Motor Vehicles Act, 1988

Objective of the Act:

 To take care of the increasing number of both commercial vehicles and personal vehicles in the
country.

• Concern for road safety standards, and pollution-control measures, standards for transportation of
hazardous and explosive materials

• Need for effective ways of tracking down traffic offenders

• Stricter procedures relating to grant of driving licences and the period of validity thereof.

• Administration of the Solatium Scheme by the General Insurance Corporation.

• Provision for enhanced compensation in cases of “no fault liability” and in hit and run motor
accidents

• Provision for payment of compensation by the insurer to the extent of actual liability to the victims
of motor accidents irrespective of the class of vehicles

• Providing adequate compensation to victims of road accidents without going into long drawn
procedure

• Enhancing penalties for traffic offenders

• Increase in the amount of compensation of the victims of hit and run cases.

• Removal of time limit for filling of application by road accident victims for compensation.

• Punishment in case of certain offences is made stringent.

• Formula for payment of compensation to road accident victims on the basis of age / income, which
is more liberal and rational etc.

In the case of Common Causes (A Registered Society) v. Union of India (2008), the SC held that the
Motor Vehicles Act, 1988 is a comprehensive enactment in respect to various matters relating to
traffic safety on the roads and minimization of roads and minimization of road accident

Features of the Act:

14 chapters, 217 sections, 2 schedules

Schedule 1: traffic signs; schedule 2: payment of compensation

The Act contains provisions regarding the following

1. Licensing of drivers of motor vehicles

2. Registration of motor vehicles
3. Providing permits and Control of transport vehicles
4. Special provisions relating to state transport undertakings
5. Traffic control
6. Liability without fault in accident cases
7. Insurance against third party risks
 8. Claims tribunals
9. Penalties for offences under the Act

Definitions

2 (28) “motor vehicle” or “vehicle” means any mechanically propelled vehicle adapted for use upon
roads whether the power of propulsion is transmitted thereto from an external or internal source
and includes a chassis to which a body has not been attached and a trailer; but does not include a
vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in
any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of
not exceeding twenty-five cubic centimetres.

2(26) “motor car” means any motor vehicle other than a transport vehicle, omnibus, road-roller,
tractor, motor cycle or invalid carriage;

2(27) “motor cycle” means a two-wheeled motor vehicle, inclusive of any detachable side-car having
an extra wheel, attached to the motor vehicle;

Chapter II:

Section 3: No person shall drive a motor vehicle in any public place unless he holds a valid driving
licence

Section 4: Age limit-18 years for motor vehicle; 20 years for transport vehicle

Section 5: Responsibility of owners for contravention of Section 3 and 4

Section 6: No holder of driving licence shall allow another to use the same

Section 8: Grant of Learner’s licence

Section 9: Grant of driver’s licence- Jurisdiction is the area where the person ordinarily resides or
carries on business or the school or institution where he is receiving driving instructions is situated;
submit required documents and pass required tests

Licence may be refused if the applicant is a habitual drunkard, habitual addict to any narcotic
substance or whose earlier licence has been revoked

Section 14: Period of licence: Learner’s licence: 6 months; transport vehicle: 3 years; others: 20 years
or upto the age of 50 years

Seciton 15: Renewal of driving licence

Section 20-22: disqualification, suspension or cancellation of driving licence.

Chapter IV: Registration of Motor Vehicles

Section 39: No person shall drive a MV unless it is registered as per the provisions of the Act, carries
a registration mark displayed according to the Act and obtains a certificate of registration.

Section 40: where to apply for registration

Section 41:how to apply for registration

Section 46: Effective in the whole of India

Section 47: Moving to a new state: if the MV is kept in another state for more than 12 months, new
registration mark must be obtained in such state.

Section 50: Transfer of ownership: transferor to Inform authorities. If within state 14 days; another
state 45 days; Transferee to apply for transfer of ownership within 30 days of the transfer

Chapter VIII: TRAFFIC CONTROL

112: Speed Limit: No driver to drive above the maximum speed or below the minimum speed fixed
under law for the time being in force

117: Parking places: The concerned authorities may determine parking places for different vehicles
and for determined periods of time

119: obey traffic signs: Every driver to obey traffic signs

120: Vehicles with left hand control: No person shall drive a MV in a public place with left hand
steering control unless equipped with a mechanical or electrical signalling device

128: safety measures: only one pillion driver for a two wheeler

129: protective headgear

130: duty to produce licence and certificate of registration

Chapter X: Liability without fault

140: where death or permanent disablement of a person has resulted from an accident, the owner
shall pay compensation for such death or disablement in accordance with the act

Death: Rs. 50,000

Permanent Disablement: Rs.25,000

The claimant need not establish negligence by the owner of the vehicle nor the owner can claim
negligence on behalf of the victim.

