<Company Name>

HR Policy

Company Car policy

Policy Effective Date: <DD/MM/YY>

No part of this documentation may be reproduced or transmitted in any form or by any means, electronic
or mechanical, including photocopying or recording, for any purpose without express written permission of
the CEO of <Company Name Here>.

© 2021, <Company Name Here>. All Rights Reserved

Revision History
Ver Change Description Prepared Reviewed By Approved Date
No. By By
 TABLE OF CONTENTS

1. Objective 4
2. Scope and Applicability. 4
3. Definition / Glossary 4
4. Policy/Process 5
4.1. General 5
4.2. Standard Operating Procedure: 5
4.3. Maintenance / Repairs / Normal Running / Insurance 6
4.4. Foreclosure: 7
4.5. Promotions 7
4.6. Transfers 7
4.7. Rejoining the Car Scheme 8
4.8. Overall Coordination / Clarification / Suggestions 8
ANNEXURE I 9
ANNEXURE II 12
ANNEXURE III 14
ANNEXURE IV 16
ANNEXURE V 17
5. Chauffeur Driven Car/Employee Self Driven Car owned by Company 18
6. Special Circumstance and Exception 18
7. Non-compliance and Consequence 18
1.Objective
The Company Car Policy has been formulated in order to introduce an employee-friendly and
easy to administer car scheme in order to facilitate easy commuting for its select employees
towards official duties.

2.Scope and Applicability

Employees in <Grade / Level / Designation> and above are eligible to participate in this
scheme. There are two types of programs:
Scheme A: Company owned car program
Scheme B: Company leased car scheme.

Eligible employees can opt for either of the schemes. All applicable taxes are to be borne by the
employee under these schemes.

3.Definition / Glossary
Term / Abbreviation Definition / Expansion

4.Policy/Process

4.1. Definiton

√ Under Scheme A, eligible employees will be provided with a car that is completely owned,
maintained and insured by the Company. The employees will have no ownership right over
the vehicle except that the vehicle will be allotted exclusively for official and limited personal
use.
√ The employee has no option on the choice of vehicle.
√ Under Scheme B, eligible employees can avail of a leased car for both official duties as well
as for personal use. For this purpose, the Company has entered into an agreement with a
car lease finance company where the employee will participate in the lease payments. The
vehicle will be assigned to the employee exclusively and at the end of the lease tenure, the
vehicle ownership will belong to the employee.
√ The employee has an option on the choice of vehicle.

√ Full finance is available without any down-payment requirement. The monthly equated
amount includes the following:

o Ex-Showroom cost of the car

o Registration Fees
o Insurance & Road taxes
o Cost of Accessories

4.2. Procedure
√ The process starts with the eligible employee opting for one of the schemes and approaches
the HR Admin team for initiating the procedure.
√ Under Scheme A, HR Admin will forward the requirement to Procurement team, who will set
the vehicle procurement process in motion
√ The procured vehicle will be owned by the Company and treated as an Asset in the books of
accounts.
√ Once the vehicle is procured and allotted to an eligible employee, an internal agreement on
the use, maintenance and safety of the vehicle has to be signed by the employee before the
same is handed over.
√ Under Scheme B, HR Admin will contact the car lease company and based on the
employee’s choice of vehicle, a supplementary agreement will be signed with the employee
for regular use and purchase of the vehicle thereafter at the end of the lease tenure.
√ Based on these documents, employees can take delivery of the car.

√ On receiving the delivery of the car, the employee needs to forward the following docs to the
Admin Department.
o Original Invoice
o Copy of Insurance Cover Note
o Copy of Registration Certificate Book
o Copy of Insurance Policy
√ Admin then intimates the payment schedule included in the Agreement to the HR Admin
Department
√ On receiving the Payment Schedule, the HR Admin Department provides the necessary
inputs to the Payroll Department via the monthly salary input.
√ Any pre-conditions on the lease with the Car Lease Finance Company must be adhered to
by all parties mentioned therein.
√ The Car Lease Finance Company will raise monthly rental bills and send it to the Admin
Department who will forward the same to the Accounts Department for payments.
√ Deferment of installment payments to the leasing company are not allowed under this
scheme
√ The vehicle has to be bought by the employee as per agreed terms at the end of the lease
tenure or in case of foreclosure at the behest of the employee.

