PHOOLGADIINDIA
LEGAL CHHITHI -2020 - VOL 2-MOTOR VEHICLE-WHO IS OWNER (download)
PHOOLGADI INDIA - LEGAL SECTION
LEGAL CHHITHI (चिठ्ठी) –2020/ VOL 2/INSURANCE ACCIDENTAL CLAIM
ACCIDENT, INSURANCE, CLAIM, DENIAL, DISPUTES
In the case of accident, certain questions comes in the mind of the individual and he approaches to the insurer regarding his claim but some time, certain question comes into picture which needs to answered or understood. This judgement can easily assist to the individual how he should take his effort in the matter of vehicles registration and its insurances. Let read out this judgement.
Who is the owner of the vehicle?- the person only who is registered owner of the vehicle.
Who is the insurance claimer in case of accident?- the person who is registered owner of the vehicle, in case of transfer, subject to the Motor vehicle act.
What time period is required to put claim before insurerer?- at the earliest and promptly FIR needs to be registered and intimation to be given to the insurance company.
The FIR was lodged within three days of the accident. In the case of a major accident of the kind as in this case, where the said truck had turned turtle and fallen into a river, slight delay if any, on the part of the traumatized driver to lodge an FIR, cannot defeat the legitimate claim of the Insured. Of course in our view, there was no delay at all in lodging the FIR. In case of a serious accident in course of inter-state transportation of goods, delay of 20 days in lodging a claim is also no delay at all.
Recently, a judgement was passed by the Hon’ble SC in case of CIVIL APPEAL NO. 2632 OF 2020 ( Arising Out of Special Leave Petition (C) No. 20569 of 2016) Surendra Kumar Bhilawe … Appellant versus The New India Assurance Company Limited … Respondent J U D G M E N T Indira Banerjee, J. JUNE 18, 2020 NEW DELHI.
Wherein the insurance company was denying to pay compensation. The insurance company issued to show cause why the claim of the Appellant should not be repudiated, on the allegation that, he had already sold the said truck to a other person on 11.4.2008. It is, however, not in dispute that the Appellant continued to be the registered owner of the said truck, on the date of the accident.
The issue of ownership was challenged and matter passed through three authorities as per below.
- the District Consumer Disputes Redressal Forum, Raipur,
- the Chhattisgarh State Consumer Disputes Redressal Commission Pandri, Raipur (C.G)
- the National Consumers Disputes Redressal Commission, New Delhi
The authorities in serial no 1 & 2, allowed the claim of the appellant in this case but the National Consumers Disputes Redressal Commission, New Delhi rejected the claim. The matter travelled to the Hon’ble Supreme Court. The apex court ruled in favour of the appellant.
THE RELEVANT PROVISIONS OF THE MOTOR VEHICLES ACT
- The National Commission also overlooked other applicable provisions of the Motor Vehicle Act 1988, particularly Sections 39 to 41, 50, 51, 66, 69, 82, 84(g), 86(c), 146, 157, 177 and 192A. 38. Some of the relevant provisions of the Motor Vehicles Act are set out hereinbelow:-
“50. Transfer of ownership-
1) Where the ownership of any motor vehicle registered under this Chapter is transferred- (a) the transferor shall,-
(i) in the case of a vehicle registered within the same State, within fourteen days of the transfer, report the fact of transfer, in such form with such documents and in such manner, as may be prescribed by the Central Government to the registering authority within whose jurisdiction the transfer is to be effected and shall simultaneously send a copy of the said report to the transferee; and
(ii) …… (b) the transferee shall, within thirty days of the transfer, report the transfer to the registering authority within whose jurisdiction he has the residence or place of business where the vehicle is normally kept, as the case may be, and shall forward the certificate of registration to that registering authority together with the prescribed fee and a copy of the report received by him from the transfer of ownership may be entered in the certificate of registration. (3) If the transferor of the transferee fails to report to the registering authority the fact of transfer within the period specified in clause (a) or clause (b) of sub-section (1), as the case may be, or if the person who is required to make an application under sub-section (2) (hereafter in this section referred to as the other person) fails to make such application within the period the period prescribed, the registering authority may, having regard to the circumstances of the case, required the transferor or the transferee, or the other person, as the case may be, to pay, in lieu of any action that may be taken against him under section 177 such amount not exceeding one hundred rupees as may be prescribed under sub-section (5).
