Nandyala Ramakrishna Reddy vs The Government Of A.P.,
2022 Latest Caselaw 8723 AP

  HE HON'BLE SRI JUSTICE TARLADA RAJASEKHAR RAO

               WRIT PETITION No.5353 OF 2021

ORDER:

This Writ Petition is filed under Article 226 of the

Constitution of India, seeking to set aside the demand notice

dated 16.02.2021 in R.No.123/2020 issued by the 2nd

respondent herein. The 2nd respondent herein issued show

cause notice in R.No.123/C1/2020 dated 04.12.2020 under

Sections 3 and 4 of the Andhra Pradesh Motor Vehicles Taxation

Act, 1963 (hereinafter called, „the Act‟), directing the petitioner

herein, who is the owner of the bus bearing No.AP 04TW 8265,

to pay an amount of Rs.88,350/- towards taxes and penalty for

the quarters ending 30.06.2020, 30.09.2020 and 31.12.2020

and the petitioner was also informed to avail the tax exemption

as facilitated by the Government of India in the letter No.RT-

1101202/2019-MVL (Pt-8) dated 30.03.2020, as provided under

Rule 12A of the Andhra Pradesh Motor Vehicles Taxation Rules,

1963 (hereinafter called, „the Rules‟), the transport vehicle

operators, those who intend not to operate the vehicles under

pandemic Covid-19, may exercise their option by filing stoppage

of their vehicle before the concerned Registering Authorities by

intimating the fact to get exemption of tax in respect of their

stopped vehicles within time stipulated under the said Rule.

2. For the show cause notice issued by the respondent-

authorities herein, the petitioner herein has issued reply notice

dated 10.02.2021 and in nutshell, raised the following grounds:

The tax levied since shall not exceed twice and the tax for

an annual licence shall not exceed four times the tax for a

quarterly licence and the Government may grant rebates as may

be prescribed in the case of half yearly and annual licences.

Rule 12A of the Rules envisages for the different purpose, if the

registered owners intend to stop the vehicle for the maintenance

repairs or lapse of permit, the registered owner has to submit the

advance stoppage report prior to the commencement of the

ensuing quarter, but here, it is a different situation and

circumstance that due to the ethnic pandemic, the entire

universe had had came to standstill and that the respondent-

authorities cannot misuse Rule 12A of the said Rules. Tax has

to be paid on the motor vehicle in advance for the purpose of

using on public roads, it is in the concept of pay and use. It is

further asserted in the reply that in pursuance of the same, the

State Legislature had enacted the present Act, in which Section

3 empowers the State Government to collect the taxes on motor

vehicles by issuing notifications from time to time. As per

Section 3 of the Act, the vehicle should be used or kept for use

and the vehicle was not used in the pandemic. Therefore, the

respondent-authorities cannot impose taxes and penalty and

Rule 12A of the Rules is not in rem and the said Rule cannot

override the statutes. In the said reply notice, it was asserted

that the vehicles do not use the roads notwithstanding that they

are registered under the Act and prayed to drop further course of

action by accepting the tax from 01.02.2021.

For which the respondent has passed an order in

R.No.123/C1/2020 dated 16.02.2021 and issued demand notice

under Sections 4 and 6 of the Act, directing the petitioner herein

to pay tax of Rs.88,350/- together with penalty for the quarter

ending 30.06.2020, 30.09.2020 and 31.12.2020, stating that

failing which, the action will be taken under the Revenue

Recovery At, 1864.

3. The said demand notice was assailed before this

Court on the grounds that tax shall be levied if the vehicle is

used or kept for use in a public place in the State and the vehicle

was not seized or detained in respect of which tax is due under

the Act, it shall be deemed that the vehicle was not used or kept

in use in the public place under Section 8 of the Act and it is

also no need to intimate the respondent-authorities and Rule

12A of the Rules envisages for the different purpose, if the

registered owner intend to stop the vehicle for the maintenance,

repairs or lapse of permit, the registered owner has to submit the

advance stoppage report prior to the commencement of the

ensuing period. Therefore, the respondent-authorities are

precluded from issuing the demand notice for the amount, as

indicated above.

4. Learned counsel for the petitioner has placed reliance

on the following judgments in support of his contentions:

1) Bolani Ores Ltd., v. State of Orissa Etc1.

