Superdar must surrender offending vehicle or pay its secured value; cannot defeat accident victims’ lien, rules Punjab and Haryana High Court

The appeal was filed by Ram Niwas, who had taken the offending Jeep No. HR-36A-5174 on superdari and claimed to be its subsequent purchaser, although ownership had never been transferred to him in the registration certificate.

The vehicle was allegedly involved in a fatal accident on 02.04.1999 due to the rash and negligent driving of respondent-driver Desh Raj, resulting in the death of Dharambir.

The Motor Accident Claims Tribunal, Narnaul, awarded compensation of ₹8,68,000 to the claimants and held the driver and Ram Niwas, described as the subsequent owner/superdar, jointly and severally liable.

During the criminal proceedings, Ram Niwas obtained custody of the vehicle on superdari after representing himself as its owner, but he did not surrender the vehicle after the Tribunal’s award and continued retaining it for approximately 24 years.

The Court applied the principle that, under the motor accident liability regime, the registered owner—not an unregistered subsequent purchaser or superdar—is ordinarily liable, along with the driver, for the compensation payable to the claimants.

It relied on the ratio of Naveen Kumar v. Vijay Kumar, Brij Bihari Gupta v. Manmet, and the other authorities cited by the appellant, accepting that a superdar cannot be made liable in place of the registered owner for the entire compensation.

However, the Court held that custody on superdari carries an obligation to preserve and surrender the vehicle, because the claimants have a lien over it for recovery of the compensation; failure to surrender the vehicle may result in liability limited to the vehicle’s value or the amount secured by the superdari bond.

Although Ram Niwas was not the registered owner and therefore could not be treated as liable for the entire compensation, he had obtained and retained possession of the offending vehicle under a superdari arrangement.

The vehicle was consequently subject to the claimants’ lien as an asset available for recovery of the award.

Despite being a party to the claim proceedings and being aware of the 2002 award, Ram Niwas neither surrendered the vehicle nor paid any amount, thereby defeating the claimants’ right to recover against it.

The Court therefore distinguished between primary liability for the compensation, which remained with the registered owner and driver, and the superdar’s separate liability to the extent of the vehicle’s value or the security furnished under the superdarinama.

The Court held that the registered owner and the driver were jointly and severally liable to pay the entire compensation of ₹8,68,000.

Ram Niwas, as superdar and non-registered owner, was not liable to pay the compensation in full; however, his liability was restricted to the amount secured under the superdarinama, representing the value of the vehicle over which the claimants had a lien.

The Court further directed that courts, particularly Magistrates releasing vehicles on superdari, should impose conditions requiring immediate surrender of the vehicle if a claim petition is filed and allowed against the owner or driver, and should require an undertaking to pay the vehicle’s assessed value if permission to sell it is granted during the pendency of the proceedings.