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2019 DIGILAW 2270 (RAJ)

Aas Mohammad v. State of Rajasthan

2019-08-22

S.RAVINDRA BHAT, SANJEEV PRAKASH SHARMA

body2019
JUDGMENT : S. Ravindra Bhat, J. 1. All these petitions challenge the validity of a notification dated 8.3.2017 (hereafter "the impugned notification") as violative of Articles 14, 19(1)(g) and 21 of the Constitution of India. The impugned notification compels transport vehicles which weigh between 3000 kgs and 16500 kgs to pay a one-time (hereafter "lump sum" or "life time") motor vehicle tax. 2. The brief facts are that in the State of Rajasthan, motor vehicles are taxed by virtue of the Motor Vehicles Taxation Act, 1951 and rules framed thereunder. The scheme of taxation, i.e. the rate of tax and the general regime of collection and exemptions are governed by rules and notifications issued from time to time. 3. The District Transport Officer appointed under the law time being in force or any officer authorized by the State Government is designated, by Section 3 to be the Taxation Officer for the purposes of the Act and Rules. Section 4 of the Act deals with imposition of tax; it constitutes the charging section. The validity of that provision was considered and upheld by the Supreme Court in the case of Automobiles Transport (Rajasthan) Ltd. Vs. State of Rajasthan, AIR 1962 SC 1406 , wherein the validity of the provision was upheld. Later, Section 4 was amended in the year 1997; Sections 4A and Section 4B were substituted subsequently by the provisions relating to special road tax. 4. Initially lump sum tax was introduced in the year 2005; Section 4C was enacted in relation to imposition of lump-sum tax. A further proviso to Section 4-C was introduced in the year 2007. Using that power (under proviso to Section 4C) the State, by notification dated 14.07.2014 imposed on certain motor vehicles registered or assigned in the State on or after 1.8.2014 a compulsorily lump sum tax. All categories of four-wheeler goods vehicles with gross vehicle weight of more than 3000 kgs (and up to 7500 kgs) were so taxed. Afterwards, the State Government by notification dated 9.3.2015 notified that certain motor vehicles registered on or after 1.4.2007 had to compulsorily pay lump sum tax. This was enhanced by notification dated 8.3.2016; while stating that all categories of goods vehicle with gross weight of more than 7500 kgs. and upto 12000 kgs., were included for lump sum tax. 5. Afterwards, the State Government by notification dated 9.3.2015 notified that certain motor vehicles registered on or after 1.4.2007 had to compulsorily pay lump sum tax. This was enhanced by notification dated 8.3.2016; while stating that all categories of goods vehicle with gross weight of more than 7500 kgs. and upto 12000 kgs., were included for lump sum tax. 5. By the impugned notification dated 8.3.2017 all categories of four wheel goods vehicle with gross vehicle weight more than 3000 kgs, and weighing upto 16500 kgs, are to be assessed for lump sum tax taxation. 6. It is argued on behalf of the petitioners that tax is a compulsory exaction of money by the State for a specific service rendered. The levy of tax is for the purpose of general review which when collected forms public revenue of the State. An element of fairness and reasonableness is a necessary ingredient for fixing the tax liability. It is argued that the levy of a lump sum tax on ageing vehicles which cannot ply in near future is unfair, arbitrary and unreasonable. Counsel urge that no public purpose is served by collecting such lump sum tax, which would be unreasonable and excessive, given that those vehicles would have paid tax annually for a considerable period of their motorable lives. Lump-sum payment of tax on vehicles which are more than 7 years old is unjust especially when they cannot operate for much longer on the road. It is argued that no public interest would be served nor it creates any expedient means for serving the public purpose. 7. Mr. Sameer Jain and Ms. Anita Aggarwal, counsel for the petitioners argue that the notification has been issued only with a view to enrich government coffers and provide the State with revenue unjustly, arbitrarily and without any basis de-hors the principle role of the State as a welfare State. The notification is thus ultra vires. 8. It is also urged that the impugned notification is arbitrary because the calculation of tax for older vehicles is based on today's market price of vehicle charging exaggerated tax from old vehicle owners. Counsel argued that the slab for one year old vehicles and more than 8 years old vehicle is the same, creating an unreasonable classification particularly which does not take into consideration that the life of a vehicle in Alwar is only 10 years. Counsel argued that the slab for one year old vehicles and more than 8 years old vehicle is the same, creating an unreasonable classification particularly which does not take into consideration that the life of a vehicle in Alwar is only 10 years. This feature argue counsel, is because the State overlooked and did not consider that due to the orders of the National Green Tribunal, motor transport vehicles which aged more than 10 years cannot ply in the National Capital Region (NCR) and owners of such vehicles are made to pay higher sums of money for the fewer number of years of the vehicles that are left on road. Learned counsel for the petitioners argued that this regional imbalance has resulted in over-classification, which is contrary to Article 14 and renders the tax unreasonable. 9. It is argued that presently vehicle owners are paying Rs.16000/- per year which for another 2 and 3 years would be about Rs.16,000 to Rs.10,000 depending upon the age of the vehicle but by the present notification they have been demanded a sum about Rs.1 lakh which is a highly exaggerated amount. The net result is that the State has kept in mind only its objective of filling up its coffers and penalize the vehicle owners by charging exorbitant amount. Learned counsel for the petitioners highlighted in this context that the lump sum tax payable, in terms of the cost of vehicle, determinable under the rules is highly unjust and arbitrary, because it is dependent upon a notional price, which is increased by 15% annually. In this regard, it was submitted that vehicles which have been subjected to annual tax, in terms of the options previously exercised, and where vehicle owners have paid repeatedly for about 10 years, would have to pay a lump sum tax, despite the relative remaining short life span of the vehicle. 10. Learned counsel also submitted that given the fact that the commercial value of vehicles would have completely diminished, since they would have been written down altogether in the books, such old vehicles, which are aged 8 years or more, are made to pay lump sum tax, which would mean that they would pay all over for the notional life time of the vehicle, and not the balance life time. 11. 11. It is highlighted that the tax slab for Alwar and Bharatpur ought to have been different since those districts are governed by the NCR policies and notifications whereby vehicles more than 10 years old are not allowed to run on the road; yet the Government without taking into consideration these aspects formed a scheme of lump sum tax payment. This would impact members of the general public. It is further argued that in the State of Rajasthan other than the NCR the policy till now is that all diesel vehicles can operate up to the age of 15 years. However, the position in the NCR region is different. The State ignored this completely and imposed a uniform lump sum tax which enforced arbitrarily and illegally by the Regional Transport Office, Bharatpur. This, it is stated has a disproportionate impact on the people of the NCR areas, as opposed to those living elsewhere and amounts to discriminatory taxation. 12. It is argued that the impugned tax has brought into force a regime whereby every transport owner is compelled by law to pay a lifetime tax, regardless of whether the vehicle is used in the State or otherwise. Previously the vehicle owner had the choice of paying lifetime tax; however, the impugned notification takes away that element of choice, and extracts payment of the entire lifetime tax. This removal of choice is arbitrary and pre-supposes uniform road use by all transport owners to their optimum or maximum weight levels. There is no basis for such assumption. Counsel highlighted that the notification was not preceded by any scientific study or research, but imposed merely as a measure of revenue maximization. 