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Judgment
Heard Mr. Varun Sharma, learned counsel along with Mr. Shailendra Bajpai, learned counsel for the petitioners in these batch of writ petitions,
wherein, Section 3 (2) of the Chhattisgarh Motor Vehicle Taxation Act, 1991 (herein after referred as ‘Act of 1991’) is challenged on the
ground that same is ultra vires to the provision of Section 56 of the Motor Vehicles Act, 1988 (herein after referred as ‘MV Act’) and Article
19 (1) (g) of the Constitution of India. Challenge is also mounted on the orders passed by the Regional Transport Officer / Taxation Officer levying
tax, penalty and interest.
Amount due in respect of petitioner in WPC No. 4028 of 2021, petitioner in WPC No. 394 of 2022 and petitioner in WPC No. 183 of 2022 is Rs.
11,15,124/-, 11,61,684/- and 11,61,684/-, respectively.
Petitioners in all theses cases are owners of the school buses, which are transport vehicles within the meaning of Section 2(47) of the MV Act.
Mr. Sharma submits that as certificate of fitness of the vehicles had expired, therefore, there is deemed suspension of registration and as such,
Section 3(2) of the Act of 1991 permitting levy of tax even in respect of such a vehicle is ultra vires to Section 56 of the MV Act as well under Article
19 (1) (g) of the Constitution of India. He submits that the vehicles in question are not in use. He places reliance on the judgment of Hon’ble
Supreme Court in the case of Hardev Motor Transport v. State of M.P. & Others, reported in (2006) 8 SCC 613, with particular reference to
paragraphs 16 and 17 thereon.
Mr. Gagan Tiwari, learned Deputy Government Advocate appearing for the respondents submits that issue raised in these writ petitions is no longer
res integra as this Court, in the case of Abdul Shafiq v. State of Chhattisgarh & Others (WPT No. 155 of 2017), by an order dated 14.07.2017, had
dismissed the writ petition wherein an identical challenge was mounted.
Section 3(2) of the Act of 1991, reads as follows :
“3. Levy of Tax on Motor Vehicles â€" (1) xxx
(2) A Transport vehicle of which the certificate of registration is current, shall, for the purposes of this Act, be presumed to have been in use or kept
for use, notwithstanding the expiry of the certificate of fitness in case of such transport vehicle.
Section 56 of the MV Act, reads as follows :
“56. Certificate of fitness of transport vehicles.â€
(1) Subject to the provisions of sections 59 and 60, a transport vehicle shall not be deemed to be validly registered for the purposes of section 39,
unless it carries a certificate of fitness in such form containing such particulars and information as may be prescribed by the Central Government,
issued by the prescribed authority, or by an authorized testing station mentioned in sub-section (2), to the effect that the vehicle complies for the time
being with all the requirements of this Act and the rules made thereunder:
Provided that where the prescribed authority or the “authorized testing station†refuses to issue such certificate, it shall supply the owner of the
vehicle with its reasons in writing for such refusal.
(2) The “authorized testing station†referred to in sub-section (1) means a vehicle service station or public or private garage which the State
Government, having regard to the experience, training and ability of the operator of such station or garage and the testing equipment and the testing
personnel therein, may specify in accordance with the rules made by the Central Government for regulation and control of such stations or garages.
(3) Subject to the provisions of sub-section (4), certificate of fitness shall remain effective for such period as may be prescribed by the Central
Government having regard to the objects of this Act.
(4) The prescribed authority may for reasons to be recorded in writing cancel a certificate of fitness at any time, if satisfied that the vehicle to which it
relates no longer complies with all the requirements of this Act and the rules made thereunder; and on such cancellation the certificate of registration
of the vehicle and any permit granted in respect of the vehicle under Chapter V shall be deemed to be suspended until a new certificate of fitness has
been obtained:
[Provided that no such cancellation shall be made by the prescribed authority unless such prescribed authority holds such technical qualification as
may be prescribed or where the prescribed authority does not hold such technical qualification on the basis of the report of an officer having such
qualifications.]
(5) A certificate of fitness issued under this Act shall, while it remains effective be valid throughout India.â€
We are of the considered opinion that the judgment rendered in Abdul Shafiq (supra) is squarely applicable in the present cases.
