from the dealers to "ensure a smooth process". This amount is passed over to the customers. Well, at least that's what the dealers unofficially claim. Whether this is true or not, you be the judge.

What Dealers Officially Claim:-
According to an article in the Times of India, dated January 5th, 2012; an association od dealers in Delhi approached the Delhi High Court. The court then asked them to file a counter affidavit in response to the PIL in which they stated that the dealers are charging the registrants only the registration fee, road tax and municipal parking charges (supra); that the handling charges / logistic charges which is in violation of their undertaking given to the Government of India is not related to registration of vehicles but are towards stockyard services / warehousing charges, driving costs in terms of fuel consumed and people engaged, fuel given following delivery, transit risk insurance from stockyard to dealer's showroom, polishing and / or waxing and towards other handling costs and have nothing to do with the collection by the said dealers of the registration fee, road tax and municipal parking charges.


The Supreme Court Held:-

"The position which emerges is that while the petitioner avers that the 'extras' so charged by the dealers are for providing the services of registration and which the dealers are not entitled to charge, the dealers deny the extras to be on account of providing the services of registration and claim the same to be on other accounts. The respondents No.1&2 as aforesaid have no authority to intervene in the charge by the dealers even if illegal of the said extras so long as they are not on account of commission or for providing service of registration. The said question thus becomes a question of fact to be adjudicated on a case to case basis and no general direction with respect thereto can be issued in this public interest litigation. The petitioners who are themselves advocates have of course demonstrated that upon the petitioners issuing legal notice in this regard a particular dealer has refunded the amount so claimed but the same cannot be indicative of any illegal practice being followed and cannot lead to a general direction. It is well nigh possible that considering the meager amount involved, that particular dealer may not have wanted to battle with an advocate and chose to refund the amount."

"We accordingly dispose of this writ petition with the direction that in the event of the respondents No.1&2 Transport Department / GNCTD receiving any complaint of any vehicle dealer charging anything extra / commission from the vehicle purchaser for providing the services of registration, the respondents No.1&2 shall enquire into the said complaint and if find any merit therein, shall take action in accordance with law against such vehicle dealers."


The Situation as of Today:-

This judgment did not receive as much publicity as the judgment on tints. However, the dealers are now telling their customers that the matter is still pending in the Supreme Court and they have to pay handling charges.

This happened with my uncle when he went to take delivery of his W8 Mahindra XUV 500 from a dealer in Delhi. The dealer was shown the judgment and they did not charge any Handling Charges which they were claiming before.


FYI:-

What exactly are Handling Charges?
The handling charges were levied by dealers for transferring the vehicles between the office of the transport department and the dealer offices, as well as for keeping the vehicle in the dealer's property till it was picked up by the customer.

What is a PIL?
http://en.wikipedia.org/wiki/Public-...igation_(India)

The Supreme Court Judgment:-
% C. Rajaram, Advocate & Anr vs Gnct Of Delhi & Ors on 20 April, 2012

An article in the Times of India:-
Government to car dealers: Waive handling charges - Times Of India


Fine Print:-
All contents of this post above are in exercise of my Right to Freedom of Expression granted and guaranteed to me by Article 19 of the Constitution of India. The content above is cited from credible and official sources of the Government of India and the Press available to every citizen on the Internet.
The contents above are in accordance with Clause (2) of Article 19 of the Constitution of India which imposes reasonable restrictions to the Right to Freedom of Speech and Expression in the instance of public order,decency and morality, security of the State, Sovereignty and Integrity of India and defamation.
The views above are mine personally and in accordance of the posting privileges granted to me by Team-BHP.com and do not necessarily reflect the views of Team-BHP.com, its members and/or administrators.
Vijayraj1890 is offline   (5) Thanks Reply With Quote
Old 15th June 2012, 20:45   #66
BHPian
 
suv100's Avatar
 
Join Date: Aug 2008
Location: Calicut
Posts: 125
Thanked: 28 Times
Default Re: The Handling Charges Scam.

I read TOI and never saw the news you mentioned. Excellent find Vijayraj.
suv100 is offline   Reply With Quote
Old 15th June 2012, 22:00   #67
BHPian
 
acroback's Avatar
 
Join Date: Aug 2011
Location: CA
Posts: 314
Thanked: 125 Times
Default Re: The Handling Charges Scam.

Never noticed this when I got my Ritz last October.
I think I should go back and check the bill for these shady handling charges.

Thanks a lot for bringing this up.Will help a lot of unsuspecting potential new buyers.
acroback is offline   Reply With Quote
Old 15th June 2012, 22:40   #68
BHPian
 
GT500's Avatar
 
Join Date: Apr 2010
Location: New Delhi
Posts: 101
Thanked: 16 Times
Default Re: The Handling Charges Scam.