Chapter XI: Insurance of MV against third party risks

(a) “authorised insurer” means an insurer for the time being carrying on general insurance business
in India under the General Insurance Business (Nationalisation) Act, 1972, (57 of 1972) and any
Government insurance fund authorised to do general insurance business under that Act;

(b) “certificate of insurance” means a certificate issued by an authorised insurer in pursuance of sub-
section (3) of section 147 and includes a cover note complying with such requirements as may be
prescribed, and where more than one certificate has been issued in connection with a policy, or
where a copy of a certificate has been issued, all those certificates or that copy, as the case may be;

(c) “liability”, wherever used in relation to the death of or bodily injury to any person, includes
liability in respect thereof under section 140;

146. Necessity for insurance against third party risk.—(1) No person shall use, except as a passenger,
or cause or allow any other person to use, a motor vehicle in a public place, unless there is in force in
relation to the use of the vehicle by that person or that other person, as the case may be, a policy of
insurance complying with the requirements of this Chapter: 1 [Provided that in the case of a vehicle
carrying, or meant to carry, dangerous or hazardous goods, there shall also be a policy of insurance
under the Public Liability Insurance Act, 1991 (6 of 1991).] Explanation.—A person driving a motor
vehicle merely as a paid employee, while there is in force in relation to the use of the vehicle no such
policy as is required by this sub-section, shall not be deemed to act in contravention of the sub-
section unless he knows or has reason to believe that there is no such policy in force

Section 161: Hit and run motor accident

(a) “grievous hurt” shall have the same meaning as in the Indian Penal Code (45 of 1860); (b)
“hit and run motor accident” means an accident arising out of the use of a motor vehicle or
motor vehicles the identity whereof cannot be ascertained in spite of reasonable efforts for
the purpose; (c) “scheme” means the scheme framed under section 163.

(3) Subject to the provisions of this Act and the scheme, there shall be paid as compensation— (a) in
respect of the death of any person resulting from a hit and run motor accident, a fixed sum of 1
[twenty-five thousandrupees]; (b) in respect of grievous hurt to any person resulting from a hit and
run motor accident, a fixed sum of 2 [twelve thousand and five hundred rupees]. (4) The provisions
of sub-section (1) of section 166 shall apply for the purpose of making applications for compensation
under this section as they apply for the purpose of making applications for compensation referred to
in that sub-section

163. Scheme for payment of compensation in case of hit and run motor accidents.—(1) The Central
Government may, by notification in the Official Gazette, make a scheme specifying, the manner in
which the scheme shall be administered by the General Insurance Corporation, the form, manner
and the time within which applications for compensation may be made, the officers or authorities to
whom such applications may be made, the procedure to be followed by such officers or authorities
for considering and passing orders on such applications, and all other matters connected with, or
incidental to, the administration of the scheme and the payment of compensation

Chapter XII: Claims Tribunal

Section 165: The State Government may by notification in the Official gazette constitute one or more
Motor Accidents claims tribunal for the purpose of adjudicating upon claims for compensation in
respect of accidents involving the death of, or bodily injury to, persons arising out of the use of
motor vehicles, or damages to any property of a third party so arising, or both.

(2) A Claims Tribunal shall consist of such number of members as the State Government may think fit
to appoint and where it consists of two or more members, one of them shall be appointed as the
Chairman thereof. (3) A person shall not be qualified for appointment as a member of a Claims
Tribunal unless he— (a) is, or has been, a Judge of a High Court, or (b) is, or has been, a District
Judge, or (c) is qualified for appointment as a Judge of a High Court1 [or as a District Judge]. (4)
Where two or more Claims Tribunals are constituted for any area, the State Government, may by
general or special order, regulate the distribution of business among them.
168. Award of the Claims Tribunal.—(1) On receipt of an application for compensation made under
section 166, the Claims Tribunal shall, after giving notice of the application to the insurer and after
giving the parties (including the insurer) an opportunity of being heard, hold an inquiry into the claim
or, as the case may be, each of the claims and, subject to the provisions of section 162 may make an
award determining the amount of compensation which appears to it to be just and specifying the
person or persons to whom compensation shall be paid and in making the award the Claims Tribunal
shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved
in the accident or by all or any of them, as the case may be

169: Procedure: Summary procedure is followed, Power of Civil Court

173. Appeals.—(1) Subject to the provisions of sub-section (2), any person aggrieved by an award of
a Claims Tribunal may, within ninety days from the date of the award, prefer an appeal to the High
Court: Provided that no appeal by the person who is required to pay any amount in terms of such
award shall be entertained by the High Court unless he has deposited with it twenty-five thousand
rupees or fifty per cent. of the amount so awarded, whichever is less, in the manner directed by the
High Court: Provided further that the High Court may entertain the appeal after the expiry of the said
period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from
preferring the appeal in time. (2) No appeal shall lie against any award of a Claims Tribunal if the
amount in dispute in the appeal is less than ten thousand rupees.

Chapter XIII: OFFENCES AND PENALTIES

177: GENERAL PENALTYY: where no penalty is prescribed offence be punishable for the first offence
with fine which may extend to one hundred rupees, and for any second or subsequent offence with
fine which may extend to three hundred rupees.

178: Traveling without ticket

179: disobedience to orders

180: allowing unauthorised persons to drive

182: offences related to licences

183: speed driving

184: driving dangerously

185: driving under the influence of drugs

187: accident punishment

192: using vehicle without registration