[By Tejas Sateesha Hinder and Ritik Kumar Rath. The authors are students of National Law Institute University, Bhopal]

Introductory Remarks

Recently, Tesla, the world’s most valuable car company, announced that they will enter the Indian market, and in January 2021, it registered itself with an office in Bengaluru. The concern as of now is not whether self-driving cars are fit for Indian roads, but whether Indian laws are ready to tackle problems associated with  self-driving cars.

Self-driving cars use Artificial Intelligence (“AI”) to control the cars. The AI software gets its information from the camera, ultrasonic sensors and radar attached in the cars. It can sense the environment around the cars with the help of complex algorithms and machine learning system. Most of the self-driving cars use ‘LiDAR’ (light detection and ranging) technology in which sensors launch pulses of light from the car’s surroundings to measure distances, detect road edges, and identify lane markings.

The Motor Vehicles Act, 1988[i] and the Consumer Protection Act, 1986[ii] are the two major laws that govern motor vehicles in India. The Motor Vehicles Act, 1988, governs the minimum age for driving a car, as well as the vehicle’s liability and registration. On the other hand, the Consumer Protection Act, 1986, regulates damages arising from negligence, industrial errors, construction defects, and unfair trading practices.

This article attempts to explore the means and need for legislative inclusivity of self-driven cars in India, by a doctrinal study of the existing regulatory framework surrounding motor vehicles in India, and a reform oriented approach through study of legal positions for  the same in the United Kingdom and Germany, both of which have notably developed their legal positions to accommodate autonomous vehicles.

Leading International Jurisprudence  


Britain is a one of the frontrunners of regularizing self-driving cars. In 2018, the Automated and Electric Vehicles Act, 2018 was passed and it got the royal assent in July 2018. Section 2(2) of this statute[iii] is notable as it explicitly states that when an accident is caused by an automated car, the owner of the vehicle is liable for the accident. The same principle applies when a death is caused by an automated car.

Further, Section 4 of this act specifically states that if an autonomous car is insured and the accident is caused because of unauthorized software updates or failure update the software, the liability of the insurer decreases. But this Act does not address the issue of liability of the autonomous car company which has developed the car and the AI system. So in short, all liability lies on the owner even if there is a fault of the AI. This pounding of liability creates multiple problems not only on the owner, but also in the process of administration of justice.

Driver agreement to legal terms and responsibility demarcation, enabled by an integrated digital interface, can fail under the extreme scrutiny of the courts in the event of an accident and subsequent lawsuit or insurance dispute. To be true, a driver’s permission to run an AV must be informed about the dangers and their obligations. This is likely to be accomplished only through specialised AV driver training and interfaces that support the legal elements of consent, such as the driver’s understanding of the nature and scope of the risk being taken.

Consent given via an interactive digital interface as a mechanism to transfer responsibility and liability between driver and AV is a step that is likely to disadvantage the driver, who may not appreciate the risk or legal obligations of operating an AV, without sufficient education and training. Manufacturers cannot be held harmless if a driver agrees to terms using a digital platform, regardless of whether or not they understand the risks and liabilities involved. When it comes to putting AV on the market, manufacturers and policymakers must be aware of these issues and work to establish a fair system of culpability.


Germany was one of the first countries in the world to come up with a legislation to control and regulate autonomous vehicles. The German Road Traffic (Amendment) Act, 2017 is one of the leading legislations in the world that regulates autonomous cars.

Section 1 of the act allows the driver to transfer the control of the car to automated driving system if that fulfills the international requirement, as under the Vienna Convention on Road Traffic, 1968. After the latest update in March 2016, automated vehicles have been approved and accepted under the Convention, which can now be applied to self-driving cars.

Section 63A of the act specifies that a black box, which is a device connected to a GPS system that tracks vehicle pace, direction, distance travelled, driving pace, and time of day. should be installed in the car to maintain a record of who was controlling the car at the time of the accident.

Additionally, with the help of this black box, the responsibility will be easily assumed. If the accident is caused by the driver, then the driver would be held responsible and if the accident is caused due to a failure of the self-driving system, then the blame would shift to the manufacturer of the car. Also, according to section 12 of the act, in the case of death or injury due to self-driving system, the maximum amount the victim can recover is €10 million.

The German legislation, by making the manufacturers liable for the accident caused by their self-driving system, forces the manufacturer to build a more fault-proof system, which is beneficial for everyone from the owner of the car to the pedestrian walking on the road.

Position in India

Currently in India there is no dedicated legislation to regulate self-driving cars. Even the 2019 amendment to the motor vehicle act has no visible impact on self-driving cars or autonomous cars. There is an everlasting question which comes with AI – of personhood and agency.

In India, there has been very less debate on the accountability of AI. Notably, NITI Aayog in 2018 released a policy paper National Strategy for Artificial Intelligence, which discusses how AI can be introduced in sectors like healthcare, agriculture, automobile, but this paper also fails to discuss the issue of liability of AI. Now the foremost question that arises is whether India should follow the Britain model where the owner is liable even if the mistake is committed by the AI, or India should follow the German model which imposes liability on the manufacturer of the car when there is mistake on the part of the AI.  

If reference is drawn from another statute, the newly enacted Consumer Protection Act, 2019, under section 2(34) defines product liability as “the responsibility of a product manufacturer or product seller, of any product or service, to compensate for any harm caused to a consumer by such defective product manufactured or sold or by deficiency in services relating thereto”. So if we consider AI as a product then the manufacturer is totally liable for the damage caused by this.

