Do you know what document are required for selling car/vehicle? Do you know that the Owner of the car/motor vehicle may still be held liable to pay compensation after the sale of the car/motor vehicle, if the transfer is not registered in the RTO office?
You are the owner of a vehicle and it is registered with the Regional Transport Office (RTO) in your name. One day you decide to sell that vehicle and you offer that vehicle to someone for sale.
The buyer purchases that vehicle from you, he makes you the entire payment which you have asked for. As a safety measure, you take an affidavit from that buyer mentioning that he has purchased that vehicle from you and you have sold that vehicle to him.
You also mention in the affidavit that from the date the vehicle is sold the buyer shall be responsible for any accident, compensation, or any incident related to the vehicle as is usually done.
Yet the vehicle is still appearing in your name in the RTO records and isn’t changed to the name of the new buyer. In such conditions, consider the possibility that the vehicle meets with a mishap.
Who might be held responsible for compensation, assuming they have filed a case under MACT, as the owner, will you be responsible? Because you are still the registered owner in the records of the RTO, even though you have sold it to another person.
Or the new buyer who is utilizing the vehicle after purchasing it from you, who has not changed or transferred the vehicle in his name?
This question came up before the Supreme Court in a case titled Naveen Kumar v. Vijay Kumar, (2018) 3 SCC 1.
What is the meaning of the owner of the vehicle as per the Motor Vehicles Act, 1988 ? Section 2(30) of the Motor Vehicles Act, 1988 , define ‘owner’ (of a vehicle) as under:
“Owner” means a person in whose name a motor vehicle stands registered, and where such person is a minor, the guardian of such minor, and in relation to a motor vehicle which is the subject of a hire-purchase, agreement, or an agreement of lease or an agreement of hypothecation, the person in possession of the vehicle under that agreement;”
Based on this clause, the Supreme Court orders that the individual in whose name the vehicle stands registered as the owner of the vehicle according to the provisions of the Act is the owner of the vehicle.
The Supreme Court held that the Parliament while amending the Motor Vehicles Act, 1988 rolled out a particular improvement by reworking the previous definition.
Section 2(19) of the earlier Act specified that where an individual possessing a motor vehicle is a minor, the guardian of the minor would be the owner and where the motor vehicle was subject to hire-purchase agreement. In that case, the person in possession of the vehicle under the agreement would be the owner for the provision of the Act.
In all cases where the motor vehicle is subject to an agreement of hire purchase, lease, hypothecation, the person with whom the agreement is done and he is in the possession of the vehicle would be the owner as per the provisions of the Act.
The Court observed Section 50 of the Act which manages the transfer of the motor vehicle, and also refers to various other judgments:
Along these lines, it was held by the Supreme Court that an individual remains the owner of the motor vehicle, regardless of whether he has offered his vehicle to someone else for sale.
If the exchange of the vehicle isn’t reflected in the RTO records and if the vehicle continues on the name of the original owner in the records of the RTO despite the sale of that vehicle.
Appropriately, such an original owner would be responsible to pay compensation, even though he has sold his vehicle to another person.
It is always in the interest of the original owners of the motor vehicles who sell their vehicles to get them transferred in the name of the buyer by following the due procedure.
They also need to submit all required documents as per the provision of the Act, particularly as per Section 50 of the Motor Vehicle Act, 1988 .
In another case, the High Court of Mumbai gave judgment in a case where the seller of the motor vehicle was made to pay the compensation.
After selling a vehicle you need to guarantee that the ownership of the vehicle is transferred in the records of the RTO office. Just by getting the payment and giving over the conveyance note to the purchaser isn’t adequate.
In doing as such, it won’t absolve the seller from any mishap or some other responsibility brought about by the purchaser to any third person. Until the name of the buyer is transferred according to the Motor Vehicles Act 1988 , the seller will remain the owner of the vehicle. Any responsibility emerging after the deal, will in any case be on the seller except where ownership is changed.
Selling your vehicle gets smooth and botheration-free if you get the documentation part right and complete. It is important for you as a seller to have all the important documents that are needed to sell a vehicle.
This saves you from future issues and all the more critically when you apply for the transfer of the ownership, the total documentation will help you in the easy transfer of the vehicle in the RTO office.
Form 28 is likewise called a no-objection certificate as it ensures that the registration authority (with which the vehicle has been registered) has no complaint while you offer your vehicle to the purchaser.
It likewise implies that you hold no liabilities against the vehicle and you can sell it without legal intricacies. You need to deposit 3 copies of Form 28 in the RTO office for transfer.
