2018 (2) TMI 2050 - SC - Indian Laws

Transfer of motor vehicle - owner and possession of vehicle with whom - allegation of road accident by the vehicle - succession of transfers - HELD THAT - In view of the definition of the expression owner in Section 2(30) it is the person in whose name the motor vehicle stands registered who for the purposes of the Act would be treated as the owner . However where a person is a minor the guardian of the minor would be treated as the owner. Where a motor vehicle is subject to an agreement of hire purchase lease or hypothecation the person in possession of the vehicle under that agreement is treated as the owner. In a situation such as the present where the registered owner has purported to transfer the vehicle but continues to be reflected in the records of the registering authority as the owner of the vehicle he would not stand absolved of liability. Parliament has consciously introduced the definition of the expression owner in Section 2(30) making a departure from the provisions of Section 2(19) in the earlier Act of 1939. 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. Admittedly the vehicle was uninsured. The submission of the Petitioner is that a failure to intimate the transfer will only result in a fine Under Section 50(3) but will not invalidate the transfer of the vehicle - for the purposes of the Act the person whose name is reflected in the records of the registering authority is the owner. The owner within the meaning of Section 2(30) is liable to compensate. The mandate of the law must be fulfilled. The liability to compensate the claimants will stand fastened upon the First Respondent - Appeal allowed.

Summary

Issues Involved:
1. Determination of liability for compensation in a motor vehicle accident.
2. Interpretation of the term "owner" under Section 2(30) of the Motor Vehicles Act, 1988.
3. Validity of successive transfers of a motor vehicle without updating the registration certificate.
4. Applicability of precedents set by previous Supreme Court judgments.

Detailed Analysis:

1. Determination of Liability for Compensation:
The case revolves around an accident that occurred on 27 May 2009, involving a Maruti-800 vehicle. The Motor Accident Claims Tribunal awarded compensation to the victims, holding the First Respondent (registered owner) jointly and severally liable with the driver. The vehicle was uninsured at the time of the accident. The High Court reversed this decision, placing liability solely on the Appellant, the last admitted owner. This judgment was contested in the Supreme Court.

2. Interpretation of "Owner" under Section 2(30) of the Motor Vehicles Act, 1988:
Section 2(30) defines "owner" as the person in whose name the vehicle is registered, with exceptions for minors and vehicles under hire purchase, lease, or hypothecation agreements. The Supreme Court emphasized that the registered owner is deemed the owner for liability purposes, even if the vehicle has been sold but the registration has not been updated. This interpretation aims to prevent uncertainty for accident victims and their legal heirs regarding who is liable for compensation.

3. Validity of Successive Transfers Without Updating Registration:
The Tribunal noted that the registration certificate still listed the First Respondent as the owner. Despite claims of multiple transfers, the Supreme Court held that the registered owner remains liable unless the registration is updated. This stance is supported by the legislative intent to protect accident victims from the complexities of tracing multiple unregistered transfers.

4. Applicability of Precedents:
The High Court relied on previous judgments, including *HDFC Bank Limited v. Reshma* and *Purnya Kala Devi v. State of Assam*. However, the Supreme Court clarified that these cases involved specific circumstances like hypothecation agreements and state requisition, which do not absolve the registered owner of liability in general scenarios. The Court referenced *Pushpa alias Leela v. Shakuntala*, which affirmed that the registered owner remains liable if the registration is not updated post-sale.

Conclusion:
The Supreme Court concluded that the First Respondent, as the registered owner, is liable for compensation. The judgment of the High Court was set aside, reinstating the Tribunal's decision. The Court underscored that the legislative framework aims to ensure that victims are not left in uncertainty regarding the liable party. The appeal was allowed, directing the First Respondent to compensate the claimants, with no order as to costs.