Orissa High Court
Om Automobiles vs State Of Odisha And Others on 11 April, 2022
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No.11525 of 2008
Om Automobiles, Berhampur .... Petitioner
-versus-
State of Odisha and others .... Opposite Parties
Appeared in this case:
For Petitioner : Mr. A. Pal, Advocate
For Opposite Parties : Mr. Pravakar Behera,
Standing Counsel for
Transport Department
CORAM:
THE CHIEF JUSTICE
JUSTICE R. K. PATTANAIAK
JUDGMENT
11.04.2022
Dr. S. Muralidhar, CJ.
1. The Petitioner, which is a partnership firm, carrying on the
business of trading, export, import of vehicle and sale of
automobiles and automobile spare parts, has filed this petition
challenging a Vehicle Checking Report (VCR) dated 5th August,
2008 issued by the Traffic Inspector, Orissa Motor Vehicle
Division, Ganjam, Chhatrapur and an order dated 6th August,
2008 passed by the Registering Authority-cum-Regional
Transport Officer (RTO), Ganjam, Chhatrapur directing that the
vehicles sold by the Petitioner Firm shall not be registered. The
Petitioner also seeks a direction to the RTO (Opposite Party No.3)
to renew the Trade Certificate (TC) of the Petitioner for a further
period of one year.
2. The background facts are that the Petitioner firm had a
dealership agreement with M/s. Honda Motor Cycle and Scooter
India Pvt. Ltd. initially for a period of three years. This was
further extended up to 16th February, 2010. For the purposes of
dealership, the Petitioner had taken premises on rent for a period
of 15 years from 5th April, 2003 onwards. The Petitioner is stated
to have invested nearly Rs.70 Lakhs for the Honda dealership at
Berhampur as well as the workshop for the Honda Scooter and
Motor Cycle at Berhampur. The Petitioner was registered under
the Orissa Sales Tax Act and subsequently, the Orissa Value
Added Tax Act. The Petitioner applied for a TC under Rule 35 of
the CMV Rules, 1989 and was granted the said certificate on 7th
April, 2005 in Form-17. The certificate was to be renewed every
year.
3. It is stated that on 5th August, 2008, the Traffic Inspector in the
office of the RTO, Ganjam, Chhatrapur came to the premises of
the Petitioner, verified the godown and found 38 vehicles (Honda
Scooters and Motor Cycles). He demanded to see the TC issued to
the Petitioner. On examination, it was found that the said TC had
lost its validity. There upon Opposite Party No.4 issued a VCR in
Form-54 and imposed a penalty under Section 192 of the Motor
Vehicles Act, 1988 (MV Act) read with Section 3 of the Orissa
Motor Vehicles Taxation Act (OMVT Act).
4. On 8th August 2008, the Petitioner applied for renewal of the
TC in Form-16 in respect of 80 vehicles. However, Opposite
Party No.3 refused to accept the renewal application on ground of
non-payment of the penalty amount imposed under the VCR. The
renewal application was sent by post by the Petitioner on 9th
August, 2008. However, in the meanwhile, on 6th August 2008,
Opposite Party No.3 passed the impugned order stating that the
vehicles sold by the Petitioner should not be registered by the
registering authority.
5. This petition was first listed for hearing on 19th August, 2008
by which time the Petitioner had paid the entire demanded amount
under the MV Tax for Rs.89,265/- on 13th August, 2008 under
protest. Further, the Petitioner deposited 50% of the penalty
amount i.e. Rs.47,500/- on 13th August, 2008. These receipts were
enclosed with a further affidavit filed by the Petitioner on 26th
August, 2008.
6. When the matter was heard on 19th August 2008, an interim
order was passed that "whatever amount has been paid pursuant to
the Demand Notice under Annexure-8 that will be subject to
result of the writ petition." Subsequently, on 23rd September 2008,
while noting that the counter affidavit had been filed by Opposite
Party No.3, it was directed that in case the Petitioner had already
paid the full amount of tax and 50% of the penalty, then it would
not be compelled to deposit the remaining amount of penalty
without the leave of the Court.
7. At the outset, the Court would like to observe that as far as the
motor vehicle tax is concerned, that being a statutory demand, the
Court is not inclined to interfere with it. In any event, the
Petitioner has paid the full amount.
8. However, as regards the penalty amount, there appears to be
merit in the contention of the Petitioner that there was no nexus
between the Petitioner not possessing a valid TC and being found
in possession of the vehicles that were yet to be registered. The
Petitioner in any event had applied for renewal of the TC. It is
nobody's case that there was any deliberate attempt on the part of
the Petitioner to operate without a valid TC.
9. As regards the vehicles found in the godown of the Petitioner,
without registration, Opposite Party No.4 lost sight of the fact that
these were new vehicles meant to be sold by the Petitioner as a
dealer in those vehicles. The registration would obviously take
place at the time of purchase of the vehicles by customers. There
is therefore no basis for simply levying a huge amount of penalty
on the Petitioner or even directing that no vehicles of the
Petitioner would be registered in future.
10. Consequently, the impugned demand of Rs.95,000/- levied on
the Petitioner under Section 192 of the MV Act read with Section
3 of the OMVT Act is not interfered with but the penalty is set
aside. The amount paid by the Petitioner constituting 50% of the
penalty shall be refunded to the Petitioner by the Opposite Parties
within a period of four weeks. If within the said time period the
payment as directed is not made, the amount will be paid together
with simple interest @ 6% per annum for the period of delay.
11. Further, the order dated 6th August, 2008 directing that
vehicles sold by the Petitioner would not be registered is also
hereby set aside.
12. The writ petition is disposed of in the above terms.
(S. Muralidhar)
Chief Justice
(R. K. Pattanaik)
Judge
M. Panda
