Rajasthan High Court - Jaipur
Rashid Mohd. Etc. vs State Of Rajasthan And Anr. on 20 December, 1993
Equivalent citations: AIR1994RAJ167B, 1994(1)WLC626, 1993WLN(UC)512
Author: A.K. Mathur
Bench: A.K. Mathur
JUDGMENT Mathur, J.
1. All these writ petitions involve common question of law and fact, therefore, they are disposed of by this common order.
2. For the convenient disposal of these writ petitions, the facts given in the case of Rashid Mohd. v. State of Rajasthan (DB Civil Writ Petition NO.-3102/1992) are taken into consideration.
3. The petitioner by this writ petition has challenged the validity of the Rajasthan Tax on Entry of Motor Vehicle into Local Areas Act, 1988 (Ad No. 14 of 1988) (hereinafter referred to as 'the Act of 1988") being violative of Articles 14, 19, 265, 300A, 301 and 304 of the Constitution of India. He has also prayed that the demand notice (Anx. 4) may be quashed.
4. The petitioner purchased a Tata Chasis new model 1991 Engine No. 692 D023 90935 Chasis No. 364 0465 from M/s. Standard Motors, Daman in consideration of Rs. 3,36,840/- inclusive of local Sales tax alias 3% vide bill No. 1920 dated 17-6-1991. Copy of bill has been annexed as Annex. 1. The petitioner then got the chasis registered in the State of Daman being DMR-2186-F and certificate of registration was issued by the Registering Authority, Daman on 17-6-1991. The petitioner thereafter brought the said vehicle in the State of Rajasthan and it was registered by the Registering Authority, Jodhpur on 9-9-1991 and registration number was allotted as RJ-19/G-1415. The petitioner is using aforesaid vehicle as a taxi and necessary permits were taken by the petitioner. By a show cause notice dated 25-2-1992 the petitioner was called upon by the respondent No. 2 to appear for determination of tax liability of the entry tax under the provisions of the Act of 1988. Therefore, in this view of the matter, the petitioner challenges the validity of the aforesaid Act and specially the provisions of Sections 2, 3 and 6 of the Act on the ground that the same are violative of Articles 14, 19, 265, 300A, 301 and 304 of the Constitution of India. It is submitted that the main object/ intention of the Act is to prevent diversion of trade to the States with lower rates of Sales Tax on the vehicle in several other States. It is alleged that this is nothing but a tax on purchase of vehicles and it is an additional Sales Tax. It is submitted that it is not covered by entry No. 52 of the Second List of the Seventh Schedule of the Constitution of India, It is submitted that this tax is in violation of Articles 301 and 304 of the Constitution of India as it restricts the free flow of trade and commerce, within the territory of India.
5. Mr. Munshi, learned counsel for the petitioner has streneously urged that the tax has been levied without authority of law and it is beyond the competence of the State Legislature. It is nothing but a colourable exercise of power and it is an additional Sales Tax which is not covered by entry No. 52 of the Second List of the Seventh Schedule of the Constitution of India. Learned counsel for the petitioners have submitted that in some of the cases dumpers have been purchased outside the State and it is alleged that they are not 'motor vehicles' as defined in the Motor Vehicles Act, 1939. It is also submitted that the Motor Vehicles Act, 1939 has been repealed and in its place the Motor Vehicles Act, 1988 has come into force but still the reference to the repealed Act of 1939 is made. Therefore, as a result of the repeal of the Motor Vehicles Act, 1939, the reference of the definition of 'motor vehicles' as defined in the Motor Vehicles Act, 1939 ceases to exist. It is submitted that the taxing statutes have to be construed strictly and in the absence of the definition of the 'motor vehicles', no tax can be imposed on the motor vehicles in the local areas. Learned counsel have also submitted that the vehicles have been purchased against C Form under Section 7 read with Section 8(3)(b) of the Central Sales Tax Act, 1956 and in fact, the sale has not taken place in Rajasthan and consequently no Sales Tax under the Rajasthan Sales Tax Act is payable. There cannot be any levy of entry tax on mere entry of such vehicles in the State of Rajasthan. It is submitted that no Sales Tax has been paid in the State of Tamil Nadu from where the dumpers are purchased, therefore, consequently no tax is payable in the State of Rajasthan. The dumpers have been purchased after paying 4% of the Central Sales Tax on furnishing the C form in the course of business.
