Punjab-Haryana High Court
Indo Canadian Transport Co. vs Union Of India (Uoi) And Ors. on 14 July, 1998
Equivalent citations: I(1999)ACC94, AIR1999P&H130, (1998)120PLR646, AIR 1999 PUNJAB AND HARYANA 130, (1999) 1 ACC 94, (1998) 120 PUN LR 646, (1998) 3 RECCIVR 638, 1998 REVLR 2 302
Author: N.C. Khichi
Bench: N.C. Khichi
JUDGMENT Jawahar Lal Gupta, J.
1. The petitioners in these 13 writ petitions claim that the States of Punjab and Haryana are not entitled to charge any taxes except those sanctioned by the Ministry of Surface Transport vide letter dated August 30, 1993 from the tourist transport operators. Learned counsel for the parties have referred to the facts in Civil Writ Petition No. 12119 of 1996. These may be briefly noticed.
2. The petitioner-M/s. Indo-Canadian Transport Company entered into an agreement with the Punjab Tourism Development Corporation for providing "modern transport facilities to the tourists visiting Punjab and in particular for taking groups from I.G.I. (Indira Gandhi International Airport), New Delhi to Amritsar and back". By virtue of this agreement, the petitioner had undertaken to get the logo of the Punjab Tourism painted on its buses and to ply on the aforesaid route. After the agreement, the petitioner claims to have purchased four buses.
3. The petitioner avers that in the year 1992, the Transport Development Council of India had held a meeting and recommended that "an appropriate scheme may be worked out for operation of tourist cabs/coaches on the basis of an All India Permit". For this purpose, a committee of the State Transport Secretaries was formed and on the basis of its recommendations, a scheme called 'The Motor Vehicles (All India Permit for Tourist Transport Operators) Rules, 1993' was finally notified on August 10, 1993. It was recorded that the State Governments "had agreed that apart from the Home State Tax, the composite fee be charged from the permit holders" at the fixed rates. For "Omni Coach of 14-35 seats", a composite fee of Rs. 12,000/- per quarter per State (other than the Home State) was fixed. A copy of the communication sent by the Ministry of Surface Transport on August 30, 1993 has been produced as Annexure P-2 with the writ petition. In paragraph 3 of this letter, it was stated as under :--
"I am writing to request you to take necessary action incorporate these provisions relating to composite fee in the State motor vehicles taxation rules and also issue necessary instructions/ guidelines to the State Transport Authorities for grant of permits. It may also be clarified that the composite fee is in lieu of all taxes."
4. The petitioner asserts that in conformity with this decision, it has been granted the requisite "authorisation certificate as a tourist transport operator" and that it has been paying the composite fee of Rs. 12,000/- per quarter. Copies of the certificates etc. have been produced as Annexures P.3 to P.6 with the writ petition. In spite of this, the petitioner alleges that respondent Nos. 2 and 3 viz. the States of Haryana and Punjab respectively have started harassing the staff of the petitioner and interfering with the plying of buses. They "are threatening to impound the buses of the petitioner and are challaning the buses alleging non-deposit of the tax......." The petitioner maintains that the respondents are estopped from charging any tax in view of the decision contained in the communication dated August 30, 1993 and that their action in not honouring the mandate contained therein, was arbitrary and unfair. Consequently, the petitioner prays that the respondents be directed not to interfere with the plying of buses or to ask for the deposit of any taxes beyond the composite fee except in the 'Home State'.
5. No written statement has been filed on behalf of respondent Nos. 1, 4, 5 and 6. On behalf of respondent No. 2 (the State of Haryana) the reply has been filed by Mr. A. S. Ahlawat, the Assistant Excise and Taxation Officer, Sonepat, The factum of the meeting of the transport Development Council and the issue of the letter dated August 30, 1993 have been admitted. It has, however, been asserted that in this letter "it is clearly mentioned that the State Governments had agreed that apart from the Home State Tax, the composite fee be charged from the permit holders according to the rates mentioned in Annexure P.2". It has been admitted that "in the case of the petitioner, the amount of composite fee was fixed at Rs. 12,000/- per quarter per State....." However, the respondent maintains that "the amount of composite fee does not include the Home State Tax which is the passenger tax leviable in the State of Haryana under Section 3 of the Punjab Passengers and Goods Taxation Act, 1952......." It has been further averred that the State Act of 1952 has been enacted under "Entry 56 of List II of the Constitution of India". The respondent maintains that "the States through which the National Highway passes incur considerable expenditure for the maintenance of roads and providing facilities for the transport of goods and passengers......". Consequently, it is urged that the demand for taxes under the laws prevalent in the State is legal and valid.