2) State of Mysore and others v. M/s. T.V.Sundaram Iyengar & Sons (P) Ltd.2

AIR 1975 Supreme Court 17(1)

3) J.Srinivasa Rao v. Government of A.P. & another3.

5. Before answering the issues raised by the learned

counsel for the petitioner, learned counsel for the respondents

would submit that the first issue has come for consideration

before this Court in batch of Writ Petitions, vide W.P.No.13780 of

2021 and batch, where this Court directed the petitioners

therein to approach the Transport Authorities for exemption of

tax for subsequent quarters by demonstrating to the satisfaction

of the authorities that they may have neither used their vehicles

nor kept them for use in the subsequent quarters, for which

exemption is sought. In the said judgment, it was envisaged that

the petitioners therein shall not be liable to pay tax on the

vehicles set out for the quarter ending 30.06.2020 and also

submitted that an alternative remedy by way of appeal under

Section 12 of the Act is provided under the Act. As per the said

appeal provision, when any person aggrieved by an order of levy

of tax under Section 6 of the Act, an appeal is maintainable from

the date of communication to him of the order of levy or the date

(1980) 1 SCC 66

(2006) 12 SCC 607

of seizure, as the case may be, on payment of such fees as may

be prescribed.

6. Learned counsel for the respondents would further

submit that a similar issue came for consideration in

W.P.No.5984 of 2009. Learned counsel for the petitioner

disputed the same and stated that the order in the said Writ

Petition has no bearing for the present Writ Petition.

7. In view of the above contentions raised by the learned

counsel for both sides, the issues for consideration of this Court

are:

1) Whether the stationed vehicle, which is registered under Section 39 of the Andhra Pradesh Motor Vehicles Act, is exempted from tax being paid under Section 3 of the Andhra Pradesh Motor Vehicles Taxation Act, 1963, irrespective of not obtaining permission under Rule 12A of the Andhra Pradesh Motor Vehicles Taxation Rules, 1963?

2) When the vehicle was not seized under Section 8 of the Act, it shall be deemed that the vehicle is not plied or put in use on the road.

8. In order to answer the issues framed by the petitioner

herein, relevant provisions are hereby extracted hereunder for

ready reference:

Section 39 of the Andhra Pradesh Motor Vehicles Act,

1988, reads as follows:

"39. Necessity for registration.--No person shall drive any motor vehicle and no owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place unless the vehicle is registered in accordance with this Chapter and the certificate of registration of the vehicle has not been suspended or cancelled and the vehicle carries a registration mark displayed in the prescribed manner."

Section 3 of the Andhra Pradesh Motor Vehicles Taxation

Act, 1963, reads as follows:

"3. Levy of tax on motor vehicles: - (1) The Government may, by notification, from time to time, direct that a tax shall be levied on every motor vehicle used or kept for use, in a public place in the State.

(2) The notification issued under sub-section (1) shall

specify the class of motor vehicles on which, the rates for the periods at which, and the date from which, the tax shall be levied:

Rule 12A of the Andhra Pradesh Motor Vehicles Taxation

Rules, 1963, reads as follows:

"12-A. Liability for payment of tax in respect of motor vehicles kept for use :- For the purpose of Section 3 of the Act, a motor vehicle shall be deemed to be kept for use and is liable to tax unless the registered owner or the person having possession or control of the motor vehicle intimates in writing to the licensing officer before the commencement of the quarter for which tax is due that the motor vehicle shall not be used after expiry of the period for which tax has already been paid. The Licensing Officer shall, on receipt of the intimation, acknowledge its receipt:"

9. In answering the issues, this Court relies on the

judgment in Travancore Tea Estates Co. Ltd. V. State of Kerala4,

wherein it was held by the Hon‟ble Apex Court that the levy is

within the competence of Entry 57 of List-II of the VII Schedule,

AIR 1980 SC 1547

which authorizes the levy on the vehicles suitable for use on

public roads and held that it shall be presumed that a motor

vehicle, for which the certificate of registration is current, shall

be deemed to be used or kept for use in the State and also held

that in order to enable the owner of the vehicle or the person,

who is in possession or control of the motor vehicle of which

certificate of registration is current, to claim exemption from tax,

he should get a certificate in the prescribed manner from the

Regional Transport Officer.

10. In International Tourist Corporation Etc. v. State of

Haryana and others5, a similar expression used or kept for use

employed in Section 3 of the Act has been discussed by the

Hon‟ble Apex Court.

