Research › Search › Judgment

J&K High Court · body

2010 DIGILAW 160 (JK)

Javeed Ahamad Shah v. Parveena Banoo

2010-03-25

GH.HASNAIN MASSODI

body2010
1. Where does the liability to pay compensation under Section 166 Motor Vehicles Act, lie when the offending vehicle has changed hands without the change in ownership, getting reflected in the records maintained by the Regional Transport Officers, is the question that looks for an answer in the present appeal. 2. The facts are brief and simple. Shri Bashir Ahmad Zargar father of respondents 1, 3, 4 and 5 and husband of respondent No. 2 (now deleted from array of respondents) on 26th May 2000, met a fatal accident at Main Bazar Awantipora when he was hit by an Auto Rikshaw bearing registration No. JK-13-0776 driven rashly and negligently by Gulzar Ahmad Dar Son of Gani Dar Resident of Dangerpora Pandgampora Tehsil and district Pulwama. The victim sustained multiple serious injuries, and was rushed to the SKIMS Soura, where he breathed his last. The respondents 1 to 4, on 14.8.2000 brought a claim petition under Section 166 Motor Vehicles Act, against the driver of the offending vehicle, its registered owner as also one Abdul Ahad Bhat Son of Mohamad Kamal Bhat resident Padgampora/respondent No.6 to whom the registered owner was claimed to have sold the offending vehicle some time before the accident. The claim petition was allowed on 26.2.2007 and an amount of Rs. 5.75 lacs determined as just compensation, to be paid by the registered owner and the prospective owner in equal proportion with simple interests at the rate of 6% from the date of institution of petition till realization of compensation amount. The interim award of Rs.50,000/- deposited by the registered owner was directed to be adjusted towards the share of compensation with which the registered owner was burdened. 3. The award is assailed through medium of instant Civil Miscellaneous Appeal by the registered owner, on the grounds that the award is based on mis-appreciation of evidence, in as much as the Learned Tribunal made the award oblivious to the admission of the respondent No.6 that the appellant had sold to him the offending vehicle much before the accident. It is insisted that there was no reason to make registered owner liable to pay compensation if any, payable to the claimants. It is insisted that there was no reason to make registered owner liable to pay compensation if any, payable to the claimants. It is pleaded that the appellant having sold the offending vehicle before the accident in question, the appellant had no supervision and control over the driver of the offending vehicle and thus could not be held vicariously responsible for the acts of the driver. It is further pleaded that there was no evidence before the Tribunal that the driver of the offending vehicle was driving the vehicle rashly and negligently at the time of accident and the Tribunal thus was not justified in burdening the appellant and respondent No.6 with liability to pay the compensation to the respondents 1 to 4 -- claimants in the claim petition. 4. Heard and considered. The liability of an owner of the offending vehicle to pay compensation to the victim of the vehicular accident or representatives of the deceased victim is stems from the principle of vicarious liability. The doctrine of vicarious liability is based on the maxim, Qiu facit per allum facit per se, which means "he who does an act through another, is deemed in law to do it himself". The maxim "Respondent superior" which means "let the superior be liable" is also relied upon to justify shifting of the liability from the servant (wrong doer) to his master (superior). The liability is put on the superior or master for expediency and also as a dictate of public policy. Firstly, if the liability to pay compensation is imposed on the servant, the victim or his legal representatives may not be able to collect the compensation for the injury/loss suffered. Secondly, the superior (master) would have no reason or incentive to be careful in selecting his servants. It follows, that if a person, instead of doing an act himself, chooses to have the act done through some other person, he must do so at his own risk and cost. It is for the person who wants to do an act through some other person to take pains to choose the best person through whom he should so act. It is for the person who wants to do an act through some other person to take pains to choose the best person through whom he should so act. If owner of a vehicle either for his convenience or for any other reason decides not to drive his vehicle but chooses to get the vehicle driven by some other persons, it is at his risk and responsibility and it is for him to choose an expert driver who does not drive the vehicle rashly and negligently. If the driver of the vehicle commits a wrong or acts negligently, it is the owner who has to pay the compensation to the victim for the negligence of the driver. The owner of the vehicle is saddled with a legal obligation to pay compensation to the victim of a vehicular accident, because it is who choses or appoints the driver of the offending vehicle, has supervision and control over him and there is a master servant relationship between the owner and driver of the offending vehicle. It is pertinent to point out that the vicarious liability of the owner arises only if the act is done in the course of employment i.e. the wrongful act, is authorized by the master or the wrongful accident is result of the wrongful or unauthorized mode of doing some act authorized by the master. If the person on whom liability to pay the compensation is sought to be put and the driver of the vehicle not have the master servant relationship, such person cannot be asked to pay the compensation to the victim of vehicular accident or representatives of the victim in the event of his death. It is only after the master-servant relationship is established between the person saddled with the responsibility to pay compensation and the driver of the offending vehicle, that the question arises whether insurer agreed to indemnify the master/owner and thus is to be asked to pay the compensation on behalf of the owner. In case the master/ owner is not held liable to pay any compensation, there is no question to fasten the insurer with the obligation to pay the compensation. 