Calcutta High Court
Charu Chandra Biswas vs Registering Authority, Motor Vehicles ... on 25 August, 1993
Equivalent citations: (1994)1CALLT438(HC)
JUDGMENT Gitesh Ranjan Bhattacharjee, J.
1. On 2nd December, 1992 the petitioner purchased a motor vehicle being a bus bearing registration No. WBR 3734 from one Shri Jnanabrata Chanda. Thereafter he applied before the Registering Authority, Barasat for recording the fact of transfer of ownership of the said vehicle and also submitted all necessary papers. His contention is that in spite of compliance of all necessary formalities the Registering Authority is not recording the fact of transfer of ownership of the vehicle or his name as owner of the vehicle in the registration certificate and on the contrary insisting upon payment of tax under the West Bengal Additional Tax and One-Time Tax on Motor Vehicles Act, 1989 payable by the transferor, as a precondition for recording the transfer of ownership of the vehicle in the certificate of registration. The petitioner has moved this Court by this writ application challenging the authority of registering authority to demand payment of any arrear tax as a pre-condition for recording the transfer of ownership in the certificate of registration. In the writ application incidentally it has also been contended that by virtue of the order of court realisation of additional tax under the said Act has been stayed and as such no additional tax is payable under the said Act. Since this aspect of the matter, is not necessary to be considered in this writ application the same is not taken up for consideration and all contentions and counter-contentions of the parties oh this point are, therefore left open and kept out of consideration. The only question that is to be considered now is whether a Registering Authority can insist upon payment of arrear tax as a pre-condition for recording transfer of ownership of a vehicle in the certificate of registration. In this connection the learned Advocate for the petitioner has referred to three decisions, viz, Nanaiah v. R.T.O., Mercara, ; Santakumari v. R.T.O. & R. Authority, AIR 1976 Kerala 17 and Proposed Dharwad Distinct Ex-Servicemen's Cooperative Society Ltd. v. State .
2. Section 50 of the Motor Vehicles Act, 1988 contains provisions regarding recording of transfer of ownership of a motor vehicle. In view of clause (a)(i) of sub-section (1) of Section 50 where the ownership of a registered vehicle is transferred within the same State in which the vehicle is registered, in that event the transferor is required to send a report about the fact of transfer, within fourteen days of the transfer, to the concerned registering authority within whose jurisdiction the transfer is to be effected and also to send simultaneously a copy of the said report to the transferee. Where however the transfer takes place in a State other than the State in which the vehicle is registered, in that case under clause (a) (ii) the transferor has to forward, within forty five days of the transfer, to the registering authority within whose jurisdiction the transfer is to be effected a no objection certificate issued by the registering authority in the other State by whom the vehicle was registered. In case of any transfer the transferee is likewise required under clause (b) of Section 50(1) to apply to the registering authority within whose jurisdiction he has the residence or place of business where the vehicle is normally kept forwarding therewith the certificate of registration together with the prescribed fee and the copy of the report received by him from the transferor for getting the particulars of transfer of ownership entered in the certificate of registration. In considering whether a no objection certificate as referred to in clause (a) (ii) of Section 50(1) can be granted or not the concerned authority is required under Section 48(5) to obtain a report in writing from the police that no case relating to the theft of the concerned motor vehicle has been reported or is pending and also to verify whether all the amounts due to Government including road tax in respect of that motor vehicle have been paid as well as to take into account such other factors as may be prescribed by the Central Government. It is therefore true that in considering whether no objection certificate can be granted or not the registering authority by whom the vehicle was registered has to consider inter alia whether all amounts payable to the Government in eluding road tax in respect of the motor vehicle have been paid. But as we have seen the question of granting no objection certificate arises only where the transfer of the vehicle is to be effected in a State other than the State in which the vehicle was registered. Where however the transfer is to be effected in the same State in which the motor vehicle is registered no such no objection certificate from the registering authority is necessary even if the registering authority by whom the vehicle was registered is different from the registering authority within whose jurisdiction the transfer is to be effected.
3. Rule 55(2) of the Central Motor Vehicle Rules, 1989 provides that an application for transfer of ownership of a motor vehicle under Section 50(1)(a)(i) of the Act (that is, where the transfer is to be effected in the same State in which the vehicle is registered) shall be made by the transferee in Form 30 and such application shall also be accompanied by the certificate of registration, the certificate of insurance and appropriate fee. Sub-section (6) of Section 50 of the Act provides that on receipt of a report or an application for transfer under the said section 'the registering authority may cause the transfer of ownership to be entered in the certificate of registration.' Now the question is whether the word 'may' used in said subsection (6) of Section 50 gives discretion to the registering authority to refuse to record the transfer of ownership on whom or for reasons extraneous to the consideration of the matter. The answer is emphatically 'no'. Under Rule 53 of the West Bengal Motor Vehicles Rules, 1989 the registering authority or the concerned authority, as the case may be, 'upon the receipt of an application for registration or for any other purpose under the Act' is required to make snch enquiries as may be reasonably necessary to establish the identity, eligibility and bona fides of the applicant.' Therefore on receipt of an application for recording a transfer of ownership in respect of a vehicle the registering authority has to see whether the requirements of the relevant provisions of Section 50 of the Motor Vehicles Act, 1988 and of Rule 55 of the Central Motor Vehicles Rule, 1989 have been complied with and also to make under Rule 53 of the West Bengal Motor Vehicles Rules, 1989 such enquiries as may be reasonably necessary to establish the identity, eligibility and bona fides of the applicant.
