Judicial Interpretation

The key judicial interpretation, found in paragraphs 19-20, is that the ‘owner’ of a vehicle is not limited to the categories specified in Section 2(30) of the Motor Vehicles Act. If the context requires, even a person who has command or control of the vehicle could be treated as its owner for fixing tortious liability for payment of compensation.

Court’s View

The Supreme Court held that M/s. Hindustan Motors, being the manufacturer and owner of the vehicle, and having control over it through its employees at the time of the accident, is liable for the compensation. The dealer (Vaibhav Jain) cannot be held liable as an owner. (Paragraphs 22-23)

Conclusion

The appeal was partially allowed. The Court concluded that apart from the driver, M/s. Hindustan Motors alone was liable for the compensation awarded. The dealer (appellant) should not have been burdened with liability to pay compensation. (Paragraph 33)

Legal Provisions

Motor Vehicles Act, 1988 – Sections 2(30), 166, 168(1); Code of Civil Procedure, 1908 – Order 41 Rule 33, Order 41 Rule 22

Case of the Appellant (Vaibhav Jain)

• Argued that on the date of accident, M/s. Hindustan Motors was the owner of the vehicle.
• The vehicle was in control and possession of M/s. Hindustan Motors through its employees.
• The Dealership Agreement did not make the dealer the owner within the meaning of Section 2(30) of the M.V. Act.
• As neither owner nor driver, the appellant cannot be made liable for compensation.

Appellant Relied On

Godavari Finance Company v. Degala Satyanarayanamma & Ors., National Insurance Co. Ltd. v. Deepa Devi & Ors.

Case of the Respondent (Hindustan Motors)

• Claimed that the vehicle was sold to the appellant via challan cum invoice.
• Argued that clauses 3(b) and 4 of the Dealership Agreement absolved M/s. Hindustan Motors of liability.
• Contended that the dealer, being the possessory owner, was rightly held liable.

Respondent Relied On

M/s. Tata Motors Limited vs. Antonio Paulo Vaz and Anr., Rajasthan State Road Transport Corporation vs. Kailash Nath Kothari & Ors.

Question & Answer

1. Q: Who is considered the ‘owner’ of a vehicle under the Motor Vehicles Act? A: The ‘owner’ is not limited to categories in Section 2(30) of the Act. It can include a person who has command or control of the vehicle. (Paragraph 19)
2. Q: Can a manufacturer shift accident liability to a dealer through a dealership agreement? A: No, clauses in a dealership agreement limiting liability for defects cannot absolve the owner of tortious liability arising from the use of the vehicle. (Paragraph 27)
3. Q: What factors determined M/s. Hindustan Motors’ liability in this case? A: M/s. Hindustan Motors was the manufacturer, owner, and had control over the vehicle through its employees at the time of the accident. (Paragraph 23)
4. Q: Why was the dealer (Vaibhav Jain) not held liable for the compensation? A: The dealer was neither the owner nor in control of the vehicle at the time of the accident. The vehicle was being driven by an employee of M/s. Hindustan Motors. (Paragraph 33)
5. Q: What is the significance of Order 41 Rule 33 of the CPC in this case? A: It was discussed whether M/s. Hindustan Motors could use this rule to challenge its liability without filing a separate appeal. The court ruled it couldn’t, as it had allowed that part of the decree to attain finality. (Paragraphs 30-32)

Details of Case

• Court: Supreme Court of India
• Bench: J.B. Pardiwala and Manoj Misra, JJ.
• Date of Order: September 03, 2024
• Case Name: Vaibhav Jain vs. Hindustan Motors Pvt. Ltd.
• Case No.: Civil Appeal No. 10192 /2024 (Arising out of SLP (C) No. 28968/2018)