MAYILVAHANAM MOTOR SERVICE v. STATE OF KERALA — 1972 DIGILAW 67 (KER)

Judgment :- 1. he petitioners are operators within the meaning of that term as defined in S.2(b) of the Kerala Motor Vehicles (Taxation of Passengers and Goods) Act, 1963 (hereinafter referred to as Act 25 of 1963). The petitioners challenge the validity of the Motor Vehicles (Kerala Third Amendment) Act, 1971, (for short, Act 34 of 1971) in its entirety. The petitioner in O. P. No. 2513 of 1971 also challenges the validity of the Kerala Motor Vehicles (Taxation of Passengers and Goods) (Amendment) Act, 1970, (for short, Act 18 of 1971) in its entirety though the petitioner In O. P. No. 2340 of 1971 confines his attack to the validity of S.6 thereof. 2. hese two petitions form two of a batch that we heard together. Even this batch only represents a small number of the totality of the petitions pending before this Court challenging the validity of Acts 18 and 34 of 1971. It is agreed before us that the pleadings in these two petitions exhaust the pleadings in the batch of cases that have been argued before us and further that the cases in that batch are representative of the entirety of cases on the subject and we will, therefore, in dealing with the matters involved, confine our attention to the pleadings. in these petitions. 3. Before we deal with the specific contentions that have been raised challenging the validity of Acts 18 and 34 of 1971, it is necessary to refer to the legislative background and the circumstances under which these Acts came to be passed. 4. t is unnecessary to go further back than 1-11-1956, when the Kerala State came into being. On that day, in the Travancore-Cochin area of the Kerala State, there was no Act in force corresponding to Act 25 of 1963, there being only a Travancore-Cochin Motor Vehicles Taxation Act. In the Malabar area of the State, the Madras Motor Vehicles (Taxation of Passengers and Goods) Act, 1950, was in force. Also there was the Madras Motor Vehicles Taxation Act. However, after the formation of the Kerala State, the incidence of tax on the stage carriages in the State was practically the same. In the Malabar area, a tax of Rs. 25/- per seat per quarter was imposed under the Madras Motor Vehicles Taxation Act and a compounding fee of Rs. Also there was the Madras Motor Vehicles Taxation Act. However, after the formation of the Kerala State, the incidence of tax on the stage carriages in the State was practically the same. In the Malabar area, a tax of Rs. 25/- per seat per quarter was imposed under the Madras Motor Vehicles Taxation Act and a compounding fee of Rs. 12.50 per seat per quarter was the rate payable under the Madras Motor Vehicles (Taxation of Passengers and Goods) Act, 1950. The tax under the Travancore-Cochin Motor Vehicles Taxation Act was raised with effect from 1-11-1956 to Rs. 37.50. Thus the tax payable per seat per quarter was the same, Rs. 37.50 for the entire area within the Kerala State. 5. The rate of fare that was payable in the Malabar area of the State was that fixed by notification, G O. (MS) 565/Home dated 5-3-1954, issued by the Government of Madras fixing 3.90 paise The fare was fixed in the notification as annas and pies. per mile, and providing a minimum of 31 paise The fare was fixed in the notification as annas and pies for distances less than 8 miles. In the Travancore-Cochin area of the State, the fare was that fixed by notification dated 23-5-1952 by the Travancore-Cochin Government, also providing a rate of 3.90 paise The fare was fixed in the notification as annas and pies. per mile and the minimum fare being 19 paise The fare was fixed in the notification as annas and pies. Thus it will be seen that the fare per mile was the same in both the areas of the State though the minimum was different. The Kerala Government by notification dated 15-4-1958 eliminated this difference in the minimum fare and a uniform minimum rate of 16 paise was fixed This notification also slightly altered the fare per mile by fixing it at 4 paise per mile. For the sake of completeness, we may also refer to the notification dated 14-2-1961 which reduced the minimum from 16 paise to 10 paise. 6. For the sake of completeness, we may also refer to the notification dated 14-2-1961 which reduced the minimum from 16 paise to 10 paise. 6. Early in 1963, it was decided to increase the motor vehicles tax, to introduce tax on passengers and goods throughout the Kerala State and also to increase the fare structure The draft notifications of the Kerala Motor Vehicles Taxation Bill and the Kerala Motor Vehicles (Taxation of Passengers and Goods) Bill were first published, followed by the Kerala Motor Vehicles Taxation Act, 1963, and Act 25 of 1963, on 15-4-1963, and these Acts came into force on 1-7-1963. There was also a notification dated 13-6-1963 in purported exercise of the powers under S.43 of the Motor Vehicles Act which was published in the Gazette on 18-6-1963 giving directions to the State Transport Authority to fix the rate of fare at 3 paise per kilometre and fix the minimum fare at 20 paise. It may be repeated here that the rate that was applicable before this notification was 2.5 paise per kilometre and the minimum fare was 10 paise. It is stated that the Government took into consideration not only the increase in the operational cost, but also the enhanced tax burden imposed by the enactments of 1963 in issuing the above notification. The fare was fixed at 3 paise per kilometre with a minimum of 20 paise from 1-7-1963. It appears that there had been repeated representations from operators to increase the fare so fixed. It also appears that there were representations from the travelling public clamouring for the reduction of the minimum of 20 paise. Government then constituted a "Transport High Level Committee". The Committee went into the question in detail and recommended that there was no need to raise the fare structure. But it recommended a reduction of the minimum fare from 20 paise to 10 paise. This was on the 15th March, 1964 and, apparently, pursuant to this recommendation, a notification dated 24-4-1964 was issued reducing the minimum from 20 paise to 10 paise. Notwithstanding this reduction of the minimum fare, the administration of the statutes of 1963 appears to have gone on smoothly, excepting perhaps for the agitation of the operators for enhancement of the fare, till the year 1966. Notwithstanding this reduction of the minimum fare, the administration of the statutes of 1963 appears to have gone on smoothly, excepting perhaps for the agitation of the operators for enhancement of the fare, till the year 1966. By this time the agitation for enhancement of the fare seems to have reached a high pitch and there having been no response from the State Government, this Court was approached by a series of writ petitions which were disposed of by a Division Bench of this Court and the decision is in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR 1968-11 Kerala 153.) Since what has been said in this decision loomed very large in the contentions that have been raised by counsel before us, it is necessary even at this stage to refer briefly to the points that had been taken and the conclusions that had been reached by this Court on those points. Five points were urged before this Court; four of them did not find favour with this Court though it accepted the 5th and gave specific directions, the import of which we will advert to and consider in the course of this judgment. The points that were raised were that Act 25 of 1963, though it purported to be under entry 56 in List II of the Seventh Schedule to the Constitution, did not really fall under that entry, that the Act in fact imposed a tax on the income of the operators, that the State legislature had no power to impose such a tax and that therefore the Act was a piece of colourable legislation. Further, it was urged that the Act violated Art.301 of the Constitution in that it did not satisfy the requirements of Art.304(b). The third point was that the Act infringed Art.14 of the Constitution, and the fourth, that it was against the provisions of the Art.19 (1) (g) and finally that even if the Act was construed to have imposed tax only on the passengers and the consignors of goods, it was still ineffective because of the lack of provisions in the statute itself or the rules framed thereunder for the collection of the tax from the passengers or the consignors of the goods. It was held by this Court that the incidence of the tax was not on the operators but on the passengers and the consignors of the goods and that therefore the legislation was well within the competence of the State legislature falling within entry 56 is