PUTTASWAMY, J. ( 1 ) AS the questions of law that arise for determination are common, we propose to dispose of them by a common order. ( 2 ) THE petitioners are owners of motor vehicles detailed in their respective petitions registered as 'tourist omnibuses' outside the State of Karnataka, covered by All India Tourist permits issued under Section 63 (7) of the Motor vehicles Act, 1939 (Central Act IV of 1939) ('the 1939 Act') by other States. ( 3 ) IN exercise of the powers conferred on it by Section 16 of the Karnataka motor Vehicles Taxation. Act of 1957 (Karnataka Act 35 of 1957) ('the act') Government of Karnataka in its notification No. HD 210 TMI 76 dated 20-12-1976 had exempted 'tourist omnibuses' covered by All India Tourist permits of other States from payment of taxes to the State of Karnataka which continued to be in operation till 31-3- 1981. On the strength of the aforesaid notification the petitioners obtaining necessary exemption taxation cards were operating their vehicles in the state of Karnataka also. ( 4 ) ON different dates prior to 31 3- 1981 the. authorised officers of the Motor vehicles Department checked the vehicles of the petitioners at different places and submitted their check reports inter alia stating thaj they had been used as regular stage carriage services and not as contract carriage services. On the basis of those check reports, the concerned regional Transport Officers of the area (RTOs) initiated proceedings under the Act for levy of taxes. On rejecting the objections urged by the petitioners, the RTOs holding they had used their vehicles at the time and date they were checked as 'stage carriages' levied taxes against them for the concerned quarters and called upon them to pay the taxes detailed in their separate but almost identical orders. Aggrieved by the said orders of the RTOs the petitioners filed appeals before the appellate authorities under the Act, who by their separate but almost identical orders made on different dates dismissed them. In these petitions under Article 226 of the Constitution the petitioners have challenged the respective orders of the appellate and original authorities made against them on grounds that will be noticed and dealt by us. ( 5 ) THE respondenis have resisted these writ petitions. In these petitions under Article 226 of the Constitution the petitioners have challenged the respective orders of the appellate and original authorities made against them on grounds that will be noticed and dealt by us. ( 5 ) THE respondenis have resisted these writ petitions. ( 6 ) SRIYUTHS A. S. Viswanath, a Ananda Shetty and C. Narasimhachar, learned counsel for the petitioners seriously disputing the findings of the authorities contend that even if they are held to be correct, then also they are only liable to be prosecuted for the contravention of the terms and conditions of the permits authorising the use of vehicles before the competent authority under the 1939 Act and they were not liable for payment of taxes to the state of Karnataka. ( 7 ) SRI H. L. Dattu, learned High court Government Pleader appearing for the respondents contends that the exemption granted by Government authorised tourist omnibuses only to operate them as contract carriage services and not as 'stage carriages' as rightly found by the authorities and on that finding they cannot escape liability for payment of taxes to the State of Karnataka under the Act. ( 8 ) WE will first address ourselves to the fact situations and then to the legal questions. ( 9 ) ON an examination of the check reports and all other relevant materials placed before them, the appellate and the original authorities have concurrently found that the petitioners had used their vehicles as stage carriage services and hot as contract carriage services. We are of the view that this finding being essentially on a question of fact recorded with due regard to the relevant principles and materials cannot be disturbed by this Court in a proceeding under Article 226 of the Constitution and must be accepted as correct. ( 10 ) BUT, Sri Shetty contends that the findings recorded by the authorities ignoring the definition of the term 'tourist' in the 1939 Act, the facts that the petitioners had operated their vehicles as tourist vehicles carrying individual tourists for which there was no prohibition and that the vehicles themselves had been engaged by the authorised tourist agents as a whole were vitiated and illegal. ( 11 ) WHAT we have earlier held equally governs this contention of Sri shetty and is liable to be rejected for those very reasons. ( 11 ) WHAT we have earlier held equally governs this contention of Sri shetty and is liable to be rejected for those very reasons. Even otherwise this argument of Sri Shetty, though attractive at first sight, totally ignores the distinction and difference between 'contract carriages' and 'stage carriages' defined in Section 2 (3) and (29) of the 1939 Act, and the true concepts and purposes of those services. On a conspectus of the true distinctions between the two kinds of services and the evidence touching on them, the authorities have concurrently found that the petitioners had used their vehicles as 'stage carriages' only. We are of the view that the non-consideration of the findings of the authorities are not vitiated by any of the factors high-lighted by Sri Shetty before us. We see no merit in this contention and we reject the same. ( 12 ) THE Notification dated 20-12- 1976 issued by Government reads thus :" NOTIFICATION no. HD 210 TMI 76 BANGALORE, dated 20th DECEMBER 1976. Whereas, the Government of Karnataka are of opinion that it is necessary in public interest to exempt the