The central legal point established in the judgment is the interpretation of the terms and conditions of the loan agreement to determine the liability of the bank as the owner of the hypothecated vehicle, as per Section 147 of the Motor Vehicle Act.

JUDGMENT :

1. Rule. Mr. Kaushal S.Jani and Mr. Dhruvik K.Patel learned advocates waive service of notice of rule on behalf of respective respondents. With the consent of the parties, the matter is heard finally today. Rule is fixed forthwith.

2. Mr. Jigar D.Dave, learned advocate for the petitioners submitted that the present petitioners are the claimants in the Motor Accident Claim Petition No.108 of 2019 filed before the Motor Accident Claim Tribunal (Aux.), Ahmedabad, challenging the order, below Exhibit-17, filed by respondent no.3 – Indusind Bank praying to delete it as a party to the matter, which came to be allowed vide order dated 31.07.2021.

3. Exhibit-17 was moved by the respondent no.3 – Indusind Bank under Order 1 Rule 10(2) of the Code of Civil Procedure (‘CPC’ for short) stating that Bank is not owner of the vehicle and they have hypothecated the vehicle - Ashok Leyland Company’s Dalu bearing no.GJ-27-X-1398, which was involved in the accident. It was urged before the Tribunal that the ownership and control of the vehicle was with respondent nos.1 and 2.

3.1 The learned Tribunal had made the observation that respondent no.3 had sanctioned the loan for purchasing of the vehicle involved in the accident for respondent no.2 and because of the said reason it was hypothecated by them and thus relying on the observation made in the case of Bank of Baroda, Ahmedabad Vs. Rabari Bachubhai Hirabhai, reported in (1986) 1 GLR 144, the learned Tribunal came to the conclusion that the respondent no.3 cannot be held liable for payment of damage, as they are not necessary party to the claim petition.

3.2 The learned Tribunal distinguished the case relied upon by the contesting party of Madras High Court in the case of K.Ramalingam Vs. Parvathi, Minor Deivayanai, on the ground that the State Bank of India was liable to give compensation as they have failed to pay the insurance amount to the Insurance Company within stipulated time; while in the present matter it was nowhere stated that respondent no.3 has responsibility to pay the insurance of the vehicle.

4. It appears from the order impugned that the learned Tribunal has only reproduced the observations in the case of Bank of Baroda, Ahmedabad (supra), while the Tribunal has not even perused the loan agreement of Indusind Bank with the borrower, thus, under what premise the learned Tribunal come to the conclusion that, it was nowhere stated that Bank has responsibility of payment of insurance of the vehicle, becomes questionable.

4.1 In the context, Advocate Mr. Dhruvik K.Patel for the respondent no.3 - Indusind Bank filed a copy of the loan agreement for the perusal of this Court.

5. Mr. Jigar D.Dave, learned advocate for the petitioners contended that the learned Tribunal ought to have considered the fact that the respondent no.2 is the owner and the vehicle was under loan agreement sanctioned by the respondent no.3 – Indusing Bank and the vehicle was hypothecated in accordance to the stipulations laid down in the loan agreement.

5.1 Mr. Dave further stated that learned Tribunal prior to deleting the Bank as a party respondent, ought to have perused the loan agreement to consider the terms and conditions agreed upon by the parties in connection with hypothecated vehicle and ought not to have allowed the application by prematurely deleting the Bank from cause title.

5.2 Mr. Dave stated that it was the duty of the Bank to direct the purchaser to insure the vehicle, and check the insurance policy of the said vehicle annually, further the Bank would have no ground to say that it is not a necessary party as, the Bank is vicariously liable for damage and compensation; thus prayed for quashing and setting aside the order passed below Exhibit-17 in Motor Accident Claim Petition No.108 of 2019.

6. Mr. Kaushal S.Jani, learned advocate for respondent no.2 submits that, the relation between the Bank and the owner of the vehicle would be governed by the terms and conditions of the loan agreement. Mr