List II of the Seventh Schedule to the Constitution. On this finding, the contentions raised by the operators that the statute violated Art.14 and 19 were rather summarily rejected holding that the petitioners could not be heard to say that there was discrimination between operator and operator or that the statute imposed unreasonable restriction on their right to carry on any occupation, trade or business. This Court also held that it bad not been established that Art.301 was violated. Regarding the fifth point this Court gave the direction in Para.30 of the judgment which we may extract: "So we think that a direction must be issued that provision must be made for the collection of the tax from the passenger as tax specifying the quantum calculated and computed on the basis of the provision in the Act. This will of course be payable to the operator who has been made liable to pay the tax to the State. It is not for us to suggest the manner in which this should be done. Perhaps this can be achieved by amending the statute by making specific provisions in the Act. It can even be done perhaps by framing Rules under S.20(g) which we have already read. Rules made under similar statutes had been relied on by courts as early as in the case in Atma Ram Budhia v. State of Bihar, for the purpose; of construing the purpose of the Act. As we said, it is for the State legislature and or the State Government to take such steps as are necessary to provide the machinery. We direct that this should be done as expeditiously as possible." 7. As we said, it is for the State legislature and or the State Government to take such steps as are necessary to provide the machinery. We direct that this should be done as expeditiously as possible." 7. Before we proceed to state what happened subsequent to this decision which was on the 4th March, 1968, it is also necessary to state and extract from the judgment what exactly this Court said in regard to the contention that the fare fixed by the notification published on 18-6-1963 (which became effective from 1-7-1963) did not include the tax that was payable under Act 25 of 1963: "We are not now in a position to say that the liability imposed by the Act has not been absorbed by the increase in fare that has been introduced as a result of the enhancement in fare effected from 1st July 1963 But we are equally unable to say that it has been so absorbed. This is what results from the adoption of a method such as the one that has been resorted to in this case." 8. It is thus clear that this Court had not come to any definite conclusion as to whether the fare fixed with effect from 1-7-1963 did or did not include the tax payable under Act 25 of 1963. 9. Soon after this judgment was pronounced and in spite of fairly clear statements in the judgment as to what this Court considered to be the proper steps to be taken, the State Government issued a notification dated 29-4-1968 in draft form and published it on 30-4-1968. This draft notification, purporting to give directions to the State Transport Authority under S.43 of the Motor Vehicles Act, has been produced is O. P. No. 2513 of 1971 as Ext. P1. The notification suggested the following amendment to the notification dated 20-6-1963 issued by the State Transport Authority fixing the fare with effect from 1-7-1963; "In the preamble to the notification before the words "as follows" and after the words "in the State" insert the words "Inclusive of the tax leviable under the Kerala Motor Vehicles (Taxation of Passengers and Goods) Act, 1963". There was also a draft amendment to the Kerala Motor Vehicles (Taxation of Passengers and Goods) Rules, 1963. There was also a draft amendment to the Kerala Motor Vehicles (Taxation of Passengers and Goods) Rules, 1963. That was in regard to R.3 of those Rules; to renumber R.3 as R.3(1) and insert a new rule, R.3(2), in these terms: "The fares and freights collected from the passengers or consignors of goods as the case may be, may include in it, such proportion of the tax as is payable under S.3 of the Act and the prescribed authority while making the assessment under sub-rule (i) shall calculate the tax due to the Government under the Act from the fares and freights collected on the same proportion." 10. What was attempted by the draft notification was to clarify that the fare already fixed and which was effective from 1-7-1963 was inclusive of the tax and that such tax was being collected from the passengers and the consignors of goods. There was no increase in the fare suggested though the operators were contending seriously from 1966 that the fare was inadequate. In view of the conditions in the permit and the provisions in the Motor Vehicles Act, more than the fare fixed under the Motor Vehicles Act could not be collected unless authorised by a special law. 11. Immediately these notifications were published, this Court was approached by a petition (O. P. No. 2177 of 1968) under Art.226 of the Constitution. This was dismissed in limine and the writ appeal from that decision (Writ Appeal No. 99 of 1968) was also dismissed. It was represented at the time of the dismissal of the writ appeal, by the Government Pleader who appeared for the State, that no tax would be collected without complying with the directions in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968-11 Kerala 153.) (Vide Para.9 of the affidavit in O. P. No. 2513 of 1971 and Para.17 of the common counter affidavit of the State dated 7-1-1972). 12. Thereafter a draft Bill was introduced in the Assembly to amend Act 25 of 1963 and it was published in the Gazette dated 11-8-1969. This Bill was to have been taken up for consideration on 9th January, 1970. But it was not taken up for consideration on that date. 12. Thereafter a draft Bill was introduced in the Assembly to amend Act 25 of 1963 and it was published in the Gazette dated 11-8-1969. This Bill was to have been taken up for consideration on 9th January, 1970. But it was not taken up for consideration on that date. Instead, an Ordinance was promulgated by the Governor on 4-1-1970 effective from 5-1-1970 introducing the same amendments to Act 25 of 1963 which were sought to be made by the Bill. This Ordinance (Ordinance No.1 of 1970) too was challenged in O. P. No. 225 of 1970. Along with this Original Petition, C.M.P. No. 821 of 1970 was moved for stay of collection of tax under Act 25 of 1963 and the following order was passed by this Court on 19-1-1970 on that petition: "Collection of tax under T.P.G. Act 1963 as amended by Ordinance No. 1/70 is stayed in respect of the period prior to its publication in the Kerala Gazette on 5-1-1970, to the extent the operator has not collected the same during the said period. Non-payment of tax claimed under the Act shall not be a ground for reffising fitness certificate." After this order was passed, the Malabar Bus Owners' Association informed the Transport Commissioner that the members of the Association had resolved to collect 10% extra over the fare from 25-1-1970. The Transport Commissioner by his letter dated 22-1-1970 informed the Association that it has no right to collect the fare in excess of the fare fixed by the competent authority. Despite the communication from the Transport Commissioner, some operators realised 10% extra over the fare fixed from the passengers. This created resentment among the public and representations were made before the Minister for Transport. Consequently it appears that a conference was held by the Minister for Transport on 2-2-1970 and it was then agreed that pending a decision in the matter, the status quo before the promulgation of Ordinance No.1 of 1970 would be maintained and that no enhanced amount would be collected by the operators. Though the Regional Transport Officers were instructed by the Transport Commissioner to collect the tax due from 5-1-1970. Though the Regional Transport Officers were instructed by the Transport Commissioner to collect the tax due from 5-1-1970. apparently pursuant to the order of this Court on CM.P. No. 821 of 1970 dated 19-1-1970, the Government issued instructions on 24-2-1970 that until further orders from the Government, the operators shall not be required to pay the tax under Act 25 of 1963, for the period from 5-1-1970 in rendering services in respect of the concerned vehicle such as issue and renewal of permits etc. (Vide Para.19 to 22 of the common counter-affidavit of the State dated 7th January, 1972.) 13. The Bill which became Act 18 of .971, introduced in the Assembly and published in the Kerala Gazette dated 11-8-1969 was passed by the legislature on 28-2-1970. The assent of the Governor, however, was received only on 1-6-1971. On the same same day, Ordinance No. 15 of 1971 was passed and it is this Ordinance that was replaced by Act 34 of 1971. 