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  • Writer's pictureIRALR


This article has been authored by Shubh Jaiswal and Mayannk Sharma, first-year students at Jindal Global Law School


On 8th January 2021, Tesla Inc. debuted in India by registering a subsidiary in the country. B.S. Yeddyurappa, the chief minister of Karnataka welcomed its founder, tech magnate Elon Musk as Tesla was incorporated with its enlisted office in the southern city of Bengaluru, a hub for numerous global technology companies and MNCs. Musk is often characterized by his knack for innovation and has repeatedly spoken about the automotive industry is on the brink of revolution. His brainchild Tesla motor inc. has manifested itself as a chief enabler by being one of the foremost large-scale manufactures of autonomous or ‘self-drive’ electric vehicles. This exceedingly noteworthy innovation promises to be both disruptive and ground-breaking, in terms, of its impact on human autonomy and shaping the societies of the near future. Soon to enter the Indian markets, it is estimated that 33 million autonomous vehicles will hit the road by 2040

Through this article, we shall first discuss what self-driving cars are, their functioning, and the major hindrances they may face in India. Then, we will briefly elucidate on the legal concerns regarding such vehicles and the existing Indian regulatory framework around automobiles and technology in general by throwing light on the MV Act, Consumer Protection Act, and IT Act, among others.

Brief history and technology employed

Although the trials for self-driving cars had begun in the 1920s, yet in the 80s, the concept of a ‘driverless’ entity seemed alien to the masses and was met with intense scepticism. The incredulity only died down in the 2000s, when pioneering advances made in technology, aided the populace to get behind the proposition. Today, AVs employ GPS (Global Positioning System) alongside onboard cameras and state-of-the-art mapping systems. Light Detecting and Ranging (LIDAR) sensors bounce light from surrounding objects, thus generating a picture of the potential perils in the path of the vehicle. According to the calibre of technology used and the extent of autonomy, The Society for Automotive Engineers, India (“SAE”) has classified such vehicles into 5 categories. The Level 0 vehicle avails itself of no automation and is entirely reliant on the human driver. Level 1 vehicles utilize assisted automation and thus only a single feature (such as cruise control or lane-keeping) is machine-driven. Level 2 cars have more than one element automated, yet the human driver must remain constantly attentive. Level 3 and Level 4 conveyances contain sufficiently automated contrivances, and the driver is expected to be present only for ‘occasional’ control. The Level 5 vehicle, although not in existence currently, promises is to be autonomous in its entirety. Although such new-fangled machinery seems reliable, it does not entirely fool proof as tons of deterrents lie in its path, waiting to play spoilsport.


Besides the self-evident impediments that the Indian road conditions like potholes and gravel would pose, there subsist various other obstacles. Range anxiety is a term mostly associated with EVs in the context of their limited range and underdeveloped infrastructure of charging opportunities. 64% of Indian drivers agreed that range anxiety is a major turn-off for buyers which contributed to the verity of range anxiety not being a myth in India. Tesla Model 3, the most economical of Tesla’s current line-up offers an impressive range of 518 kms which, safe to say, is more than sufficient evidence to debunk the myth of a Tesla running out of charge during a commute.

The infrastructural impediments would make it arduous for EVs to acclimatise themselves to the Indian milieu since a lot of the owners may be worried about the lack of ‘Charging stations’ along their commute. However, as per a report, the distance travelled by an average commuter in India is limited to merely 500-700 kms/month, which the Model 3 offers in a single charge within 40 mins of using a supercharging station that would be provided along with the delivery of the vehicle. Since petrol-pumps in India are a stone’s throw away, each pump can have the provision of a charging station installed with it through a collaborative experiment between the government and EV manufacturers which would curtail the issue of ‘lack of charging stations.’ Although, terrain difficulties such as broken signal lights, stray bovine, jaywalking are some issues that would greatly affect the mobility of EVs, particularly in the case of Tesla’s flagship ‘Pilot mode’ which completely relies on the usage of cameras, sensors, and Artificial Intelligence.

The pricing of Model 3 (post excise duties) continues to remain a veritable concern among its prospective buyers, with Musk going as far as tweeting that “100% import duties would make our cars unaffordable in India.” The Model 3 retails at about USD 38,000 (Approx. Rs. 27.88L) in the USA but the accumulating excise duties would set an Indian consumer back by about Rs. 60L! For an average Indian, such an exorbitant financial commitment is untenable. With petrol prices reaching an all-time high of up to Rs.100/liter in some districts, it could be said that the current government is indirectly promoting EVs in India.

Relevant Statutes:

Motor vehicle act (MV act)

As per section 3(1) of the Motor Vehicle Act (MV act) of 1939, “A motor vehicle may not be driven by any person below the age of 18 or that by any person not having a driving license.” The responsibility for complying with the above rules is on the ‘owner’ of the vehicle. However, a question arises as to the application of the same rules as mentioned in the MV Act on the owner in the case of autonomous/self-driving vehicles. To address these challenges, appropriate amendments would be required by the MV Act to accommodate a provision for an Ad Hoc driving license or none at all for self-driving vehicles. This is because if the user is not in even a minimal degree of control then there seems to be no requirement of a license. Provided that most, if not all functions of AVs would be done by a Central Processing Unit along with a multitude of sensors, the question also arises regarding the AV being ‘operated’ by a person below the age of 18. [Agency/Passive driver w.r.t issuance of license]

The principle of ‘no-fault’ liability draws back to Manushri Raha v. B.L. Gupta wherein the apex court recommended the induction of no-fault liability into the MV Act, which was subsequently not incorporated, and compensation was restricted to accidents that occurred as a result of the principle of ‘fault’ only. Through an amendment in the MV Act of 1988, sections 140-144 provided for compensation arising out of accidents as a result of no-fault liability, as Section 144 dealt with the application of ‘strict liability’ to the owner or on their behalf of the insurance company.