5. Having noticed the underlying principles of liability of the owner of an offending vehicle, to pay compensation to the victim of the vehicular accident caused by its driver, the attention is now to shift to the case in hand. 5. Having noticed the underlying principles of liability of the owner of an offending vehicle, to pay compensation to the victim of the vehicular accident caused by its driver, the attention is now to shift to the case in hand. 6. Section 39 Motor Vehicles Act, 1988 makes it mandatory for owner of motor vehicle to get the same registered in accordance with the Act. Upon the said registration, a certificate of registration known as "ownership" in common parlance is to be issued by the authority under the Act, with whom the motor vehicle is to be registered. In the event the registered owner intends to sell the vehicle such registered owner as also the person(s) to whom the vehicle is intended to be sold, are to report proposed sale to the Competent Authority and make a request for transfer of the vehicle from the name of registered owner to the name of transferee. The authority under the Act, after satisfying itself regarding genuineness of the transfer is to order transfer of the vehicle and cause an entry recorded to this effect in Certificate of Registration. However in practice the sale of a vehicle is effected by delivery of the vehicle to the transferee and the sale is evidenced by either receipt of the sale price or a power of attorney or affidavits sworn by the transferor and transferee. The sale of the vehicle does not get reflected in the records maintained by the authority under Act, an no entries evidencing the sale of the vehicle are made in the certificate of registration. In some cases the motor vehicle is sold even more than once, without corresponding entries in the Certificates of Registration. The question that calls for an answer is, in case the vehicle meet an accident who is to pay compensation to the victim or representative of the victim in the event victim does not survive accident, the registered owner or the person who actually owns and has control over the vehicle on the date of accident. In case offending vehicle has the insurance cover, no difficulty would arise, in as much as without entering into controversy as regards liability of the registered owner and transferee, the Insurance company is to be saddled with the obligation to pay compensation. 7. In case offending vehicle has the insurance cover, no difficulty would arise, in as much as without entering into controversy as regards liability of the registered owner and transferee, the Insurance company is to be saddled with the obligation to pay compensation. 7. In Rajasthan State Road Transport Corporation v. Kailash Nath Kothari and Others etc, 1997 STPL (LE) 23797 (SC) a question, like one raised in the present appeal fell for consideration of the Supreme Court, The Supreme Court held as under:- The definition of owner under Section 2 (19) of the Act is not exhaustive. It has, therefore to be construed, in a wider sense, in the facts and circumstances of a given case. The expression owner must include, in a given case, the person who has the actual possession and control of the vehicle and under whose directions and commands the driver is obliged to operate the bus. To confine the meaning of "owner" to the registered owner only would in a case where the vehicle is in the actual possession and control of the hirer, not be proper for the purpose of fastening of liability in case of an accident. The liability of the "owner" is vicarious for the tort committed by its employee during the course of his employment and it would be a question of fact in each case as to on whom can vicarious liability be fastened in the case of an accident. 8. The offending vehicle, in the reported case was handed over by the owner to the appellant as the owner had not a route permit, to ply the Bus on a particular route. The driver though an employee of the owner was at the time of accident under the control and command of the appellant. The Supreme Court in the facts of the case held the appellant to be vicariously liable for the tort committed by the driver while plying the Bus under contract of the appellant. The court further observed:- The general proposition of law and the presumption arising there from that an employer, that is the person who has the right to hire and fire the employee, is generally responsible vicariously for the tort committed by the concerned employee during the course of his employment and within the scope of his authority, is a rebuttable presumption. If the original employer is able to establish that when the servant was lent, the effective control over him was also transferred to the hirer, the original owner can avoid his liability and the temporary employer or the hirer, as the case may be, must be held vicariously liable for the tort committed by the concerned employee in the course of his employment while under the command and control of the hirer notwithstanding the fact that the driver would continue to be on the pay roll of the original owner. 9. The question again arose in Dr. T.V. Jose v. Chacko P.O. Alias Thankachan and Others-2001 STPL (LE) 30278 SC where the appellant was registered owner of offending vehicle that caused the vehicular accident on 10th April 1987. The legal representatives of the victim filed claim petition before the MACT. The appellant pleaded before the Tribunal that the appellant had sold the vehicle on 17th May 1986 to another person who had thereafter sold the vehicle to yet another persons and that the offending vehicle had been thereafter sold to two other persons, one after another and that on the date of accident the 4th transferee was owner of the offending vehicle, though the vehicle continued to be registered in ownership of the appellant i.e. the original owner. The Tribunal held the registered owner i.e. appellant before Supreme Court, not to be liable and fastened liability to pay compensation on the driver found to have been rashly and negligently driving the vehicle at the time of accident. On appeal the High Court held that; "all the documents disclosed the appellant to be the owner of the car" and as such registered owner/appellant was liable to pay compensation to the claimants. The Supreme Court while recording disagreement with the High Court that the, appellant, continued to be the owner as his name had not been changed in the records of RTO, observed; "there can be transfer of title by payment of consideration and delivery of the car". 