Paragraphs 3 to 7 of the said judgment read as follows:
“3. Section 39 of the MV Act makes registration of motor vehicles obligatory. It provides that no person shall drive any motor vehicle and no
owner of a motor-vehicle shall cause or permit the vehicle to be driven in a public place or any other place unless the vehicle is registered in
accordance with the Chapter IV of the MV Act 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. The proviso to that Section is not relevant for the purpose of this case. Any
mechanically propelled vehicle adapted for use upon roads detailed in the definition clause of Section 2(28) of the MV Act is a 'motor vehicle' or
'vehicle' for the purpose of that Act. Therefore, Section 39 of the MV Act applies to all motor-vehicles or vehicles as defined in Section 2(28) of the
MV Act. Various definitions in Section 2 of that Act show that vehicles get classified into different categories as defined therein. Section 56(1) of the
MV Act applies to “transport vehicle†which is defined in Section 2(47) of the MV Act, to mean a public service vehicle, a goods carriage, an
educational institution bus or a private service vehicle;
which categories are also defined. Hence, the applicability of Section 56 of the MV Act is confined to transport vehicles. The proviso in Sub-section
(1) of Section 56 of the MV Act denudes a transport vehicle of the efficacy and the validity of its registration under Section 39, unless it carries a
“certificate of fitnessâ€. The “certificate of registration†as defined in Section 2(4) of the MV Act evidences due registration of a motor-
vehicle in accordance with the provisions of Chapter IV of the MV Act. The requirement that a transport vehicle shall possess a “certificate of
fitness†in terms of Section 56(1) of that Act is one which is in addition to the requirement of certificate of registration. The effect of Sub-section (1)
of Section 56 of the MV Act is that the validity of the registration of a transport vehicle for the purpose of satisfying the mandate of Section 39 of the
MV Act is not to be deemed, unless that particular transport vehicle carries a certificate of fitness in accordance with the provisions of Section 56 of
the MV Act. Therefore, a transport vehicle may be one which is covered by a certificate of registration; yet, one which cannot be deemed to be one
which is validly registered for the purpose of Section 39 unless it carries a certificate of fitness as enjoined in Section 56 of the MV Act.
Reading such inhibition as contained in Section 56 of the MV Act alongwith the prohibition contained in Section 39, it can be seen that the legislative
prescription through those statutory provisions is that no person shall drive any transport vehicle and no owner of any transport vehicle shall cause or
permit that vehicle to be driven as delineated in Section 39 of the MV Act unless that transport vehicle carries a certificate of fitness in terms of the
dictate of Section 56 of the MV Act read with the prescriptions made by the Central Government as enjoined in that section, apart from the certificate
of registration.
Clause (c) of Section 2 of the Taxation Act defines 'tax' to mean a tax leviable under that Act. Section 3 of that Act provides for levy of tax on
motor vehicles. It reads as follows:
:“3. Levy of tax on Motor Vehicles. - (1) A tax shall be levied on every motor vehicle used or kept for use in the State at the rate specified in
the First Schedule:
[Provided that the lifetime tax on every motor vehicle shall be levied at the rates specified in the second Schedule]:
Provided further that in respect of a motor vehicle passing through the State from a manufacturer to a dealer under a temporary certificate of
registration for a period not exceeding one month, the rate of tax shall be one third of the tax payable for a quarter.
(2) A Transport Vehicle of which the certificate of registration is current, shall, for the purposes of this Act, be presumed to have been in use or kept
for use, notwithstanding the expiry of the certificate of fitness in case of such transport vehicle.â€
Sub-section (1) of Section 3 provides that a tax shall be levied on every motor vehicle used or kept for use in the State at the rate specified in the
first Schedule to that Act. The impugned Sub-section (2) of Section 3 provides that a transport vehicle of which the certificate of registration is
current, shall, for the purpose of the Taxation Act, be presumed to have been in use or kept for use, notwithstanding the expiry of the certificate of
fitness in case of such transport vehicle. The presumption so provided as per Sub-section (2) of Section 3 of the Taxation Act is that if a vehicle is
covered by certificate of registration in terms of the Motor Vehicles Act and the Rules thereunder, it shall be deemed to be a vehicle which is used or
kept to be used for the purpose of levy of tax under Sub-Section (1) of Section 3 of the Taxation Act.
