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2002 DIGILAW 1816 (RAJ)

O. S. Motors Ltd. v. State of Rajasthan

2002-11-11

H.R.PANWAR, N.N.MATHUR

body2002
JUDGMENT 1. :- This bunch of special appeals is directed against the common judgment of the learned Single Judge dated 07.05.2002 dismissing the writ petitions. 2. The special appeal No.343/2002 is taken as the representative appeal. In short, the necessary facts are that petitioner O.S. Motors Limited, a public limited company, purchased a motor vehicle being Mahendra & Mahendra Jeep (hereinafter referred to as "subject vehicle") having seating capacity of 9 in all, exclusively to be used as private vehicle and not for plying it on hire or reward. The subject vehicle was registered after following the formalities as provided under Section 41 of the Motor Vehicles Act, 1988. The requisite tax was also paid in accordance with the provisions of Rajasthan Motor Vehicles Taxation Act, 1951. The transport department issued a registration certificate dated 27.3.1999 in the prescribed form. The vehicle was assigned "C" series (car, jeep and all non-transport vehicle having seating capacity upto 7). The petitioner opted for one time tax under Section 4(1)(b) of the Motor Vehicles Act and paid Rs. 14,500/-. The vehicle was provided the number viz. RJ-19/1C-3602. The grievance of the petitioner is that a notice dated 20.10.2001 has been served upon it calling upon to show cause as to why the registration of the subject vehicle under "C" series be not converted into "P" series and recover the taxes after adjusting the tax already paid as one time tax under "C" series. According to the notice, the subject vehicle is a private service vehicle as such a transport vehicle under Section 2(47) of the Act, and thus liable to be taxed under Section 4B of the Rajasthan Motor Vehicle Taxation Act. 3. The learned Single Judge after elaborate analysis of the relevant provisions held that general category of omnibus is assigned to the category of transport vehicle and such category of omnibus which is meant for private purpose is assigned to non-transport vehicle. The existence of omnibus in both the columns under notification dated 19.6.1992 shows that only special category of omnibus to be used for private purpose falls in the category of non-transport vehicle and all other omnibus falls under the category of transport vehicle. Thus, to justify that subject vehicle is a non-transport vehicle, the owner is required to establish that the vehicle is being used for private purpose. Thus, to justify that subject vehicle is a non-transport vehicle, the owner is required to establish that the vehicle is being used for private purpose. Learned Single Judge expressed that as to whether the subject vehicle is covered by the definition of private service vehicle or not cannot be decided by an academic discussion but it is a matter of fact. The owner of the vehicle seeking registration in the category of non-transport vehicle is required to convince the registering authority that the subject vehicle is only used for private purpose. Reading the Government circular dated 24.11.1992, the learned Single Judge ruled that an omnibus can be registered as a non-transport vehicle if the owner undertakes that it will be used for private purpose only, in case, there is violation in the undertaking, the owner is liablpe.,to face the consequences provided under the statute. Thus, in such a case where the notice has been given, the petitioner is supposed to answer the show cause and satisfy the authority that vehicle is being used only for private purpose. Following the decision of the Apex Court in Calcutta Discount Company's case, the learned Single Judge refused to interfere at the stage of notice and dismissed the writ petition as premature. 4. Assailing the judgment of the learned Single Judge, it is contended by the learned counsel' that transport authority having once registered as an omnibus for private purpose in the category of a non-transport vehicle becomes functus officio and it lacks jurisdiction to review his own order. It is submitted that the show cause notice does not disclose prima facie ground regarding the so-called breach of undertaking given by the petitioner. The learned counsel after referring to the definition of private service vehicle under Section 2(33) of the Motor Vehicles Act, submitted that a vehicle carrying more than six persons excluding the driver and ordinarily used by or on behalf of the owner of such vehicle for the purpose of carrying persons for, or in connection with, his trade or business also falls in the category of private service vehicle. On the other hand, learned counsel appearing for the department has supported the judgment of the learned Single Judge. 5. On the other hand, learned counsel appearing for the department has supported the judgment of the learned Single Judge. 