Provided that action under section 177 shall be taken against the transferor or the transferee or the other person, as the case may be, where he fails to pay the said amount. xxx xxx xxx
- Necessity for permits- (1) No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him the use of the vehicle in that place in the manner in which the vehicle is being used. xxx xxx xxx
82.Transfer of permit- (1)Save as provided in sub-section (2), a permit shall not be transferable from one person to another except with the permission of the transport authority which granted the permit and shall not, without such permission, operate to confer on any person to whom a vehicle covered by the permit is transferred any right to use that vehicle in the manner authorised by the permit. xxx xxx xxx
- General conditions attaching to all permit The following shall be conditions of every permit- ……………….. (g) that the name and address of the operator shall be painted or otherwise firmly affixed to every vehicle to which the permit relates on the exterior of the body of that vehicle on both sides thereof in a colour or colours vividly contrasting to the colour of the vehicle centered as high as practicable below the window line in bold letters. xxx xxx xxx
- Cancellation and suspension of permits.- (1)The Transport Authority which granted a permit may cancel the permit or may suspend it for such period as it thinks fit- ……………….. (c) if the holder of the permit ceases to own the vehicle covered by the permit, xxx xxx xxx 140. Liability to pay compensation in certain cases on the principle of no fault- (1) Where death or permanent disablement of any person has resulted from an accident arising out of the use of motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or disablement in accordance with the provisions of this section. xxx xxx xxx
- Necessity for insurance against third party risk- (1) No person shall use, except as a passenger, or cause or allow any other person to use, a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that person, as the case may be, a policy of insurance complying with the requirement of this Chapter. xxx xxx xxx
- Transfer of certificate of Insurance-- (1) Where a person in whose favour the certificate of insurance has been issued in accordance with the provisions of this Chapter transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer. (2) The transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the fact of transfer in the certificate of insurance and the policy described in the certificate in his favour and the insurer shall make the necessary changes in the certificate and the policy of insurance in regards to the transfer of insurance. xxx xxx xxx
163A. Special provisions as to payment of compensation on structured formula basis- (1) Notwithstanding anything contained in this Act or in any other law for time being in force or instrument having the force of law, the owner of the motor vehicle or the authorised insurer shall be liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be. xxx xxx xxx
- General provision for punishment of offences- Whoever contravenes any provisions of this Act or of any rule, regulation or notification made thereunder shall, if no penalty is provided for the offence be punishable for the first offence with fine which may extend to one hundered rupees, and for any second or subsequent offence with fine which may extend to three hundred rupees. xxx xxx xxx
192A. Using vehicle without permit- (1) Whoever drives a motor vehicle or causes or allows a motor vehicle to be used in contravention of the provisions of sub-section (1) of section 66 or in contravention of any condition of a permit relating to the route on which or the area in which or the purposes for which the vehicle may be used, shall be punishable for the first offence with a fine which may extend to five thousand rupees and for any subsequent offence with imprisonment which may extend to one year but shall not be less than three months or with fine which may extend to ten thousand rupees but shall not be less than five thousand rupees or with both. Provided that the Court may for reasons to be recorded, impose a lesser punishment.
THE RELEVANT PARA OF THE JUDGEMENT ARE PRODUCED BELOW WITH RESPECT TO THE LAW.
- The judgment of this Court in Complete Insulations Private Limited vs. New Indian Assurance Company Limited(1996) 1 SCC 221 was rendered in the context of Motor Vehicle Act, 1939 which has been repealed and replaced by the Motor Vehicles Act, 1988. As observed in the said judgment itself, under Section 103-A of the old Act, the Insurer had the right to refuse to transfer the certificate of insurance and/or the Insurance policy. However, Section 157 of the Motor Vehicles Act, 1988 introduces a deeming provision whereby the transfer of the certificate of Insurance and the policy of Insurance are deemed to have been made, where the vehicle along with the Insurance policy is transferred by the owner to another person. This provision has taken away the Insurer’s right of refusal to transfer the Policy Certificate of Insurance. which was there under the old Act. The judgment of this Court in Dr. T.V. Jose vs. Chacko P.P. @ Thankachan and Ors. was also rendered in the context of the Motor Vehicles Act of 1939.