6. A separate reply has also been filed on behalf of respondent No. 3, the State of Punjab by Mr. Harmel Singh, Deputy State Transport Commissioner. It has been averred that the State of Punjab had enacted the "Punjab Motor Vehicles Taxation Act, 1924 (Amended), 1993 and levied Special Road Tax..... According to the respondent, on the air-conditioned tourist buses, the road tax is @ Rs. 1,44,0007- per year and that the petitioner "is bound to make payment of taxes as prescribed in the Punjab Motor Vehicles Taxation Act, 1924......."
7. Counsel for the parties have been heard.
8. On behalf of the petitioners, it has been contended by Mr. M. S. Khaira that under the provisions of law, the Tourist Operators constitute a special class. With the object of encouraging tourism and to ensure that proper facilities were provided, a decision had been taken at the national level that the operators shall not be required to pay taxes separately in different States and that they would only be required to deposit a composite fee at the prescribed rate in lieu of all the taxes. It was on the faith of this categorical condition that the petitioners had bought expensive buses and undertaken to provide good facilities to the travellers. After the petitioners have spent substantial amounts of money, the respondents cannot be permitted to raise demands for payment of taxes other than the prescribed composite fee.
9. The claim made on behalf of the petitioners was controverted by the counsel for the respondents who urged that the petitioners were liable to pay the taxes as prescribed under the various State Legislations. Mr. Goyal, who appeared for the State of Haryana, urged that the composite fee only included the taxes leviable by the Centre and the States under the Motor Vehicles Act and that it did not cover the other taxes under the Statutes enacted by the different State Governments. It was also contended that the 'Home State Tax' implied all the taxes leviable in a particular Slate under Statutes other than the Motor Vehicles Act, 1988.
10. Before proceeding to consider the respective contentions of the learned counsel for the parties, a few provisions deserve to be noticed. The basic provisions are contained in the Motor Vehicles Act, 1988. Section 2 (43) defines a 'Tourist vehicle' to mean "a contract carriage constructed or adapted and equipped and maintained in accordance with such specifications as may be prescribed in this behalf." Section 88 (9) inter alia provides that "subject to any rules that may be made by the Central Government under Sub-section (14), any State Transport Authority may, for the purpose of promoting tourism grant permits in respect of tourist vehicles valid for the whole of India, or in such contiguous States not being less than three in number including the State in which the permit is issued....." Sub-section 11 lays down the specific conditions which shall be attached to every permit granted under Sub-section 9. It has been inter alia provided that the motor vehicle "shall conform to such description, requirement regarding the seating capacity, standards of comforts, amenities and other matters as the Central Government may specify in this behalf." It has also been provided that "every such motor vehicle shall be driven by aperson having such qualifications and satisfying such conditions as may be specified by the Central Government". Still further, in exercise of the powers under the Act, the Motor Vehicles Rules, 1989 have been framed. Rule 85 prescribes the additional conditions which are incorporated in every tourist permit granted in respect of a tourist vehicle. The explanation to this rule defines 'Home State' to mean "the State which has granted the permit under Sub-section 9 of Section 88".
11. It appears that in pursuance of the deliberations of the meeting held in January 1992, the Central Government had framed the Motor Vehicles (All India permit for Tourist Transport Operators Rules), 1993. These rules were framed in exercise of the powers conferred by Section 88 (9) and (14). Section 14 (Rule 1(4)?) specifically postulates that the conditions "prescribed in Rules 82 to 85-A of the Central Motor Vehicles Rules, 1989 shall not apply to the permits granted under this scheme". Rule 2 contains the definitions. The relevant provisionscan usefully beextracted "(b) 'Authorisation Certificate' means a certificate issued by an appropriate authority to a recognised Tourist Operator authorising him to operate throughout the territory of India or in such contiguous States, not being less than three in number including the State in which the permit is issued on recognised tourist circuits, as are specified in the all India Permit for a tourist vehicle granted to him.