13. The State in its counter affidavit argues that Section 4-C of Rajasthan Transport (Taxation) Act 1951 deals with the lump-sum tax scheme. Section 4 of the Act deals with imposition of tax. The validity of that provision was considered in the Automobiles Transport (Rajasthan) Ltd. case (supra); its vires was upheld. In 1997, Section 4 was amended; also Sections 4A and 4B were substituted by the provisions relating to special road tax. Likewise, Section 4C was enacted in relation to imposition of lump-sum tax. 14. The State points out that initially lump sum tax was introduced in the year 2005 and pursuant to powers given under the Act, a further proviso to Section 4-C was introduced in 2007. Likewise, Section 4C was enacted in relation to imposition of lump-sum tax. 14. The State points out that initially lump sum tax was introduced in the year 2005 and pursuant to powers given under the Act, a further proviso to Section 4-C was introduced in 2007. By notification dated 14.07.2014, the State Government thought in public interest that certain motor vehicles registered or assigned in the State on or after 1.8.2014 compulsorily had to pay lump sum tax. All categories of four wheeled goods vehicle with a gross vehicle weight of more than 3000 kgs. to 7500 kgs. were brought within the fold of such tax measure. The state later by notification dated 9.3.2015 notified that certain motor vehicles registered on or after 1.4.2007 had, compulsorily, to pay lump sum tax. This notification was modified by notification dated 8.3.2016 which stated that all categories of goods vehicle having gross weight of more than 7500 kgs. and upto 12000 kgs., were brought within the fold of lump sum tax. Now, the impugned notification dated 08.3.2017 states that all category of four wheel goods vehicle with a gross vehicle weight more than 3000 kgs. and upto 16500 kgs., are to be assessed under the lump sum tax scheme. 15. It is argued by the learned Advocate General that the progressive nature of the levy and the inclusion of categories of vehicles, based on their weight shows that initially the State contemplated lump sum tax system which was found just and proper for the public at large. In a phased manner it was been enhanced to 16500 kgs. It is submitted that the impugned notification has now been challenged by the petitioners; however, till the notification came into existence, no one including the petitioners challenged the scheme/provision though the law was in existence at least for the vehicles with registered laden weight capacity up to 12000 kgs. 16. It is submitted that though the petitioners contend to carrying on business in Bharatpur, nonetheless they have been granted national permits and permits for route. This means that they can ply their goods vehicles in other parts of the State of Rajasthan or inter-State routes and except NCR-there is no restriction that they cannot ply the aged more than 10 years. Even otherwise, according to the petitioners, the impugned notification operates harshly upon them. This means that they can ply their goods vehicles in other parts of the State of Rajasthan or inter-State routes and except NCR-there is no restriction that they cannot ply the aged more than 10 years. Even otherwise, according to the petitioners, the impugned notification operates harshly upon them. It is submitted that harshness is not a ground for challenging the validity of a provision of law. If some people reside in Bharatpur and experience difficulties then that cannot be a ground to hold a law to be arbitrary. 17. It is submitted that the petitioners are the owners of four-wheeled goods vehicles weighing more than 3000 kgs. and are weigh up-to 16500 kgs. It is submitted that initially lump sum tax was introduced in the year 2005 and in pursuance of powers given under the Act, a further proviso to Section 4-C was introduced in the year 2007. By notification dated 14.7.2014 the State Government thought in public interest that certain motor vehicles registered or assigned in the State on or after 1.8.2014 would have to pay lump sum tax and it was made clear that all categories of four wheeled goods vehicle with a vehicle weight more than 3000 kgs. to 7500 kgs. will be of that category. Thereafter, lump sum tax was increased to 12000 kgs. and now it has been increased to 16500 kgs. Lump sum taxation has therefore be introduced in a phased manner; yet the petitioners never challenged the said provision. The State contends that the petitioners are bound by the principle of estoppel, and are not entitled to challenge the notification dated 8.3.2017. 18. Without prejudice to the other contentions, it is argued that the courts adopt a very circumspect approach towards judging validity of tax laws. It is submitted that the legislature is afforded greater leeway in fiscal and tax legislation, as compared with other laws and policies, in matters of classification of individuals, articles and goods, services etc. as well as in the grant of concessions and benefits in such laws, than in other legislation. The learned Advocate General relied on State of Tamil Nadu v. M. Krishnappan & Anr., 2005 (4) SCC 53 , in support of his contention. It was also argued that the legislation, i.e. the Act, was upheld in Automobile Transport (Rajasthan) v. State of Rajasthan, AIR 1962 SC 1406 , in this regard. 19. The learned Advocate General relied on State of Tamil Nadu v. M. Krishnappan & Anr., 2005 (4) SCC 53 , in support of his contention. It was also argued that the legislation, i.e. the Act, was upheld in Automobile Transport (Rajasthan) v. State of Rajasthan, AIR 1962 SC 1406 , in this regard. 19. It was argued that the concept of lump sum or life time tax, is not unknown; the State relied on Krishnappan (supra) to say that in the present case, the introduction of the concept through progressive increase of levy was to ensure that vehicle owners got used to such lifetime taxation. The Advocate General pointed out that rebate or relief has been consciously given by the State, in the impugned notification, which prescribe differential rates, having regard to the age of the vehicle. The learned Advocate General submitted that the arguments on behalf of some petitioners about the inability of vehicles to ply more than 15 years is not correct, because there is no rule or regulation in force in the State of Rajasthan, which prohibits such use. Counsel relied on Rule 88 of the Central Motor Vehicles Rules, 1989 (hereafter "Central Rules") to submit that it is only national permits which cannot be operated after a specified duration. Thus, there is No. 15 year rule which in a blanket manner, prohibits the use of motor vehicles after they attain a particular age. It was urged that the State has ample power to exempt or grant relief to a class or classes of taxpayers; in the present case, in case of hardship, it is open to the petitioners to approach the authorities for such relief or special concession, in the case of vehicles. 20. The Advocate General pointed out that Rule 42 of the Rajasthan Motor Vehicle Rules governs the issue of valuation. He also argued that in the present case, the tabular chart published by the State based on which lump sum tax is to be paid by various classes of vehicles, factors in the relative age of the vehicles: it is submitted that as far as vehicles which are more than five years are concerned, the State itself has classified them according to their age, and imposed a lesser rate of lump sum tax. The imposition of lump sum tax, which is dependent upon the determination of value (of the vehicle), in terms of the rule, it is highlighted, has not been challenged. Therefore, the contention of the tax being arbitrary or oppressive, is unjustified. Counsel also relied on Federation of Mining Association of Rajasthan v. Union of India, 2007 (2) WLC 716 (DB), a Division Bench judgment of this court, to submit that in Rajasthan too, the court had recognized that the basis of the tax is the load of the vehicle on the road; thus irrespective of the year of its manufacture, the tax would remain constant. Relying on State of West Bengal v. Kesoram Industries, 2004 (10) SCC 201 , it was urged that enactment of a tax levy is entirely different from a regulation; courts would in judicial review adopt a deferential scrutiny in relation to fiscal statutes. It was also argued that in considering the validity of taxation statutes against a complaint of arbitrariness or discrimination, the court would not lightly set aside or interfere with the working of a levy or such statute, unless there is perversity or gross disparity "resulting in clear and hostile discrimination", as held by the Supreme Court in Indian Oil Corporation v. State of Bihar, 2018 (1) SCC 242 . 