4.3. Maintenance / Repairs / Normal Running /

Insurance
The employee will be required to maintain the car in good condition & incur all running costs
including costs of fuel, oils, air, cleaning, parking, etc. as required from time to time. If, as
per agreement, the vehicle has to be handed over to the Car Lease company for periodical
maintenance or repairs, then the employee is required to abide by the same. However, if
maintenance and repairs are not covered under the agreement, employees will undertake to
bear such expenses.

Traffic or parking violations or seizure of the vehicle by authorities for such violations will be
the whole responsibility of the employee.

Any accidents caused due to negligence, carelessness, overspeeding or driving under the
influence of alcohol or drugs will be the whole responsibility of the employee.

4.4. Foreclosure:
√ Premature exiting from the car scheme by returning the car at any point of time is allowed
under the Scheme A. However, under Scheme B, premature exit from the scheme is
allowed only by paying the balance installments, including any foreclosure fees / charges /
penalties, as appropriate. This may include transfer charges of vehicle ownership too.
√ The working of the foreclosure charges would be as agreed with the Car Lease Finance
Company.
√ In case the employee resigns to join a new organization, there is a possibility of assigning
the car to that organization by the Car Lease Finance Company. This will need to be
mutually decided by the Leasing Company and the employee’s new organization for
continuity of the lease.
4.5. Transfers
In case of inter-location transfers within the company, the car leasing company will organize
all the necessary formalities. The concerned employee will be required to contact the HR
Admin Department to initiate necessary processes.

In case of transfers to a subsidiary / affiliate / sister company, the car can be assigned to the
new subsidiary if it also has an agreement with the said Car Lease Finance Company.

The transfer charges will be borne by the company if transfer is company-initiated. It will be
borne by the employee if transfer is employee-initiated.

4.6. Overall Coordination / Clarification /

Suggestions
√ The Car Schemes will be coordinated by the HR Admin Department. The department
shall maintain an MIS pertaining to the scheme across all locations of the Company.
√ All clarifications with regard to the scheme can be obtained from the HR Admin
Department.
 ANNEXURE I
Application to join Company Car Scheme

Employee Name:

Employee id #:

Department:

Designation:

E-Mail Id:

Mobile No:

Date:

To,
HR Administration Department.
Kind Attn: <Name of Admin Person>

Sub: Request for a car under Company Car Lease Scheme

Dear Sir/Madam,

I request you to provide me with a car as per the following details. I have read the rules
governing the scheme and agree to abide by the same and amendments, if any, to the same.

Yours faithfully,

Name and Signature of the employee

 DETAILS OF CAR UNDER COMPANY CAR LEASE SCHEME
Car Make / Model / Color
Petrol / Diesel / EV
Desired Date of Delivery
Option ◻ Option 1 ◻ Option 2 ◻ Option 3
Tenure 3 Yrs 4 Yrs 5 Yrs
Lease Rental pm (from below)
Heads Cost To be Rentalized Cost to be
or paid Upfront Rentalized
Ex-Showroom Cost of Car
Insurance
Registration
Octroi / Other Taxes
Cost of Accessories
Total Cost to be Rentalized
Monthly Lease Rental

ANNEXURE II
(To Be Executed on Stamp Paper)

UNDERTAKING

Name of the Employee : ______________________

Residential Address : _______________________

_______________________

________________________

<Company Name Here>

<Office Address>
Attn: <Name of Admin Person>

SUB: Company Leased Car Scheme

In consideration of your having admitted me to the company's leased car scheme and provided me with
car No.________________ Make __________________, hereinafter called "The Car" with effect from
______________ on terms and conditions of the said scheme, I undertake to the Company as follows :-

1. I have read all terms and conditions of the scheme and I agree to accept and abide by all the terms
and conditions laid down by <Company’s Name> in the Leased Car Scheme and any amendments,
thereof.