(c) 'Appropriate authority means the authority which is authorised under the Act to grant a permit in respect of a tourist vehicle'.
(d) 'Schedule' means a Schedule appended to these rules;
(g) 'Tourist Transport Operator' means a company or an individual engaged in the business of promotion of tourist circuits, recognised by the Department of Tourism of the Government of India."
12. These rules also lay down the procedure of applying for the issue of an authorisation certificate, the charging of authorisation fee, the seating capacity, the age of the tourist coaches, the distinguishing particulars to be exhibited on Motor vehicles, the rule relating to list of tourists, the filing of quarterly return and the issue of a certificate of recognition. The forms of application as well as the authorisation certificate have been given in Schedules I and II. The eligibility conditions for the issue of a certificate of registration as "Approved Tour Operator" are contained in the Fourth Schedule. It has been inter alia provided that the operator shall have to indicate the turnover in terms of foreign exchange etc. There are two more Schedules. However, it is not necessary to refer to the provisions thereof for resolving the controversy in the present cases.
13. A perusal of the above provisions broadly indicates that the tourist vehicles are a special class and are subject to special rules. Different standards have been laid down for the tourist vehicles. In other words, each and every vehicle cannot be classified as a tourist vehicle. It is required to be "equipped and maintained" in conformity with the specifications laid down in this behalf. Similarly, the law envisages that special conditions shall be laid down for the grant of permits in respect of the tourist vehicles. In particular, the vehicle is required to conform to the "description, requirement regarding the seating capacity, standards of comforts, amenities and other matters as the Central Government may specify in this behalf. Even the driver has to possess the prescribed qualifications. All this is intended to achieve the avowed object of "promoting tourism". Still further, it is also evident that initially, special provisions had been made in Chapter IV of the Motor Vehicles Rules, 1989 in respect of tourist permits. However, in the year 1993, the new rules were framed and it was specifically provided that Rules 82 to 85-A of the Central Motor Vehicles Rules, 1989 "shall not apply to the permits granted under this Scheme."
14. The above legislative provisions clearly show that the 'tourist vehicles' as well as 'tourist transport operators' are treated as a special class.
15. It is in the background of these provisions that the factual position in the present cases has to be considered.
16. Indisputably, the Transport Development Council had held a meeting in January 1992. A perusal of the communication dated August 30, 1993 sent by the Ministry of Surface Transport (Transport Wing) to all the Transport Secretaries of the State Governments and the Union Territory Administrations shows that on the basis of the recommendations of a specially constituted committee, the 1993 rules were finalised and notified. It was further recorded that the State Government "has agreed that apart from the Home State Tax, the composite fee be charged.. .." Still further, it was specifically recorded that "the composite fee is in lieu of all taxes". In other words, the provision was that the Home State which admittedly means "the State which has granted the permit under Sub-section 9 of section 88" is entitled to charge all the taxes leviable therein. Besides that, the tourist operator has to pay a composite fee "in lieu of all taxes". The obvious purpose was to ensure that the operator is not required to appear before assessing authorities or raise disputes regarding the 'amount of money due' which may vary from State to State. A uniform fee @ Rs. 12,000/- per quarter was fixed and it had to be paid every quarter to each State through which the operator was moving.
17. It is undoubtedly correct that normally, even a tourist operator should be required to pay all those taxes which every other transporter pays. If the tourist operators were not visualised as a separate class, the claim made on behalf of the respondents that they should not be accorded any preferential treatment would have been perfectly justified. Ordinarily, the laws operating in each State should have their full operation against everyone. The provisions of the 1952 and 1924 Acts would have been normally applicable to even the tourist operators. However, the State Governments had admittedly agreed to charge a composite fee of Rs. 12,000/- in lieu of all taxes. Having agreed to this, the respondents cannot be permitted to levy and charge various other taxes as claimed by them.