14. The position thus was that from the beginning of the year 1970, there was no collection of tax under Act 25 of 1963 pursuant to the agreement reached between the operators and the Government on 2-2-1970. Counter affidavits had been filed in O.P. No. 225 of 1970 and in O.P. No. 319 of 1970 and in petitions similar to O. P. No. 319 of 1970. The counter affidavit in O. P. No. 319 of 1970 is Ext. P2 in O. P. No. 2513 of 1971. A further statement was filed in O. P. No. 568 of 1970 which is produced as Ext. P3 in O. P. No. 2513 of 1971. When these petitions came up before this Court, in view of the statements contained in Exts. P2 and P3 in O.P. No 2513 of 1971, the original petitions were dismissed with liberty to move this Court afresh in the circumstances mentioned in the judgment in O. P. No. 319 of 1970 and connected cases. 15. We may at this stage refer to the fact that apparently as a result of the agitation by the operators that the fare fixed with effect from 1-7-63 was inadequate, a Committee had been constituted by appointing Shri. K. Sankaran, a retired Chief Justice of this Court, as Chairman in 1966 itself and this Committee completed its investigation and submitted its report to the State Government on the 20th October, 1S67. Government seems to have appointed another Committee also with the Minister for Revenue and Labour as Chairman on 5-12-1970 to go into the question of difficulties of the bus owners. It is stated in the counter affidavit that after considering the recommendations of these Committees and all other relevant matters the Government issued direction to the State Transport Authority on 24-9-1971 for fixing revised rates of fare. By this direction, the rate of fare inclusive of tax on passengers and goods has been raised to 3.3 paise per kilometre and the minimum fare in respect of ordinary stage carriages has been raised from 10 paise to 20 paise with effect from 15-10-1971. 16. We shall now refer to the salient features of Act 18 of 1971 and Act 34 of 1971. By Act 18 of 1971, sub-s. (2) of S.1, it was provided that the provisions of the Act, excepting those of S.5 and 6, shall be deemed to have come into force on the 1st day of July, 1963, and S.5 and 6 on the 5th day of January, 1970. S.3 of Act 25 of 1963 was amended by S.2 of Act 18 of 1971. S.3 of Act 25 of 1963 as amended by Act 18 of 1971 is in these terms: "3. Levy of tax on passengers and goods.-(1) On and from the date of commencement of this Act, there shall be levied a tax on all passengers, luggage and goods carried by stage carriages, and on all goods transported by goods vehicles, at the following rates, namely: (a) in the case of stage carriages, 10 paise in the rupee on the fares and freights payable to the operators of such carriages; (b) in the case of public carrier vehicles, 5 paise in the rupee on the freights payable to the operators of such vehicles; (c) in the case of private carrier vehicles. 2 paise per tonne Kilometre of the goods: Provided that in the case of all goods transported by goods vehicles for export out of the territory of India, no tax under this Section shall be payable: Provided further that no tax shall be levied on any passenger, luggage or goods carried in a stage carriage, if the total distance permitted to be covered by such stage carriage in a day, does not exceed eighty kilometre. Explanation 1:- For the purpose of this proviso, "export" shall not include movements of goods from one port in the territory of India to another part in the said territory. Explanation 2:- For the removal of doubts it is hereby declared that - (i) in respect of passengers, luggages or goods booked through over the railways and any road transport service, the tax payable under this Ad shall be calculated only on the fares and freights payable on such passengers, luggage or goods for the distance on the road covered by the taxable vehicle; (ii) no tax shall be payable under this Act on goods carried by any vehicle owned by any department of the Central Government or by the Railways. (2) The tax levied under sub-s. (1) shall be paid by the passengers or the consignors of the goods, as the case may be, to the operators along with the fares or freights payable to the operators of the stage carriages or the goods vehicles. (3) The operator shall be liable to pay the tax levied under sub s. (1) on all passengers, luggages or goods carried by stage carriage and on all goods carried by good vehicles of which he is the operator, to the Government in the manner provided in this Act." 17. We may also extract S.3 as it stood before it was amended by Act 18 of 1971: "3. On and from the date of commencement of this Act. there shall be levied and paid to the Government a tax on all. We may also extract S.3 as it stood before it was amended by Act 18 of 1971: "3. On and from the date of commencement of this Act. there shall be levied and paid to the Government a tax on all. passengers, luggage and goods carried by stage carriages, and on all goods transported by goods vehicles, at the following rates, namely: (a) in the case of stage carriages, 10 paise in the rupee on the fares and freights payable to the operators of such carriages; (b) in the case of public carrier vehicles, 5 paise in the rupee on the freights payable to the operators of such vehicles; (c) in the case of private carrier vehicles, 2 paise per tonne Kilometre of the goods: Provided that in the case of all goods transported by goods vehicles for export out of the territory of India, no tax under this Section shall be payable: Provided further that no tax shall be levied on any passenger, luggage or goods carried in a stage carriage, if the total distance permitted to be covered by such stage carriage in a day, does not exceed eighty kilometres. Explanation 1:- For the purpose of this proviso, "export" shall not include movements of goods from one port in the territory of India to another port in the said territory. Explanation 2:- For the removal of doubts it is hereby declared that (i) in respect of passengers luggage or goods booked through over the railways and any road transport service, the tax payable under this Act shall be calculated only on the fares and freights payable on such passengers, luggage or goods for the distance on the road covered by the taxable vehicle; (ii) no tax shall be payable under this Act on goods carried by any vehicle owned by any department of the Central Government or by the Railways." 18. Thereafter came S.6 of Act 18 of 1971 which is in these terms: "6. Thereafter came S.6 of Act 18 of 1971 which is in these terms: "6. Validation.- Notwithstanding any judgment, decree or order of any court, all taxes levied or collected or purported to have been levied or collected under the principal Act before the date of commencement of this section shall be deemed to be and to have always been levied or collected in accordance with law as if S.3 of the principal Act as amended by this Act was in force at all material times when such tax was levied or collected. and no such levy or collection shall be called in question on the ground that it was without authority of law, and all taxes so levied or purported to have been levied but not collected may be collected in accordance with the provisions of the principal Act as amended by this Act: Provided that nothing in this Act shall render any person liable to be convicted of any offence in respect of anything done or omitted to be done by him before the 5th day of January, 1970, if such act or omission was not an offence under the principal Act before the aforesaid date but for the provisions of this Act." 19. By Act 34 of 1971, S.43 of the Motor Vehicles Act, 1939 was amended. In sub-section (1) of S.43 in regard to the power to issue directions to the State Transport Authority, power has been taken by the amendment to give directions "prospectively or retrospectively". Further sub-section (1A) of S.43 of the Motor Vehicles Act has been added which is in these terms: "(1A) Any direction under sub section (1) regarding the fixing of fares and freights for stage carriages, contract carriages and public carriers may provide that such fares or freights shall be inclusive of the tax payable by passengers or consignors of goods as the case may be, to the operators of the stage carriages, contract carriages or public cariers under any law relating to tax on passengers and goods already in existence or to be made from time to time." 20. S.3 of Act 34 of 1971 contains a provision for validation and it is necessary to read that section also: - "3. S.3 of Act 34 of 1971 contains a provision for validation and it is necessary