Form 29 is utilized to imply the RTO that you have offered your vehicle to the purchaser. It is an affirmation that all reports needed to sell the vehicle have been given over to the purchaser. You need to present 2 copies of this form along with the required fees to the RTO office.
After implying to the RTO that the vehicle has been sold through Form 29, it is your obligation as a seller to demand the RTO to change the ownership of the vehicle to the new purchaser.
This is done through Form 30 which pronounces that every one of the lawful and monetary liabilities identified with vehicles has now been transferred to the new purchaser. You should apply for the ownership change within 14 days of the sale of the vehicle with 2 copies to the RTO office.
As the name recommends, the RC of a vehicle affirms that it is enlisted in your name and you are the legitimate owner of the motor vehicle. The RC is needed for selling the car as well as any sort of vehicle that goes under the Motor Vehicles Act 1988 .
You should have RC of your vehicle with no sort of misprint or deformity as any disparity in the RC would surely show doubt about ownership.
In case that you have lost your RC or it has been taken by someone, you need to file an FIR with the nearby police station and apply for a copy of the RC by filling the Form 26.
A valid insurance certificate is a must for selling your vehicle. Without having a valid insurance certificate, you will not have the option to offer your vehicle to another purchaser.
If you don’t have a valid insurance certificate then you will not get the proper price for your vehicle nor will you be able to transfer that vehicle in the name of another person in the RTO office.
In case insurance is not done and you want to sell your car/vehicle then you can go for third-party insurance to fulfill the legal obligation of the sale.
Another obligatory report needed for the sale agreement is a PUC certificate. It affirms that the pollution levels of the vehicle are well within the limits set by the concerned administrative offices as per the legal provisions.
PUC certificates can very easily be obtained in your city as most of the petrol stations have a provision of pollution check facility at their stations. The expense of acquiring PUC is extremely cheap and ranges between Rs 30 and Rs 100 relying on the vehicle type and limit.
You need to have a self-attested copy of your PAN card while offering your vehicle to a purchaser. On the off chance that you don’t have the PAN card, you can give a duplicate of Form 60 to complete the sale deal.
Most of the states expect you to give a self-attested copy of your residence proof. You can utilize any of the under mentioned documents and present them to the authority as legitimate evidence of the residence:
In certain states, reports like power bills and lease arrangements are additionally considered legitimate residence evidence.
For the sale of a vehicle, it is required for you to have any two self-attested photos that will need to be submitted along with the other documents to the RTO.
The affidavit of sale will be made in your name (the seller) having a declaration that all liabilities related to the motor vehicle have now been transferred to the purchaser.
When RC has transferred both the seller and the purchaser sign the sale affidavit and the purchaser will become liable for all the liabilities of the motor vehicle.
Notwithstanding these compulsory documents, there are some other discretionary things that you can give over to the purchaser. These include all keys of the vehicle; vehicle service record and original invoices etc.
There is no need to hire an agent to sell your vehicle if you have all the above-mentioned documents in your possession. The agents usually charge heavy commission for getting the sales process through.
According to the law, as long as the vehicle is registered in your name, you hold the duty regarding the vehicle and any undesirable episode that happens as a result of it.
Therefore, you must inform the RTO regarding the sale. You need to inform the RTO, at a place where the vehicle was registered, in a time of 14 days of the deal, by sending duplicates of all the important documents by registered post.
Once the postal confirmation is received only then the seller can think of fulfilling his duty of completing the due procedure of sale as per the Motor Vehicle Act, 1988 . In case the purchaser belongs to another area different than your RTO jurisdiction then you need to send that RTO also, all the required documents by registered post.
The insurance company with whom your vehicle is insured must also be informed about the sale agreement especially if the insurance cover is also part of the sale deal. If it is not, then also you need to inform the insurance company of the cancellation by registered post as was done concerning RTO.
Remember to request the purchaser to dispatch a duplicate copy of the fresh RC book to you, which has been properly transferred to the name of the purchaser.
You also need to follow up if there is a delay in the transfer of the name in the RTO office and also retain with you all the copies of the documents you have handed over to the purchaser as well as to the RTO office.
Now that you know all the document required for selling car /vehicle and you also know the procedure, precautions to take care of before going ahead with the sale. There is no need for you to hire an agent to sell your vehicle if you have all the above-mentioned documents in your possession.
The agents usually charge heavy commission for getting the sales process through because they take benefit of your ignorance. If you don’t have time and would prefer to pay instead of pursuing the entire sale process, in that case, hiring an agent can be considered.