10. The Court while observing that evidence on the record revealed that the ownership of the car had been transferred, held that ; "However, the Appellant still continued to remain liable to third parties as his name continued in records of RTO as owner. The Appellant could not escape that liability, by merely joining Mr. Roy Thomas in these Appeals. Mr. The Court while observing that evidence on the record revealed that the ownership of the car had been transferred, held that ; "However, the Appellant still continued to remain liable to third parties as his name continued in records of RTO as owner. The Appellant could not escape that liability, by merely joining Mr. Roy Thomas in these Appeals. Mr. Roy Thomas was not a party either before MACT or the High Court. In these appeals we can not and will not go into the question of inter-se liability between the Appellant and Mr. Roy Thomas. It will be for the Appellant to adopt appropriate proceedings, against Mr. Roy Thomas if, in law, he is entitled to do so". 11. In P.P. Mohamad v. K. Rajappan and others 2003 ACJ 1595 the MACT held the registered owner of the offending vehicle involved in vehicular accident that resulted in injury to the respondent No.1, not liable to pay the compensation to the respondent No. 1 on the ground that the registered owner of the offending vehicle i.e. appellant had transferred the offending vehicle before the date of accident to respondent No. 4 who in turn had transferred the vehicle to respondent No. 5 and that the driver of the offending vehicle claimed to be an employee of respondent No. 5 and not the appellant. The Tribunal fastened the liability on the respondent No. 5 and driver of the offending vehicle. The High court in appeal held that the appellant-registered owner, was alone liable to pay compensation because the appellants name continued to be recorded as owner of the vehicle in records of the office of RTO. The court spelt out the question before the court, in back ground of the controversy involved in following words: "question before this court is whether by reason of the fact that the vehicle has been transferred to the respondent No. 4 and thereafter to the respondent No. 5 , the appellant got absolved from liability to third person who was injured. 12. The court referring to law laid down in Dr. T.V. Jose (supra) held : "we are in agreement that the view expressed there, merely because the vehicle was transferred does not mean that the appellant stands absolved of his liability to third person. So long as his name continued in RTO records, he remain liable to pay 3rd person. 13. The court referring to law laid down in Dr. T.V. Jose (supra) held : "we are in agreement that the view expressed there, merely because the vehicle was transferred does not mean that the appellant stands absolved of his liability to third person. So long as his name continued in RTO records, he remain liable to pay 3rd person. 13. The court further held that: "The person who is actually in possession of the vehicle would be liable to pay the compensation." 14. The Court referring to Rajasthan Road Transport Corporations case (supra) held that the question whether the original owner gets absolved of his liability to the third party was not before the Court. The respondent No. 4 (owner of the intervening period) was held not to be liable as neither he was registered owner, nor he was having the control over the vehicle. The Court held that the appellant as the person, in whose name the registration continued remained liable to third persons. However, the person, "actually in possession also would be liable". 15. From the law laid down in above referred reported cases it emerges that the registered owner of offending vehicle involved in a vehicular accident continues to remain liable to pay compensation to the victims of the accident or the legal representative(s) of the victim in case victim dies, in the accident, notwithstanding the vehicle having been transferred by the registered owner to any other person. The transferee of the vehicle who is in actual possession and has control over the vehicle shall also be liable to pay the compensation. However, it is the registered owner only who shall be liable to pay the compensation to the third party or the claimant and such registered owner may in turn recover the compensation determined by the Tribunal from the person in possession and having control of the vehicle. It needs no emphasis, that law (Section 35 Motor Vehicles Act) insist on registration of vehicle with the prescribed authority, and name of the owner entered in the certificate of registration. It prohibits plying of the vehicle in a public place without its registration so that there is no ambiguity and uncertainty about the ownership of the vehicle and in case of any mishap, there is no confusion as regards identity of the person responsible to third party. It prohibits plying of the vehicle in a public place without its registration so that there is no ambiguity and uncertainty about the ownership of the vehicle and in case of any mishap, there is no confusion as regards identity of the person responsible to third party. It is pertinent to point out that the Section 39 Motor Vehicle Act, does not prohibit acquisition or purchase of the motor vehicle, what it prohibits is plying of motor vehicle in a public place. The requirements of registration of the motor vehicle and incorporation of name of the owner in certificate of registration is thus not without a purpose. One of the objects sought to be achieved apart from identity of a person liable to pay taxes /fee in respect of the vehicle is to be clear about the person who is to be held responsible in case the