The Motor Vehicles Act, 1988
146.
Necessity for insurance against third party risk.
- No person
shall use, except as a passenger, or cause or allow any other person to
use, a motor vehicle in a public place, unless there is in force in
relation to the use of the vehicle by that person or that
other person, as the case may be, a policy of insurance complying with the
requirements of this Chapter.
Explanation.--A person driving a motor vehicle merely as a paid employee,
while there is in force in relation to the use of the vehicle no such
policy as is required by this sub-section, shall not be deemed to
act in contravention of the sub-section unless he knows or has reason to
believe that there is no such policy in force.
- Sub-section
(1) shall not apply to any vehicle owned by the Central Government or a State
Government and used for Government purposes unconnected with any commercial
enterprise.
- The
appropriate Government may, by order, exempt from the operation of sub-section
(1) any vehicle owned by any of the following authorities, namely:--
- the
Central Government or a State Government, if the vehicle is
used for Government purposes connected with
any commercial enterprise;
- Any local
authority;
- Any State
transport undertaking:
Provided that
no such order shall be made in relation to any such authority unless a fund has
been established and is maintained by that authority in accordance with the
rules made in that behalf under this Act for
meeting any liability arising out of the use of any vehicle of that authority
which that authority or any person in its employment may incur to third parties.
Explanation.--For the purposes of this sub-section, "appropriate Government"
means the Central Government or a State Government, as the case may be, and--
- In relation to
any corporation or company owned by the Central Government or any State
Government, means the Central Government or that State Government;
- In relation to
any corporation or company owned by the Central Government and one or more State
Governments, means the Central Government;
- In relation to
any other State transport undertaking or any local authority, means
that Government which has control over that undertaking or authority.
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