Patna High Court
Palamau Zila Transport Association And ... vs State Of Bihar And Ors. on 11 January, 1991
Equivalent citations: 1992(1)BLJR587
Author: S.B. Sinha
Bench: S.B. Sinha
JUDGMENT S.B. Sinha, J 1.All these writ applications involving common questions of law and fact were heard together and are being disposed of by this common judgment. 2.In these cases, the validity and/or legality of the order, dated 22nd June, 1988 as contained in Annexure-3 to the C.W.J.C. Nos. 1300, 2172 of 1988 (R) and Annexure-2 in C.W.J.C. No. 1107/88 (R) and order dated 12-1-1990 (Annexure-3 to C.W.J.C. 1221/90 (R) are in question. 3.By reason of the said purported orders issued from the Office of the State Transport Commissions, Bihar, Patna, all the District Transport Officers were directed to accept surrender of the licenses granted to them in terms of the provisions of Bihar Motor Vehicles (Taxation) Act, 1930 (hereinafter called and referred to for the sake of brevity as 'the said Act') only if the applicants therefore fulfill the following conditions:-- (a) if the vehicle is involved in any accident resulting in extensive damage; (b) if the vehicle is seized by the police and had been in seizure for a period of one month; (c) major repairs of the vehicles which are expected to take more than one month. 4. According to the petitioners, in terms of the provisions of the said Act, the District Transport Authority of each district has been designated as Taxing Officer by a notification, dated 5-4-1973. The petitioners contend that they approached respondent No. 3 for surrender of the vehicles which was refused to them in view of the impugned orders as mentioned hereinbefore as a result whereof even if the petitioners or the members of their Palamau Zila Transport Association do not intend to ply their vehicles, they will have to pay tax in terms of the provisions of the said Act. According to the petitioners, they have a right to ply or not to ply their commercial vehicles in view of Article 19(1)(g) of the Constitution of India and thus by reason of an administrative order, their right to surrender their tax taken in order to enable to avoid payment of road tax cannot be curtailed. It has been contended that in that view of the matter, the impugned orders as contained in Annexure-3 to the aforementioned two writ applications are violative of Articles 14 and 19(1)(g) of the Constitution. 5. The petitioners in this connection have placed strong reliance upon Bolani Ores Ltd. v. State of Orissa ; Tata Engineering and Locomotive Co. Ltd. v. State of Bihar 1979 PLJR 398 and Excel Wear v. Union of India and Ors. . 6. In this case, a counter-affidavit has been filed on behalf of the respondents. In the said counter-affidavit, it has been contended that no total embargo has been imposed by the State Transport Commissioner upon the District Transport Officers, but certain reasonable restrictions have been imposed with a view to checking malpractices and evasion of taxes adopted by the owners of the vehicles. It has further been contended that an amendment has been carried out in 1983 in section of the said Act and in that view of the matter, all the registered owners or persons having possession or control over a vehicle have to pay tax in terms of Section 6 of the Bihar and Orissa Motor Vehicles Taxation Act, 1930. 7. The said Act was enacted to impose tax on motor vehicles in Bihar. Section 6 of the said Act read as follows:-- 6. Imposition of tax.--(1) As from the first day of January 1931, and after that date, there shall be paid for every motor vehicle a tax at the rate specified in the Second Schedule to this Act. (1-A) As from the first day of April, 1983 and after that date there shall be paid annually by the registered owner or person having possession or control of every public service motor vehicle an additional motor vehicle tax at the rate specified in the Third Schedule of this Act. (2) The tax shall be paid annually by the registered owner or person having possession or control of the motor vehicles provided that the tax may be paid-- (i) for one or more quarterly periods, on payment for each such quarterly period of one-quarter of the annual rate of the tax, (ii) for any period less than a quarterly period expiring on the last date of any quarterly period, on payment of one-twelfth of the annual rate of the tax for every month or part of a month included in such period. (iii) for one month, commencing from the date of registration at the rate of one-twelfth of the annual rate of the tax where the motor vehicle is temporarily registered under Section 25 of the Motor Vehicles Act, 1939 (IV of 1939): Provided further that in case of a motor vehicle temporarily registered under Section 25 of the Motor Vehicles Act, 1939 any one-twelfth of the tax payable for the year shall he payable in respect of such vehicle so registered. In case of renewal of temporary registration under proviso to Section 25 of the abovementioned Act, tax at the rate of one-twelfth payable for the year shall be payable on each renewal of the temporary registration. (3) The taxing officer shall grant to every person who pays tax or extra tax under Sub-section (2) of Section 9, or additional motor vehicle tax under Section 6(1-A) in respect of any motor vehicle or public service motor vehicle-- (a) receipt in which shall be specified the particulars of the tax, extra tax or additional motor vehicle tax paid and such other particulars as may be prescribed; and (b) a tax token in the prescribed form, provided that in case of public service motor vehicle no token for extra tax paid shall be granted unless the additional motor vehicle tax due has been paid. Section 7 provides for refund on surrender of tax token. Section 8 reads as follows:-- 8. Declaration by person keeping motor vehicles of use.