21. Before proceeding with analysis of the rival contentions, it would be useful to extract the relevant provisions of the Act and the Rules as well as the Motor Vehicles Act, 1988 and the relevant Central Rules. They are reproduced below: "Provisions of the Rajasthan Motor Vehicles Taxation Act, 1951 3. Exemption (1) The State Government may by notification in the Official Gazette exempt either totally or partially whether prospectively or retrospectively any motor vehicles or class of motor vehicles from the payment of the tax, penalty or interest imposed or charged by or under the provisions of this Act or rules made there under: Provided that the interest or penalty or both shall be exempted only for the purposes of giving effect to the amnesty schemes of limited duration. (2) Every notification issued under this section shall be laid before the House of the State Legislature at the session thereof next following, and shall be liable to be rescinded or modified by a resolution of that House and the rescission or modification so made, shall after publication by notification in the Official Gazette be deemed to have come into force. 4. 4. Imposition of tax.-(1) Save as otherwise provided by this Act or by the Rules made there under 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) a tax in respect of such vehicles which are not covered by clause (b), (c), (cc) or (d), at such rates as may be specified by the State Government by notification in the Official Gazette which shall not exceed 10% of the cost of the chassis/vehicle per annum: Provided that where the rates are not specified, on quarterly 10, half yearly or monthly basis, by the State Government, by notification in the Official Gazette and if the tax is permissible to be paid quarterly 10, half yearly or monthly, the amount payable shall be equivalent to the one fourth 10 [one half] or one twelfth respectively of the annual rate of tax; (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 11 [shall not exceed 16% of the cost of the vehicle/chassis:] Provided that in the addition to One Time Tax there shall be paid by the owner or person having possession or control of a motor vehicle on which onetime tax is payable, any tax or penalty as was payable under this Act for any period prior to the coming into force of the provisions of Chapter V of the Rajasthan Finance Act, 2005 (Act No. 15 of 2005) at such rates as were applicable to such vehicles from time to time Provided further that on every transfer of ownership of motor vehicle mentioned above, an additional one-time tax shall be playable at such rates as may be notified by the State Government in the Official Gazette; (c) a tax in respect of motor vehicles registered outside the State and using roads in Rajasthan, at such rates, as may be notified by the State Government in the Official Gazette which shall not exceed Rs. 500/- per seat for 7 days or part thereof in case of passenger vehicles and shall not exceed Rs. 250/- per thousand Kg. Gross Vehicle Weight/Registered Laden Weight or part thereof for 30 days or part thereof in case of goods vehicles and shall not exceed Rs. 500/- per seat for 7 days or part thereof in case of passenger vehicles and shall not exceed Rs. 250/- per thousand Kg. Gross Vehicle Weight/Registered Laden Weight or part thereof for 30 days or part thereof in case of goods vehicles and shall not exceed Rs. 5000/- per thousand Kg. of Unladen Weight or part thereof for 30 days or part thereof in case of Construction Equipment Vehicles; (cc) a tax in respect of motor vehicles or motor vehicle chassis temporarily registered and passing through the State using roads in Rajasthan, at such rates, as may be notified by the State Government in the Official Gazette which shall not exceed Rs. 5000/-; (d) a tax on dealers in, or manufacturer of, motor vehicles in respect of such vehicles as are in their possession in the course of his business as such manufacturers, or dealer under the authorisation of a trade certificate granted or deemed to be granted under the Motor Vehicle Rules for the time being in force in the State of Rajasthan, at such rates as may be specified by the State Government by a notification in the Official Gazette which shall not exceed rupees ten thousand for every 50 vehicles or part thereof in respect of three or four wheeled vehicles; and shall not exceed Rs. 10,000/- for every 100 vehicles or part thereof in respect of two wheeled vehicles; and (e) a onetime tax in respect of transport vehicles at such rates as may be notified by the State Government in the Official Gazette, which shall not exceed 50% of the cost of the vehicle/chassis: Provided that in addition to onetime tax, there shall be paid by the owner or person having possession or control of transport vehicle on which onetime tax is payable any tax or penalty as was payable under this Act for any period prior to the coming into force of the provisions of the Chapter V of the Rajasthan Finance Act, 2005 (Act No. 15 of 2005) at such rates as were applicable to such vehicles from time to time: Provided further that the owner or person having possession or control of transport vehicles shall have option either to pay tax levied under clause (a) or onetime tax levied under clause (e). ******************* 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 vehicle expect those transport vehicle which have paid lump sum tax payable under section 4-C)] at the rates as may be specified by notification in the Official Gazette, by the State Government which shall not exceed 7 [Rs. 2,000/-] per day in respect of passenger vehicle 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 vehicle plying on temporary permits of this State, and 8 [not exceeding 5% of the cost] of the chassis/vehicle per month in respect of other vehicles. Explanation.-The cost of the chassis/vehicle for the purpose of computation of tax shall include purchase price and such other elements as may be prescribed by the State Government. Provided further that where a motor vehicle other than those which has paid onetime tax under section 4-C 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, along with 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 test purposes. 4-C. Imposition of Lump sum tax.-Notwithstanding anything contained in section 4 and section 4-B and subject to the rules as may be made by the State Government there shall be levied and paid to the State Government a lump sum tax on all transport vehicles at the rates as may be specified by the notification in the Official Gazette by the State Government which shall not exceed 50% of the cost of vehicle/chassis: Provided that the owner or person having possession or control of transport vehicle shall have option either to pay tax levied under clause (a) or clause (e) of sub-section (1) of section 4 and section 4-B or lump sum tax under section 4-C: Provided further that the State government may by notification in the Official Gazette require the owners or the persons having possession of such class of transport vehicles registered on or after 01.04.2007 as may be specified in the notification to pay lump sum tax under section 4-C instead of tax payable under clause (a) or clause (e) of sub-section (1) of section 4 and section 4-B. **************************** **************** Rajasthan Motor Vehicles Taxation Rules, 42. Cost for the purpose of computation of tax-Cost of the vehicle/chassis shall be arrived at in case: (a) the vehicle/chassis is purchased in the financial year in which the tax due, by including the elements of taxes and levies in purchase price prevailing on 1st April of the year of purchase. Cost for the purpose of computation of tax-Cost of the vehicle/chassis shall be arrived at in case: (a) the vehicle/chassis is purchased in the financial year in which the tax due, by including the elements of taxes and levies in purchase price prevailing on 1st April of the year of purchase. (b) The vehicle/chassis purchased earlier than the year in which the tax is due by adding the element of notional price increase at the rate of 15 (fifteen) percent per annum compounded annually on the purchase price prevailing on 1st April of the year of purchase of similar type of vehicle: Provided that the owner of the vehicle/chassis or any person authorized by him in this behalf, may opt to have the cost of his vehicle assessed as to be the same as the cost assessed at current price of similar type of vehicle as prevailing on 1st April of the year in which the tax is due: Provided further that if the original purchase bill is not produced by the vehicle owner, and/or the option of having the cost assessed at the current price is not exercised by the owner, the price of the similar types of vehicles existing as on 1st of April of the year for which the tax is due shall be taken for computation purposes: Provided also that in case of notional price increase of 15% compounded annually, the cost of the vehicle so arrived at shall not exceed the current cost of similar types or new vehicles in the financial year in which the tax is due: Provided also that in case of vehicle purchased/registered outside the state or military disposal vehicles, cost shall be as applicable in the year in which the tax is due for the similar type of vehicle of this State. Explanation (i) Purchase prices for determining the cost for computation of tax shall be as prevailing at Jaipur and if in case the dealer of any vehicle is not available at Jaipur, the cost shall be as prescribed by the Transport Commissioner. (ii) When under clause (n) of sub-rule (1) of rule 2 of the these rules, similarity is established with more than one vehicle/chassis, then the vehicle/chassis having lower cost shall be taken for the purpose of computation of tax." Rule 5.9 of Raj. Motor Vehicles Rules, 1990: 5.9. (ii) When under clause (n) of sub-rule (1) of rule 2 of the these rules, similarity is established with more than one vehicle/chassis, then the vehicle/chassis having lower cost shall be taken for the purpose of computation of tax." Rule 5.9 of Raj. Motor Vehicles Rules, 1990: 5.9. Issue of permit:-(1) The Secretary/Executive Officer of the [State Transport Authority/Regional Transport Authority] shall, intimate the applicant within seven days from the date of order of the [State Transport Authority/Regional Transport Authority] regarding grant or rejection of the application and on receipt of the prescribed obtained form R.S. 5.19 for the permit shall be issued which shall be in one of the following forms:- (i) In respect of Stage Carriage permit In Form R.S. 5.9 (ii) In respect of service of Stage Carriage In Form R.S.5.10 (iii) In respect of a Particular contract carriage In Form R.S.5.11 (iv) In respect of casual contract carriage In Form R.S.5.12 (v) In respect of contract carriage to be used for private hire In Form R.S.5.13 (vi) In respect of Private Service vehicle In Form R.S.5.14 (vii) In respect of Goods Vehicle In Form R.S.5.15 (viii) In respect of National p ermit In Form R.S.5.16 (ix) In respect of All India Tourist p ermit In Form R.S.5.17 (x) In respect of temporary permit In Form R.S.5.18 (xi) In respect of cash receipt cum temporary permit for contract/goods carriage In Form R.S.5.18 A (xii) In respect of a particular educational institution Bus In Form R.S.5.18 B (3) Save in the case of Temporary Permit every permit shall be in two portion A and B. One copy of part A only shall be issued. One copy of part B shall be issued in respect of every vehicle authorised by the permit and where a permit relates to more than one vehicle each such copy shall carry, in addition to the number of permit a separate serial number contained in Brackets after the number of permit. Each such copy shall be sealed and signed by the authority by which the permit is issued and by the authority by which the permit is countersigned. Each such copy shall be sealed and signed by the authority by which the permit is issued and by the authority by which the permit is countersigned. (4) (3) The holder of a permit shall cause the relevant copy of part B thereof or the Temporary permit, as the case may be, to be carried in Glassed Frame or other suitable container in or fixed to the interior of the vehicle in such a way as to maintain it in a clean and legible condition, readily available for inspection at any time by the authorised person." Section 66 of the Motor Vehicles Act, 1988 "66. Necessity for permits.-(1) No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him the use of the vehicle in that place in the manner in which the vehicle is being used: Provided that a stage carriage permit shall, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a contract carriage: Provided further that a stage carriage permit may, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a good carriage either when carrying passengers or not: Provided also that a goods carriage permit shall, subject to any conditions that may be specified in the permit, authorise the holder to use the vehicle for the carriage of goods for or in connection with a trade or business carried on by him. (2) The holder of a goods carriage permit may use the vehicle, for drawing of any trailer or semitrailer not owned by him, subject to such conditions as may be prescribed: [Provided that the holder of a permit of any articulated vehicle may use the prime-mover of that articulated vehicle for any other semi-trailer.]" ***************** ***************** Rule 88 of the Central Motor Vehicles Rules, 1989: 88. Age of motor vehicle for the purpose of national permit.--(1) No national permit shall be granted in respect of a goods carriage, other than multiaxle vehicle, which is more than -[twelve years] old at any point of time. Age of motor vehicle for the purpose of national permit.--(1) No national permit shall be granted in respect of a goods carriage, other than multiaxle vehicle, which is more than -[twelve years] old at any point of time. (2) No national permit shall be granted for a multiaxle goods carriage which is more than fifteen years old at any point of time. (3) A national permit shall be deemed to be invalid from the date on which a goods carriage covered by the permit completes fifteen years in case of a multiaxle goods carriage and -[twelve years] where the vehicle is other than a multiaxle goods carriage, unless such goods carriage is replaced. Explanation.--For the purpose of this rule, the period of 125 [twelve years] or fifteen years, as the case may be, shall be computed from the date of initial registration of the motor vehicle covered under its permit or the prime mover in case of an articulated vehicle.] (4) No national permit shall be granted in respect of a multi-axle trailer approved to carry a gross vehicle weight of more than 50 tonnes, which is more than 25 years old at any point of time, the period of 25 years being computed from the date of initial registration of the said trailer. Explanation.--For the purpose of this rule, "multi-axle trailer" means a trailer having more than two axles. [(5) A national permit shall be in such security printed watermark paper and shall carry such hologram as the State Government or the State Transport Authority, as the case may be, issuing such permit, may specify: Provided that the use of such security printed water-mark paper carrying such hologram shall come into force on or before six months from the date of commencement of the Central Motor Vehicles (Third Amendment) Rules, 2002." 22. In M. Krishnappan & Ors., (supra) the Supreme Court while dealing with a challenge to introduction of the "life time" or lump sum tax, in the State of Tamil Nadu, held as follows: "17. The short question which arises for consideration in the present case is - whether the High Court was right in holding that with the introduction of the concept of "value" as the basis of the tax, the impugned levy fell outside entry 57 of list-II of the seventh schedule to the Constitution. 18. The short question which arises for consideration in the present case is - whether the High Court was right in holding that with the introduction of the concept of "value" as the basis of the tax, the impugned levy fell outside entry 57 of list-II of the seventh schedule to the Constitution. 