If you have travelled on Indian highways, you may have noticed something interesting. A private bus could be in service in Tamil Nadu, Gujarat, Maharashtra, Telangana, or Delhi.

But have you noticed why most private bus operators use registration numbers from Bihar, Nagaland, and Arunachal Pradesh?

Lower vehicle-related costs, particularly taxes and permit costs, are the primary reason why most private bus operators are using registration numbers from these states.

But it is important to note that the Government of India does not say that “most” private buses in India are registered in these three states only. 

So, explore this article in detail.

Indian Vehicle Number Plate Code: All States & UTs

Why Do Most Private Bus Operators Use Registration Numbers from Bihar, Nagaland, and Arunachal Pradesh?

Most private bus operators use registration numbers from Bihar, Nagaland, and Arunachal Pradesh for the following reasons:

• Vehicle purchase

• Registration

• Road tax

• Permit

• Fitness certificate

• Insurance

• Maintenance

• Driver and staff

• Other government charges

All these above are costing less in these three states compared to all other states. That’s why these three states are used most for the registration of the private buses.

Lower Tax and Registration Cost

This is one of the main reason. The taxes levied on motor vehicles vary from state to state. Each state has its own taxation system.

The Bihar Government, for instance, has gotten a different tax formula for transport vehicles such as buses, which is based on the number of seats in the bus and the type of bus.

The registration and maintenance fees for commercial vehicles, therefore, may vary across states.

Permit System Is Also Important

Registration does not imply route availability of a bus.

The right permit also must be obtained for a bus.

The Government of Nagaland's Transport Department has highlighted that it can provide base permit to passenger vehicles for inter-State permit and an All India Tourist Permit, subject to necessary conditions, with the State Transport Authority.

The Central Government's All India Tourist Vehicles (Authorisation or Permit) Rules, 2021 also lays down the legislative framework for operation of tourist vehicles with regard to All India authorisation or permit.

So, a bus with an NL number plate may be observed in another state if it is legally permitted to do so.

All India Tourist Permit Makes Interstate Travel Easier

Tourist buses often travel long distances.

For example:

Bengaluru → Hyderabad → Nagpur → Delhi

or

Chennai → Bengaluru → Pune → Mumbai

Qualifying tourist cars are eligible for the All India Tourist Vehicle permit system instead of a fresh permit for each small movement.

All India authorisation is granted to tourist vehicle operators as laid out in the Central Government rules 2021, and the rules regarding the vehicle, the road tax and the road tax fee are laid down. 

Why Would an Operator Choose Another State?

These factors can make a particular state attractive to a bus operator.

So, Many private bus operators are associated with Bihar, Nagaland and Arunachal Pradesh registrations because differences in state taxes, registration costs, permit systems and other business expenses can make some states financially attractive, while All India Tourist Permits can allow eligible buses to operate across state borders.

Note: The popular claim that “most private bus operators register in Bihar, Nagaland and Arunachal Pradesh to save tax” is a commonly discussed explanation, but it should not be presented as an official government statistic unless supported by official registration data.