vehicle causes an accident resulting in loss to life and property. In the circumstances, both for the convenience and also as a public policy imperative the registered owner is be held liable to pay compensation to the victim of an accident or his legal representatives in case the victim does not survive the accident. In case the claimants in a petition under Section 166 Motor Vehicle Act, are asked to chase the person who is in possession and control of the offending vehicle, it would become impossible for the claimants to get the compensation determined and recover the compensation. As in such a case every person said to be in possession and control of the vehicle would come up with the argument that he had sold the vehicle to one and other person and buck would continue to pass from person to person. In the circumstances it is the registered owner of a vehicle who notwithstanding the developments subsequent to his being recorded as registered owner of the vehicle continues to be liable to pay compensation to the victim or his legal representatives. In the circumstances it is the registered owner of a vehicle who notwithstanding the developments subsequent to his being recorded as registered owner of the vehicle continues to be liable to pay compensation to the victim or his legal representatives. It is for the registered owner to prove convincingly during trial of claim petition that co-respondent in the claim petition was liable to pay compensation because of his having acquired ownership of the vehicle or after paying the compensation to the claimants before the Tribunal, institute appropriate proceedings for recovery of the compensation so paid from person who according to him has been as transferee in possession and control of the offending vehicle. However, the base-line remains that, it is registered owner who is to pay the compensation to the claims in a claim petition. 16. In the present case the Tribunal has apportioned compensation amount equally between the registered owner and the transferee in possession and control of the offending vehicle. The Tribunal after having arrived at the conclusion that the registered owner (respondent No. 2) had sold the vehicle much before the date of accident to the respondent No. 3 and that it was respondent No. 3 who was on the date of accident in possession and control of the offending vehicle, ought not to have burdened the registered owner -appellant herein with the liability to pay compensation to the respondents 1 to 4. The Tribunal has interpreted erroneously observations by the made of Supreme Court in P.P. Mohamad v. K. Rajappan and others 2003 ACJ 1595, Rajasthan State Road Transport Corporation v. Kailash Nath Kothari and Others etc, 1997 STPL (LE) 23797 (SC). 17. The law does not lay down that the compensation determined under Section 168 Motor Vehicle Act, is to be shared by or apportioned between the registered owner and transferee of the vehicle or having possession and control of the vehicle on the date of accident. The Tribunal has expressed helplessness that "the apex court has not stated or fixed the proportion of liability of the registered owner and the person in actual possession of the offending vehicle after its sale". The Tribunal has expressed helplessness that "the apex court has not stated or fixed the proportion of liability of the registered owner and the person in actual possession of the offending vehicle after its sale". The Tribunal has misdirected itself by looking for guidelines to determine the portion of the compensation amount to be paid by the registered owner and the portion of the compensation amount to be paid by the person in actual possession and control of the vehicle on the date of the accident. The principle of law laid down by Supreme Court is that while it is the registered owner who is liable to pay the compensation to the victims or his legal representative(s), the liability of a person in possession and control of the vehicle on the date of accident does not get extinguished and such person is responsible to pay the compensation determined by the court to the registered owner if registered owner has paid the compensation to the claimants or if the registered owner during trial of claim petition under Section 166 Motor Vehicles Act, has been able to prove that such person was in possession and control of the offending vehicle on the date of accident. To hold that the registered owner, even where it is proved that the registered owner had sold the offending vehicle much before the accident is responsible to pay the compensation or any part thereof for the wrong committed by the driver, appointed by the purchaser, would amount to violation of the conceptual framework of the doctrine vicarious liability. The registered owner in such a case, neither appoints the driver nor supervises his duty and work and no master servant relationship exists between the registered employer and the driver. However, in the present case the accident has taken place on 26.5.2000 i.e. about ten years back. The claim petition has been allowed about three years back. It would not be just, fair and proper to ask the claimants to go for next round of litigation after a such long delay. The appellant has already deposited a portion of the awarded amount which is released in favour of the respondents 1 to 4, the claimants have been given liberty to seek execution of the award. It would not be just, fair and proper to ask the claimants to go for next round of litigation after a such long delay. The appellant has already deposited a portion of the awarded amount which is released in favour of the respondents 1 to 4, the claimants have been given liberty to seek execution of the award. In the circumstances the appellant is held to be at liberty to initiate appropriate proceedings, if so advised for recovery of the portion of the award (one half of the award amount of Rs. 5.75 lacs) along with interest that has accrued thereon from the respondent No. 3 namely Abdul Ahad Bhat held in possession and control of the offending vehicle on the date of the accident, after the appellant pays the aforesaid amount to the claimants/respondent No. 2 to 4. The appeal is disposed of accordingly.