The Charges
Awarded
Sold the Car, Stuck With the Liability: Legalfoxes Secures Interim Protection for a Seller Left Holding Cars24’s Unfinished RC Transfer
The Gurugram Civil Court declines to order an immediate transfer or scrapping of the vehicle at the interim stage, but directs Cars24 to move the transfer process forward, disclose its status, and bear any liability arising after the seller handed over possession.
Our client, Sachin Chauhan, sold his Ford Figo Aspire through the online resale platform operated by Cars24 Services Pvt. Ltd. He completed every formality the company required, handed over physical possession of the vehicle along with the original registration certificate, keys and other documents, and received a signed “Vehicle Delivery Acknowledgment Receipt” from Cars24 confirming the handover. Cars24 had also issued him a “Seller Protection Policy,” assuring him of protection against post-sale challans, legal proceedings and liabilities until the RC stood transferred to the next owner.
Nearly 19 months later, despite repeated follow-ups, emails and a formal legal notice, the registration certificate still stood in Mr. Chauhan’s name. Left exposed to potential fines, claims or legal proceedings over a vehicle he no longer possessed or controlled, he instituted a civil suit against Cars24 and moved an application under Order XXXIX Rules 1 and 2 read with Section 151 CPC, seeking an interim mandatory injunction directing Cars24 to complete the RC transfer or, failing that, to take steps to scrap or de-register the vehicle so the liability could not continue to follow him.
Cars24’s Defence
Representing Cars24, counsel opposed the application on several fronts: that the relief sought was effectively the same as the final relief claimed in the suit and granting it at the interim stage would amount to deciding the case without trial; that the suit suffered from non-joinder, since the dealer/channel partner actually responsible for effecting transfer had not been made a party; that Cars24 merely operated a technology platform connecting sellers to dealers, with the transfer obligation resting on the dealer, not the platform; and that Mr. Chauhan already stood protected by the Seller Protection Policy, with no proof that any challan, claim or proceeding had actually arisen against him.
The Advocacy That Kept the Pressure On Cars24
Appearing for Mr. Chauhan, Mr. Atin Handuja, Founder Managing Partner of Legalfoxes, argued that Cars24 could not deflect responsibility onto a dealer when every document, acknowledgment and assurance underpinning the transaction the delivery receipt, the seller protection undertaking, the platform itself came directly from Cars24. He submitted that a seller who has parted with possession, keys and papers cannot reasonably be left to bear indefinite exposure for a vehicle no longer within his control, and that Cars24, having taken on a contractual and representational role in the transaction, was obliged to see the transfer through within a reasonable time.
What the Court Held
Applying the Supreme Court’s guidelines on temporary mandatory injunctions in Dorab Cawasji Warden v. Coomi Sorab Warden requiring a strong case for trial, irreparable injury, and balance of convenience the Court accepted that Mr. Chauhan had placed prima facie material on record establishing delivery of the vehicle, Cars24’s own acknowledgment of that delivery, and its assurances regarding post-sale liability. At the same time, the Court held that directing an outright transfer or scrapping of the vehicle at the interlocutory stage would effectively decree the suit itself, which the law does not permit before trial particularly with the precise division of responsibility between Cars24 and its dealer network still to be tested on evidence.
Rather than granting or dismissing the application outright, the Court crafted an interim middle path. It directed Cars24 to take effective steps, in line with its own policy, to expedite completion of the ownership transfer, and to place on record the current status of that process along with the particulars of the concerned dealer and the vehicle’s present purchaser. It further directed that if Mr. Chauhan is served with any challan, notice, claim or proceeding relating to the vehicle for any period after 26 July 2024 the date he handed over possession Cars24 must deal with it strictly in accordance with the Seller Protection Policy it had itself relied upon.
Why This Result Matters
For Mr. Chauhan, the order does not close the matter, but it does something practically important: it puts Cars24 on record, under a court’s directions, to push the transfer forward and to disclose exactly where the process stands and who is responsible for it and it makes clear that any liability arising after he handed over the vehicle cannot be pinned on him. For sellers using online vehicle-resale platforms more broadly, the order is a reminder that a platform’s own delivery acknowledgments and seller-protection assurances can be used to hold it accountable, even where the platform tries to shift responsibility to a dealer or channel partner further down the chain. The suit itself remains very much alive, with Cars24’s written statement now due on 27 August 2026.
Firm Legalfoxes Advocates and Consultants
Advocate Mr. Atin Handuja, Founder Managing Partner
Email contact@legalfoxess.com
This case story is shared for general informational purposes and does not constitute legal advice.