18. It is well to remember that the State maintains old roads and makes new ones. These roads are at the disposal of those who use motor vehicles either for private purpose or for trade or commerce. India is a cost-push economy. It has high rate of inflation. The costs of maintenance as well as the costs of material used in the maintenance of the roads increases by the day. This naturally costs the State, which has to find funds for making new roads, and for maintenance of those that are in existence. The impugned tax is regulatory and compensatory in nature in the sense that it is imposed to meet the increasing costs of maintenance and upkeep and to that extent it is not plenary. However, as stated above, the limited question is: whether the tax ceases to be compensatory and regulatory with the introduction of "weight-cum-value" index and whether the said index is contrary to the scheme of the said 1974 Act. 19. At the outset it may be noted that depreciation is a function of time and maintenance. In the present case, we are concerned with the "life time tax" which is one time payment spread over the economic life of the vehicle. The said tax is based on time, use and maintenance of the roads. As stated in the judgment of this Court in Bombay Tyre (supra), any standard, which maintains a nexus with the essential character of the levy can be regarded as a valid basis for assessing the measure of the levy. Applying the said test to the present case, we hold that the index of "weight-cum-value" maintains the nexus with the essential character of the levy in question and, therefore, the High Court erred in holding that by introduction of the value of the vehicle as a parameter, the levy ceases to be regulatory and compensatory in nature. It is important to bear in mind that entry 57 of list-II of the seventh schedule to the Constitution refers to taxes on vehicles suitable for use on roads. It is important to bear in mind that entry 57 of list-II of the seventh schedule to the Constitution refers to taxes on vehicles suitable for use on roads. Under the said entry, a field is provided to the State Legislature to impose the impugned tax in respect of every aspect of a vehicle. When the Constitution provides a field of legislation, it has to be read in the broadest possible terms. When the State is empowered to levy taxes on goods, it is empowered to levy such taxes on every aspect of such goods. Similarly, when the State is empowered to levy tax on the vehicle, it is empowered to levy tax on every aspect of the vehicle. Throughout the Constitution, the legislative power relating to taxes and the legislative power relating to general subjects is treated separately and is not subsumed under a general head. Applying the above tests to the present case, we are of the view that the High Court had erred in holding that on account of introduction of "weight-cum-value" index in the third schedule to the Act, the impugned tax had ceased to be regulatory and compensatory and consequently, the said levy fell outside entry 57 list-II. 20. In the case of Commissioner of Central Excise, Lucknow, U.P. v. Chhata Sugar Co. Ltd. reported in 2004 (165) ELT 369 (SC), this Court has held that a regulating measure may also contain taxing provisions. 21. In the case of State of W.B. v. Kesoram Industries Ltd. and Ors. reported in [2004] 266 ITR 721 (SC), the Constitution Bench of this Court has held that a power to tax may be exercised for the purposes of regulating trade, industry, commerce or any other activity; the purpose of levying such an impost is the exercise of sovereign power to effectuate regulation though incidentally the levy may contribute to the revenue. 22. In the present case, we are satisfied that the levy in question being one time tax continues to be a part of regulatory measure. For administrative reasons in the matter of collection of tax, one time payment of tax is administratively convenient and at the same time, it is also beneficial to the users of the vehicles who do not have to go to the office of the RTO every year to pay the annual taxes. For administrative reasons in the matter of collection of tax, one time payment of tax is administratively convenient and at the same time, it is also beneficial to the users of the vehicles who do not have to go to the office of the RTO every year to pay the annual taxes. It is also beneficial to the users of the motor vehicles, as they do not have to pay taxes at the increased rates from time to time over the economic life of vehicle as contemplated by Section 3(2) of the Act. Moreover, weight alone may not provide a sufficient parameter/basis for imposition of "life time tax". As an illustration, we may point out that the weight of the Honda CRV Car is 1500 kg. as against the weight of Tata Indigo GLX which weighs 1490 kg. and yet the cost of Honda CRV is Rs. 15,24,396 lacs whereas the price of Tata Indigo is 5,08,651 lacs. Hence, weight index alone may not constitute the basis of "life time tax". 23. In the circumstances, we reiterate that introduction of "weight-cum-value" index will not make the levy non-regulatory/non-compensatory. Further, under the unamended 1974 Act weight was the basis of the impugned levy as an annual tax. But with the introduction of a "life time tax", the entire future projection spread over the economic life of the vehicle had to be taken into account along with other factors like fall in the value of the rupee, inflation, rising costs of the material, cross subsidy etc. and consequently, it was necessary to introduce the new index of "weight-cum-value" and factors like paying capacity of the owner. In our view, these factors have nexus with the use of the roads over a period of time and hence, the impugned levy fell within entry 57 list-II of the seventh schedule to the Constitution. 24. We also do not find the impugned levy to be discriminatory, arbitrary or unreasonable so as to violate Article 14 of the Constitution as held by the High Court. In the case of Municipal Corporation of the City of Ahmedabad and Ors. v. Jan Mohammed Usmanbhai and Anr. 24. We also do not find the impugned levy to be discriminatory, arbitrary or unreasonable so as to violate Article 14 of the Constitution as held by the High Court. In the case of Municipal Corporation of the City of Ahmedabad and Ors. v. Jan Mohammed Usmanbhai and Anr. reported in [1986] 2 SCR 700, this Court held that Article 14 forbids class legislation and not reasonable classification and in order to pass the test of reasonable classification, the classification must be founded on an intelligible differentia which distinguishes persons or class of persons that are grouped together from the others left out of that group and that such differentia must have a rational relation to the object sought to be achieved by the statute in question. 25. In the case of The State of Gujarat and Anr. etc. v. Shri Ambica Mills Ltd., Ahmedabad and Anr. etc. reported in [1974] 3 SCR 760, this Court held that where size is an index, discrimination between large and small is permissible. Article 14 does not require that every regulatory statute should apply to each and everyone equally in the same business. 26. Similarly, in the case of State of Maharashtra v. Madhukar Balkrishna Badiya (supra), this Court has held that taxing of a company owned vehicle at three times the rate payable by an individual owner did not make the enactment violative of Article 14 as the Legislature had the power to distribute the tax burden in a flexible manner and the Court would not interfere with the same. 27. There is no merit in the contention advanced on behalf of the respondent herein that there is violation of Article 14 of the Constitution by imposing higher burden of tax on vehicles owned by "others" vis-a-vis the vehicles owned by the "individuals" in part-I of the third schedule. We do not find merit in this argument. Firstly, as held by this Court in the case of Bombay Tyre (supra), levy is a constitutional concept whereas collection of a tax as well as incidence of tax comes within the statutory measure. The mode of collection or the incidence of tax cannot be the conclusive test to decide the nature of the levy. The nature of the levy is a concept different from the mode of collection of tax. The mode of collection or the incidence of tax cannot be the conclusive test to decide the nature of the levy. The nature of the levy is a concept different from the mode of collection of tax. Levy is a constitutional concept whereas mode of collection of tax is a statutory concept. They stand on different footings. Secondly, it is important to remember the words of Lord Wilberforce, quoted with approval by House of Lords in the case of Barclays Mercantile Business Finance Ltd. v. Mawson (Inspector of Taxes) reported in (2005) 1 All ER 97 stating that "a tax is generally imposed by reference to economic activities or transactions which exist in the real world". When an economic activity is to be valued, it is open to the law maker to take into account various factors including the paying capacity of the user, the value of the vehicle, the economic life of the vehicle etc. Lastly, in the present case, for the vehicles registered before 1.7.1998 the option between annual and one time tax is retained." 