6. A reply has been filed by the State and the State has taken the position that the Act has been passed in exercise of the power conferred on the State Legislature under Entry No. 52 of the Second List of the Seventh Schedule of the Constitution of India. It is alleged in the reply that the main object of the Act is that some States and Union Territories have reduced the rates of Sale Tax on motor vehicles and chasis substantially. Such reduction in tax rates by the neighbouring States has resulted in diversion of trade to those areas and consequent loss of legitimate Sales Tax revenue to the State of Rajasthan. It is alleged that with a view to compensate such loss of legitimate revenue the State Government has decided to levy a tax entry of such motor vehicles which are purchased from outside the State of Rajasthan and brought in the State of Rajasthan for use or sale therein and are liable to be registered under the Motor Vehicles Act. However, no tax has been levied on such motor vehicles which are registered in any other State or Union Territory for a period of fifteen months or more before the date on which they are liable to be registered in this State. It is further submitted that the tax liability has been reduced to the extent of the amount already paid under the General Sales Tax of that State of Union Territory on the vehicles brought within the territory of the local area. It is alleged that such imposition is not violative of any provisions of the Constitution of India and neither it is a colourable exercise of the power.
7. However, in order to appreciate the controversy involved in the matter, it will be useful to refer the necessary provisions of the Act and the aims and object of the Act. The Statement of Objects and Reasons given in the Bill give an insight into the purpose for which the Act has been enacted. The Statements of Objects and Reasons read as under:--
"From 1984 onwards some States and Union Territories have reduced the rates of Sales Tax on motor vehicles and chasis substantially. Such reduction in tax rates by the neighbouring States has resulted in diversion of trade to those areas and consequent loss of legitimate Sales Tax revenue to the State of Rajasthan. With a view to compensate such loss of legitimate Sales Tax revenue, the State Government has decided to levy a tax on the entry of such of the motor vehicles which are purchased outside the State and brought in the State of Rajasthan for use or sale therein and are liable to be registered under the Motor Vehicles Act, 1939 (Central Act 4 of 1939). No tax has been levied on such of the motor vehicles which are registered in any other State of Union Territory for a period of 15 months or more before the date on which they are liable to be registered in this State. The tax liability has been reduced to the extent of the amount already paid under the law relating to general Sales Tax in any other State of Union Territory by any importer not being a dealer for his own use."
8. The present Act has been enacted with a clear purpose to compensate the State of the loss of the tax. Now, the question is whether it is covered by entry No. 52 or entry No. 54 of the Second List of the Seventh Schedule of the Constitution of India. Before we deal with this aspect, it will be relevant to refer to the salient provisions of the Act itself.
9. Section 2(b) defines entry of the motor vehicle into local area which reads as under:--
"2(b) -- Entry of a motor vehicle into a local area with all its grammatical variations and cognate expressions, means entry of a motor vehilce into a local area from any place outside the State but not being a place outside the territory of the Union of India for use or sale therein."
10. Section 2(c) defines 'importer' which reads as under:--
"2(c) "importer" means a person who, in any capacity brings or causes to be brought a motor vehicle into a local area from any place outside the State but not being a place outside the territory of the Union of India for use or sale therein."
11. Section 2(d) defines 'local area', which reads as under:--
"2(d) "Local area" means the area within the limits of (i) a panchayat established under the Rajasthan Panchayat Act, 1953 (Act No. 21 of 1953); or (ii) a municipality established under the Rajasthan Municipalities Act, 1959 (Act No. 38 of 1959); or (iii) a notified area committee or a cantonment board constituted or established under any law for the time being in force".
12. Section 2(e) defines the 'motor vehicle', which reads as under:--
"2(e) -- "Motor Vehicle" means a motor vehicle as defined in Clause (18) of Section 2 of the Motor Vehicles Act, 1939 and includes motor cars, motor taxi cabs, motor cycles, motor cycle combinations, motor scooters, motorettes, motor omnibuses, motor minibuses, motor vans, motor lorries, trailers and chassis of motor vehicles and bodies or tankers built or meant for mounting on chassis of motor vehicles, but excludes tractors."
13. Section 2(g) defines 'purchase value' which reads as under:--
"(2)(g) 'purchase value" means the value of motor vehicles, as ascertained from original invoice and includes the value of accessories fitted to the vehicle, insurance, excise duties, countervailing duties, Sales Tax, transport fee, freight charges and all other charges incidentally levied on the purchase of a motor vehicle; provided that where the purchase value of a motor vehicle is not ascertainable on account of non-availablility or non-production of the original invoice or when the invoice produced is proved to be false or if the motor vehicle is acquired or obtained otherwise than by way of purchase, then the purchase value shall be the value of price at which the motor vehicle of like kind or quality is sold or is capable of being sold in open market."
14. Section 3 deals with the incidence of tax which reads as under:--
"3. Incidence of Tax -- (1) There shall be levied and collected a tax on the purchase value of a motor vehicle, an entry of which is effected into a local area for use or sale therein and which is liable for registration in the State under the Motor Vehicles Act, 1939 (Central Act 4 of 1939), at such rate or rates as may be notified by the State Government from time to time but not exceeding the rates notified for motor vehicles under Section 5 of the Rajasthan Sales Tax Act, 1954 (Rajasthan Act 29 of 1954) or fifteen per cent of the purchase value of a motor vehicle, whichever is less:
Provided that no tax shall be levied and collected in respect of a motor vehicle which was registered in any Union Territory or any other State under the Motor Vehicles Act, 1939 (Central Act 4 of 1939) for a period of fifteen months or more before the date on which it is liable to be registered in the State under the said Act.
(2) The tax shall be payable by an importer -- (a) If he is a dealer registered or liable to be registered under the provisions of the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954), in the manner and within the time as tax on sales is payable by him under the said Act; and (b) if he is a person not covered by clause (a), on the date of entry of the motor vehicle into the local area, to the incharge of the entry check-post or the Commercial Taxes Officer of the area where he ordinarily resides or carries on any business or provides any service, and the provisions of the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954) as applicable to a registered dealer or casual trader shall, mutatis mutandis, apply to such dealer or, as the case may be, such person.
(3) The tax shall be in addition to the tax levied and collected as Octroi by any local authority within its loal area."
15. Section 4 deals with the reduction in tax liability which reads as under:--
"4. Reduction in tax liability-- (1) Where an importer an importer of a motor vehicle liable to pay tax under this Act, being a dealer in motor vehicles, becomes liable to pay tax under the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954) by virtue of the sale of such motor vehicle, then his liability under the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954) shall be reduced to the extend of tax paid under this Act. (2) The amount of tax leviable under this Act shall subject to such conditions as may be prescribed, be reduced to the extent of the amount of the tax paid, if any, under the law relating to General Sales Tax as may be in force in any other State or Union Territory by an importer who, not being a dealer registered under the provisions of the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954), had purchased the motor vehicle in that State for his own use."
16. Section 5 deals with the exemption from tax and Section 6 deals with the offences and penalties. Section 7 deals with the applicability of the provisions of the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954) and the rules made thereunder which reads as under:
7. Applicability of the provisions of the Rajasthan Sales Tax Act -- Subject to the provisions of this Act and the Rules made thereunder, the authorities empowered to assess, reassess, collect and enforce payment of tax under the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954) shall assessee, reassess, collect and enforce payment of tax including penalty or interest payable by an importer under this Act as if the tax, penalty or interest were payable under the said Act, and for this purpose they may exercise all or any of the powers assigned to them under the said Act and the Rules made thereunder for the time being in force including the provisions relating to returns, advance, payment of tax, provisional assessments, recovery of tax, appeals, rebates, penalties, interest, compounding of offences and other miscellaneous matters shall, mutandis, apply."
The idea behind the whole scheme of the Act is that whoever brings the motor vehicle in local area i.e. Panchayat established under the Rajasthan Panchayat Act, Municipality established under the Rajasthan Municipalities Act, notified committee or cantonment board constituted under any law then such persons who bring such motor vehicle shall be subjected to incidence of tax on the purchase value of such motor vehicle and the purchase value shall be ascertain from original invoice and includes the value of accessories fitted to the vehicle, insurance excise duties, countervailing duties Sales Tax transport fee, freight charges and all other charges incidentally levied on the purchase of a motor vehicle. The charging of Section 3. It says that the tax shall be levied and collected on the purchase value of motor vehicle which is entered into local area and at such rates as may be notified by the State Government from time to time.
However, the proviso says that no tax shall be levied and collected in respect of the motor vehicle which are registered in Union Territory or ther State or any other State under the Motor Vehicles Act, 1939 for a period of 15 months or more before the date on which it is liable to be registered in the State under the said Act. Section 2 says that the tax should be payable by an importer and the importer is a person who in any capacity brings or causes to be brought the motor vehicle in the local area from the place outside the State but not the place outside the territory of Union of India for use or sale therein. Section4 gives a rebate to the extent of the Sales Tax paid in that vehicle in the other State or Union Territory by importer who has paid that tax. The procedure for assessment of the taxing liability is same as is done under the Rajasthan Sales Tax Act and all the provisions of the Rajasthan Sales Tax has been adopted for assessment and collection of the tax under this Act. The method of assessment, appeal and other provisions shall apply to this Act also.
17. Now in this light we have to construe that whether the present tax is covered by the Entry 52 of the Second List of the Seventh Schedule of the Constitution of India or not. The Entry 52 of the Seventh Schedule of the Constitution of India reads as under:--
"52. Taxes on the entry of goods into a local area for consumption, use or sale therein."
A reference has also been made of the Entry 54, which reads as under:--
"54. Taxes on the sale or purchase of goods other than newspapers."
Entry 52 as quoted above empower the State Legislature to impose any tax on entry of goods into local area for consumption, use or sale therein. The State Legislature is competent to levy the tax on entry of goods in the local area for consumption, use or sale therein. The local area has been defined under Sub-section 2(b) of the Act as quoted above. Therefore, whoever brings any goods within the local area then he will have to pay the tax which can be subjected to tax by the State Legislature. The incidence of tax under Entry 52 is bringing of the goods in the local area for consumption, use of sale therein. It is submitted by the learned counsel that in fact this entry is nothing but meant for taxation by the local authorities i.e. Municipality or the Panchayat and the State cannot utilise this entry for making good their losses in the Sales Tax. Learned counsel has referred to Section 104 of the Rajasthan Municipalities Act which enables the Municipality to levy octroi and submitted that it is for this limited purpose and this entry cannot be utilised for levying of additional sales tax to make good the loss of sales tax in the State on account of low rate of taxation in other States or Union Territories. The submission of the learned counsel is in a very narrow jacket. The Entry 52 does not confine itself for collection of the octroi by the Municipality or the Panchayat. It is of a very wide amplitude and it enables the State Legislature to tax all kind of goods which enter into the local area. In fact, Sub-section 3(b) of Section 104 of the Municipalities Act clearly lays down that "the tax under Clause 2 shall not be on a motor vehicle as defined in the Motor Vehicles Act, 1939 (Central Act IV of 1939) or any other mechanically propelled vehicle." Therefore, the municipalities in Rajasthan have not been empowered to charge any octroi on motor vehicles brought within their limits. The Entry 52 is an enabling provision for the State Legislature to impose a tax on entry of goods into local areas and simply because local authorities are collecting agent under the Municipality of Panchayat Act, it does not follow that State Legislature cannot enact law and empower State to collect tax on motor vehicle entering into local areas.
18. Likewise, the amount so collected and placed at the disposal of local authority is also not decisive of the matter. Therefore, to interprate this entry for this limited purpose is not correct. The test is that whether the State Legislature is competent to levy the tax on the goods brought within local area or not. In the present case, the motor vehicles are brought within the local area of the Panchayat or it is brought into the local area of Municipality or the cantonment, such vehicle shall be subjected to incident of taxation under this Act.