Quote:
Originally Posted by Vijayraj1890 View Post
The Supreme Court of India on the 20th of April, 2012 has issued a directive to car dealers striking down and handling charges the dealers charge over and above the amount required to register the vehicle.

This means that if you find any fishy or illogical amount in your final bill, you have the right to ask what its for and refuse to pay if it is over and above the registration charges already mentioned to you.
Nice initiative Vijay, appreciate the effort!

A car is being bought in the family and I was also doubtful of this, I sent a mail to maruti , and here is the reply. It can be seen from this, that MSIL itself supports these charges.

I am about to pay Rs.6000 as handling charges to the dealer from whom I'm taking the delivery. I feel since the manufacturer is backing the dealer as is evident from the mail below I don't have a chance, but since the mahindra dealer ^^ has waived it off, I am having second thoughts.

Here is the excerpt from the reply :-

Quote:

Dear Mr. *****l,

Thank you for contacting Maruti Suzuki Customer Care.
We have received your communication regarding handling charges.

With reference to your query we wish to inform you that these charges are pertaining to fuel expenses, driver expenses & other related expenses .The dealers have been charging the same under an agreement for sale of vehicle with its customers including you. Hence the said charges are in line of our company’s policy. If you wish to have more clarity on this, you may contact our dealer as they have an official communication document pertaining to this matter.

Contact Us

However, we will shortly get in touch with you over phone (***) to have more details about exact requirements and to provide you with the requested information.
Thanking & assuring you of our best services at all times.
Please feel free to revert in case of any other query or clarification required.

Regards,
ANY TIME MARUTI
(Call Us- Toll Free: 1800 102 1800 and 1800 1800 180)
24*7 live chat Support on SX4 & A-Star web sites (Marutisx4 Men Are back, Maruti Suzuki A-Star: Stop at nothing with KB series Engine)
Please visit us at Maruti Suzuki company manufactures the best selling cars in India
001

==========================================
From: webmaster@maruti.co.in
Received: 6/11/2012 7:36 AM
To: ATM Queue
Subject: Enquiry About Interested in purchase
Dear Admin,
**** has posted enquiry
Name ****
Email *****
Address ***** ,
City NEW DELHI
State DELHI
PinCode 11001*
Phone Number ***
Model Maruti WagonR
Model Varient SELECT MODEL
Registration Number To be Purchased
Enquiry About Interested in purchase
Enquiry


I would like some clarification regarding the " handling charges" charged by maruti dealers. I am in the process of purchasing a maruti vehicle from a dealers and they are quoting Rs.5750/- as handling charges. I would like to know the advisory given by Maruti Suzuki India Ltd. to its dealers on charging the same from its consumers. These charges have been termed as illegal as per recent judgement in the month of January 2012. Link : Government to car dealers: Waive handling charges - Times Of India Kindly provide me the view as taken by MSIL. Regards **


I havent received any response from them as mentioned by them above.

As per the judgement attached by you, it is indeed sad to see the non compliance of the same by my dealer, I shall discuss the same while taking delivery.

Cheers

GT 500

Last edited by GT500 : 15th June 2012 at 22:57.
GT500 is offline   Reply With Quote
Old 15th June 2012, 23:08   #69
BHPian
 
Join Date: Feb 2009
Location: Pune
Posts: 193
Thanked: 29 Times
Default Re: The Handling Charges Scam.

Something most of us aware - dealers charge us extra for administration charges/handelling charge. But what can be done?

However, never knew about judgement and PIL. Thanks for info.
idea is offline   Reply With Quote
Old 16th June 2012, 00:01   #70
Distinguished - BHPian
 
Sahil's Avatar
 
Join Date: May 2004
Location: Bombay
Posts: 5,052
Thanked: 1,687 Times
Default Re: The Handling Charges Scam.

Handling charges and Registration mark-up charges are two different things on the invoice.

I think the handling charges are justified and often set by the company itself, they are mainly transport charges etc. This is a common charge practice even in USA.

However, the real scam is in the registration charges, the amount can be huge! I have pointed this out here several times in the past too. The scam amount is the fee the dealer charges over and above the RTO tax but on the invoice it is combined under RTO tax itself so not many actually go down to calculating the difference. I learned the hard way and have been a victim for years, paid 50k extra once ! Usually these amounts range from 5000 to over 50k for premium cars. Over the past few years I have refused the pay the dealer more than 3000rs for agent charges on registration. You can and should put your foot down on this matter as you are not liable to pay it, if dealer refuses you can get the car registered on your own too. I have used this approach too a few times when dealer has acted stubborn, you can easily find an agent at the RTO who will do it for less than 2000rs.

