Who is “Owner” for making payment of Compensation

Who is “Owner” for making payment of Compensation

By: Rajesh K. Sharma, Advocate (LinkedIn)

Supreme Court of India Expands Definition of 'Owner' Under Motor Vehicles Act for Tortious Liability

The Supreme Court's observation in the Vaibhav Jain v. Hindustan Motors Pvt. Ltd. case expands the interpretation of "owner" under Section 2(30) of the Motor Vehicles Act, 1988 (MV Act) in the context of fixing tortious liability for motor vehicle accidents.

Section 2(30) of the MV Act defines "owner" as a person in whose name the vehicle is registered, or in cases where the registered owner has transferred possession, the person who has possession or control of the vehicle. The court, in this judgment, clarified that the definition is not restricted solely to these categories, and in certain situations, the term "owner" can be applied more broadly to include a person who has command or control over the vehicle at the time of an accident. This expanded interpretation is significant in cases where determining tortious liability for compensation is at issue.

In the case at hand, the Supreme Court was reviewing a civil appeal arising from a judgment of the Chhattisgarh High Court, which had enhanced the compensation awarded to the claimant and dismissed the dealer's appeal. The two-Judge Bench, comprising Justice J.B. Pardiwala and Justice Manoj Misra, emphasized that tortious liability may be attributed to a person who is effectively in control of the vehicle, even if they are not technically the registered owner.

This ruling is notable because it broadens the scope of who can be held liable for motor vehicle accidents, potentially holding dealers or other individuals in control of a vehicle responsible for compensating victims. The court analyzed whether, at the time of the accident, the vehicle was under the control of the dealer (the appellant), thus implying that the dealer could be considered the "owner" for the purposes of liability.

In essence, the decision underscores that the statutory definition of "owner" in the MV Act is flexible and can be expanded depending on the facts of the case, with the focus being on who had command and control of the vehicle at the time of the accident. This broader interpretation ensures that individuals who exercise effective control over a vehicle cannot evade responsibility simply because they are not the registered owner, which is crucial for victims seeking compensation.