--(1) Every person who keeps a motor vehicle for use shall fill up and sign a declaration in the prescribed form stating the prescribed particulars and shall deliver the declaration as so filled up and signed to the taxing officer and shall pay to the taking officer the tax which be appears by such declaration to be liable to pay in respect of such vehicle. (2) Where a motor vehicle is altered so as to render the person who keeps such vehicle for use liable to the payment of an additional tax under Section 9 such person shall fill up and sign an additional declaration, in the prescribed form showing the nature of the alterations made and containing the prescribed particulars and shall deliver such additional declaration as so filled up and signed to the Taxing Officer and shall pay to the Taxing Officer the additional tax payable under Section 9 which he appears by such additional declaration to be liable to pay in respect of such vehicle. (3) Every person who owns any motor vehicle which it let for hire shall, for the purposes of this Act, be deemed to be the person who keeps such vehicle for use. Section 9-A reads as follows:-- (1) Where the Taxing Officer- is, on an application accompanied by an affidavit of the owner of a motor vehicle of public service motor vehicle is satisfied after due enquiries as prescribed by the State Government that a motor vehicle has not been used in Bihar for a continuous period of not less than one calendar month since the tax or the installment of tax was last paid, he may exempt the owner of a motor vehicle or public service mot or vehicle from payment of arrears of tax and additional Motor Vehicle Tax and write off the amount of such arrears up to a maximum of Rs. 2,000 under intimation to the State Transport Commissioner, and where the amount of arrears of such tax exceeds rupees two thousand refer the matter to the State Transport Commissioner or to any officer authorised by the State Government not below the rank of the Assistant State Transport Commissioner, for a decision. (2) The State Transport Commissioner or any officer authorised by the State Government not below the rank of the Assistant Transport Commissioner to whom any matter has been referred by the Taxing Officer under Sub-section (1) may, if satisfied that the motor vehicle has not been used for a continuous period of not less than one calendar month since the tax or the installment of the tax was last paid exempt the owner of the motor vehicle from payment of arrears of tax and additional motor vehicles tax and write off the amount of such arrears or part thereof. (3) Notwithstanding anything contained in the preceding sub-sections, where it comes to the notice of the State Government, the State Transport Commissioner or any other officer prescribed that exemption and writing off has been secured by any motor owner by misrepresentation of facts or fraud the State Government or the Transport Commissioner or the authority prescribed may supersede the orders regarding writing off or exemption, as the case may be, and institute fresh proceeding for the recovery of such amount together with a penalty that may exceed to one hundred per cent of the amount exempted, writtend off, as the case may be. Section 11-A of the said Act provides for recovery of tax and further provides that tax imposed under this Act shall be recoverable as arrear of the land revenue and be a first charge on the motor vehicle in respect of which such tax is payable. Section 12 contains a penal provision. 8. The State of Bihar in exercise of its powers conferred upon it under Section 14 of the said Act has framed a Rule known as Bihar and Orissa Motor Vehicles (Taxation) Rules, 1930. Rule 4 provides for the procedure for payment of tax. Rule 7 thereof empowers the Taxing Officer to require a person tendering a tax to produce the vehicle in respect of which such tax is tendered or the certificate of registration and permit granted in respect of such vehicle to be produced before him for accepting the tax tendered under Sub-rule (1) of Rule 4. Rule 8 provides for the method of calculation of tax. Rule 11 of the said Rules provides for procedure for obtaining refund of tax. 9. From a perusal of the said Act and the rules framed thereunder, it is evident that the said Act is a self-contained Code. The Taxing Officer appointed under Section 4 of the said Act, become is a statutory functionary. 