23. The impugned notification modified the nature of the motor vehicle tax structure, which is a lump sum tax, based on value and weight of the transport vehicle. The preceding analysis shows that the levy in the Act, is in terms of Section 4(1). Motor vehicle taxation depends on the class of vehicle (transport, non-transport vehicle, vehicle based on chassis, etc.). The parent statute, which was upheld by the Supreme Court in the Automobile Transport (Rajasthan) decision, underwent a series of changes. In 1997, the Act was amended and new provisions were substituted. Section 4(1)(a) enabled tax to be paid, in respect of transport vehicles at monthly, quarterly or half yearly rates. The regime for non-transport vehicles and those registered outside the State, however was different. By Rajasthan Act No. 15, of 2005, Section 4C was introduced, which (through its proviso) made lump sum tax payment optional for all transport vehicles. By Rajasthan Act No. 4 of 2007, the second proviso was added (to Section 4C) which made it obligatory for payment of lump sum tax in respect of all transport vehicles registered on or after 01.04.2007. This again, was dependent upon the introduction of such system of lump sum taxation by the State, through Official Gazette. 24. By Rajasthan Act No. 4 of 2007, the second proviso was added (to Section 4C) which made it obligatory for payment of lump sum tax in respect of all transport vehicles registered on or after 01.04.2007. This again, was dependent upon the introduction of such system of lump sum taxation by the State, through Official Gazette. 24. It is thus, obvious that the obligation to pay lump sum tax was imposed through statute, as far back as in 2007; this applied prospectively to all classes of vehicles registered after 01.04.2007. However, the State did not by Gazette notify the date or the rates (of lump sum tax) applicable to the specified class or classes of vehicles. This changed for the first time, on 14.07.2014 when the State issued notification (SO 94) obliged all categories of four wheeled goods vehicles with gross weight of more than 3000 kgs. and up to 7500 kgs., all motor cabs with seating capacity of six (excluding driver) and maxi cabs with seating capacity of six or more, up to twelve (excluding driver) to pay lump sum tax, instead of tax under Section 4(1)(a) and (e). This applied to vehicles registered or assigned to the State of Rajasthan on and after 01-08-2014. This notification was amended by a notification (published in the Gazette) dated 09-03-2015 which modified the earlier notification to the effect that lump sum tax was to be paid in respect of the said three categories of vehicles (spelt out in the earlier notification dated 14-07-2014) registered on or after 01-04-2007. This notification came into effect from 01-04-2015. The third notification (dated 08-03-2016 brought into force with effect from 01-04-2016) expanded the scope of the previous notification and made lump sum tax payable in respect of vehicles with a gross weight of 7500 kgs. or more, up to 12000 kgs. Thus, all vehicles falling in this category became liable to pay lump sum tax from 01-04-2016. The impugned notification expanded the scope of lump sum taxation: its overall effect, was that all categories of four wheeled vehicles weighing more than 3000 kgs. (3 tons) and up to 16500 kgs. (16.5 tons) are to pay lump sum tax. 25. In the opinion of this court, the facial challenge to the introduction of the life time (or lump sum) tax, based upon its determined value, cannot be sustained, in the light of the decision in Krishnappan. (3 tons) and up to 16500 kgs. (16.5 tons) are to pay lump sum tax. 25. In the opinion of this court, the facial challenge to the introduction of the life time (or lump sum) tax, based upon its determined value, cannot be sustained, in the light of the decision in Krishnappan. As held by the Supreme Court, the previous basis (in the case of the vehicle owners in that decision) was weight of the vehicle. However, the introduction of the weight cum value, was commended by the court, which outlined various benefits: avoiding annual payments (on the part of the vehicle owners) and the attendant possibility of frequent increase in rate of taxes; stability of the rate, to the customer of the services provided through the vehicle (or the vehicle), as the case may be, and a more rational basis for working out the maintenance of the roads. Therefore, the question of the challenge to the levy as arbitrary fails. Besides, the court is bound by a series of decisions of the Supreme Court, which have held that in regard to fiscal policies and legislation, judicial scrutiny is narrow and circumspect, since the courts do not have the wherewithal or expertise to tailor policies or judge their efficacy. In Elel Hotels & Investments Ltd. v. Union of India, (1989) 3 SCC 698 , this aspect was highlighted: "Similar contentions as to the unreasonableness of the restrictions which the imposition of the impugned tax was said to bring about on the petitioners' freedom of trade and business and the adverse effect of this tax on a significant area of national economy generally and the Tourism Industry in particular have been considered in the petitions assailing the vires of the Expenditure Tax Act, 1987. It is now well settled that a very wide latitude is available to the legislature in the matter of classification of objects, persons and things for purposes of taxation. It must need to be so, having regard to the complexities involved in the formulation of a taxation policy. Taxation is not now a mere source of raising money to defray expenses of Government. It is a recognised fiscal tool to achieve fiscal and social objectives. It must need to be so, having regard to the complexities involved in the formulation of a taxation policy. Taxation is not now a mere source of raising money to defray expenses of Government. It is a recognised fiscal tool to achieve fiscal and social objectives. The differentia of classification presupposes and proceeds on the premise that it distinguishes and keeps apart as a distinct class hotels with higher economic status reflected in one of the indicia of such economic superiority. The presumption of constitutionality has not been dislodged by the petitioners by demonstrating how even hotels, not brought into the class, have also equal or higher chargeable receipts and how the assumption of economic superiority of hotels to which the Act is applied is erroneous or irrelevant." 26. Recently too, the Supreme Court held, in Vasavi Engg. College Parents Assn. v. State of Telangana, (2019) 7 SCC 172 , as follows, reiterating its earlier view: "22. The need for judicial restraint with regard to recommendations of Expert Committees, more particularly in matters relating to finance and economics, was considered in BALCO Employees' Union v. Union of India [BALCO Employees' Union v. Union of India, (2002) 2 SCC 333 ], it was held: (SCC pp. 372 & 382, paras 65 & 98) "65. ...Nevertheless, contention is sought to be raised that the method of valuation was faulty, some assets were not taken into consideration and that Rs. 551.5 crores offered by M/s. Sterlite did not represent the correct value of 51% shares of the Company along with its controlling interest. It is not for this Court to consider whether the price which was fixed by the Evaluation Committee at Rs. 551.5 crores was correct or not. What has to be seen in exercise of judicial review of administrative action is to examine whether proper procedure has been followed and whether the reserve price which was fixed is arbitrarily low and on the face of it, unacceptable. *** 98. In the case of a policy decision on economic matters, the courts should be very circumspect in conducting any enquiry or investigation and must be most reluctant to impugn the judgment of the experts who may have arrived at a conclusion unless the court is satisfied that there is illegality in the decision itself." 19. *** 98. In the case of a policy decision on economic matters, the courts should be very circumspect in conducting any enquiry or investigation and must be most reluctant to impugn the judgment of the experts who may have arrived at a conclusion unless the court is satisfied that there is illegality in the decision itself." 