11. Once again, the Hon‟ble Apex Court in State of

Karnataka v. K.Gopalakrishna Shenoy and another6, while

dealing with a similar issue, it was held that it confers to levy a

tax on all motor vehicles which are suitably designed for use on

roads at prescribed rates without reference to the road worthy

1981 AIR 774

1987 AIR 1911

condition of the vehicle or otherwise. It was further clearly

pointed out in the said judgment that the charging section of the

Act has to be construed on its own force and not with reference

to the provisions of contained in the Motor Vehicles Act. The Act

is burdened on the registered owner of the motor vehicles or any

other person who possessed the vehicle or control over the motor

vehicle, to pay tax levied in advance, either quarterly, half-yearly

or annually on a licence to be taken out by him for that quarter,

half-year or year, as the case may be, within 15 days from the

date of commencement of the quarter, half-year or year, as the

case may be. As per the judgments of the Hon‟ble Apex Court

referred to supra, once a motor vehicle is registered under

Section 39 of the Andhra Pradesh Motor Vehicles Act, it shall be

deemed to be used and therefore, the owner of the vehicle shall

be liable to pay tax levied under the Act.

12. The similar issue came into consideration in

Automobile Transport Ltd. v. State of Rajasthan7.

AIR 1962 SC 1406

13. Learned counsel for the petitioner would submit that

as per the judgment of the Hon‟ble Apex Court in Bolani Ores's

case (1 supra), the petitioner need not pay the tax as the vehicle

is not plied on the road. In the said judgment at paragraph

No.29 the Hon‟ble Apex Court held that the tax is subject to the

limitations, viz., that the power of taxation thereunder cannot

exceed the compensatory nature which must have some nexus

with the vehicles using the public roads and if the vehicles do not

use the roads, notwithstanding that they are registered under the

Act and they cannot be taxed. In the said judgment, a tax was

imposed on the dumpers, rockers and tractors taking the said

vehicle as the motor vehicle within the meaning of the relevant

provisions of the Motor Vehicles Act. The Hon‟ble Apex Court

held that the said vehicles, though it may be a motor vehicle

within the definition of a term is neither a goods vehicle nor a

vehicle which carries passengers nor is it being driven in a place

to which public have as a right access and as it does not perform

any of the aforesaid functions or uses it is not a vehicle which

has to be registered nor it has to be driven only by a person who

holds a licence and it cannot be taxed, but the vehicle used by

the petitioner herein in the present case is a passenger/goods

vehicle, which plies on the road. Therefore, the said proposition

of law cannot be applicable to the present facts of the case.

14. In another judgment relied on by the learned counsel

for the petitioner in T.V.Sundaram Iyengar's case (2 supra), the

word "kept" has came into consideration. In the said case, the

problem resolves itself into the issue is: Whether the motor

vehicle of the respondents, which is registered in Tamil Nadu

State, which merely passes through the State of Mysore are

„kept‟ for the duration of their journey in the State of Mysore

within the meaning of 3(2) of the Act. The word „kept‟ has been

interpreted by the Hon‟ble Apex Court in the said case.

Paragraph No.8 of the said judgment is extracted hereunder:

"The word 'kept' has not been defined in the Taxation Act. We have, therefore, to interpret it in its ordinary popular sense, consistently with the context. The word 'kept' has been repeatedly used in the Section. In sub-section (1), it occurs in association with the phrase "for use on roads". In that context the ordinary dictionary meaning of the word 'keep in' is 'to retain', 'to maintain' or cause to stay or remain in a place 'to detain', 'to stay or continue in a specified condition, position etc.'

In association with the use of the vehicle, therefore, the word 'kept' has an element of stationariness. It is something different from a mere state of transit or a course of journey through the State. It is something more than a mere stoppage or halt for rest food or refreshment etc., in the course of transit through the territory of the State."

15. As per the said judgment, "mere state of running

through or even halting of the vehicle in the course of the

journey through the State of Mysore for its outside destination

will not be sufficient to constitute „keeping‟ of that vehicle in the

State within the meaning of Section 3 of the Act". Eventually, it

is held that on parity of reasoning, a vehicle in transit through

the State of Mysore or even making a necessary halt for a short

interval during transit, cannot be said to be a vehicle „kept‟ for

use on roads in the State of Mysore. As per the judgment, when

a vehicle passes through one State to another State and mere

halting of the vehicle in the course of journey does not amount

„kept‟ and in the said judgment, Hon‟ble Apex Court stated that

the vehicle passing through one State to another State keeping a

short duration does not amount to „kept‟ and directed the

authorities not to collect any tax from the owner of the said

vehicle. This principle is not applicable to the facts of the

present case.