To promote innovation and facilitation of autonomous technology, the Ministry of Law & Justice amended the MV Act of 2016 to include section 2B. As per this newly inserted section, to promote innovation, research, and development in the fields of vehicular engineering, mechanically propelled vehicles, and transportation in general, the Central Government may exempt certain types of mechanically propelled vehicles from the application of the provisions of the Motor Vehicles Act. The central government may utilise section 2B to provide an initial impetus to EV manufacturers by providing exemptions and rebates or by forming an SEZs (Special Economic Zones). The eclectic scope of section 2B can help in the formulation of exclusive SEZs by employing the usage of tax benefits such as “Duty free import/domestic procurement of goods for development, operation and maintenance of SEZ units.” In addition to the applicability of the MV Act, the Consumer protection act (CoPRA) also deals with the legal provisions that entail Autonomous vehicles.

Consumer Protection Act, 2019

Accidents of autonomous vehicles can lead to legal complications while assigning liability and manufacturers will be expected to maintain a higher duty of care than they do at present. Matters relating to negligence, manufacturing defects, design defects, failure to warn, misrepresentation, unfair trade practices, breach of warranty, and strict liability will fall under the ambit of the Consumer Protection Act, 2019. Since autonomous technology disregards the possibility of human error (especially in level 4 vehicles), the liability would fall to either the manufacturer or technology provider for a flaw in the car or a defect in technology. Considering that consumer apprehensions regarding unintended legal complications could present a roadblock to acceptance of these cars, Volvo, Google, and Daimler AG’s Mercedes-Benz have all pledged to accept liability in the event that their vehicles were to cause an accident. Even Elon Musk has stated that Tesla would accept liability unless the crash was not design-related. Moreover, the Information Technology Act introduces liability in situations where neither the manufacturer nor the driver is at fault.

Information Technology Act, 2000

A significant flaw in these self-drive vehicles is one that every futuristic piece of technology possesses - its potential to get hacked. A hacker can deftly take complete command over the car even by being at a remote location, thus rendering the driver futile. Such an accident occurring with the hacker in authority severely complicates the onus of liability. The Information Technology Act, 2000 attempts at simplifying this issue as privacy and data protection come under its ambit. The IT act, along with the IT rules, 2011, lay down the chassis for the protection of Sensitive Data and Personal Information (“SDPI”). Section 66 of the IT Act classifies hacking as the situation where someone who, with the intent to cause wrongful loss or damage, or knowledge of the same, destroys, deletes, or alters any information in a computer resource, or diminishes its value, or affects it injuriously. Although it does not explicitly mention ‘autonomous vehicles’, the scope of the phrase ‘computer resource’ can be amplified to include them as the law is open to statutory interpretation. The legislature, to ensure rapid delivery of justice, can amend the said act and add a more specified clause that unambiguously mentions either ‘autonomous vehicles’ or ‘artificial intelligence’. This will make certain that even a literal interpretation of the act will determine liability. While not infallible, this act can appreciably reduce cyber espionage in such vehicles by amending the recently tabled personal data protection bill.

Personal Data Protection Bill, 2019

In 2018, the Personal Data Protection Bill was released by a panel of experts (Shrikrishna Committee) tasked with creating a Data Protection statute for India. Under this bill, “Personal data” has been defined as “data about or relating to a natural person who is directly or indirectly identifiable, having regard to any characteristic, trait, attribute or any other feature of the identity of such natural person, or any combination of such features, or any combination of such features with any other information.” The functioning of autonomous vehicles necessitates the handling of certain knowledge like driver details and location history which classifies as ‘personal data.’ Section 3(13) of the bill obligates for a ‘data fiduciary’ which means any person, including the State, a company, any juristic entity, or any individual who alone or in conjunction with others determines the purpose and means of the processing of personal data which entails that sufficient notice must be provided to the person the data is being collected from. In the context of self-drive cars, the manufacturer would be designated as the ‘data fiduciary’ and they would be required to obtain consent from the car owner before gathering any information.

While the intent behind the bill is righteous, it may give rise to certain deterrents in the smooth functioning of these vehicles as the manufacturer may have to seek prior approval from the consumer before every software update, thus delaying the process. Also, the bill warrants that parental authority is necessary for children below 18 years of age which would require minors to acquire parental permission before every ride, thus making the procedure strenuous. Vehicle manufacturers will have to plan out their conveyances around this bill as both the judiciary and the executive have hinted that it will soon be an act.


The prospects for autonomous vehicles entering the Indian market are manifold as predicted by the Boston Consultancy Group (a 13% market penetration by 2025 equivalent to a market of around $42 Billion) but present themselves with unique socio-legal challenges. The transition from manual to autonomous entails a responsibility for the manufacturers as well as the legislative for adopting a harmonious approach to formulate statutes that would invite autonomous vehicle companies to set up manufacturing plants in India. Exorbitant duties and legal obfuscations are an impediment to the melting pot of Foreign Direct Investment that these vehicle manufacturers aim to bring. The development of the statutory framework that regulates the operation of these vehicles has not paced as copiously as the technology has as elicited through the article. The adoption of the strict liability model- that lays down liability on the owner and manufactures of the vehicle is recommended. Further, a collaborative approach between tech moguls and the government (both centre and state) could have a transformative effect on the lives of citizens.

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