- In Pushpa @ Leela And Others vs. Shakuntala and Others(2011) 2 SCC 240, the question before this Court was, whether liability to pay compensation to third parties as determined by the Motor Vehicles Accidents Claims Tribunal in case of an accident, was that of the purchaser of the vehicle alone, or whether the liability of the recorded owner of the vehicle was coextensive, and from the recorded owner it would pass on to the Insurer of the vehicle. This Court found that the person whose name continued in therecords of the registering authority as the owner of the truck was equally liable for payment of the compensation, having regard to the provisions of Section 2(30) read with Section 50 of the Motor Vehicles Act, 1988 and since an insurance policy had been taken out in the name of the recorded owner, he was indemnified and the Insurer would be liable to satisfy the third party claims.
- In Naveen Kumar vs. Vijay Kumar and Others(2018) 3 SCC 1 , a three- Judge Bench of this Court held that in view of the definition of the expression ‘owner’ in Section 2(30) of the Motor Vehicles Act, 1988, it is the person in whose name the motor vehicle stands registered, who, for the purposes of the said Act, would be treated as the owner of the vehicle. Where the registered owner purports 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 his liability as owner.
- The Judgment of this Court in Pushpa @ Leela & Ors. vs. Shakuntala (supra) and Naveen Kumar vs. Vijay Kumar (supra) were rendered in the context of liability to satisfy third party claims and as such distinguishable factually. However, the dictum of this Court that the registered owner continues to remain owner and when the vehicle is Insured in the name of the registered owner, the Insurer would remain liable notwithstanding any transfer, would apply equally in the case of claims made by the insured himself in case of an accident. If the insured continues to remain the owner in law in view of the statutory provisions of the Motor Vehicles Act, 1988 and in particular Section 2(30) thereof, the Insurer cannot evade its liability in case of an accident.
- The FIR was lodged within three days of the accident. In the case of a major accident of the kind as in this case, where the said truck had turned turtle and fallen into a river, slight delay if any, on the part of the traumatized driver to lodge an FIR, cannot defeat the legitimate claim of the Insured. Of course in our view, there was no delay at all in lodging the FIR. In case of a serious accident in course of inter-state transportation of goods, delay of 20 days in lodging a claim is also no delay at all. It is nobody’s case that the claim application filed by the Appellant was time barred. Moreover, the Insurer had, in any case, duly sent its Surveyors/ Assessors to assess the loss. The claim of the Appellant could not have, in this case, been resisted, either on the ground of delay in lodging the FIR, or on the ground of delay in lodging an Accident Information Report, or on the ground of delay in making a claim. 52. In any case, as held by this Court in Om Prakash vs. Reliance General Insurance and Another(2017) 1 SCC 724 delay in intimation of accident, or submission of documents due to unavoidable circumstances, should not bar settlement of genuine claims.
- In view of the definition of ‘owner’ in Section 2(30) of the Motor Vehicles Act, the Appellant remained the owner of the said truck on the date of the accident and the Insurer could not have avoided its liability for the losses suffered by the owner on the ground of transfer of ownership to Mohammad Iliyas Ansari.
- The judgment of this Court in Oriental Insurance vs. Sony Cheriyam(1999) 6 SCC 451 was rendered in the context of liability of an Insurer in terms of the insurance policy and is not attracted in this case, where the claim of the insured has not been rejected on the ground of the same not being covered by the policy of insurance, but on the ground of purported transfer to a third party by entering into a sale agreement.
- We have not dealt with the judgments of the National Commission and/or other Fora under the Consumer Protection Act, 1986, relied upon by the parties, as they are factually distinguishable and are in any case, not precedents binding on this Court. In any case, we have considered and dealt with the submission of the respective parties at length.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Disclaimer
Connect : https://phoolgadi.wordpress.com/ Visit : https://groups.google.com/d/forum/phoolgadiindia
This is private circulation. The contents of this document are solely for information purpose. It does not constitute any legal or non-legal advice or medical/non-medical advice or recommendation on any topic. While due care has been taken in preparing this document, the existence of mistakes and omissions herein is not ruled out. Neither editor/writer nor team of editors nor PHOOLGADI INDIA accepts any liabilities neither for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document nor for any actions taken in reliance thereon. Please take due care and take appropriate legal advice before taking any action by putting reliance on this book/article. Please refer prevailing laws & Case-laws mentioned for better understanding of the matter.