to read that section also: - "3. Validation-(1) Notwithstanding any judgment, decree or order of any court to the contrary or anything contained in any law for the time being in force, (a) the directions relating to fares for stage carriages issued by the Government on or after the first day of March 1963 shall be deemed to be inclusive of the tax payable under the Kerala Motor Vehicles (Taxation of Passengers and Goods) Act, 1963 (Kerala Act 25 of 1963 hereinafter referred to as the said Act) and to have been issued under S.43 of the Motor Vehicles Act, 1939 as amended by this Act; (b) the revised rates of fares for the stage carriages fixed by the State Transport Authority to take effect from the first day of July, 1963, or thereafter in pursuance of the above mentioned directions, shall accordingly be deemed to be inclusive of the tax. payable under the said Act by passengers of stage carriages; (c) all taxes under the said Act collected or purported to have been collected from the operators of stage carriages shall be deemed to be, and to have always been validly collected in accordance with law; (d) no suit or other proceedings shall be maintained or continued in any court against the Government or any other authority or persons whatsoever for the refund of any tax so collected; (e) no court shall enforce any decree or order directing the refund of any tax so collected; and (f) any such tax due to the Government before the commencement of this Act, but not collected, and any such tax which may become due to the Government, from any operator of stage carriages, may be recovered in the manner provided under the said Act. (2) For the removal of doubts, it is hereby declared that nothing contained in sub-section (1) shall be construed as preventing any person from claiming refund of any tax paid by him in excess of the amount due from him under the said Act." 21. This court had held that the tax imposed by Act 25 of 1963 was on the passenger or the consignor of the goods. This court had held that the tax imposed by Act 25 of 1963 was on the passenger or the consignor of the goods. Sub-S. (2) of S.3 of Act 25 of 1963 as amended has clarified this position by stating that the tax levied under sub-S. (1) of S.3 shall be paid by the passenger or the consignor of the goods to the operator. Sub-section (3) of S.3 as amended obliges the operator to pay the tax levied under sub-section (1) of S 3 to the Government in the manner provided in the Act. This amendment as such does not alter the position as we understand it from what it was before the amendment and as it was interpreted by this Court in the decision in Thomman & others v. The Regional Transport Officer, Ernakulam and another (ILR.1968-11 Kerala 153) Objection has been specifically taken in O. P. No. 2340 of 1971 to S.6 alone of Act 18 of 1971; and though the prayer in O. P. No. 2513 of 1971 is couched in wide terms it is not urged before us that any provision other than S.6 of Act 18 of 1971 requires examination by this Court as to its validity. We have already read S.6 and by the mere terras of that section there is nothing added to Act 25 of 1963 if the fare collected by the operators from the passengers or consignors of goods included the tax element also as is urged on behalf of the State. These petitions are sought to be sustained on the ground that the fare fixed with effect from 1-7-1963 did not include the tax imposed under Act 25 of 1963. We shall deal with this contention presently. But it is necessary to state here that the challenge to the validity of S.6 of Act 18 of 1971 is based on the ground that the operators had not and could not have collected the tax from the passengers as the fare fixed with effect from 1-7-1963 did not include the tax imposed by Act 25 of 1963. 22. But it is necessary to state here that the challenge to the validity of S.6 of Act 18 of 1971 is based on the ground that the operators had not and could not have collected the tax from the passengers as the fare fixed with effect from 1-7-1963 did not include the tax imposed by Act 25 of 1963. 22. There is a more serious objection taken to the amendment to S.43 of the Motor Vehicles Act introducing the deeming provision that the directions issued by the State Government long before S.43 was amended by the legislature should be deemed to include a direction to take into account the liability to tax under Act 25 of 1963 also, infixing the fare payable in exercise of the power under that section of the Motor Vehicles Act by the State Transport Authority, and the further provision that the fare so fixed shall be deemed to include the tax. These deeming provisions, it was contended, introduced unreasonable restrictions by making the operators liable for the tax under Act 25 of 1963 though they bad not collected the tax from the passengers and the consignors of goods. Of course this contention can stand only if the fare fixed on 1-7-63 did not take in the tax imposed under Act 25 of 1963. The real question therefore is how far this factual aspect has been established by the petitioners before us and in this regard it may be necessary to examine the position separately for the two periods; the one commencing from 1-7-1963 when the fare was fixed till the end of the year 1967, and the other from the period from the beginning of 1968 till the fare was again revised with effect from 15-10-1971. We shall deal with this question first before referring to the other contentions that have been advanced by counsel before us because the sustainability of these contentions depends to a large extent on the answer to this question of fact. 23. We shall deal with this question first before referring to the other contentions that have been advanced by counsel before us because the sustainability of these contentions depends to a large extent on the answer to this question of fact. 23. We may repeat at this stage that the materials that were placed before us at the time the same point was discussed in the judgment in Thomman and others v. The Regional 'Transport Officer, Ernakulam & another (ILR.1968 II Kerala 153) did not enable us to come to any conclusion one way or the other as to whether the tax was included in the fare fixed with effect from 1-7-63 and we have extracted the relevant passage from the judgment already. But in these proceedings the Advocate General, who appeared for the State, has taken us through the relevant files and it is necessary to refer to certain details. 24. The Bill which gave rise to Act 25 of 1963 was introduced as a result of the recommendations made by the Transport Commissioner on 1-1-1963. In the wake of this Bill the implication of the introduction of the tax proposed by the Bill was examined. 25. The Director of Transport wrote to the Secretary to Government on 2-4-1963, and Para.2, 3 and 4 of that letter are relevant: "2. At the existing rate of fares, the earning per mile worked out for the year 1962-63 comes to 123 np. The present proposal to increase the basic rate as 3 np. per head per kilometre will result in about 20 percent increase in the rate of fares. From the actual figures of the previous years, the Department could expect only about 8 per cent in the E. P. M. from the services at the proposed rate of fares. Thus 133 np. seems to be a fair estimate of the E. P. M. which the department could expect to get for the year 1963 - 64 after the fair increase. 3. As against the increased E. P.M. of 133 np. the expenditure worked out will come to 130 np. per mile. This increased operational cost is estimated by the Department taking into account the enhanced rate of vehicle tax. the new imposition of passenger tax under the T. P G. Act and such other duties. 3. As against the increased E. P.M. of 133 np. the expenditure worked out will come to 130 np. per mile. This increased operational cost is estimated by the Department taking into account the enhanced rate of vehicle tax. the new imposition of passenger tax under the T. P G. Act and such other duties. Consequent to the proposed levy of tax on passengers, there will be more than 60 per cent increase in the rate of tax to be paid by the department. All these factors were taken into consideration in estimating the operational cost. 4. No doubt the increased rate of tax, the levy of passenger tax and such other duties would reduce the profit margin and the return on capital out lay to a considerable extent, Despite the incidence of higher rate of tax. levy of passenger tax and other duties. I feel that the department could still operate its services profitably at the rate of fares contained in the draft notification published by the Government. Since by careful operational economics the expenditure per mile could be reduced by 2 to 3 np. per mile and the earnings increased by rationalisation of services. So further enhancement of fares is unnecessary." 