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Old 7th February 2018, 08:39   #1
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Default Supreme Court: Change records after car sale or pay for mishaps

According to Supreme Court, the original owner will be liable if the registration is not changed after sale.

change-records-after-car-sale-or-pay-for-mishaps-sc

This will help the organised used car players as people would be reluctant to sell to unorganized used car dealers or individuals.

What is surprising is that there is no clear indication on the procedure the original owner has to follow to absolve of his/her liability after selling the car.
Does informing the RTO is sufficient or are there any other procedure that needs to be followed?

Last edited by speedmiester : 7th February 2018 at 08:42.
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Old 7th February 2018, 08:49   #2
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Default Re: Old car sold, new owner refusing to transfer ownership

An absolutely ridiculous judgement which absolves the offenders(buyers who didn't transfer ownerhsip) and crucifies the registered owner.

If I remember right, the old book RCs had a clause mentioned where the buyer had to get the ownership transferred within 30 days of purchase of the vehicle.

If anyone on the forum has the old book RC (Gujarat preferably), could you post a snapshot of this clause?

EDIT - reproducing an extract from the CMRV1989.

Quote:
55. Transfer of ownership
(1) Where the ownership of a motor vehicle is transferred, the transferor shall report the fact
of transfer in Form 29 to the registering authorities concerned in whose jurisdiction the transferor
and the transferee reside or have their places of business.
(2) An application for the transfer of ownership of a motor vehicle under sub-clause (z) of clause
(a) of sub-section (1) of section 50 shall be made by the transferee in Form 30, and shall be
accompanied by—
(i) the certificate of registration;
(ii) the certificate of insurance; and
(iii) the appropriate fee as specified in rule 81.
(3) An application for transfer of ownership of a motor vehicle under subclause (ii) of clause (a)
of sub-section (1) of section 50 shall be made by the transferee in Fonn 30 and shall, in addition to
the documents and fee referred to in sub-rule (2), be accompanied by one of the following
documents, namely:—
(a) a no objection certificate granted by the registering authority under subsection (3) of section
48; or
(b) an order of the registering authority refusing to grant the no objection certificate under sub-
section (3) of section 48; or
(c) where the no objection certificate or the order, as the case may be, has not been received, a
declaration by the transferor that he has not received any such communication together
with—
(i) the receipt obtained from the registering authority under subsection (2) of section 48;
or
(ii) the postal acknowledgement received from the registering authority where the
application for no objection certificate has been sent by post.

Last edited by aah78 : 7th February 2018 at 23:31. Reason: Posting an extract from CMRV. EDIT: Quote fixed.
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Old 7th February 2018, 08:54   #3
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Default Re: Old car sold, new owner refusing to transfer ownership

Quote:
Originally Posted by vigsom View Post
An absolutely ridiculous judgement which absolves the offenders(buyers who didn't transfer ownerhsip) and crucifies the registered owner.

If I remember right, the old book RCs had a clause mentioned where the buyer had to get the ownership transferred within 30 days of purchase of the vehicle.

If anyone on the forum has the old book RC (Gujarat preferably), could you post a snapshot of this clause?
Agree, the court should have put the responsibility on the buyer to have the car registered in their name instead of blaming the original owner.
Even if we have all proofs that the car has been sold, still this will become a huge liability on part of the original owner.
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Old 7th February 2018, 08:56   #4
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Default Re: Old car sold, new owner refusing to transfer ownership

Not sure how this will hold true in case of an exchange for cars while purchasing new ones. In that case we just get some paper work without the car actually being sold. When you don't have a buyer in the first place, whom do you transfer the car to? Should it be on name of the dealer/middleman?
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Old 7th February 2018, 08:56   #5
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Default Re: Old car sold, new owner refusing to transfer ownership