But there lies other question of whether AI is a service or a product because AI is basically a large programming code and programing code installed into a system is generally considered as a service rather than product. These cases are generally treated as breach of warranty rather than product liability.[iv]

Another latent question but one of higher significance is whether the principle of ‘no fault liability’, according to which without any error or ‘fault’ on his side, a defendant would be held liable, should be applied for accident caused by self-driving cars. Section 140 of Motor Vehicle Act, 1988 prescribes the payment of compensation of Rs.50,000 in the case of death and Rs.25,000 in case of permanent damages. But in the case of Haji Zakaria v. Naoshir Cama[v] a very important question arose- whether liability of paying compensation can be imposed when no rash or negligent driving was undertaken by the owner. The Supreme Court was of the view that no liability can be imposed on the owner or the driver where there is an absence of negligence. So if we apply this judgment, the accident caused by a self-driving car is not negligence of the driver or owner but it is the negligence of the manufacturer so the manufacturer should be liable to pay the compensation.

Similarly, if we take the court’s view in the case of United States v. Athlone Indus Inc.[vi] it was held that robots cannot be prosecuted for their faults and the case discussed at length that legal liability can be imputed on the manufacturer because of a faulty robotic system.

A need for proper legislation with proper demarcation of liability is necessary as India is in the pinnacle in road accident where annually 4.5 lakh road crashes happen in which atleast 1.5 lakh people die. A recent report of the World Bank states that India has1% of the world’s total vehicles but contributes 11% to global deaths in road accidents. With such horrifying statistics, if India allows autonomous cars to run on the roads without a proper legislation, it will be a catastrophe.  

Conclusion and Suggestions

In order to address the problem of autonomous vehicles in the context of the India, it is necessary to address the other laws that will also play a role. For example, in the case of privacy and confidentiality, which often includes sensitive personal data, the position of the Information Technology Act, 2000, must be discussed, particularly Section 66 of the Information Technology Act, 2000, since this technology is vulnerable to hacking. Since the concept of “computer resource” does not involve autonomous vehicles, hacking of autonomous vehicles would be beyond the scope of the current provision on hacking under the IT Act. ‘Securing self-driving vehicles comes at a cost, just how much manufacturers are prepared to pay is the question. From a hardware standpoint, automakers should install more sensors such that if one is corrupted, another can take control, according to Petit. However, in order to save money, most automakers are trying to eliminate redundant sensor systems.’ As a result, the Legislature should broaden the definition of hacking under the IT Act and enact stringent regulations requiring automobile makers to implement anti-hacking systems and safety features. It must therefore address the issues of responsibility and protection that would happen if a hacking-related injury happens.

Another important legislation is the Geospatial Information Regulation Bill, 2016. The intent of this bill is to incorporate regulation, acquisition, transmission, publishing, and delivery of geospatial information. The Bill clarifies its goals by allowing Restricted Entities to acquire a licence for certain Geospatial Data/Maps from Indian Entities only for the limited purpose of servicing their Indian customers. Furthermore, APIs must be used to view those data so that it does not flow through the Restricted Entity or its servers. It is also illegal to resell or reuse such information. Ground checking/verification is often banned for Restricted Agencies, allegedly due to security issues over allowing international entities to collect comprehensive information inside Indian territories.

In order to protect privacy, the Guidelines note that DST would be informed with a negative list comprising sensitive characteristics that will be subject to acquisition and/or usage regulations. Any individual would not be allowed to label these attributes on any Map. DST will also form a Geospatial Data Promotion and Development Committee (“GDPDC”), which will include members from various government agencies. Any question resulting from the finalisation of negative attribute lists and the draught rules on such attributes will be decided by the GDPDC. Furthermore, Restricted Organizations are barred from conducting ground checking/verification, allegedly due to security issues over allowing international entities to collect accurate details on Indian soil.

Hence, this bill is currently in the negotiation stage, so it would resolve the problem of driverless cars.

Other big obstacles will include grappling with the question of existing relevant provisions of the Motor Vehicle Act and the Consumer Protection Act; getting the autonomous vehicle into the regulatory system would necessitate amending these two regulations so that it could be implemented properly. A section specific amendment is not being looked at in this regard. As indicated in the latter part of the terminal paragraph of the conclusion, an amendment to the extent of extending provisions which govern issues not involving faults of drivers per se, to the owners of self-driving cars.

In addition to this, a provision should be added for a situation where a company whose self-driving cars are not up to the mark for Indian roads should be forced to provide higher penalty and if the situation worsens, then their license should be cancelled.  

Next, either the government should make amendment to Motor Vehicles Act, 1988 to accommodate self-driving cars or government should makes a dedicated legislation on self-driving cars like Britain and Germany wherein rules regarding liability in case of an accident to rules related to charging should be clearly mentioned. Also the act should impose the liability on the manufacturer for any fault of AI, as the same will provide a two-fold benefit. First, the car manufacturers are in a much better position to pay compensation, alias their deep pockets, and second, when compensation is given by the manufacturers then there is a greater incentive for them to try to make their products more error-free.

[i] The Motor Vehicles Act, Gazette of India (1988).

[ii] The Consumer Protection Act, Gazette of India (1986).

[iii] Electronic Vehicles Act, sec. 2(2) (2018).

[iv] Motorola Mobility, Inc. v. Myriad France SAS, Case No. 11 C 7373; Hallinan v. Fraternal Order of Police of Chi. Lodge No. 7, 570 F.3d 811, 820 (7th Cir.2009).

[v] Zakaria & Ors. v. Naoshir Cama & Ors., AIR 1976 AP 171.

[vi] United States v. Athlone Industries, Inc., 746 F.2d 977 (3d Cir. 1984).