26. It is clear from Para.3 extracted above that the increased operational cost was estimated by the department by taking into account the enhanced rate of vehicles tax, the new imposition of the passenger tax and such other duties. Reference was also made by the Advocate General to the objections dated 3-4-1963 filed by the Modern Bus Transports, Bank Road, Calicut-there were a number of other similar objections by other operators also-to show that when they objected to the draft directions contained in the notification dated 4th March, 1963. Reference was also made by the Advocate General to the objections dated 3-4-1963 filed by the Modern Bus Transports, Bank Road, Calicut-there were a number of other similar objections by other operators also-to show that when they objected to the draft directions contained in the notification dated 4th March, 1963. published in the Kerala Gazette (Extra-ordinary) of that date, regarding the manner is which the fare should be fixed by the State Transport Authority the operators also proceeded on the basis that the proposals regarding the fare had taken account the "increase in tax at the revised rate as envisaged by the State Budget." The Finance Minister in his Budget speech, also dated 4-3-1963, referred to the necessity to fall in line with the other States by introducing a tax on passengers and goods and also the need to revise the fare and suggested that the fare should be increased from 2.5 paise to 3 paise per kilometre . Our attention was also drawn to volume 3 of the Motor Vehicles State Carriages Fare Revision file and to the notes for hearing prepared by the Secretariat dated 25-4-1963. This commences at page 61 of the file. Para.122,123 and 124 would clearly show that the incidence of the enhanced tax was taken into account in fixing the fare at 3 paise per kilometre and what is stated in these paragraphs would also show that the enhancement was meant to cover not only the additional cost of operation due to the increase in cost of fuel and spare parts etc. but also the increase in the tax liability. We have therefore to hold that the fixation of the fare with effect from 1-7-1963 did take into consideration the additional tax burden introduced by Act 25 of 1963. The position for the period from the beginning of 1968 will be dealt with later. 27. We Shall now proceed to consider the various arguments that have been advanced before us by counsel challenging the provisions of Acts 18 and 34 of 1971. These may be grouped under five different heads as follows: (1) Act 34 of 1971 read with S 6 of Act 18 of 1971 is a colourable exercise of legislative power. 27. We Shall now proceed to consider the various arguments that have been advanced before us by counsel challenging the provisions of Acts 18 and 34 of 1971. These may be grouped under five different heads as follows: (1) Act 34 of 1971 read with S 6 of Act 18 of 1971 is a colourable exercise of legislative power. (2) The provisions offend Art.14 of the Constitution; (3) The provisions are opposed to the decisions of this Court in Thommen and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 II Kerala 153); (4) The provisions of Act 34 of 1971 are repugnant to the provision's of Act 25 of 1963 as amended by Act 18 of 1971; and (5) The above statutory provisions offend Art.10(1)(f) and (g); Art.31 and Art.301 of the Constitution. 28. We shall deal with these contentions seriatim. In support of the contention that there has been colourable exercise of legislative power, it was argued that the amendments made to S.43 of the Motor Vehicles Act by Act 34 of 1971 can only be a legislative Act falling under entry 56 in List II of the Seventh Schedule to the Constitution whereas the Motor Vehicles Act itself is an Act that was passed by Parliament under entry 35 in List III of that Schedule. Reference in this connection was made in detail to entry 56 and entry 57 in List II and entry 35 in List III. What was argued was that the Motor Vehicles Act being A statute passed under entry 35 in List III of the Seventh Schedule to the Constitution, the State legislature in purporting to amend it by introducing the provisions contained in Act 34 of 1971 which can only be done under entry 56 in List II, was misusing its legislative powers, that the State legislature has power to amend the Motor Vehicles Act by virtue of entry 35 in List III cannot be, and was riot, disputed. The argument was that in so amending, the power under entry 56 in List II could not be utilised. This is an argument which we are unable to accept. A statute can be passed by virtue of the powers conferred on the legislature under one or more entries in the Lists of the Constitution. The argument was that in so amending, the power under entry 56 in List II could not be utilised. This is an argument which we are unable to accept. A statute can be passed by virtue of the powers conferred on the legislature under one or more entries in the Lists of the Constitution. Whether the method should be the one that was adopted by the State Legislature or whether the method adopted is the proper method is not a question for this Court to consider. The competency of a piece of legislation cannot depend on the question whether the method adopted is the method to be adopted. We should not therefore confuse competency with propriety and the question before us being only one of competency and colourable exercise of power, we need not advert to impropriety, if any. Competency as we said, there was, and we find no reason to hold that Act 34 of 1971 is a colourable piece of legislation. No doubt this was not the method which this Court visualised when it gave directions by the judgment in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 2 Ker.153), but this Court cannot in any manner fetter the legislative power vested in the State by giving directions and the fact that the State had not accepted the suggestion that Act 25 of 1963 or the rules framed under that Act should be amended so as to fully and fairly give effect to the position that the tax imposed by Act 25 of 1963 was really on the passenger and the consignor of the goods, is no ground at all for holding that Act 34 of 1971 is an instance of colourable exercise of legislative power. 29. It was also suggested that the deeming provisions in Act 34 of 1971 did not specifically provide that the draft notifications issued under S.43(1) shall be deemed to contain a direction that the fare fixed was inclusive of the tax. 29. It was also suggested that the deeming provisions in Act 34 of 1971 did not specifically provide that the draft notifications issued under S.43(1) shall be deemed to contain a direction that the fare fixed was inclusive of the tax. Reference was made to the proviso to S.43(1) under the Motor Vehicles Act and it was urged that unless a specific provision was made in the validating Act validating the draft notification issued under the proviso, the validation of the final notification and the inclusion of a deeming provision in the final notification will not be sufficient to make the notification issued by the State Government giving "direction to the State Transport Authority a notification containing a direction that the fare shall include the tax. Reliance was placed on the decision of the Supreme Court in Municipal Council, Khurai and another V. Kamal Kumar and another (AIR. 1965 SC. 1321) in support of this submission. We do not think that the principle of that decision which referred to the drawing up of a list showing the rate of tax on property in a municipality based on a resolution which had been altered by the municipality itself before the list was drawn up has any application to the facts of this case. We have already held that the direction issued to the State Transport Authority suggesting a certain rate of fare did take into account the tax under Act 25 of 1963. this being so, the validation only clarifies this position which had a factual basis. It is not therefore a case where the legislature by a retrospective piece of legislation and a deeming provision introduced a non-existent fact as a foundation for the sustenance of an enactment. We reject this contention. 