Quote:
Originally Posted by vigsom View Post
An absolutely ridiculous judgement which absolves the offenders(buyers who didn't transfer ownerhsip) and crucifies the registered owner.
Agree, I was moving out of the country in 2012, sold my car to a guy in the same company, had to go through an agent, as the routine process takes upto a month, the process should be made faster, the seller seems totally at the mercy of the buyer. Thankfully the transfer was done, and he sent me a copy of the new RC also.
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Old 7th February 2018, 09:30   #6
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Default Re: Old car sold, new owner refusing to transfer ownership

https://timesofindia.indiatimes.com/...w/62812223.cms

Quotes from the article:

Quote:
If you sold your car and did not bother to change the ownership in registration records, you would be liable for compensation claims arising from accidents involving the vehicle even if another person owned and drove the car, the Supreme Court ruled on Tuesday.
Quote:
In its judgment, a three-judge SC bench said, "In a situation such as the present where the registered owner has purported to have transferred 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 liability.
The Haryana high court had incidentally absolved the first owner as it said there was a clear evidence of sale, this was overruled by the Supreme Court when the same was challenged by the advocate of one of the owners.

So as I read in one of my WhatsApp groups, the only way to complete a sale would be to hand over the keys to the buyer only after the registration transfer process is complete . This, at least in the short term would hurt the unorganized used car market.

When there is a sale of any goods, isnt it the duty of the buyer to get the formalities done? Not sure what the rationale behind this judgement is.

Last edited by arvind71181 : 7th February 2018 at 09:31.
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Old 7th February 2018, 11:37   #7
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Default Supreme Court: Change records after car sale or pay for mishaps

Just in.

Quote:
If you sold your car and did not bother to change the ownership in registration records, you would be liable for compensation claims arising from accidents involving the vehicle even if another person owned and drove the car, the Supreme Court ruled on Tuesday.
Quote:
In its judgment, a three-judge SC bench said, "In a situation such as the present where the registered owner has purported to have transferred 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 liability.
https://timesofindia.indiatimes.com/...w/62812223.cms

Long story short: A sold to B sold to C sold to D. All this while the car continued to be in A's name. D had an accident and the Motor Accidents Claims Tribunal made A pay damages. A challenged this and HC admitted his petition. But D went to SC challenging A's absolution. SC ruled A has to pay.

In our country where there's quite some jugaad and where things aren't followed by the rule book, this judgement should be detrimental to car owners intending to sell.

Last edited by libranof1987 : 7th February 2018 at 11:41.
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Old 7th February 2018, 12:13   #8
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

This is an incredibly stupid judgement. How can any seller ensure with 100% guarantee that the buyer will take care of the transfer? What if he's from another city? Am I going to follow him there? What if it's a car dealer?

As long as a car owner has sufficient proof that he has sold the car (delivery note, receipt etc.), that should suffice. I even took a video of the time that I sold my Civic on the building's CCTV camera .
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Old 7th February 2018, 12:50   #9
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

That's really scary, if a judgement has already been made on this subject by the SC, will it not be taken as reference by other courts when such cases come up for hearing? So even if you have proof like a picture / video along with the delivery note & receipt will it stand in the court of law? As going by what is written in the article, it has not in this case ,even though the first owner had clear evidence of the sale.

So what should one do when he is exchanging his car for a new one at a company showroom? what if the showroom doesn't follow the rules & sells it off to someone without transferring it.

This kind of brings up a lot of questions and quite a lot of stress along with it.
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Old 7th February 2018, 12:55   #10
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

Here's an article for people who want to go into the legal nuances of the judgement.

https://barandbench.com/owner-motor-...court-answers/
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Old 7th February 2018, 13:05   #11
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

Precisely the reason why whenever we sell our cars -we have always ensured that the transfer is done by us before handing over the car to the new owner.

The transfer set or delivery note can serve as a proof of transfer - but the original RC book will still have the previous owner name. Its better to have that transferred before physical delivery - since this is on record at the RTO. Delivery note and Transfer note are not recorded with the RTO.