16. The learned counsel also relied on the judgment

of J.Srinivasa Rao's case (3 supra). The Hon‟ble Supreme

Court held that the rate of tax could not be increased in

derogation to the provisions appended to Section 3 of the

Act and annulled the amendment made to increase the tax

for maxi cabs holding that the notification which issued

increasing the tax changes the basis the mode of taxation.

This judgment has no relevance to the present facts of the

case.

17. In the judgments relied on by this Court in

Travancore Tea Estates Co. Ltd.'s case (4 supra) and International

Tourist Corporation's case (5 supra), K.G.Shenoy's case (6 supra)

and in Automobile Transport Ltd.'s case (7 supra), the Hon‟ble

Apex Court has categorically held that while the motor vehicle is

registered in the State, it shall be deemed to be used and kept to

be used in the State. In view of the said judgments, the vehicle

registered in the present State is liable for payment of tax

whether it was used or not used in the State on public roads

unless the registered owner or the person having possession or

control of the motor vehicle intimates in writing to the licensing

officer before the commencement of the quarter for which tax is

due under Rule 12A of the Rules. Accordingly, the petitioner is

liable to pay the tax as per the demand which is impugned in the

Writ Petition.

17. The second issue raised by the learned counsel for

the petitioner is that as the vehicle was not seized by the

respondent-authorities under Section 8 of the Act, it shall be

deemed that the vehicle is not plied on the road and ought not to

have directed the petitioner to pay the levied tax under Section 3

of the Act. As answered already, once the vehicle is registered,

invariably the owner of the vehicle has to pay the tax. Once a

certificate of registration issued is to be deemed a potential user

of the roads all through the time the certificate of registration is

current and therefore liable to pay tax. Even if the vehicle was

not in a road worthy condition and could not be put to use on

the roads without the necessary repairs being carried out, the

owner or person having possession or control of a vehicle is

enjoined to pay the tax on the vehicle and then seek a refund.

18. The contention of the petitioner that the vehicle was

not seized under Section 8 of the Act shall be deemed, it is not

used or kept in use is not a good argument as per the judgment

in Automobile Transport Ltd.'s case (7 supra), that it is not for the

Transport Authorities to justify the demand for tax by proving

that the vehicle is in a fit condition and can be put to use on the

roads. It would be absolutely impossible for the State to keep

monitoring all the vehicles and prove that each and every

registered vehicle is in a fit condition and would be making use

of the roads and is therefore liable to pay tax.

19. In view of the same, the contention raised by the

petitioner that the vehicle was not seized under Section 8 of the

Act shall be deemed to be not plied is not a worthy argument

and accordingly, it is rejected.

20. For the reasons stated supra and in view of the law

laid down by the Hon‟ble Apex Court in Travancore Tea Estates

Co. Ltd.'s case (4 supra), International Tourist Corporation's case

(5 supra), Automobile Corporation Ltd.'s case (7 supra) and

K.G.Shenoy's case (6 supra), once the vehicle is registered under

the Act, the owner of the motor vehicle is invariably has to pay

tax, unless obtained permission under Rule 12A of the Rules,

intimating the authorities in writing that the vehicle is not in

use.

21. In the present case though the respondent-

authorities have conveyed to utilize the tax exemption under

Rule 12A of the Rules, the petitioner has not availed the said

facility. The petitioner, who was the registered owner and

possessor of the vehicle, has not intimated under Rule 12A of the

Rules to the licensing authority before commencement of this

quarter for which tax is due.

22. For the aforesaid reasons, this Court does not found

any reason to impeach with the demand notice, which is

impugned in this Writ Petition. Accordingly, this Writ Petition is

dismissed. There shall be no order as to costs of the Writ

Petition.

As a sequel, interlocutory applications pending, if any, in

this Writ Petition shall stand closed.

________________________________________ JUSTICE TARLADA RAJASEKHAR RAO

Date: 15.11.2022 siva

THE HON'BLE SRI JUSTICE TARLADA RAJASEKHAR RAO

WRIT PETITION No.5353 OF 2021

Date: 15.11.2022

siva