10. In Bolarti Ores v. State of Orissa (Supra) the provisions of the said Act and the rules framed there under came up for consideration of the Supreme Court. In that decision it was held that the said Act provides for regulatory measure in imposing taxes for the purpose of raising revenue to meet the expenditure for making roads, repairing them and to facilitate movement and regulation of the traffic. It was further held therein that the provision of the said Act is to levy taxes on vehicles which use the road. It was, therefore, held that those vehicles which although are remittable under the-Motor Vehicles Act are not taxable under the said Act as long as they are working within the premises of the respective owners. 11. In that case, the Supreme Court held as follows:-- The regulations under the Motor Vehicles Act for registration and prohibition of certain categories of vehicles being driven by persons who have no driving license, even though those vehicles are not plying on the roads, are designed to ensure the safety of passengers and goods etc. and for that purpose it is enacted to keep control and check on the vehicles. Legislative power under Entry 35 of List. II (Concurrent List) does not bar such a provision. But Entry 57 of List II is subject to the limitations referred to above, namely, that the power of taxation there under cannot exceed the compensatory nature which must have some nexus with the vehicles using the roads, viz. public roads. If the vehicles do not use the roads, notwithstanding that they are registered under the Act, they cannot be taxed. This very concept is embodied in the provisions of Section 7 of the Taxation Act as also the relevant sections in the Taxation Acts of other States, namely, that where a motor vehicle is not using the road and it is declared that it will not use the roads for any quarter or quarters of a year or for any particular year or years no tax is leviable thereon and if any tax has been paid for any quarter during which it is not proposed to use the motor vehicle on the road the tax for that quarter is refundable. 12. In Tata Engieering and Locomotive Co. Ltd. v. State of Bihar reported in 1979 PLJR 398, a Division Bench of this Court took into consideration the amendments introduced by Sections 3(b), 3(c) and 5 of the Ordinance No. 84/76 and subsequent Ordinance whereby and where under Sections 6 and 8 of the Act were amended providing for payment of tax annually by every owner or person in their possession or control of the Motor Vehicle. Sections 6 and 8 of the said Act as it originally stood prior to the amendment reads as follows:-- 6. Imposition of tax.--(1) As from the first day of January, 1931, and after that date there shall be paid on every motor vehicle a tax at the rate specified in the Schedule to this Act. (2) The Tax shall be paid annually by the person who keeps a motor vehicle for use. 13. This Court, therefore, while considering as to whether the amendments brought about by reason of the Ordinance aforementioned which has culminated in enactment of Motor Vehicles (Taxation) (Amendment) Act, 1983 in that on held that in view of Entry 57, List II of the 7th Schedule of the Constitution of India and in order to uphold its validity, a limited meaning to the words 'vehicle' or 'motor vehicle', despite the amendment has got to be given as meaning 'motor vehicles using the roads, namely, public roads. B.S. Sinha, J.
In his concurrent judgment observed that the amended provisions have got to be read with Entry 57, List II of the Constitution, particularly, as explained by the Supreme Court in M\s. Bolani Ores Ltd.'s case (supra).
14. From the judgments of the Supreme Court as also of this court as mentioned hereinbefore, it is, therefore, evident that despite amendment in Sections 6 and 8 of the said Act by reason of Amending Act of 1983 an owner of a vehicle is liable to pay tax only when it is used in the public roads.
15. As noticed hereinbefore, in Bolani Ores Ltd. (Supra), the Supreme Court held that the tax imposed by reason of the said Act is a compensatory in nature and, thus, in view of Article 301 of the Constitution of India, the incidence of tax must be held to be the use of vehicles on public roads.
16. It is, thus, clear that public service motor vehicles which are intended to be used for carrying on business may or may not be plied on the public roads for that purpose.
17. It is now well-known that a citizen has a fundamental right to carry on a business in terms of Article 19(1)(g) which includes a right not to carry on business. See Excel Wear v. Union of India and Ors. . It would, therefore, be evident that if a person does not intend to carry on any business in transporting goods or passengers by means of a public service motor vehicle, he cannot be made liable to pay any road tax in terms of the provisions of the said Act.
Only with that end in view, Sections 7 and 9-A of the Act have been enacted. In terms of Section 7 a person is entitled to refund of tax when he produces a certificate signed by the Taxing Officer stating that the tax token granted in respect of the vehicle has been surrendered.
18. Rule 11 of the said Rules provides for the manner in which a person desirous to obtaining refund of tax under Section 7 has to deliver the tax token granted in respect of the vehicle to the taxing officer by whom the tax token was granted and on receipt thereof the Taxing Officer shall grant to the person a certificate in Form E.