30. The attack on the ground that there has been discrimination and therefore that Art.14 has been violated is based purely oh the provision in S.18 of Act 25 of 1963, and the provision in S.5 of Act 18 of 1971 which came into force only from the 5th day of January, 1970. S.5 of Act 18 of 1971. omitted S.18 of Act 25 of 1063 from that date. S.18 of Act 25 of 1963 was in these terms: "18. S.5 of Act 18 of 1971. omitted S.18 of Act 25 of 1063 from that date. S.18 of Act 25 of 1963 was in these terms: "18. Reduction of tax in cases of certain Motor Vehicles- Where the operator of a motor vehicle is a co-operative society registers or deemed to be registered under any law relating to co-operative societies for the time being in force; the tax payable in respect of that motor vehicle shall be one half of the rates payable under this Act, if the prescribed office, is satisfied, after such enquiry as he deems fit, that, (i) the co-operative society is solely engaged in the business of transport of goods or passengers or both from one place to another in motor vehicles; '(ii) at least seventy-five per cent of the members of the co-operative society are its employees; (iii) atleast fifty per tent of the members of the co-operative society are not delated to each other; (iv) at least ninety per cent of the employees of the society are its members; and (v) the motor vehicle is used exclusively by the co-operative society. Explanation.- For the purposes of this section a member shall be deemed to be related to any other member if that member is the husband, wife, brother or sister or any lineal ascendant or descendant of that other member." 31. The validity of the above section has been considered in the judgment in Thomman and others v. The Regional Transport Officer, Ernakulam, and another (ILR.1968 II Kerala 153) and the court negatived the contention by stating that it was for the passenger or the consignor of the goods to complain about the discrimination, if any, contained in S.18 of Act 25 of 1963. S.18 in terms only refers to "the tax payable in respect of that motor vehicle". The tax imposed by Act 25 of 1961, this court had held in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 II Kerala 151) was on the passenger and the consignor of goods. By virtue of the amendment to 4.3 of 25 of 1963 by Act 18 of 1971 this position has been clarified and placed beyond the pale of controversy. By virtue of the amendment to 4.3 of 25 of 1963 by Act 18 of 1971 this position has been clarified and placed beyond the pale of controversy. We, no doubt, see that, in practical application, this concession would not work in favour of the passengers and consignors of goods because the fare fixed for all the vehicles is uniform and is normally charged to every passenger whether he travelled by a vehicle owned by a co-operative society or by a company or by any other person. If the section means that the operators, if they are co-operative societies, need pay over to Government only half the tax they have collected from the passengers, then it was submitted by counsel that it is a clear case of discrimination between operator and operator and therefore the Act is bad. This submission was made not with reference Jo Act 25 of 1963 but with reference to the provisions in S.5 of Act 18 of 1971. The effect of S.5 of Act 18 of 1971 is only to remove the discrimination, if any, introduced by S.18 of Act 25 of 1963 at least from 5-1-1970. S.5 of Act 18 of 1971 does not create any discrimination. There was no challenge to S.18 as such in these proceedings, and we do not consider that in view of this we must determine the validity of S,18 in these proceedings. S.5 Act 18 of 1971 is free from such infirmity. We therefore reject this contention. 32. The argument that Acts 18 and 34 of 1971 are against the conclusions reached by this court and against the directions contained in the judgment of this court in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 II Kerala 153) is based on the contention that this Court intended that Act 25 of 1963 should be amended or the ruler framed under that Act should be amended so as to effectuate the intention of Act 25 of 1963 that the tax imposed by that Act is really on the passenger or the consignor of the goods. That was the conclusion reached by this Court and that was the direction, there can be no doubt, and this is so is clear from Para.30 of the judgment. That was the conclusion reached by this Court and that was the direction, there can be no doubt, and this is so is clear from Para.30 of the judgment. In fact it is seen from the papers made available before us that it was so understood by the State Government also. But this does not mean that the object that the tax should be on the passenger or the consignor of the goods cannot be achieved by the State legislature in any other manner. The only question then would be whether the steps taken by the legislature were within its legislative competence. We have already adverted to this aspect when dealing with the first point about colourable exercise of power by the legislature. We may add that when the earlier judgment was pronounced, S.43 of the Motor Vehicles Act did not, as this court interpreted it, contain a provision either expressly or by necessary implication that the taxes payable under enactments similar to Act 25 of 1963, the incidence of which were on the passenger and the owner of the goods, must or could be taken into consideration in giving directions under S.43(1) by the State Government to the State Transport Authority. This is specifically referred to in the judgment and that was the reason for holding that a direction by the State Government that the tax under Act 25 of 1963 should also be included in the fare is not a proper method and that such a direction is not contemplated by S.43(1) of the Motor Vehicles Act. This was the basis of the decision in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 Kerala II 153) and this too was the basis for the direction in Para.30 of the judgment, The basis has now been altered by the State Legislature, exercising a power which it has, by amending the Motor Vehicles Act and therefore the foundation of the judgment in this regard has ceased to exist. This is certainly permissible and it is unnecessary to refer to the various decisions on this aspect except to that in State of Tamil Nadu and another v. M. Rayappa Gounder and another (AIR. 1971 SC. 231) which fully supports the above view. We therefore negative this contention. 33. This is certainly permissible and it is unnecessary to refer to the various decisions on this aspect except to that in State of Tamil Nadu and another v. M. Rayappa Gounder and another (AIR. 1971 SC. 231) which fully supports the above view. We therefore negative this contention. 33. The argument that Act 25 of 1963 as amended by Act 18 of 1971 is inconsistent with the provisions in Act 34 of 1971. shortly stated, proceeded on the ground that the fare and freights mentioned in S.3 (1) of Act 25 of 1963 (as amended by Act 18 of 1971) must mean the entire amount paid by the passenger or the consignor of the goods, but that the amendment effected to S.43 of the Motor Vehicles Act would show that it cannot be so, for the fare fixed by the Transport Authority is not only the fare in the strict sense, but fare in the strict sense plus tax. It is therefore said that the provisions are inconsistent. We understand the word 'fares' in Act 25 of 1963 not as the entire amount payable by a passenger, inclusive of the tax which has been imposed on him by Act 25 of 1963, but only as the entire amount less the tax that is payable under that Act, The tax being 30 per cent of the fare, it is clear that the fare is only 10/11 of the entire amount that is paid by a passenger. The impost of tax is on this 10/11th. In other words, the tax imposed under S.3 of Act 25 of 1963 is only 1/31th of the total amount paid by a passenger. This is specifically admitted in the counter-affidavit that has been filed in the case. The mere fact that the fare has thus assumed different meanings for the purposes of S.3 of Act 25 of 1963 and Act 34 of 1971, cannot be a ground for holding that one or the other statute must be, or can be, declared by this Court to be invalid. We therefore reject this contention as well. 34. We shall now pass on to the question whether there has been violation of Art.19(1)(f) and (g) and 31 of the Constitution. We therefore reject this contention as well. 34. We shall now pass on to the question whether there has been violation of Art.19(1)(f) and (g) and 31 of the Constitution. Various points were urged before us, but ultimately what was contended was that the combined effect of Act 18 of 1971 and Act 34 of 1971 was to deprive the operators of their own property and therefore the provisions of the Acts were violative of Art.31 of the Constitution and also violative of Art.19(1)(g) in that the restrictions imposed by the Acts on the operators were unreasonable. To understand the argument based on Art.19 and 31, it is necessary to refer once again, very