Sec. 2. (a) Before issuing a certificate of inspection and registration for a passenger boat, the department shall have the boat, including all motors, machinery, and equipment, thoroughly and carefully inspected by a competent person.
(b) If the department finds that:
(1) the boat, including motors, machinery, and equipment, is:
(A) of a suitable design and construction for the service in which the boat is or is to be employed; and
(B) in a good, safe, and sound operating condition and state of repair that warrants the belief that the boat can be operated with safety in the service;
(2) the boat, including motors, machinery, and equipment, is in compliance with this article and the rules adopted under this article; and
(3) property tax under IC 6-1.1 is not owed on the boat, as evidenced by the tax receipt for payment from the appropriate county treasurer;
the department shall register the boat and issue a certificate.
(c) If the department does not find the conditions in subsection (b), the department shall immediately notify the owner of the boat why the boat fails to meet the requirements.