5. The question which falls for consideration is as follows: Whether the omnibus (bigger cars) having seating capacity over seven is a private service vehicle as defined in Section 2(33) of the Motor Vehicles Act and, therefore, is also a transport vehicle as defined under Section 2(47) of the Motor Vehicles Act and, therefore, is liable to tax under Section 4(1) (a) and 4B of the Taxation Act, 1951 under notification dated 31.3.1997 or whether one time tax paid under Section 4(b) of the Act for non-transport vehicle is discharged of complete liability in respect of the said vehicle under the said Act? In order to appreciate the controversy, it will be apposite to refer to the relevant provisions of law and circulars of the Government issued from time to time. 6. The Motor Vehicles Act, 1988 provides the law relating to motor vehicles. Section 2 is a definition clauses. Section 2(29) provides that omnibus means any motor vehicle constructed or adapted to carry more than six person excluding the driver. Section 2(33) provides that private service vehicle means a motor vehicle constructed or adapted to carry more than six persons excluding the driver and ordinarily used by or on behalf of the owner of such vehicle for the purpose of carrying persons for, or in connection with, his trade or business otherwise than for hire or reward but does not include a motor vehicle used for public purposes. Section 2(47) provides that transport vehicle means a public service vehicle, a goods carnage, an educational institution bus or a private service vehicle. Chapter IV provides the scheme of registration. Section 41 provides the procedure of registration. Sub-clause (4) provides that certificate of registration will also specify the type of motor vehicle. Sub-dause (4) and (6) are extracted as follows: "(4). In addition to the other particulars required to be included in the certificate registration, it shall also specify the type of the motor vehicle, being a type as the Central Government may, having regard to the design, construction and use of the motor vehicle. by notification in the Official Gazette, specify." (5) ........................ "(6). In addition to the other particulars required to be included in the certificate registration, it shall also specify the type of the motor vehicle, being a type as the Central Government may, having regard to the design, construction and use of the motor vehicle. by notification in the Official Gazette, specify." (5) ........................ "(6). The registering authority shall assign to the vehicle, for display thereon, a distinguishing mark (in this Act referred to as the registration mark) consisting of one of the groups of such of those letters and followed by such letters and figures as are allotted to the State by the Central Government from time to time by notification in the official Gazette, and displayed and shown on the motor vehicle in such form and in such manner as may be prescribed by the Central Government." 7. The Central Government in exercise of powers conferred by sub-section (4) and Section 41 in supersession of earlier notification specified the types of motor vehicles in column 2 of the table. Transport Vehicles Non-Transport Vehicles (i) ................ (i) ................ (ii) ................ (ii) ................ ................ ................ ................ ................ (xii) Private Service Vehicle. ................ ................ (xxiii) Omnibus. ................ The said notification was amended by the notification dated 24.11.1992 by adding the column 2 of the table as follows: "SO 850 (E), dated 24.91.1992.- In exercise of the powers conferred by Sub-section (4) of Section 41 of the Motor Vehicles Act, 1988 (59 of 1988), the Central Government hereby makes an amendment to its Notification published in the Extraordinary Issue of the Gazette of India, Part II, Section 3, Sub-section (ii), No. S.O.451 (E), dated the 19th June, 1992 namely : (1) The following items shall be added in the end of the Column 2 of the Table of Notification No. 451(E) : (xiv) Omnibus for private use." 8. The State Government in exercise of powers in sub-clause (6) of Section 41 issued a notification dated 21.12.1989 directing the registering authorities to register the one type of vehicle under one series as provided in the notification. The relevant portion of the notification is extracted as follows : HINDI MATTER 356032 9. It will also be relevant to refer to the provisions of Rajasthan Motor Vehicles Taxation Act, 1951. Section 2 provides the definition. The relevant portion of the notification is extracted as follows : HINDI MATTER 356032 9. It will also be relevant to refer to the provisions of Rajasthan Motor Vehicles Taxation Act, 1951. Section 2 provides the definition. Sub-clause (e) of Section 2 provides that words and expressions used but not defined in this Act and defined in the Motor Vehicles Act, 1988 shall have the meaning assigned to them in that Act and Rules as amended from time to time. Section 4(1) (b) is extracted as follows: "4. Imposition of tax:- (1) Save as otherwise provided by this Act or by the Rules made thereunder or any other law for the time being in force, there shall be levied and collected on all motor vehicles used or kept for use in the state- (a) ...... (b) a One Time Tax in the case of non transport vehicles at such rates as may be notified by the State Government by notification in the official gazette which shall not exceed 10% of the cost of the vehicle." Section 4-B is also extracted as follows: "4-B. Special Road Tax:- In addition to the tax levied under Section 4 and subject to the rules as may be made by the State Government in this behalf, there shall be levied and paid to the State Government a Special Road Tax on all transport vehicles [except those three wheeled passenger vehicles with a seating capacity upto 4 excluding driver which have paid one time tax payable under clause (e) of Sub-section (1) of Section 4] at the rates as may be specified by notification in the official gazette, by the State Government which shall not exceed Rs. 2,000/- per day in respect of passenger vehicles and shall not exceed Rs. 250/- per thousand Kg. of load carrying capacity or part thereof for thirty days in respect of goods vehicles of other States or for vehicles plying on temporary permits of this State, and not exceeding 5% of the cost of the chassis/vehicle per month in respect of other vehicles. 