tax payable in respect of Tourist Motor cabs and Tourist Omnibuses registered in the States other than the State of karnataka and plying in the State of karnataka; now, therefore, in exercise of the powers conferred by sub-section (1) of Section 16 of the Karnataka Motor vehicles Taxation Act, 1957 (Karnataka act 35 of 1957) and in partial modification No. HD 90 TMT 72 dated 18th September, 1972, the Government of Karnataka hereby exempt tax payable under the said Act in respect of tourist motor cabs and tourist omnibuses registered in the States other than the State of Karnataka and plying in the State of Karnataka under the authority of a permit granted under sub-section (7) of Section 63 of the motor Vehicles Act, 1939 (Central Act 4 of 1939) in relation to which are valid in the State of Karnataka without counter-signature as per Rule 123-A of the Karnataka Motor Vehicles Rules, 1963, provided that the taxes payable in respect of vehicles to the State in which it is registered has already been paid, and provided further that similar exemption from payment of tax is granted in respect of similar vehicles of this State. By order and in the name of the Governor of Karnataka sd/- under Secy, to Govt. Home Dept. By order and in the name of the Governor of Karnataka sd/- under Secy, to Govt. Home Dept. " this notification grants exemption from payment of taxes to motor vehicles classified as 'tourist omnibuses' registered in States other than the State of karnataka covered by permits issued by other States under Section 63 (7) of the 1939 Act. An exemption notification must be construed strictly and its scope cannot be extended for purposes other than those for which such exemption is granted is well settled. From this it follows that the petitioners are entitled for exemption from payment of taxes only and if only they operate their vehicles as contract carriage services or as all India Tourist services and not in any other manner. ( 13 ) THE object of granting exemption to tourist omnibuses covered by All india Tourist permits of other States was to encourage genuine foreign and inter-State tourist traffic and was not to encourage the owners of vehicles to operate them as 'stage carriages' or for any other purpose. If the contention of the petitioners is pushed to its logical conclusion, then they can use their vehicles in any manner they like and still claim the benelit of exemption granted for a particular, special and exclusive purpose. We are clearly of the view that that was not the object and intendment of the notification dated 20-12-1976. We are, therefore, of the view that the petitioners, who operated their vehicles as 'stage carriages' cannot claim the benefit of exemption for 'tourist omnibuses' covered by All India tourist permits and are liable to pay taxes for such operation to the State of karnataka. ( 14 ) SRI Viswanath next contends that even on what we have found earlier, the petitioners were liable to pay taxes only under Section 3 (2) of the Act that governed vehicles registered in other states and not under Section 3 (1) of the act as held by the authorities. ( 15 ) SRI Dattu, contends that Section 3 (2) had no application to vehicles operated illegally in contravention of the terms and conditions of permits and that such cases were only governed by Section 3 (1) of the Act. ( 16 ) SECTION 3 of the Act which is material reads thus :"3. ( 15 ) SRI Dattu, contends that Section 3 (2) had no application to vehicles operated illegally in contravention of the terms and conditions of permits and that such cases were only governed by Section 3 (1) of the Act. ( 16 ) SECTION 3 of the Act which is material reads thus :"3. Levy of tax- (1) A tax at the rates specified in Part-A of the Schedule shall be levied on all motor vehicles suitable for use on roads. Explanation-A motor vehicle of which the certificate of registration is current shall, for the purposes of this act, be deemed to be a vehicle suitable for use on roads. Note : For the purpose of the above explanation the certificate of registration shall, notwithstanding anything contained in Section 38 of the Motor vehicles Act, 1939, be deemed to be current even if the certificate of fitness is not effective provided such certificate of fitness has not been cancelled. (2) Notwithstanding anything contained in sub-section (1) or Section 4 taxes at the rate specified in Part-B of the Schedule shall be levied on motor vehicles suitable for use on roads, which are in the state for periods shorter than a quarter, but not exceeding thirty days. (3) In the case of motor vehicles in respect of which any reciprocal arrangement relating to taxation has been entered into between the Government of Karnataka and any other State Government, the levy of tax shall, notwithstanding anything contained in this Act, be in accordance with the terms and conditions of such reciprocal arrangement : provided that the tax leviable under any such arrangement shall not exceed the tax leviable under the Schedule : provided further that the terms and conditions of every such reciprocal arrangement shall be published in the official Gazette, and a copy thereof shall be laid before the State Legislative assembly. "this section is the principal charging section of the Act. ( 17 ) SECTION 3 (1) of the Act primarily regulates the levy of taxes on vehicles normally registered in the State of Karnataka and used in the State of karnataka. If Section 3 (1) of the Act applies, then the rates of taxes are governed by Part-A of the schedule to the Act. ( 17 ) SECTION 3 (1) of the Act primarily regulates the levy of taxes on vehicles normally registered in the State of Karnataka and used