4. It is needless to mention that the question whether any tax is due in respect of the concerned vehicle, either under the West Bengal Motor Vehicles Tax Act, 1979 or under the West Bengal Additional Tax and One-Time Tax on Motor Vehicles Act, 1989, is not in any way connected with an enquiry about the identity, eligibility and bona fides of the applicant as referred to in Rule 53 of the West Bengal Motor Vehicles Rules, 1989. In view of Section 10 of the West Bengal Motor Vehicles Tax Act, 1979 and Section 18 of the West Bengal Additional Tax and One-Time Tax on Motor Vehicles Act, 1989 both the transferor and the transferee remain liable for payment of the pre-transfer arrear of tax despite the transfer. The concerned motor vehicle also may be seized by the concerned authorities under both the Acts for realisation of unpaid tax notwithstanding such transfer. Therefore the question of bona fides of the applicant-transferee in the matter of getting the transfer recorded cannot be legitimately or logically linked up with the question of non-payment of tax, because by reason of transfer of the vehicle neither the transferee nor the transferor gets any advantage regarding liability to pay arrear tax for the pre-transfer period. It is thus evident that the question whether tax has been paid or not, is not a matter of enquiry either under Rule 53 of the West Bengal Motor Vehicles Rules, 1989 or otherwise, in connection with the application for recording the transfer of ownership of the vehicle. Even where the registering authority by whom the transfer is sought to be recorded belongs to a State different from the State where the motor vehicle was registered, such registering authority has no doubt to satisfy himself that a no objection certificate issued by the concerned registering authority under Section 48 of the Motor Vehicles Act in respect of the transfer has been produced before him, but in such case also he cannot embark upon any enquiry himself, as a pre-condition for recording the transfer of ownership, whether the tax in respect of the concerned motor vehicle has been paid or any tax is in arrear.
5. It is true that in sub-section (6) of Section 50 of the Motor Vehicles Act, 1988 the word 'may' has been used in the context of the duty of the registering authority to cause the transfer of ownership to be entered in the certificate of registration on receipt of an application for the purpose. But the said word 'may' obviously cannot be so interpreted as to give an unrestrained, capricious and absolute discretion upon the registering authority in the matter of recording the fact of transfer of ownership in the certificate of the registration. On the other hand, it, is evident that the word 'may' has been used there to denote that in appropriate cases, for good and valid reason, the registering authority may not record the alleged transfer of ownership and refuse to record the same. But refusal to record the alleged fact of transfer must be based on good, valid and relevant reasons and not on caprice or sweetwill. As for example, if in considering the application for recording the transfer of ownership the registering authority finds that the essential requirements of the relevant provisions of Section 50 of the Motor Vehicles Act or Rule 55(2) of the Central Motor Vehicles Rules have not been complied with or on enquiry under Rule 53 of the West Bengal Motor Vehicles Rules about the matters mentioned therein the Enquiring Authority finds that there are good, sufficient, valid and relevant reasons for rejecting the application for recording the transfer of ownership of the vehicle, in that case he can certainly reject that application for recording the transfer of ownership. But even then where he rejects such application and refuses, to enter the particulars of transfer of ownership in the certificate of registration he must record his reasons for doing so inasmuch as such rejection or refusal is appealable under Section 57 of the Motor Vehicles' Act, 1988. It is needless to mention that an appealable order of rejection or refusal must be a speaking order and contain reasons in support thereof. Therefore, there is no scope of holding that the word 'may' as- used in sub-section (6) of Section 53 gives an unfettered or absolute discretion upon the registering authority to decide whether he should record the particulars or not. His decision in the matter must be based on reason and it is needless to say that such reason, in order to be sustainable, must be based on factors relevant to the consideration of the matter within the permissible zone of enquiry delineated by law. The question whether any tax is in arrear does not fall within such zone of enquiry or consideration, for reasons discussed earlier, in the context of recording the transfer of ownership in the certificate of registration and as such the registering authority cannot withhold recording of transfer on the ground of non-payment, of tax. Any such action on the part of the registering authority will be wholly arbitrary and illegal.
6. In paragraphs 4 and 5 of the writ petition is stated that the respondent authorities took steps for confirmation of the sale of the vehicle and were satisfied, after taking interview of both the transferor and the transferee, regarding the sale of the vehicle and that the sale verification of the same has been completed by the respondent. This has not been challenged by the respondent before me. That being so when the requirement of the prescribed procedure has been complied with and the sale verification has been completed with no adverse outcome, the petitioner has acquired a legal right to get the transfer of ownership of the vehicle recorded in the registration certificate by the registering authority under Section 50(6) of the Motor Vehicles Act, 1988. The registering authority has a duty to give effect to that right by recording the transfer of ownership of the vehicle under Section 50(6) of the Motor Vehicles Act, 1988 without undue delay.
7. The respondents are accordingly directed to record the fact of transfer of ownership of the concerned vehicle in favour of the petitioner under Section 50(6) of the Motor Vehicles Act and return the certificate of registration to the petitioner after recording the transfer therein along with other documents within two weeks from the date of communication of this order. The writ application stands disposed of accordingly. No cost is ordered.