250/- per thousand Kg. of load carrying capacity or part thereof for thirty days in respect of goods vehicles of other States or for vehicles plying on temporary permits of this State, and not exceeding 5% of the cost of the chassis/vehicle per month in respect of other vehicles. [Provided further that where a motor vehicle is found plying after the surrender of the certificate of registration, the Special Road Tax on such vehicle shall be payable forthwith for the entire period for which such certificate of registration was surrendered, alongwith a penalty equal to five time the amount of Special Road Tax but no such tax or penalty shall be charged from empty vehicle going for repair or for test purposes. Explanation:- The cost of the chassis/vehicle for the purposes of computation of tax shall include purchase price and such other elements as may be prescribed by the State Government.] 10. The Transport Commissioner by office order dated 21/98 dated 06.11.1998 directed all the registering authorities that vehicles having seating capacity of 7 to 10 which are purchased in the name of company, firm, institution may be registered in the category of non-transport vehicles on furnishing that such vehicles would be used only for private use and not for hire or reward. However, the said notification was withdrawn by order No.4/2000 dated 23.02.2000 for the reason that it was not in accordance with the definition of Private Service Vehicle provided in Section 2(33) of the Act of 1988. Another order No.45/2000 dated 16.08.2000 was issued directing that all the vehicles registered in "C" series between issuance of office order dated 06.11.1998 and office order dated 23.02.2000 be changed to "P" series and road tax and special road tax be recovered after adjustment of One Time Tax already paid; it was however made clear that no penalty should be recovered. 11. Thus, under the scheme of Taxation Act Sections 4 and 4B are the charging Sections. Section 4 imposed a liability of Road Tax whereas Section 4B is for the imposition of Special Road Tax. The tax liability depends upon the nature of the vehicle i.e., transport vehicle or non-transport vehicle. Section 4(1)(b) of the Taxation Act provides for OTT on all non-transport vehicles. Section 4(1)(a) and Section 4B are attracted in case of transport vehicles. The phrase "transport vehicle" and "non-transport vehicle" have not been defined in Taxation Act. The tax liability depends upon the nature of the vehicle i.e., transport vehicle or non-transport vehicle. Section 4(1)(b) of the Taxation Act provides for OTT on all non-transport vehicles. Section 4(1)(a) and Section 4B are attracted in case of transport vehicles. The phrase "transport vehicle" and "non-transport vehicle" have not been defined in Taxation Act. However, the definition given in the Motor Vehicles Act, 1988 and the Rules have been extended to the Taxation Act by virtue of Section 2(e). In exercise of powers under sub-clause (4) of Section 41 of the Motor Vehicles Act by issuing a notification the vehicles have been categorised by the notification by the Government as referred to above. It is evident that omnibus which is used for private use is excluded from the definition of transport vehicle and it is classified as non-transport vehicle. In order to show that the subject vehicle is a non-transport vehicle, the owner is required to establish that vehicle is being used for the private purpose. A private vehicle as defined in the Act includes a vehicle carrying more than six persons and ordinarily used by or on behalf of the owner for the purpose of carrying persons for or in connection with trade or business otherwise than for hire or reward. The persons who are referred to in this definition may be the persons of the company directly concerned with its functioning. If the vehicle is used for carrying such persons, it is covered by the definition of private service vehicle. obviously, the question as to whether subject vehicle is used for the private use or not is a question of fact. The learned Single Judge has rightly observed that this cannot be decided by an academic discussion. The petitioner has approached this court at the stage of notice. He must answer the show cause notice and satisfy the authority that it has not committed breach of the undertaking given or violated the bonds of private use. There is no substance in the contention that once the vehicle has been registered in the "C" Series, the registering authority becomes functus officio and it cannot be changed. The vehicle has been registered in the "C" Series on the undertaking given that the subject vehicle shall be used only for the private purpose. Whether there is any breach of undertaking or not and the question of burden etc. The vehicle has been registered in the "C" Series on the undertaking given that the subject vehicle shall be used only for the private purpose. Whether there is any breach of undertaking or not and the question of burden etc. is to be decided by the authority under the Taxation Act. Thus, the learned Single Judge has rightly rejected the bunch of writ petitions being premature. We do not find any illegality or infirmity in the order of the learned Single Judge. 12. Consequently,we find no merit in these special appeals and the same are dismissed. No order as to costs.Appeal Dismissed. *******