Last edited by Sahil : 16th June 2012 at 00:04.
Sahil is offline   Reply With Quote
Old 16th June 2012, 01:18   #71
BHPian
 
Join Date: Oct 2007
Location: Bangalore
Posts: 72
Thanked: 16 Times
Default Re: The Handling Charges Scam.

Quote:
Originally Posted by Sahil View Post
Handling charges and Registration mark-up charges are two different things on the invoice.

I think the handling charges are justified and often set by the company itself, they are mainly transport charges etc. This is a common charge practice even in USA.

However, the real scam is in the registration charges, the amount can be huge! I have pointed this out here several times in the past too. The scam amount is the fee the dealer charges over and above the RTO tax but on the invoice it is combined under RTO tax itself so not many actually go down to calculating the difference. I learned the hard way and have been a victim for years, paid 50k extra once ! Usually these amounts range from 5000 to over 50k for premium cars. Over the past few years I have refused the pay the dealer more than 3000rs for agent charges on registration. You can and should put your foot down on this matter as you are not liable to pay it, if dealer refuses you can get the car registered on your own too. I have used this approach too a few times when dealer has acted stubborn, you can easily find an agent at the RTO who will do it for less than 2000rs.
Why do we want even to pay a single rupee more? There is a process to register on own, i even saw a thread here. With that in mind, i think paying even an agent is promoting bribe and corruption. A little time and effort is all what is needed to do away with any extra charges etc.
hemantbsutar is offline   Reply With Quote
Old 16th June 2012, 02:29   #72
Distinguished - BHPian
 
Sahil's Avatar
 
Join Date: May 2004
Location: Bombay
Posts: 5,052
Thanked: 1,687 Times
Default Re: The Handling Charges Scam.

Quote:
Originally Posted by hemantbsutar View Post
Why do we want even to pay a single rupee more? There is a process to register on own, i even saw a thread here. With that in mind, i think paying even an agent is promoting bribe and corruption. A little time and effort is all what is needed to do away with any extra charges etc.
Well that's a matter of personal choice. I rather use an agent a fee to do the running around for me. Our time is worth a lot more than that man.
Sahil is offline   Reply With Quote
Old 16th June 2012, 02:58   #73
Senior - BHPian
 
blackfire_9's Avatar
 
Join Date: Nov 2009
Location: India
Posts: 1,075
Thanked: 186 Times
Default Re: The Handling Charges Scam.

Hi sahil,

I personally don't think that the "handling charges" are in any way justified. To put it quite simply in the form of an analogy, why would you want to pay anything extra to a grocery store owner on account of similar handling charges which could be attributed to something like the electricity consumed by the refrigerator used for storage.

When a customer walks into a showroom to buy a car, he is only liable to pay for the price of the car & nothing else. Any sort of inventory management & the associated costs are the dealer's responsibility; it is certainly wrong to ask a customer for some money on this account.

Quote:
Originally Posted by Sahil View Post

I think the handling charges are justified and often set by the company itself, they are mainly transport charges etc. This is a common charge practice even in USA.
blackfire_9 is offline   Reply With Quote
Old 16th June 2012, 07:35   #74
BHPian
 
Join Date: Oct 2007
Location: Bangalore
Posts: 72
Thanked: 16 Times
Default Re: The Handling Charges Scam.

Quote:
Originally Posted by Sahil View Post
Well that's a matter of personal choice. I rather use an agent a fee to do the running around for me. Our time is worth a lot more than that man.
Promoting or fighting the menace of bribe is always a personal choice. The reason bribery exists most of the times is either ignorance or paying amounts to avoid using the system( even if its slow). I guess even dealers are asking this amount(whatever the quantum) to say- "we are running around for you". Then why question them and pay up! (unless can find a cheaper way out like you suggested). I guess its "to each his own".
hemantbsutar is offline   Reply With Quote
Old 16th June 2012, 08:11   #75
BHPian
 
hrman's Avatar
 
Join Date: Jun 2006
Location: Bangalore
Posts: 834
Thanked: 263 Times
Default Re: The Handling Charges Scam.

Thanks for highlighting this.
In my Skoda's case, they jacked up the registration charges by some 15k in the price list. This is not mentioned in the Final invoice, which carries only the Actual Ex Showroom price. And I took delivery 2 days before this judgment.
hrman is online now   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
VW directs dealers to stop physical delivery of Polo! EDIT: It's a handbrake issue subhro1988 The Indian Car Scene 147 3rd November 2015 12:13
Kerala MV Dept: Now inviting complaints via Facebook ghodlur Street Experiences 3 28th August 2013 21:46
Kerala Motor Vehicle Dept Online jkdas The Indian Car Scene 108 17th August 2013 06:12
Transport charges - for a set of 4 tyres audiophile Shifting gears 1 9th October 2008 23:35


All times are GMT +5.5. The time now is 18:04.

Copyright 2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks