Allahabad High Court
Ali Hasan Damular Pawar vs State Of U.P. And 4 Others on 5 May, 2023
Bench: Ashwani Kumar Mishra, Shiv Shanker Prasad
HIGH COURT OF JUDICATURE AT ALLAHABAD
?Court No. - 47
Case :- WRIT TAX No. - 569 of 2023
Petitioner :- Ali Hasan Damular Pawar
Respondent :- State Of U.P. And 4 Others
Counsel for Petitioner :- Dharmendra Kumar
Counsel for Respondent :- C.S.C.
Hon'ble Ashwani Kumar Mishra,J.
Hon'ble Shiv Shanker Prasad,J.
Heard learned counsel for the petitioner and learned Standing Counsel.
Petitioner purchased a Tata Indica Car bearing registration No. U.P. 16 BT 3534 after availing finance from the respondent no. 4. It appears that the vehicle was repossessed by the respondent no. 4 on 04.02.2016.
The State Authorities have subsequently raised a demand for payment of road tax and as amount has not been paid proceedings for recovery have been initiated against the petitioner vide order dated 12.02.2020. Aggrieved by this demand order the petitioner is before this Court.
Learned counsel for the petitioner submits that once the vehicle was repossessed by the respondent no. 4 the liability to pay tax fell upon them and any demand for tax can be validly raised against the petitioner only for the period prior to repossession of the vehicle. It is submitted that the petitioner has represented before the respondent no. 3 highlighting such facts with a request to modify the demand of tax in terms of Rule 18 of the Motor Vehicle Taxation Rule as well as in accordance with the judgment of Supreme Court in Mahindra and Mahindra Financial Services Ltd. Vs. State of U.P. and Others, (2022) 5 SCC 525.
In paragraph 12 of the judgment of the Supreme Court the following principle has been laid down:-
"In view of the above discussion and for the reasons stated above, it is held that a financier of a motor vehicle/transport vehicle in respect of which a hire-purchase or lease or hypothecation agreement has been entered, is liable to tax from the date of taking possession of the said vehicle under the said agreement. If, after the payment of tax, the vehicle is not used for a month or more, then such an owner may apply for refund under Section 12 of the Act, 1997 and has to comply with all the requirements for seeking the refund as mentioned in Section 12, and on fulfilling and/or complying with all the conditions mentioned in Section 12(1), he may get the refund to the extent provided in sub-section(1) of Section 12, as even under Section 12(1), the owner/operator shall not be entitled to the full refund but shall be entitled to the refund of an amount equal to one-third of the rate of quarterly tax or one twelfth of the yearly tax, as the case may be, payable in respect of such vehicle for each thirty days of such period for which such tax has been paid. However, only in a case, which falls under sub-section(2) of Section 12 and subject to surrender of the necessary documents as mentioned in sub-section(2) of Section 12, the liability to pay the tax shall not arise, otherwise the liability to pay the tax by such owner/operator shall continue."
In the facts of the case, we permit the petitioner to make a fresh comprehensive representation before the respondent no. 3 specifying facts including the date on which the vehicle was repossessed by annexing relevant documentary evidence in that regard along with the copy of this order within three weeks from today. In the event, such representation is made, the authority concerned shall pass appropriate orders within a further period of two months thereafter.
For a period of three weeks and in case such a representation is made within such period till disposal of petitioner's objection no coercive action would be taken against the petitioner.
Subject to the observation made above, this petition stands disposed of.
Order Date :- 5.5.2023
SK Srivastava
