Can Owner Of Uninsured Vehicle Involved In Accident Get Interim Custody By Furnishing Property As Security? Kerala High Court Answers

Justice C.S. Dias was considering a plea by a vehicle owner alleging that the condition imposed by the Magistrate asking him to deposit cash security equivalent to the assessed value of the vehicle, for getting interim custody was onerous.

The Court examined Rule 391A of the Kerala Motor Vehicles Rules, 1989 [Prohibition against release of motor vehicle involved in accident] and various precedents. It took the view that vehicle owner's as well as the accident victims' interest must be balanced and therefore, property security of sufficient value would be enough.

“Harmonising the object of Rule 391A with the principles enunciated by the Honourable Supreme Court, I am of the considered opinion that while the petitioner must furnish adequate security, the requirement of cash security alone may be suitably relaxed. The ends of justice would be adequately served by permitting the petitioner either to deposit the cash security as directed by the learned Magistrate or, in the alternative, to furnish immovable property security of sufficient value,” it added.

The petitioner, while driving his car, got involved in an accident and in the result, the rider of the motor cycle that was hit got grievously injured. A crime was registered alleging offences under the Bharatiya Nyaya Sanhita and the Motor Vehicles Act. The investigating officer seized the vehicle since it was not having third-party risks insurance policy.

The petitioner then approached the Magistrate for interim custody of the vehicle since it was lying exposed to the vagaries of nature. The Magistrate called for a valuation report from the Assistant Motor Vehicles Inspector and the car was valued at Rs. 3,77,000/-. In then granted interim custody of the vehicle on various including deposit of the afore amount. Aggrieved, he approached the High Court.

The Court took the view that Rule 391A is meant to safeguard the victims of motor accidents when the offending vehicle is not covered by third-party risks insurance. It further explained that as per Rule 391A, a vehicle involved in an accident but not covered by a valid third-party insurance policy cannot be released to its owner unless adequate security is furnished and that the same was intended to safeguard the interests of the victims of the accident.

The Rule further states that in case there in non-compliance, Magistrate can initiate proceedings for the sale of the vehicle and to deposit the sale proceeds before the jurisdictional Claims Tribunal, the Court noted.

It also explained the legislative intent behind the Rule:

“The underlying object of the Rule is both salutary and purposive. It seeks to ensure that victims of motor accidents are not left remediless merely because the offending vehicle was uninsured. If an uninsured vehicle were released without insisting upon adequate security, the owner may, after several years have elapsed, plead inability to satisfy the award passed by the Claims Tribunal, by which time the vehicle itself would have substantially depreciated in value or become unavailable for realisation. The Rule, therefore, creates a statutory safeguard to protect the legitimate interests of accident victims.”

The Court referred to the decisions in State of Kerala v. Sanith Jan and in Sunderbhai Ambalal Desai v. State of Gujarat [(2002) 10 SCC 283] and found that condition directing deposit of cash security equivalent to the assessed value of the vehicle is not arbitrary or excessive.

The Court then disposed of the plea with a set of directions. It was directed that the petitioner may either make cash deposit of Rs. 3.77 lakhs or, in the alternative, furnish as security, an encumbrance-free immovable property having a minimum value of Rs. 10 lakhs belonging either to himself or to his relatives.

He was also directed to execute a bond before the Magistrate undertaking that the property shall not be alienated, sold, encumbered or transferred for 2 years or until an attachment order is passed by the Motor Accidents Claims Tribunal having jurisdiction. The petitioner was further directed to undertake to have a valid third-party risks insurance policy for the vehicle while it is in his custody.

He is also directed to comply with the other conditions imposed by the Magistrate. It was also made clear that in case of failure to furnish cash security or immovable property security within one month, the Magistrate must proceed with sale of the vehicle as per Rule 391A(2).

With these directions, the Court disposed of the plea.

Case No: Crl.MC No. 5070 of 2026

Case Title: Thadevoos v. State of Kerala

Citation: 2026 LiveLaw (Ker) 360

Counsel for the petitioner: N.L. Bitto, Mithul T. Anto

Counsel for the respondent: C.S. Hrithwik – Senior Public Prosecutor

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