18. It was contended by the counsel for the respondents that under the provisions of the 1924 Act, the special road tax at the rate of Rupees 1,44,000/- per year is payable by a tourist operator. Similarly, it was also contended on behalf of the State of Haryana that the tourist operators were liable to pay the passenger tax under the 1952 Act.
19. This contention cannot be accepted in view of the fact that these State Governments had voluntarily accepted to charge a composite fee of Rs. 12,000/- per quarter. In this context, it deserves mention that each State in the country is entitled to issue permits for the tourist vehicles. It is entitled to charge all the taxes levied in that State. It was for this purpose that the rights of the Home State to charge all the taxes were preserved and protected. Resullantly, in respect of all the tourist vehicles which are granted permits in the State of Haryana, the tax as leviable under the 1952 Act can be charged by the State. Similarly, in respect of the vehicles for which the permits are granted by the State of Punjab, the special road tax of Rs. 1,44,000/- per year can be charged by the authorities. However, in the case of vehicles which merely pass through these States or which terminate the journey in any of these States, the authorities are entitled to levy and charge a composite fee of Rs. 12,000/- only.
20. Mrs. Tuli appearing for the State of Punjab, had contended that Rule 84 of the 1989 Rules specifically provided that the tourist permit shall not exempt "the owner of a vehicle from the payment of tax or fee, if any, leviable in any State."
21. The rule undoubtedly says so. However, a perusal of the 1993 rules as referred to above, clearly shows that the operation of this rule and in fact of Rules 82 to 85A has been specifically excluded by the provision contained in Sub-rule (4) of Rule 1. This rule gives a clear indication of the legislative intent. It shows that the liability of the operators to pay taxes leviable in every State was sought to be curtailed.
22. It was further contended that the 1993 Rules do not contemplate the imposition of composite fee.
23. Counsel is right in submitting that a specific provision in this behalf has not been made in the 1993 rules. However, a combined reading of the letter at Annexure P. 2 and the rules indicates that the necessity for the enactment of such a provision was obviated by the fact that it had been specifically observed in the letter that only a composite fee shall be charged. The State Governments had agreed to it. That being so, the necessity of providing for a composite fee was obviated.
24. On behalf of the State of Haryana, it was sought to be contended that the composite fee can only include such taxes as can be levied by the Central and State Governments under the provisions of the Motor Vehicles Act, 1988.
25. Having considered the matter, we are unable to accept this submission. We find no adequate reason give a restrictive meaning to the words "all taxes". Still further, the composite fee is required to be paid in each State. If the operator was obliged to pay all the taxes as levied by each State, there would have been no necessity to burden him with an extra fee of Rs. 12,000/- per quarter.
26. Mr. Goyal also submitted that the petitioners in some of the cases were not tourist operators. They had not been approved to run tourist vehicles and, thus, the relief as prayed for in these petitions should not be granted.
27. This is a fact which we leave the competent authority to determine after hearing the parties concerned.
28. In view of the above, we hold that the tourist operators constitute a separate and special class. Keeping in view the objective of promoting tourism, a conscious decision to levy a composite fee of Rs. 12,000/- per quarter per Statel was taken. It was on the faith of this decision that the tourist operators undertook the work of transporting tourists by spending substantial amounts of money on expensive vehicles. Once the petitioners have acted on the faith of the representation made to them, the respondents shall be estopped from levying anything beyond the composite fee as provided for in the letter dated August 30, 1993. This position shall continue till the latter is withdrawn or a conscious decision is taken by each State regarding the levy of taxes. 29. The writ petitions are disposed of in the above terms. It is, however, clarified that in case, the respondents are of the view that a particular transporter is not a tourist operator, they will give a notice to him and decide the matter after the grant of a due and reasonable opportunity. If it is found that the operator is not a tourist operator as envisaged under the law, it shall be liable to pay the taxes as required under the law. Till the decision is finally taken by the State authorities, the petitioners shall be permitted to operate subject to their depositing the requisite 'composite fee'. This would be, however, without prejudice to the right of the respondents to recover the due amount in pursuance to the final decision that may be taken. In the circumstances of these cases, there will be no order as to costs.