The State of Rajasthan is divided in into local areas i.e. the Panchayats, Municipalities or cantonment, therefore, if it is brought within the limits of the Panchayat or Municipality or the cantonment then such vehicle shall be subjected to the incidence of tax and for which the State is competent under Entry 52. Article 304 of the Constitution of India says that a reasonable restriction on trade, commerce can be made notwithstanding anything contained in Article 303 and so. But the State shall not discriminate in impost on the goods imported from other State or Union Territory and similarly goods produce in their own territory. The restriction is that there should not be a discrimination between the goods so imported. The reasonable restriction in public interest or on freedom of trade or commerce or intercourse with or within that State if required to be imposed, then such Bill shall be moved in the State Legislature with previous sanction of the President. When this Bill was introduced in the State Legislature the assent of the President was taken on 8-11-1988, therefore, the argument that it violates Article 301 or 303 of the Constitution is not well founded. A reference was also made to Entry 54 of the Second List of the Seventh Schedule which deals with tax on sale or purchase of the goods subject to provisions of Entry 92(a) of the first list of Seventh Schedule of the Constitution. It is true that the Vehicles which are purchased from the other State or Union Territory are being subjected to tax but the incident of taxation, in the present case, is the entry in the local area. The methodology which has been adopted is that what shall be basis on which the tax can be levied and that is the purchase value but it is not a tax on purchase of the goods. The incidence of the taxation is entry into the local area. Simply because that the amount of the tax is calculated on the basis of the purchase value, it does not mean that it is a tax on purchase of the goods. Therefore, the incidence of taxation is entry of the vehicle in the local area and as such the Entry 54 will not be applicable and it is only Entry 52 which will govern the case. In this view of the matter we are of the opinion that the State Legislature is competent under Entry 52 of the Second List of the Seventh Schedule of the Constitution to levy this tax. It is wrong to say that it is a colourable exercise of the power. There is no question of colourable exercise of the power in the present case nor is a extra territorial tax. The taxing incident being the entry of the vehicle in the local area. The purpose may be to make good the loss of revenue on account of the lowering of the Sales Tax by the other States and Union Territories. It is for the State to make the loss good and for that purpose they can resort to any legitimate method. But in the present case instead of increasing the incident of taxation under the Sales Tax, State have resorted the tax as a entry tax on the motor vehicle in the local area under Entry 52 of the Second List of Seventh Schedule of the Constitution then it cannot be said to be a extra territorial tax or a colourable exercise of the power. The purpose is well known as it is evident in the statement of objects as quoted above. Therefore, there is no subterfuge employed by State. The State has made the fact known that the levy is being made in public interest to compensate the loss of the tax on account of lowering of the Sales Tax in the other States and Union Territories. This step has been taken by the State in the public interest and such act cannot be said to be subterfuge method adopted by the State Government. It is true that the provisions of the Sales Tax Act has been made applicable for the limited purpose of assessing the taxing liability but it cannot be said to be an additional Sales Tax.
19. Learned counsel for the petitioner has invited our attention to the decision of the Hon'ble Supreme Court given in the case of State of Karnataka v. Hansa Corporation, AIR 1981 SC 463. In this case the validity of the provisions of the Karnataka Tax on entry of goods into local area for consumption, use of sale therein came up for challenge, The challenge was to select local areas vis-a-vis Article 14 that whether such tax imposes unreasonable restriction on the dealers or not in reference to Articles 301 and 304 and in that context their lordships has repelled all the arguments and observed as under:--
"The taxing event is the entry of scheduled goods into a local area. The tax becomes payable on the entry of scheduled goods in local area. Therefore, the price of the scheduled goods at the time of entry paid by the dealer who is the importer of goods within the scheduled area would be the ad valorem price on the basis of which tax would be computed. No subsequent rise or fall in price has any relevance to the computation of the tax. The price of the scheduled goods at the time when the tax becomes chargeable irrespective of the fact that it would be computed at a later date when the dealer submits his return as required by the other provisions of the Act, would be the price for computation of tax. And there is no ambiguity or any vagueness in this behalf. There is thus specific guideline in the charging section itself for taking into account the price according to which tax would be computed."
In this case also it was observed that the tax has been imposed under Entry 52 of the Second List of Seventh Schedule read with Article 246 of the Constitution of India as it confers the power on the State Legislature to enact the law to levy the tax on the goods brought into local areas for consumption, use or sale therein and accordingly it was found that Act is valid.