2. The car is registered in the name of the Company but shall remain the property of the Car Leasing
Finance Company until expiry of the lease tenure. Thereafter, the vehicle will be transferred and
registered in the employee’s name post all payments and completion of formalities as set forth in the
car lease scheme.

3. In case of any dispute which may arise between the Company and me, the Car Leasing Finance
Company will have the right to repossess the car any time during the leasing period, by forfeiting my
right to claim for any refunds, compensation, ownership or any such proprietary hold over the vehicle.

4. I shall use the car only for my personal and official use. I shall not put the car on hire or for reward
and shall not use the car for any unlawful purpose.

5. In case of my separation from the Company for any reason whatsoever including - but not limited to -
resignation, retirement, VRS, dismissal, etc., I hereby agree to bear the entire foreclosure charges by
way of a separate payment to the Company. I hereby authorize the company to adjust any valid
additional charges from my settlement dues and in case of any shortfall, I shall forthwith make good
the same to the Company.

6. Notwithstanding the aforesaid, I / my legal heirs shall be personally liable to pay to the Company all
amounts due from me under this scheme and to pay the same to you on demand and without demur
and notwithstanding any dispute/ difference that may be subsisting between me/ my legal heirs and
the Company.

7. The agreement shall bind in all respect to heirs, executors, legal representatives and myself. I further
agree that the Company shall have the same rights against my heirs, executors and legal
representatives, as it has against me under this agreement.

8. I understand that on execution of this Undertaking, the monthly lease installment payable to the Car
Leasing Finance Company will be deducted from my annual pay.

9. I understand that once I join this scheme, the revised pay structure will come into effect from the
month in which the car lease period starts and the same shall be applicable throughout the period
that I am part of the scheme.

10. The scheme would be governed by the tax regime as applicable from time to time and any
implications thereof would be to my account.

Yours faithfully,
Signature of the Employee

Name: ___________________________

Place:____________________________

Date: ____________________________

Witness: _________________________

Signature_________________________

Name: ___________________________

Address: _________________________

__________________________
 ANNEXURE III
Authorization Letter to Car Lease Finance Company to make the payment to the Car dealer

Date:

To,
<Lease Finance Company Name>
<Lease Finance Company Address>

Subject: Car for <Employee Name>

Dear Sir/ Madam,

With reference to our leasing arrangement for cars, please find enclosed the proforma invoice dated
___________ raised by <Dealer’s Name>, amounting to ______________. The terms of the transactions
are as follows:

Nature of Asset:

Cost of Asset:

Lease Tenure:

Lease Rentals:

Lease Management Fee:

You are requested to arrange for the insurance and applicable taxes.

You are requested to issue a cheque favoring <Name of Dealer> payable at <Location> for INR
___________ and also forward the necessary documents for registration of the vehicle.

Thanking you,

For <Company Name Here>

Authorized Signatory
 ANNEXURE IV

Letter of Authority issued to Employee to take the delivery of vehicle from the Car dealer

Date: ____________

To,

<Dealer’s Name>

<Dealer’s Address>

SUB: Supply of one _______ Car leased to us by <M/s ABC Finance Limited>

Ref: Your proforma invoice dated ___________

Dear Sir/ Madam,

We hereby authorize <Employee’s Name & Designation> of M/s <Company Name Here>, whose
signature is attested below to collect the ______________ Model which is leased out to us by < Name of
Car Lease Finance Co.>.

All documents signed by <Employee’s Name & Designation> in this regard shall be binding on the
Company.

.........................................(Signature of Employee)

For <Company Name Here>

<Authorised Signatory>
5. Special Circumstance and Exception
Any Deviation to this policy has to be approved by Finance & HR. Any changes to the policy has
to be approved by Legal and Compliance.

6.Non-compliance and Consequence

Violation of this policy is subject to disciplinary action, up to and including termination.
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