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Naveen Kumar v. Vijay Kumar and Ors.

Civil Appeal · 2018 INSC 100Decided 6 Feb 2018
Civil Appeal No. 1427 of 2018
Chief Justice Dipak Misra · Justice A.M. Khanwilkar · Dr. Justice D.Y. Chandrachud

Background

A motor accident in 2009 killed a boy and injured his aunt when a reversing car hit them. The car was registered in the name of the first respondent, who claimed he had already sold it in 2007, after which it allegedly passed through two more owners before reaching the appellant. The Motor Accident Claims Tribunal awarded compensation and held the registered owner jointly liable with the driver, but the Punjab and Haryana High Court overturned this, holding that liability should fall on the last person shown to be in possession (the appellant) rather than the registered owner.

Decision Breakdown

The Supreme Court held that under Section 2(30) of the Motor Vehicles Act, 1988, the person in whose name a vehicle is registered is treated as its "owner" for liability purposes, with only narrow statutory exceptions (minors, and vehicles under hire-purchase/lease/hypothecation). It clarified that the precedents relied on by the High Court (concerning a requisitioned vehicle and a hypothecated vehicle) did not apply to an ordinary unregistered private sale. The Court reasoned that Parliament's purpose in defining "owner" this way was to prevent accident victims from being forced to trace an unregistered chain of informal sales to find someone liable. Since the vehicle remained registered in the first respondent's name and was uninsured at the time of the accident, he was the "owner" liable to pay compensation; the High Court's judgment was set aside and the Tribunal's award restored against the first respondent.

Lesson Learnt

If you sell your vehicle, you must get the registration formally transferred: until that happens, you remain legally the "owner" and can be held liable for accidents the vehicle causes, even if you claim to have handed over possession and documents to a buyer.

Official source (sci.gov.in)View Judgment (PDF)

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