19. Apparently enough, the impugned orders which are contained in Annexure-3 to C.W.J.C. 1300 of 1988 (R) and 1221 of 1990 (R) and Annex-ure-2 in 1107/88(R) as also Annexure-3 in C.W.J.C. 2172/88 (R), having no force of law, the same do not satisfy the requirement of Article 19(6) of the Constitution. If reasonable restrictions are to be imposed in relation to the surrender of tax token in accordance with the provisions of the said Act, the same has to be provided for by reason of a law alone as otherwise the question of imposing any restriction on the fundamental right of the citizen of India not to carry on business, would not arise.
20. It was not and could not be the contention of the respondent that the impugned orders as contained in Annexure-3 to the C.W.J.C. Nos. 1300 of 1988 (R) and 1221/90 (R) were issued by the respondent No. 2 in exercise of any of his power conferred upon him by reason of the provisions of the said Act or Rules framed there under. It is, therefore, clear that respondent No. 2 had acted illegally and without jurisdiction in issuing the said directions.
21. As noticed hereinbefore, in view of the notification issued by the State of Bihar, the respondent No. 3 has been nominated as a Taxing Officer and thus he is required to exercise his statutory function within the frame-work of the said Act and the Rules framed there under without in any way guided by any other authority who has no moto to play in that regard under the said Act. Any direction by the higher authority with regard to the exercise of the statutory function of respondent No. 3 would evidently be ultra vires.
Reference in this connection may be made to Commissioner v. Gobardhan Das .
22. In C.WJ.C. 1107/88 (R) a notice, dated 24th July, 1988 as contained in Anncxure-2 to the supplementary affidavit has been annexed to show that all those papers which were filed before the District Transport Officer, Ranchi for the purpose of surrender of the tax token and for refund of the tax were not entertained and in all such cases where surrender has been accepted the same were directed to be cancelled with effect from 1-7-1988.
23. By reason of the aid notice, the owners of the vehicles were further directed to get the papers released from the Office of the District Transport Officer, Ranchi on payment of tax falling which it was threatened that the same would be realised along with late fee.
24. It appears from Annexure-4 to C.W.J.C. 2172/18 (R) that therein the application of the petitioners for surrender of the tax token was accepted on 30th March, 1988 but the same was also cancelled and by reason of an order, dated 23-7-1988 as contained in Annexure-4, the District Transport Officer directed realisation of tax for 1-7-1988 failing which it was directed that a certificate case shall be instituted against him for realisation of the said amount together with penalty.
25. Mr. M.Y. Eqbal, learned Government Pleader No. I, however, contended that respondent No. 2 had power to issue the impugned circular letters in exercise of his power conferred upon him under Section 43-A of the Motor Vehicles Act, 1939.
26. This submission of Mr. Eqbal is devoid of any substance inasmuch as indicated hereinbefore, the said Act is a self-contained Code in the matter of realisation of tax and for other purposes mentioned therein and thus the provisions of Motor Vehicles Act, 1939 cannot be taken recourse to except in so far as the provisions thereof have been incorporated in the said Act by reference. Learned Government Pleader No. I further submitted that the impugned orders are also sustainable in view of the provisions contained in Sub-section (3) of Section 9-A of the Act.
27. From a perusal of Section 9-A of the said Act it would appear that in terms of Sub-section (1) of Section 9-A, the Taxing Officer exercises a quasi-judicial function and by reason of Sub-section (3) thereof, the State Government or the Transport Commissioner has been empowered to supersede such an order in the event it comes to its knowledge that exemption and writing off has been secured by any owner by misrepresentation of fact or fraud. The power of the State Government or the Transport Commissioner under Sub-section (3) of Section 9-A of the said Act being statutory in nature, the same can be exercised only in independent cases if the conditions precedent here for exist. The said provision, therefore, also do not empower the respondent No. 2 to issue a general instruction as contained in Annexure-3 to C.W.J.C. 1221/90(R) and C.W.J.C. 2172/88(R).
28. Taking thus all facts and circumstances into consideration, I am of the view that the circular letters, dated 22-6-1988 which are contained in Annexure-3 to C.W.J.C. Nos. 1300, 2172 and Annexure-2 in C.W.J.C. No. 1107/88(R) and order, dated 12-1-1990 Annexure-3 to C.W.J.C. No. 1221/90(R) must be held to by illegal and without jurisdiction and are struck down as such. The Divisional Transport Officer, respondent No. 3 shall now proceed to decide each case independently without taking into consideration the aforementioned circular letters and in terms of the provision of the said Act and Rules framed there under.
In the result, these writ applications are allowed. However, in the facts and circumstances, there will be no order as to costs.
R.N. Sahay, J.
29. I agree.