As regards motor vehicle taxation, in terms of Entry 57 in List II (State List) in the Seventh Schedule in the Constitution, the State has the exclusive
power to make laws with respect to taxes on vehicles, whether mechanically propelled or not, suitable for use on roads; subject to the provisions of
Entry 35 of List III (Concurrent List), which includes the subject: principles on which taxes on mechanically propelled vehicle are to be levied.
Therefore, the power of the State of Chhattisgarh to levy tax through the provisions of the Taxation Act is beyond dispute. The levy of tax as per
Section 3 of the Taxation Act is on every motor vehicle used or kept for use in the State of Chhattisgarh. It is not made dependent on the registration
of the vehicle. Also, such levy is not conditional on registration of the motor vehicle concerned. The provisions in Section 39 of the MV Act read with
Section 56(1) of that Act does not abridge the authority to levy tax under Section 3 of the Taxation Act. The impugned provision in Section 3(2) of
theTaxation Act is a statutory devise to protect and insulate the exchequer against deprivation of tax in terms of Section 3(1) of the Taxation Act on
the premise that transport vehicle, though stands with a certificate of registration, is to be treated as one which cannot be driven or permitted to be
driven in any public or other place on the ground that it does not carry a certificate of fitness in terms of Section 56 of that Act. If we were to accept
the plea that inspite of possessing a certificate of registration, a vehicle which has run beyond the expiry of certificate of fitness should be exempted
from levy of tax, that would impinge the provision for levy of tax, as is contained in Section 3(1) of the Taxation Act which imposes the levy tax on
'motor vehicle used or kept for use in the State'. There being no conflict between the provisions of the MV Act and the Taxation Act, the plea of the
Petitioner that the impugned provision in the Taxation Act does not stand in the light of the Article 254 of the Constitution is repelled. In the light of the
fact that the vehicles get classified into different categories or types, going by the interpretation clause, namely, Section 2 of the MV Act, no hostile
discrimination can be read into the impugned provision in the Taxation Act. The impugned Sub-section (2) of Section 3 of the Taxation Act applies
only to those vehicles which fall within the term 'transport vehicle' as defined in the MV Act. For this reason, the plea of arbitrariness and hostile
discrimination and the challenge attempted to be levied with reference to Articles 14 and 19(1)(g) of the Constitution are only to be negatived. We do
so.
It is not in dispute that the Petitioner's vehicle is one which continues to hold a certificate of registration. Under such circumstances, we do not find
that any case for examining the constitutional validity of the provisions is made out by the Petitioner. This writ petition therefore fails.â€
As regards the plea set up by Mr. Sharma that the said vehicles are not in use, such a plea cannot be accepted.
Section 55 of the MV Act provides that if a motor vehicle has been destroyed or has been rendered permanently incapable of use, the owner shall,
within fourteen days or as soon as may be, report the fact to the registering authority within whose jurisdiction he has the residence or place of
business where the vehicle is normally kept, as the case may be, and shall forward to the authority the certificate of registration of the vehicle and the
registering authority shall, if it is the original registering authority, cancel the registration and the certificate of registration, or, if it is not, shall forward
the report and the certificate of registration to the original registering authority and that authority shall cancel the registration.
The petitioners had not taken any such steps to demonstrate that the vehicles were rendered permanently incapable of use.
In Hardev Motor Transport (supra) in paragraphs 16 and 17, Hon’ble Supreme Court has observed as follow :
“16. Tax imposed on motor vehicles in terms of the provisions of the 1991 Act is a regulatory one. It was so held in Boloni Ores Ltd. v. State of
Orrissa {(19740 2 SCC 777} stating : (SCC p. 794, para 29)
“If the vehicles do not use the roads, notwithstanding that they are registered under the Act, they cannot be taxed.â€
We may, however, hasten to add that even if a vehicle is roadworthy and can be plied on a road, a tax may be imposed, but if a vehicle is not
capable of being plied on the road, no tax would be leviable.â€
A perusal of the above judgment goes to show that when the vehicle is capable of plying on the road, a tax may be imposed, but if a vehicle is not
capable of being plied on the road, no tax would be leviable. Present cases are not cases where any applications were filed before the registering
authority stating that the vehicles are rendered permanently incapable of being used.
In view of the above discussions, there is no merit in these writ petitions and accordingly, the same are dismissed.
Interim order passed earlier shall stand vacated.