briefly, to the facts which we have already detailed, in so far as they bear on this question. At the time of the coming into force of Acts 18 and 34 of 1971, the fare rate that was in force was that fixed by notification dated 13-6-1963 effective from 1-7-1963. There was according to the petitioners a downward revision even in this fare in 1964 by reducing the minimum from 20 paise to 10 paise. The question whether the fare fixed with effect from 1-7-1963 was inclusive of tax as on 1-7-1963 or thereafter was left open in the judgment in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 II Kerala 153). We have now found that when the fare was fixed in 1963, the fixation was after taking into account the incidence of the tax under Act 25 of 1963, as well. But by 1966, the operators were clamouring that the fare fixed in 1963 was inadequate and reported representations for revision were made before the Government. Since there was no response, this Court was approached by a series of writ applications in 1966 and the collection of the tax under Act 25 of 1963 had been stayed. This stay continued till the batch of cases were disposed of by judgment of this Court dated 4-2-1968. That judgment contained a direction which we have already adverted to but which we may extract again: "So we think that a direction must be issued that provision must be made for the collection of the tax from the passenger as tax specifying the quantum calculated and computed on the basis of the provision in the Act. That judgment contained a direction which we have already adverted to but which we may extract again: "So we think that a direction must be issued that provision must be made for the collection of the tax from the passenger as tax specifying the quantum calculated and computed on the basis of the provision in the Act. This will of course be payable to the operator who has been made liable to pay the tax to the State. It is not for us to suggest the manner in which this should be done. Perhaps this can be achieved by amending the statute by making specific provisions in the Act. It can even be done perhaps by framing Rules under S.28 (g) which we have already read. Rules made under similar statutes had been relied on by courts as early as in the case in Atma Ram Budhia f. State of Bihar, for the purpose of construing the purpose of the Act. As we said, it is for the Stats legislature and or the State Government to take such steps as are necessary to provide the machinery. We direct that this should be done as expeditiously as possible." After this judgment was given, no attempt was made to comply with the direction of this Court but as attempt was made to amend the notification dated 13-6-1963 and R.3 of the Kerala Motor (Vehicles (Taxation of Passengers and Goods) Rules, 1963, by a draft notification in April, 1968. The draft notification was challenged before this Court in O. P No. 2177 of 1968. The petition was however dismissed in limine. The appeal from that decision was also dismissed on 29-5-1968. There was an undertaking given to the Court then that there will be no attempt to collect the tax. Thereafter no attempt was made to collect the tax either. Till August, 1969, nothing seems to have happened. On 11-8-1969, the Bill which became Act 18 of 1971 was published and introduced in the legislature. This was to have been discussed on 9-1-1970 Actually the Bill was not discussed on that day but on 5-1-1970, Ordinance No.1 of 1970 was passed. This contained provisions similar to that contained in the Bill. On 11-8-1969, the Bill which became Act 18 of 1971 was published and introduced in the legislature. This was to have been discussed on 9-1-1970 Actually the Bill was not discussed on that day but on 5-1-1970, Ordinance No.1 of 1970 was passed. This contained provisions similar to that contained in the Bill. After this Ordinance came into operation, the operators understood the Ordinance to mean that they were entitled to collect 10% of the fare fixed with effect from 1-7-1963 in addition to the fare, by way of tax payable by the passengers and consignors of goods under Act 25 of 1963. Quite a number of the operators started so collecting. Then the Transport Commissioner intervened and directed that there should be no such collection. Though many desisted, some still continued to collect. This was resented by the public and it is alleged is the affidavit in support of the petition in O. P. No. 2513 of 1971 that a law and order situation arose. The Minister then convened a conference on the 2nd of February, 1970 and agreed that the status quo before will be maintained and told the operators' representatives that no collection in addition to the fare fixed should be collected by the operators. This has apparently been adhered to by the State Government as well as the operators. 35. Ordinance No.1 of 1970 was challenged before this Court in O. P. No. 225 of 1970 and an order was passed on C. M. P. No. 821 of 1970 in that original petition staying the collection of tax for the period prior to 5 -1-1970. Though the Regional Transport Officers gave instructions that the tax after 5-1-1970 may be collected, the Government issued directions on 24-2-1970 that no collection should be made. 36. It will thus be seen that from the later part of the year 1966 till Acts 18 and 34 of 1971 came into operation on 1-10-1971 there had been practically no insistence that the tax imposed by Apt 25 of 1963 should be paid. It is the case of the petitioners that this was because the Government itself realised that the fare fixed with effect from 1-7-1963 had ceased to be realistic and was quite inadequate. It is the case of the petitioners that this was because the Government itself realised that the fare fixed with effect from 1-7-1963 had ceased to be realistic and was quite inadequate. It is also said that the Government had enough material before it, at any rate, by the end of 1967 which would clearly show that the fare fixed with effect from 1-7-1953 was inadequate. Reference was made to the report of the Committee headed by retired Chief Justice Mr. K. Sankaran. This report was in October, 1967, and must have been available with the State Government. This report was not published nor was it made available to the court at the time of the disposal of the petitions in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1958 II Kerala 153). This report, we have now seen as it was made available to us by the Advocate General. The report clearly shows that the Committee considered that the fare fixed on 1-7-1963 was insufficient and inadequate. In fact, even at that time the Committee had recommended a 10/ % increase in the fare and a revision of the minimum fare from 10 paise to 20 paise. One of the petitioners has referred to the report of the Committee headed by Dr. B. V. Keskar and the points made by that committee are the following: - (i) Taxes on motor vehicles had been increasing at a rate faster than all other taxes; (ii) The tax element in the cost of operation had risen to 43.3 percent in 1966 and that the increase in operation costs was due more to increase in the tax element than other costs; (iii) The rate of increase in costs outstripped the rate of increase in revenue; (iv) While in increase in national income during the period between 1950-51 and 1965-66 was 110 percent, the increase in tax revenue from motor vehicles was 623 percent; (v) The tax element in operation costs had become a definite dis-incentive to the healthy development of road transport; (vi) The rate of profit on turnover in the case of State Road Transport undertakings bad been steadily decreasing during the 3rd plan period eg. in Kerala, it had declined from 8.71 in 1961-62 to 2.62 in 1965-66." It is thus clear that there was enough material before the State Government for atleast seriously considering the question as to whether a revision of fare was necessary from the beginning of 1968. This was apparently not done nor was the direction of this Court in Para.30 of the decision in Thommen and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 II Kerala 153) carried out. One would have thought that compliance with that direction was not difficult. If the fare fixed on 1-7-1963 still continued in 1968 to be adequate and ensured a reasonable return to the operators after meeting the tax liabilities under Act 25 of 1963 and the other taxing statute, all that was required was to introduce a refixation of the fare by omitting the tax under Act 25 of 1963 and make provision in that Act or the Rules framed under the Act to collect the tax under Act 25 of 1963 separately. If this had been done, the question would never have arisen as to whether the imposition of tax had resulted in deprivation of property or was so unreasonable as to be violative of Art.19(1)(g) of the Constitution. The only question that can possibly be then raised would be whether the fare fixation was proper. If such a question is raised, the answer to it will not be linked with the question of the tax being ex-proprietary or unreasonable. But that was not the method adopted. Now by a legislative fiat it has been declared that the fare fixed is inclusive of the tax. How far this is true on actual facts is doubtful. It is possible that the amount left after deducting the tax from the fare fixed with effect from 1-7-1963 is inadequate after 1968, to meet the operational cost. In that case there can be violation of Art.31 as well as of Art.19(1)(f) and (g). 