in the State of karnataka. If Section 3 (1) of the Act applies, then the rates of taxes are governed by Part-A of the schedule to the Act. ( 18 ) SECTION 3 (2) of the Act regulates the levy of taxes on vehicles registered outside the State of Karnataka but are used for short periods not exceeding a peried of one month. Whether this provision can be invoked in cases of clandestine and illegal operation of vehicles of other States is the short and interesting question that arises for our determination. ( 19 ) THE rule of progressive construction of statutes is as much applicable to taxation measures is set at rest by the Supreme Court in Mcdowell and company Limited v. Commercial Tax officer (59 STC 277) and a Full Bench of this Court in C. Arunachalam v. Commissioner of Income Tax [ilr 1984 (2) Kar. 1387]. As ruled in those cases, taxation laws cannot be interpreted as to provide for a chance for evasion and toencourage illegal activities. We must bear these principles on the construction suggested on Section 3 (2) of the Act. ( 20 ) THE terms 'which are in the state for periods shorter than a quarter', occurring in Section 3 (2) of the Act are significant. We are of the view that those terms connote, comprehend and apply only to vehicles of other States that enter the State of Karnataka for lawful operations and operate them lawfully in terms of the authorisation of those vehicles. On the veiy terms of Section 3 (2) we are clearly of the view that entry to this State must be in terms of the 1939 Act and the Act and the operation of the vehicle must be in accordance with the terms and conditions of the permit or authorisation of that vehicle. We are of the view that Section 3 (2) of the Act cannot be applied to eases of illegal operation as found in the present cases. We are of the view that the acceptance of the construction suggested for the petitioners on Section 3 (2) of the act would only encourage illegal operations of vehicles of other States in this state and the same must be avoided by us. We are of the view that the acceptance of the construction suggested for the petitioners on Section 3 (2) of the act would only encourage illegal operations of vehicles of other States in this state and the same must be avoided by us. We cannot, therefore, invoke Section 3 (2) of the Act to cases of illegal operations as in the present cases. ( 21 ) WHEN once it is held that Section 3 (2) of the Act has no application to cases of illegal operation of the vehicles, it necessarily follows from the same that the nature and extent of liability of taxes to the State of Karnataka of such operations can only be regulated by Section 3 (1) of the Act and not Section 3 (2) of the Act. As pointed out by a Division bench of this Court in Gurunath Madusa khode v. Transport Commissioner (ILR 1985 Kar. 3787) the unit of payment of taxes under Sec. 3 (1) can and must be for a peiiod of not less than three months. ( 22 ) SRI Narasimhachar has relied on a decision rendered by one of us (Puttaswamy, J.) in Desraj Vasudeva and another v. The Regional Transport Officer, bangalore (W. P. . Nos. 22189 to 22190 of 1981 decided on 12-6-1984) as supporting the very case urged by the petitioners. ( 23 ) IN Desraj Vasudeva's case, one of us (Puttaswamy, J.) relying on the ruling of Jagannatha Shetty, J. (as His lordship then was) in Kumarappa v. Commissioner for Transport [1974 (1) Kar. L. J. 105] without any discussion had accepted the case of the petitioners. But, that ruling itself has been overruled by a division Bench of this Court in Noorulla khan v. Regional Transport Officer (ILR 1985 Kar. 2711 ). Even otherwise the decision rendered by one of us (Puttaswamy, J.) in Desraj Vasudeva's case does not correctly lay down the law. For all these reasons, we see no merit in this contention of Sri Narasimhachar. ( 24 ) ON the foregoing discussion, we hold that there is no merit in this contention of the petitioners and we reject the same. For all these reasons, we see no merit in this contention of Sri Narasimhachar. ( 24 ) ON the foregoing discussion, we hold that there is no merit in this contention of the petitioners and we reject the same. ( 25 ) IN Gurunathasa Madusa Khode's case this Court has pointedout that even if the petitioners were to initially pay the taxes for the entire quarter, then also it was open to them to seek for refund of taxes for the unused periods in terms of that ruling. After making payment of taxes for the entire quarter, it is open to the petitioners to claim for refund of such taxes as they are entitled to in law which has to be examined and decided by the authorities in accordance with law. ( 26 ) ON the foregoing discussion, it follows that these writ petitions are liable to be dismissed. But, at this stage, learned counsel for the petitioners pray "for one month's time for payment of taxes outstanding by their respective clients. We are of the view that this request of the learned counsel for the petitioners is fair and reasonable and the same should be granted. ( 27 ) IN the light of our above discussion, we dismiss these writ petitions and discharge the rule issued in all these cases. But, we grant one month's time from this day to all the petitioners to pay the taxes that are due by them. If all or any of the petitioners make payments within that time then the same shall be treated as payments made in time and that no penalty under Section 12 of the act shall be imposed on those that make such payments within that time and their cases regulated on that basis. ( 28 ) WRIT petitions are disposed of in the above terms. But, in the circumstances of the cases, we direct the parties to bear their own costs. --- *** --- .