A school bus put into service for election duty, a fatal road accident, a legal battle over who should pay damages – the Supreme Court has now settled the issue, placing the burden squarely on the state.
In a ruling with wide-ranging implications for election administration, the Supreme Court ruled that governments cannot shift liability to private insurance companies when accidents occur while using seized vehicles.
A bench of Justices Sanjay Karol and N Koteswar Singh held that once a vehicle is seized by the authorities under statutory powers, the responsibility to pay compensation under the Motor Vehicles Act lies with the state employee, and not the private owner or the insurance company, because the control and, therefore, liability completely shifts to the state during the period of seizure.
“It is held that when a vehicle is seized for public functions and an accident occurs during the period of such seizure, liability must be properly borne by the requesting authority, and not by the insurance company used by the owner for the regular and voluntary use of the vehicle,” declared the ruling issued last week.
The ruling came in a case arising out of a 2010 accident in Madhya Pradesh, where a school bus required for panchayat election duty collided with a motorcycle, resulting in the death of the driver. While the Motor Accident Claims Tribunal had initially decided to pin liability on the insurance company, the Madhya Pradesh High Court transferred liability to the district judge and electoral authorities – a ruling that the Supreme Court has now upheld.
Senior advocate Archana Pathak Dev assisted the court as amicus curiae.
After denying the state’s appeal against the 2024 order, the court held that the order fundamentally changes the nature of control over a vehicle. She noted that the owner “has been stripped of custodial and decision-making authority” and has no say in how, when or where the car is deployed during this period.
The court relied on some prior precedent to assert that liability under the Motor Vehicle Act follows possession and control, not mere ownership.
The court rejected the state’s argument that such liability would deter authorities from confiscating vehicles for public purposes, and stressed that the legal authority bears the corresponding responsibility. He pointed out that “when the state intervenes, assumes control, and deploys the car for its own purposes, it bears this control the corresponding responsibility.”
Importantly, the Court distinguished between voluntary contractual arrangements and a request forced by law. She explained that insurance policies are designed to cover risks arising from the owner’s normal use of the vehicle, and cannot be extended to include risks resulting from forced government deployment.
“Forced deployment of public functions cannot reasonably be described as ‘regular use’ within the ‘usual’ concept. To fix liability on the insurer in these circumstances would be tantamount to extending the contract beyond the risks it was agreed to cover. To require the insurer to answer for consequences arising from unauthorized use over which the insured has no control would be unfair.”
The ruling also noted that although the Representation of the People Act allows for the confiscation of vehicles, it does not expressly provide for the confiscation of drivers. However, when authorities choose to use a driver with a vehicle, they are effectively accepting responsibility for the operation of the vehicle and the driver’s conduct during the probation period.
“Once a vehicle is seized and deployed for electoral duty, control and use of it effectively passes to the State authorities for the duration of that period, as noted above. In such circumstances, the reasonable inference is that by accepting and utilizing the services of the driver, the authorities implicitly recognize the competence, ability and ability of the driver to operate the vehicle.”