20. In the present case we have already pointed out above that by virture of Sub-section 3(b) of Section 104 of the Rajasthan Municipalities Act no octroi is leviable on motor vehicles, therefore, this is the area where there is no conflict of the incident of taxation with that of any local authority. This area being remained unoccupied, therefore, the State has exercised its power under Entry 52 of the State List of the Seventh Schedule read with Articles 246 of the Constitution of India. Therefore, the attempt made by the learned counsel to distinguish this case is not properly placed. This judgment clearly lays down that under Entry 52 the State is competent to levy the tax on the motor vehicles on its entry in the local areas. Similarly question was also examined by the Andhra Pradesh High Court in the case of Suresh Chand Sri Gopal v. The Union of India, 1989 (72) STC 241 and it was held that the State Legislature is competent under Entry 52 of the State List of the Seventh Schedule to levy this tax. It was held as under:--
"that the taxes contemplated by Entry 52 of the List II of the Seventh Schedule to the Constitution referred to, and included, what was known as octroi, the basic feature of this tax was that it was levied on goods entering a local area for the purpose of consumption, use of sale therein. Article 246 of the Constitution empowered the State Legislatures to levy this tax. There were no words in the entry, or anywhere else in the Constitution saying that this tax could be levied only by a local authority. It was of course open to a State Legislature either to levy this tax by itself or to empower the local authorities to levy this tax."
21. Our attention was also drawn to a decision of the Bombay High Court given in the case of Jaika Automobiles Pvt. Ltd. Nagpur v. State of Maharashtra, AIR 1993 Bombay 124. There also the provisions of the Maharashtra Act was challenged and that was also repelled by that Court. In that case also, after examining all the provisions of the Maharashtra Tax on Entry of Motor Vehicles into local Areas Act, the Court held that the State Legislature is competent to impose this tax under Entry 52 of the State List and provisions are not ultra vires of Article 14 or any other provisions of the Constitution of India.
22. Therefore, as a result of the above discussion, we are of the opinion that the Act is intra vires of the Constitution of India and does not suffer from any vice of colourable exercise of power. The enactment is fully covered under Entry 52 of the Second List (State List) of the Seventh Schedule of the Constitution of India.
23. Next, it was contended in some of the writ petitions that the dumpers are not "motor vehicles' as defined in Section 2(18) of the Motor Vehicles Act, 1939 and Section 2(28) of the Motor Vehicle Act, 1988. Learned counsel have made two fold attack in this context. Firstly, that the dumpers are not 'motor vehicles' as defined in Section 2(18) of the Motor Vehicles Act, 1939 and secondly, that the Motor Vehicle Act, 1988 has come into force with effect from 1-7-1989 repealing the Motor Vehicle Act, 1939, therefore, the definition given in Section 2(18) cannot now survive. It is submitted that since the taxing statute has to be strictly construed, therefore, the Motor Vehicles Act, 1939 which having been repealed, the definition given under the Motor Vehicles Act, 1939 cannot be read. It is true that the corresponding amendment was made in the Act of 1988 that in place of Motor Vehicles Act, 1939, the Motor Vehicles Act, 1988 should be read. But, so far as we are concerned, the definition of the 'motor vehicles' as given in the new Motor Vehicles Act, 1988 under Section 2 is substantially the same. Therefore, the reference of Motor Vehicles Act, 1939 in the Act will make much difference for the purposes of this Act and the incident of taxation. As such this argument of the learned counsel has also no merit and the same is rejected.
24. Now, the question is that whether the dumper is 'motor vehicle' or not. In this connection, learned counsel has invited our attention to the decision of the Hon'ble Supreme Court given in the case of Bolani Ores Ltd. v. State of Orissa, AIR 1975 SC 17: (1975 Tax LR 1208). In this case, the question was whether the dumpers, rockers and tractors are 'motor vehicles' and taxable under the Act or not with reference to Section 2(18) of the Motor Vehicles Act, 1939. Their Lordships of the Supreme Court held as under:
"Thus the dumpers and rockers though registrable under the Motor Vehicles Act are not taxable under the Bihar Taxation Act as long as they are working solely within the premises of the respective owners. So far as the tractors are concerned they are neither registrable under the Motor Vehicles Act nor taxable under the Taxation Act."
