Kochi: The Kerala High Court has made stringent the condition to release vehicles involved in accicents if the owner has not taken a third-party insurance cover.
It is not sufficient to furnish a bond equal to the cost of the vehicle but an amount adequate to pay the compensation should be deposited as a guarantee, the HC ordered on Tuesday.
The guarantee must be furnished in such a way as to ensure easy liquidity.
Justice Bechu Kurien Thomas ordered that an amount equal to the compensation payable should be deposited as cash, bank guarantee, or fixed deposit.
Thrissur court order quashed
The High Court clarified these points while quashing the order of the Magistrate Court in Thrissur which directed the release of vehicles after the furnishing of bonds with a value equal to the cost of the vehicle. The High Court was considering an appeal filed by the Kerala Government.
The government challenged the orders of the Magistrate Court to release vehicles after the furnishing of bonds with a value equal to the cost of the vehicles that caused accidents. It argued that this could not be considered as a sufficient guarantee and that the victims had to resort to further legal measures in order to monetise the bonds.
The Magistrate Court had ordered the release of vehicles in two cases on furnishing of bonds of Rs 3,80,000 and Rs 19,80,000. The High Court directed the Magistrate to reconsider the petitions.
The High Court also ordered that the Magistrate Court must direct the production of the new insurance policy document before releasing vehicles that do not have third-party insurance.
What is third-party insurance?
Third-party insurance is a must for all vehicle owners as per the Motor Vehicle Act. This insurance cover offers protection against damage to the third-party vehicle, personal property and physical injury. The insurer is not covered by this type of insurance
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