Motor Vehicles Act] Person In Whose Name Vehicle Stands Registered On The Date Of Accident To Be Treated As Owner: SC
Motor Vehicles Act: Person in Whose Name Vehicle Stands Registered on the Date of Accident to be Treated as Owner
1. Introduction
Under the Motor Vehicles Act, 1988, ownership of a vehicle is a key factor in determining liability and responsibility in motor accident claims, enforcement of insurance policies, and other legal matters.
The Supreme Court has consistently held that:
The person in whose name the vehicle is registered on the date of the accident shall be treated as the owner of the vehicle for the purposes of the Motor Vehicles Act.
This principle is crucial because the owner is typically liable for compensation claims arising out of accidents involving the vehicle.
2. Statutory Provisions
Section 2(34) of the Motor Vehicles Act, 1988
Defines “owner” as:
“owner”, in relation to a motor vehicle, means a person in whose name the vehicle is registered, and includes —
the person to whom the certificate of registration of the vehicle is delivered during the validity thereof; and
where a vehicle stands in the name of a person who is deemed to be the owner of the vehicle under the provisions of this Act, such person.
Implication:
The person in whose name the registration certificate (RC) is issued and valid on the date of accident is the legal owner.
Transfer of ownership must be reflected in the RC to be effective against third parties, including victims.
3. Why is this Principle Important?
Liability for compensation: Owner is primarily responsible for payment.
Insurance claims: Insurance companies settle claims based on the ownership.
Avoids ambiguity: Provides legal clarity about responsibility.
Protects innocent third parties: Avoids disputes about ownership in accident claims.
4. Leading Supreme Court Case Law
4.1. Natraj Studios (P) Ltd. v. Navrang Studios (P) Ltd., AIR 1959 SC 629
Held that registration is the prima facie evidence of ownership.
Until the registration is changed, the registered person is presumed the owner.
4.2. General Manager, Kerala State Road Transport Corporation v. Susamma Thomas (1994)
(1994) 3 SCC 700
The Supreme Court held that the owner of the vehicle is the person whose name is on the registration certificate at the time of the accident.
The Court emphasized that ownership is a question of fact, primarily decided by registration details.
Liability under the Motor Vehicles Act depends on ownership as per the registration records.
4.3. National Insurance Co. Ltd. v. Swaran Singh (2004)
(2004) 6 SCC 297
Held that the person in whose name the vehicle is registered on the date of the accident is liable as the owner.
The insurer is liable to pay compensation to the victim on the basis of ownership.
Emphasized that mere sale or transfer without updating registration does not absolve previous owner.
4.4. New India Assurance Co. Ltd. v. Ramdeo (2012)
(2012) 6 SCC 528
The Court reaffirmed that the owner on record as per the registration certificate on the date of accident is liable.
The transfer of ownership without formal registration is ineffective in law against third parties.
4.5. National Insurance Co. Ltd. v. Balakrishnan (2013)
(2013) 6 SCC 687
Clarified that in the absence of change of ownership in RC, the registered owner alone can be held liable for payment of compensation.
5. Practical Implications
Vehicle buyers must update RC promptly to avoid future liabilities.
Insurance companies rely on RC records to determine liability.
If accident happens before transfer of ownership is recorded, the seller remains the owner in the eyes of law.
Courts will hold the registered owner liable even if the vehicle was sold but the registration was not updated.
6. Exception & Additional Points
If the vehicle is stolen or used without the owner's permission, the owner may not be liable.
In such cases, driver or insurer’s liability may be examined separately.
However, for the purpose of claims under the MV Act, registered ownership is the prime factor.
7. Conclusion
The Supreme Court has firmly established that for the purpose of the Motor Vehicles Act, the person in whose name the vehicle is registered on the date of the accident is the legal owner and liable. This principle ensures clarity and protects victims seeking compensation. All transfers of ownership must be legally registered to effectively shift liability.
RELATED Blog
0 comments