19. It needs no emphasis that complex executive decisions in economic matters are necessarily empiric and based on experimentation. Its validity cannot be tested on any rigid principles or the application of any straitjacket formula. The Court while adjudging the validity of an executive decision in economic matters must grant a certain measure of freedom or play in the joints to the executive. Not mere errors, but only palpably arbitrary decisions alone can be interfered with in judicial review. The recommendation made by a statutory body consisting of domain experts not being to the satisfaction of the State Government is an entirely different matter with which we were not concerned in the present discussion. The Court should therefore be loath to interfere with such recommendation of an expert body, and accepted by the Government, unless it suffers from the vice of arbitrariness, irrationality, perversity or violates any provisions of the law under which it is constituted. The Court cannot sit as an appellate authority, entering the arena of disputed facts and figures to opine with regard to manner in which TAFRC ought to have proceeded without any finding of any violation of rules or procedure. If a statutory body has not exercised jurisdiction properly the only option is to remand the matter for fresh consideration and not to usurp the powers of the authority." In Indian Oil Corporation, the court was equally forthright; it held that sans perversity or palpable arbitrariness or gross disparity "resulting in clear and hostile discrimination" courts are to desist from interdicting tax legislation on the ground of unreasonableness or arbitrariness. 27. The next question is whether the imposition of a lump sum taxation regime, on old vehicles (which have already been subjected to annual taxation previously) is arbitrary or unreasonable. One of the serious arguments made was that earlier, the owner or taxpayer had the choice of paying quarterly, half yearly or annually. Such owner/taxpayer had exercised that choice and paid dues for a long time. One of the serious arguments made was that earlier, the owner or taxpayer had the choice of paying quarterly, half yearly or annually. Such owner/taxpayer had exercised that choice and paid dues for a long time. The argument was that now, subjecting such old vehicles to lump sum taxation is unreasonable. 28. The argument with regard to shorter life span of vehicle which has been subjected to annual taxation previously for a long period such as 8 to 10 years, facially seems appealing. Yet there is a basic fallacy in the submission. The underlying premise for the argument is a definitive life span of motor vehicles. As pointed out on behalf of the State, the restriction of use, of vehicles aged more than 15 years is not universal, but rather confined to those which are plying under national permits, in terms of Rule 88. The other restriction is in some parts of Rajasthan where the NGT's order, banning the plying of such vehicles within the concerned districts (as they form part of NCR) are enforced. However, these two instances are referred by way of exception. In the case of all other vehicles, this Court notices that the material on record in the form of tabular chart produced by the petitioner (in D.B. Civil Writ Petition No. 4103/2017, Krishan Gopal Bansal & Ors. Vs. The State of Rajasthan & Anr.), reveals that State has taken care to ensure that value of the vehicles is determined according to its age. The tabular chart-which is part of the State's notification, in-fact determines that the value for one year old vehicles is higher, whereas those for five years and above is lowest (almost 75% lower than those which are one year or older but less than five years). For the facility of reference, the said tabular chart in respect of various vehicles is reproduced as follows:- "REGIONAL TRANSPORT OFFICER BHARATPUR LIST OF GOODS VEHICLE GVW 12001 TO 16500 SR. NO. For the facility of reference, the said tabular chart in respect of various vehicles is reproduced as follows:- "REGIONAL TRANSPORT OFFICER BHARATPUR LIST OF GOODS VEHICLE GVW 12001 TO 16500 SR. NO. TYPE OF VEHICLE GVW WHE ELBASE COST LST SURCH ARGE LST + SURCH ARGE 1 YEAR OLD VEH 2 YEAR OLD VEH 3 YEAR OLD VEH 4 YEAR OLD VEH 5 AND MORE THAN 5 YEAR OLD VEH 1 LPT 1613/ 42 16200 5200 1699000 186890 18689 205579 185021 164463 143905 123347 102790 2 LPT 1615/62 TC E3 16200 6200 1880000 206800 20680 227480 204732 181984 159230 136488 113740 3 LPT 1613/48 16200 4855 1751000 192610 19261 211871 190684 169497 148310 127123 105936 4 LPT 1109/36 12990 3600 1620000 178200 17820 196020 176418 156816 137214 117612 98010 5 LPT 1109/42 12990 4200 1690000 185900 18590 204490 184041 163592 143143 122694 102245 6 LPT 1109/48 12990 4800 1743000 191730 19173 210903 189813 168722 147632 126542 105452 7 EICHER HCV 20.16 16200 5340 2063000 226930 22693 249623 224661 199698 174736 149774 124812 8 EICHER TERRA 16 HDR 16000 3485 1955000 215050 21505 236555 212900 189244 165589 141933 118278 9 EICHER TERRA 16 XP 16000 3485 2000000 220000 22000 242000 217800 193600 169400 145200 121000 10 EICHER 20.16 16000 5340 2050000 225500 22550 248050 223245 198440 173635 148830 124025 29. It is thus clear from a plain reading of the above tabular chart that the State has taken care, at the first instance, that the basis for taxation i.e. value of the motor vehicles is appropriately reflective of their age. The vehicles which are newer i.e. between 1 to 2 years, are valued higher and subjected to higher tax, but lower compared to new vehicles and the value diminishes according to the age. Thus, the actual tax burden levied-evident from the chart, becomes much lower. 30. Having regard to these facts, the Court is of the opinion that a further argument or investigation with respect to the age of vehicles or that older vehicles to pay a lump-sum which cast disproportionate burden on them, is not substantial. The Court is of the opinion that while devising tax structure which has accommodated both, the oldest and the relatively newer vehicles, in an appropriate manner, a further examination of the minutiae as to the impact upon individual taxpayers, is neither called for nor appropriate while judging the validity of the levy. 31. The Court is of the opinion that while devising tax structure which has accommodated both, the oldest and the relatively newer vehicles, in an appropriate manner, a further examination of the minutiae as to the impact upon individual taxpayers, is neither called for nor appropriate while judging the validity of the levy. 31. Likewise, as far as the levy on vehicles which cannot ply for more than 10 years is concerned, the Court is of the opinion that there is no discrimination or arbitrariness. Firstly, these vehicles can ply in the rest of Rajasthan-thus right to carry on trade is not prohibited or substantially impaired; secondly the impact of the levy can be softened, if such class of vehicle owners, found exclusively in the NCR region, apply for relief under Section 3 of the Act which empowers the government to provide exemption-either wholly or partially, to "any motor vehicles or class of motor vehicles". Therefore, it is open to the State of Rajasthan to soften the rigors of the taxation, if established in an appropriate or suitable manner. 