25. This case came up for consideration again before the Hon'ble Supreme Court and the Hon'ble Surpeme Court in the case of Central Coal Fields Ltd. v. State of Orissa, AIR 1992 SC 1371 :(1992 AIR SCW 1366) after considering the case of Bolani Ores Ltd., (supra) held that dumpers and rockers are motor vehicles. It was observed as under at Page 1375; of AIR:--
"It would be appropriate now to mention that some documentary material was sent to us by the appellants by means of an affidavit after we had reserved judgment. That material is suggestive of the fact that Dumpers in some States are granted permission to run on public roads at a speed not exceeding 16 kms. per hour and on bridges and culverts at a speed not exceeding 8 kms. per hour. From this it is suggested that they have a minimum weight fixed on some principles. Pictures of various types of Dumpers have also been sent to us which indicate prominently one factor that these Dumpers run on tyres, in marked contrast to chain plates like cater pillers or military tanks. By the use of rubber tyres it is evident that they have been adapted for use on roads, which means they are suitable for being used on public roads. The mere fact that they are required at places to run at a particular speed is not to detract from the position otherwise clear that they are adapted for use on roads. The very nature of these vehicles make it clear that they are not manufactured or adapted for use only in factories or enclosed premises. The mere fact that the Dumpers or Rockers as suggested are heavy and cannot move on the roads without damaging them is not to say that they are not suitable for use on roads. The word 'adapted' in the provision was read as 'suitable' in Bolani Ore's case (AIR 1975 SC 17) by interpretation on the strength of the language in Entry 57, List II of the Constitution. Thus on that basis it was idle to contend on behalf of the appellants that Dumpers and Rockers were neither adaptable nor suitable for use on public roads. Thus on the fact situation, we have no hesitation in holding that the High Court was right in concluding that Dumpers and Rockers are vehicles adapted or suitable for use on roads and being motor vehicles perse, as held in Bolani Ores case, were liable to taxation on the footing of their use or kept for use on public roads; the network of which, the State spread, maintains it and keeps available for use of motor vehicles and hence entitled to a regulatory and compensatory tax. (Exemptions claimable apart). The appellants, therefore, in our view, have no case for grant of any relief in these appeals."
26. Therefore, it was observed by their Lordships that the word 'adapted' should he read as 'suitable' and if the Dumpers can be made suitable to run on the public roads, therefore, it was found that they are 'motor vehicles' for the purpose of taxation. Similarly, in the case of Union of India v. Chowgule & Co. Pvt. Ltd., AIR 1992 SC 1376 : (1992 AIR SCW 1373) the same position was reiterated.
27. Mr. Rajendra Mehta, learned counsel for the respondents has also submitted that the dumpers which have been purchased by the petitioner from Tamil Nadu, no Tamil Nadu Sales Tax has been paid as the same has been purchased against the prescribed 'C' Form under the Central Sales Tax Act, therefore, they arc not liable to tax. The Contention of the learned counsel is without any merit. It has been pointed out in the reply that under the Central Sales Tax Act registration certificate was issued to the petitioner on 17-3-1988 under the heading machinery, equipment an allied spheres does not include dumpers as a machinery. We don't wish to make any observation regarding this certificate because it is a matter to be decided by the assessing authority, but suffice it to say that simply because they have been purchased on the strength of C From, that will not make any difference for the simple reason that whoever is the importer of the vehicle in Rajasthan local area shall have to pay the tax on enty on the basis of the invoice. Simply because they have been purchased against C Form under the Central Sales Tax Act and he has not paid Tamil Nadu Sales Tax, he will not be absolved to taxing liability under this Act in Rajasthan. Relevant is the entry into local area of the motor Vehicle and whoever is the importer, he has to pay the tax. Only rebate in the tax can be given to him of the amount of tax paid on the vehicle. The incidence of tax is not the payment of tax by the incumbet under the General Sales Tax Act of the other State. The incident of tax is entry of the vehicle in the local area. It is only the rebate which is given to him of the amount of tax which he has paid in that State under the Sales Tax Act of that State. Therefore, the contention of the learned counsel that he has purchased the dumpers against C Form issued under the Central Sales Tax Act, therefore, he is not liable to pay this tax is not well founded and the same is overruled.
28. Hence, all these writ petitions have no merit and the same are hereby dismissed.