(1) If any mechanically propelled inland vessel registered under this Act is declared missing, destroyed, lost, abandoned or has been rendered permanently unfit for service or destined for scrapping or dismantling or sold abroad; the owner of the vessel shall, within such time as may be prescribed by the Central Government, report the fact to the Registrar of Inland Vessels of the place where the vessel is registered and shall also forward to that authority, along with the report, the certificate of registration of the vessel and thereupon such Registrar of Inland Vessels shall have the certificate of registration cancelled.
(2) Any Registrar of Inland Vessels may at any time require that any mechanically propelled inland vessel within the local limits of his jurisdiction may be inspected by such designated authority as the State Government may, by general or special order, appoint in this behalf and, if as a result of such inspection, such Registrar of Inland Vessels is satisfied that the vessel is in such a condition that it is not fit to ply in any inland water, the Registrar of Inland Vessels may, after giving the owner of the vessel an opportunity of being heard, cancel the registration of the vessel and require the owner thereof to surrender forthwith to him, the certificate of registration in respect of that vessel, if it has not already been so surrendered.