32. The Court is also of the opinion that the basis of discrimination i.e. the alleged regional disparity in the impact of the levy, has also not been established. Several authorities have enunciated the principles that mere differentiation in regard to region or impact of laws in different regions of the State-i.e. geographical discrimination, cannot be the basis for holding a law or policy unreasonable or discriminatory. This argument was made Khandige Sham Bhat v. Agrl. ITO, AIR 1963 SC 591 precisely in a similar manner, but rejected by the Supreme Court, in the following terms: "12. The next argument is that there is discrimination between assessees in Kasaragod area and those in the rest of the Madras area in that in the case of arecanut the assessees of Madras area, other than Kasaragod Taluk, would be in a better position as they gather their crops before November. The assessees of the Madras area under the Act formed one class and Section 2-A applies to all of them: Section 2-A applies to both parts of the Madras area i.e. the Malabar area and the South Kanara area. In both the cases the income of the assessees that accrued before November 1, 1956 was not taxable; in both the cases the income that accrued thereafter is liable to tax. In both the cases the income of the assessees that accrued before November 1, 1956 was not taxable; in both the cases the income that accrued thereafter is liable to tax. The rate also is the same. The statement only shows that all the crops, except arecanut, are gathered by the assessees of the entire area during the same period. The fact that in the case of one of the crops the assessees in the Malabar area harvested earlier cannot be a ground for holding that the law has made an unjust discrimination between persons belonging to the same class, but that is due only to the fortuitous circumstance of some assessees gathering the crops earlier than others. As we have pointed out, the arecanut crop is only one of the many crops in that area and the extent of its cultivation in Kasaragod Taluk is comparatively less than that in the entire area of the State or even the Madras area. We cannot, therefore, say that the law made an unjust discrimination between persons belonging to the same class. Again, in Nazeria Motor Service v. State of A.P., (1969) 2 SCC 576 , the ground of geographical basis for discrimination, a basis for challenge, was turned down: "8. This is sufficient to dispose of the challenge under Article 19(1)(g) as well. We may in this connection refer briefly to the conclusion of the High Court which was reached on a consideration of the affidavits filed before it. It has been found that there is no material which would warrant the conclusion that the increase in the surcharge of the fares and freight contemplated by the impugned Validating Act would constitute an impediment to the trade. The utmost that could be said was that it would result in the diminution of profits. Even on the assumption that the profits would be diminished or greatly reduced it cannot be held that there is any infringement of Article (19)(1)(g). 9. Coming to the attack on the ground of violation of Article 14 reference may be made to the background relating to taxation of passengers and goods carried in motor vehicles in the State prior to the formation of Andhra Pradesh. It appears that there was no law in the erstwhile Hyderabad State imposing any tax on passengers and goods. 9. Coming to the attack on the ground of violation of Article 14 reference may be made to the background relating to taxation of passengers and goods carried in motor vehicles in the State prior to the formation of Andhra Pradesh. It appears that there was no law in the erstwhile Hyderabad State imposing any tax on passengers and goods. After the merger of Telengana and Andhra areas the laws in operation in the Telengana region continued to remain in force by virtue of the provisions of Section 119 of the States Reorganisation Act, 1956. By Act 10 of 1958 the State of Andhra Pradesh amended Act 12 of 1952 inter alia extending that Act, to the Telengana area. This Act (Act 10 of 1958) also amended the principal Act by adding Section 19 according to which the Government could grant an exemption by means of a notification in respect of any motor vehicle running in a particular area. On November 4, 1961 a notification was issued exempting passengers, luggage and goods carried in stage carriages from payment of tax under the aforesaid Act within the Telengana area. There can be no manner of doubt that this exemption was given to the operators in the Telengana region for the reason that before the extension of the parent Act to this area no tax similar to the one levied under the parent Act was payable in that area and that this exemption was granted under a different enactment. It is apparent that for these reasons the challenge under Article 14 cannot succeed. The same is the position with regard to the tax payable by the appellants and that which the transporters having permits for inter-State routes have to pay. As has been pointed out in the affidavits filed on behalf of the State, the laws in the two States, Madras and Andhra Pradesh are different and persons having primary permits from Madras are naturally governed by the laws operating in that State. No question of discrimination can arise when taxes are being imposed under two different sets of laws in different States or geographical areas." 33. In CWP No. 4103/2017, in addition to the challenge to the impugned notification, Rule 42 of the Rules framed in 1951 is also challenged because it stipulates that the value of the vehicle would be increased by 15% annually. In CWP No. 4103/2017, in addition to the challenge to the impugned notification, Rule 42 of the Rules framed in 1951 is also challenged because it stipulates that the value of the vehicle would be increased by 15% annually. In this context, it is argued by the petitioners that unlike in the case of computation of insurance premium of the vehicles, which is made annual on diminished value, the appreciation of the value of the vehicle is factored in for the purposes of taxation. It is contended that this is not only arbitrary but also unreasonable, thus violative of Article 19(1)(g) and further it infringes Article 301 of the Constitution of India. 34. In a previous judgment of this Court in Federation of Mining Association of Rajasthan (supra), the vires of Rule 42 was upheld. The Court had then ruled that the basis for determining tax and the value of the vehicle was the load and consequently, the annual increase of 15%, cannot be characterised as arbitrary. This Court can do no better than reiterate the reasonings in Federation of Mining Association of Rajasthan(supra), wherein it was pertinently observed as follows:- "8. As regards rule 42 it was submitted that the manner in which the cost of vehicle is calculated for the purpose of computation of tax is arbitrary. It was submitted that whereas under clause (a) the cost is calculated with reference to the vehicle/chassis purchased in the financial year in which the tax due by including the elements of taxes and levies in purchase price prevailing on 1st April of the year of purchase, in the case of vehicle/chassis purchased earlier than the year in which the tax is due, it is calculated by adding the element of notional price increase at the rate of fifteen percent per annum compounded annually on the purchase price prevailing on 1st April of the year of purchase of similar type of vehicle which is arbitrary. The submission overlooks the first proviso to rule 42 which gives option to the owner of the vehicle/chassis or any person authorised by him to have the cost of his vehicle assessed "as to be the same as the cost assessed at current price of similar type of vehicle as prevailing on 1st April of the year in which the tax is due." The owner or the person authorised in that behalf may thus opt to have the cost assessed at current price of vehicle and, therefore, the grievance of the petitioner that the calculation of the cost by adding notional price increase at the rate of fifteen percent per annum, would appear to be misconceived. It is to be kept in mind that the basis of the tax is the load of the vehicle on the road and, therefore, irrespective of the year of manufacture/purchase of the vehicle, the incidence of tax would not differ." 35. Further, this Court notices that under the proviso to the Rule, the owner of the vehicle or chassis has the option to secure the assessment of the cost of the vehicle, in the same manner as the cost is assessed at the current price of a vehicle of the similar type prevailing on 1st April of the year in which the tax is due. This exercise, in the opinion of the Court, as upheld in Federation of Mining Association of Rajasthan's case (supra), minimizes the chances of anomaly in the determination of basis of the cost, which, in turn, determines the tax. 36. In the opinion of the Court, moreover, the exhaustive exercise of cost determination at current rate and also having regard to the age of the vehicle, eliminates the likely chances of a high value. Thus, the Court discerns no facial perversity or arbitrariness warranting interference. For these reasons, it is held that there is no arbitrariness or unreasonableness in the method of valuation of the vehicle, prescribed by Rule 42. 37. In view of the foregoing analysis, it is held that all these writ petitions have to fail. The impugned notification and Rule 42 are held not to be arbitrary or unreasonable; nor are they violative of Article 301 of the Constitution of India. The writ petitions are accordingly dismissed. All pending applications too are disposed of.