37. The provision for taxation is not outside the purview of Art.19 or of Art.31. The following passage from the judgment in Rai Ramkrishna and others etc. v State of Bihar (AIR 1963 SC 1657) will make the position clear: "(12). In view of the recent decisions of this Court Mr. 37. The provision for taxation is not outside the purview of Art.19 or of Art.31. The following passage from the judgment in Rai Ramkrishna and others etc. v State of Bihar (AIR 1963 SC 1657) will make the position clear: "(12). In view of the recent decisions of this Court Mr. Sastri also concedes that taxing statutes are not beyond the pals of the constitutional limitations prescribed by Art.19 and 14, and he also concedes that the test of reasonableness prescribed by Art.304 (b) is justiciable. It is, of course, true that the power of taxing the people and their property is an essential attribute of the Government and Government may legitimately exercise the said power by reference to the objects to which it is applicable to the utmost extent to which Government thinks it expedient to do so. The objects to be taxed so long as they happen to be within the legislative competence of the Legislature can be taxed by the Legislature according to the exigencies of its needs, because there can be no doubt that the State is entitled to raise revenue by taxation. The quantum of tax levied by the taxing statute, the conditions subject which is levied, the manner in which it is sought to be recovered, are all matters within the competence of the Legislature, and in dealing with the contention raised by a citizen that the taxing statute contravenes Art.19, Courts "would naturally be circumspect and cautious." Where for instance it appears that the taxing statute is plainly discriminatory, or provides no procedural machinery for assessment and levy of the tax, or that it is confiscatory, Courts, would be justified in striking down the impugned statute as unconstitutional. In such cases, the character of the material provisions of the impugned statute is such that the Court would feel justified in taking the view that, in substance the taxing statute is a cloak adopted by the Legislature for achieving its confiscatory purposes. This is illustrated by the decision of this Court in the case of Kunnathat Thathunnl Moopil Nair v. State of Kerala, AIR. 1961 SC. 552 where a (axing statute was struck down because it suffered from several fatal infirmities. On the other hand, we may refer to the case of Jagannath Baksh Singh v. State of Uttar Pradesh, AIR. 1962 SC. 1961 SC. 552 where a (axing statute was struck down because it suffered from several fatal infirmities. On the other hand, we may refer to the case of Jagannath Baksh Singh v. State of Uttar Pradesh, AIR. 1962 SC. 1563 where a challenge to the taxing statute on the ground that its provisions where unreasonable was rejected and it was observed that unless the infirmities in the impugned statute were of such a serious nature as to justify its description as a colourable exercise of legislative power, the Court would uphold a taxing statute." 38. The question then is whether the petitioners have been able to establish before us that the effect of Acts 18 and 34 of 1971 is confiscatory or whether the statutes can be treated as an evidence of colourable exercise of legislative power. 39. The combined effect of the restriction that no more than the fare fixed can be collected and that the fare should be deemed to be inclusive of tax can, in given circumstances, give rise to confiscation of property and if a deeming provision is introduced with retrospective effect that the fare shall be inclusive of the tax, when in fact, It was not so, the legislation can become colourable. There is no doubt in our mind that the combined effect of the impugned statutes has definitely very adversely affected the petitioners before us, In fact, all the available material indicates that the fare fixed with effect from 1-7-1963 had become inadequate by the end of the year 1967. What is the extent of the inadequacy, we are still unable to decide. It however appears possible that by the application of Acts 18 and 34 of 1971 from 1968 onwards the legislature has come dangerously close to infringing Art.31 as well as Art.19(1)(f) and (g) of the Constitution if these articles have not actually been violated. The exact extent of the harm done by the application of the two Acts has not been proved. It is also not established that the majority of the operators will have to give up their business if the tax imposed by the two statutes is paid. The only attempt made to furnish figures was by the petitioner in O. P. No. 2513 of 1971. The income-tax assessment order for the year 1970-71 has been produced by this petitioner. It is also not established that the majority of the operators will have to give up their business if the tax imposed by the two statutes is paid. The only attempt made to furnish figures was by the petitioner in O. P. No. 2513 of 1971. The income-tax assessment order for the year 1970-71 has been produced by this petitioner. If the income estimated for that year for the petitioner in O. P. No.2513 of 1971 by the Income-tax department is taken into account and the tax liability deducted therefrom, very little is left to the petitioner then as profits for the four buses operated by him for that year. If this is the true position as regards the large majority of the petitioners before this Court, there can be little doubt that the statutes are extremely unreasonable and infringe the right to carry on the business in the sense that it would become impossible to carry on the business. But we are not in a position to state that this is the position in regard to the majority, or atleast a sizable section of the operators in the State. We may at this stage refer to the argument of the Advocate General relying on the decision in Thomman and others v. The Regional Transport Officer, Ernakulam and another (ILR.1968 II Kerala 153) that a tax under entry 56 in List II of the Seventh Schedule to the Constitution can also be on the operator and reference was made to the decisions in Tata Iron and Steel Co., Ltd. v. State of Bihar (1958 SCR. 1353) and in M. P. F. Sundararamier and Co. v. State of Andhra Pradesh (1958 SCR. 1422) for this proposition. This principle may not apply where in clear and unambiguous terms the statute imposes the tax only on the passenger or the consignor of goods. The provisions made by amending the Motor Vehicles Act, S.43, and by introducing the deeming provisions were in the nature of machinery sections for the collection of the tax imposed by Act 25 of 1963. Those provisions can never be understood as taxing provisions, particularly when they are against the specific terms of the charging section, S.3, of Act 25 of 1963. We do not think that this principle will apply. 40. Those provisions can never be understood as taxing provisions, particularly when they are against the specific terms of the charging section, S.3, of Act 25 of 1963. We do not think that this principle will apply. 40. We have to reject the contention that Art.31 and 19(1)(f) and (g) have been violated because of lack of details affording direct proof that the effect of Acts 18 and 34 of 1971 is to deprive property or to cripple the business of the operators. 41. The only other question remaining for consideration is about the violation of Art.301 of the Constitution. That article is said to be violated on the ground that the restrictions imposed by the Acts are unreasonable. In deciding whether such restrictions are unreasonable or not, the same principle that should apply in deciding the question with reference to Art.19(1)(g) must be applied. We have already held that we are not in a position to hold that Art.19(1)(g) has been violated. So we negative this contention also. We dismiss these writ petitions. In the circumstances we direct the parties to bear their respective costs.