Motor Accident Claim: If The Transfer Of Vehicle Is Not Registered With Authority Original Owner Is Liable [Read Judgment]

A claimant for compensation ought not to be burdened with following a trail of successive transfers, which are not registered with the registering authority, the bench observed.

The Supreme Court, in Naveen Kumar v Vijay Kumar, has held that the expression ‘owner’ for the purpose of Motor Vehicles Act is the person in whose name the motor vehicle stands registered.

The bench headed by the Chief Justice of India Dipak Misra observed that the registered owner, who has purported to transfer the vehicle but continues to be reflected in the records of the registering authority as the owner of the vehicle, would not stand absolved of liability.

The vehicle involved in the accident, in this case, had passed several hands. When the claim was lodged, following an accident, the parties claimed that they had sold the vehicle to another person. As the vehicle was uninsured, the tribunal held that the owner as per records of registering authority is jointly and severally liable together with the driver of the vehicle.

However, on appeal, the high court set aside the findings of tribunal, holding that there was no justification for the tribunal to pass an award against the registered owner when there was evidence that he had transferred the vehicle. The last ‘owner’ was saddled with the liability and he approached the apex court.

Referring to relevant provisions of the Motor Vehicles Act, the bench said: “The Act of 1988 has provided in the first part of Section 2(30) that the owner would be the person 6 in whose name the motor vehicle stands registered. Where such a person is a minor the guardian of the minor would be the owner. In relation to a motor vehicle which is the subject of an agreement of hire purchase, lease or hypothecation, the person in possession of the vehicle under that agreement would be the owner.”

The bench said the judgment in Purnya Kala Devi v State of Assam (a decision relied on by the high court) does not hold that a person who transfers the vehicle to another but continues to be the registered owner under Section 2(30) in the records of the registering authority is absolved of liability. “The situation which arose before the court in that case must be borne in mind because it was in the context of a compulsory act of requisitioning by the state that this Court held, by analogy of reasoning, that the registered owner was not liable,” the bench observed.

It further observed: “The principle underlying the provisions of Section 2(30) is that the victim of a motor accident or, in the case of a death, the legal heirs of the deceased victim should not be left in a state of uncertainty. A claimant for compensation ought not to be burdened with following a trail of successive transfers, which are not registered with the registering authority. To hold otherwise would be to defeat the salutary object and purpose of the Act. Hence, the interpretation to be placed must facilitate the fulfilment of the object of the law. In the present case, the First respondent was the ‘owner’ of the vehicle involved in the accident within the meaning of Section 2(30). The liability to pay compensation stands fastened upon him.”