Related threads :
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Old 7th February 2018, 13:05   #12
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

Quote:
Originally Posted by GTO View Post
As long as a car owner has sufficient proof that he has sold the car (delivery note, receipt etc.), that should suffice. I even took a video of the time that I sold my Civic on the building's CCTV camera .
+1 Get all the proof (photo ID, address proof, signed delivery receipt) of the new buyer when the car is sold a video will be a bonus. When vento was sold apart from collecting copies of identification I also took a video of the dude driving off and him visible. Did that for Nano too with an IP cam. Now have a proper CCTV setup, and just a few days after install it proved itself worthy in an altogether different matter.

When exchanging cars at a company owned used car dealer for a new car we expect them to be responsible and properly complete the transfer before handing over the car. But always it won't go as we expect it to be and I had a very bad experience with the Das Welt Auto (DWA) at Trivandrum when i exchanged the Swift for the Polo GT. Das Welt sold my swift to a 3rd party seller and they sold the swift to a buyer and the name change was not properly done, and i was getting overspeeding challans at my address while the car was being used by the new owner still in my name. I called DWA and asked them to pay the fines which they did not and i ended up getting few more challans in the meantime. Finally I called up the traffic police station and informed them, after that informed DWA about what I am going to do and the challans were paid promptly and the name change also promptly done. Did not expect a company owned used car dealership like DWA (VW used car dealer) to be so irresponsible like this.

Last edited by Sankar : 7th February 2018 at 13:14.
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Old 7th February 2018, 13:13   #13
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

It's all well and good to document the sale as much as possible but the critical bit is which, if any, of such documents have legal standing in a court of law. What constitutes 'legal proof of ownership'?

Thinking back to the recent Mysore accident where multiple kids died in a car when it was in possession of a used car dealer. The original owner on record is stuffed if this judgment is used as legal precedent.
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Old 7th February 2018, 13:17   #14
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Smile Re: Supreme Court: Change records after car sale or pay for mishaps

Quote:
Originally Posted by GTO View Post
This is an incredibly stupid judgement. How can any seller ensure with 100% guarantee that the buyer will take care of the transfer? What if he's from another city? Am I going to follow him there? What if it's a car dealer?

As long as a car owner has sufficient proof that he has sold the car (delivery note, receipt etc.), that should suffice.
I would like to differ here GTO. IMO is it a very valid judgment and need of the hour. It is not only the buyers responsibility but also the seller's responsibility to ensure that the car ownership transfer happens. In fact your thread on How to sell a car lists the steps to go about for the car transfer was like a bible. I followed it step by step when I sold my Fiesta or earlier Santro. Heck I did not want to take chances with my own Brother in law to whom I sold the Fiesta, so I ensured that he does the ownership transfer within 15 days of buying the car.

There are grey areas like when the car is sold to a dealer during an exchange program, the dealer smartly sits on the ownership and waits till he gets a customer. In the mean time, the car could be used by the dealer himself or loaned to anyone or maybe the car may be used for any illegal activities. Merely having the delivery note and signing off the required forms holds no ground. Even Insurance co do not accept the delivery note for the valid insurance ownership transfer. The other issue is dealer themselves do not want to get the ownership transferred to their name as they would have to show another owner on the RC which reduces the car selling price.

The recently amended Motor Vehicle Act unfortunately did not address the above issue.
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Old 7th February 2018, 13:20   #15
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Default Re: Supreme Court: Change records after car sale or pay for mishaps

Quote:
Originally Posted by GTO View Post
This is an incredibly stupid judgement. How can any seller ensure with 100% guarantee that the buyer will take care of the transfer? What if he's from another city? Am I going to follow him there? What if it's a car dealer?
This is a missed opportunity to give a land mark judgement, there is no defined standard for a sale agreement when we sell/buy a used car. From my experience of selling 6 cars, I can say that a CC issued by the RTO is the only secure document in your hand. In fact when the buyer of my Rapid was involved in an accident, I used the CC to prove my innocence in the incident.
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