IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN THURSDAY, THE 24TH SEPTEMBER 2009 / 2ND ASWINA 1931 OP.No. 2393 of 2001(I) ---------------------- PETITIONER(S): --------------- M.AZEEZ, MUZHIKKAL HOUSE, VEEMBOOR, PAPPINIPARA, MANJERI. BY ADV. SRI.P.RAVINDRAN, SENIOR ADVOCATE RESPONDENT(S): --------------- R.T.O.(TAXATION), MALAPPURAM. GOVERNMENT PLEADER K.P.PRADEEP, THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 24.9.09 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: O.P.No. 2393/01. APPENDIX PETITIONER(S)' EXHIBITS P1. COPY OF THE ENDORSEMENT DTD.30.9.00 IN THE REGISTRATION. P2. COPY OF THE COMMUNICATION DTD.19.1.01. sdk+ ///True copy/// P.A. to Judge S.SIRI JAGAN, J. ================== O.P.No.2393 of 2001 ================== Dated this the 24th day of September, 2009 J U D G M E N T The petitioner is a stage carriage operator. He had a permit to ply stage carriage bearing registration No.KL-6111. The validity of the permit expired on 9.2.2000. The petitioner submitted an application for renewal of the permit in time. No orders have been passed on the same yet. The petitioner submits that in 1998 in a major motor accident, the petitioner's vehicle suffered severe damages. Consequently, the vehicle was taken off the road with effect from 1.10.1998 and garaged. Fitness certificate in respect of the vehicle also expired in the meanwhile, i.e., on 6.11.98. The petitioner was submitting G forms claiming exemption from 1.10.1998 till 30.9.2000. Exemption was being granted also. However, after 30.9.2000, since the permit was not renewed, the petitioner did not pay tax nor had he submitted G forms. The petitioner submits that he could not file G form in time since he was hospitalised and by the time he was discharged from hospital, time for submission of G forms had already expired. The petitioner, therefore, submitted, an application to the respondent seeking exemption from payment of tax or at least permission to pay tax as applicable to vehicles which are idling. The same was rejected by Ext.P2. The petitioner is challenging Ext.P2 in this original petition. O.P.2393/01 2 Although originally the petitioner sought exemption from payment of tax itself, in view of the Full Bench decisions of this Court in Gracy Vincent v. State of Kerala [2006(1) KLT 7 (F.B)] and in Regional Transport Officer v. Abdurahiman [2007 (1) KLT 613 (FB)], the petitioner would contend that even if the petitioner is not eligible for exemption from tax, since he had not submitted G forms, he is certainly entitled to pay tax at the rate prescribed in Entry 12 of the Schedule to the Kerala Motor Vehicles Taxation Act relating to motor vehicles other than those liable to tax under the other provisions of the Schedule. The argument is that till 9.2.2000, ie. the date on which the validity of the permit issued to the petitioner had expired, the petitioner was liable to pay tax under Entry 7 of the Schedule to the Act as a motor vehicle plying for hire and used for transport of passengers, in respect of which permits have been issued under the Motor Vehicles Act, 1988. After 9.2.2000 the permit had expired and although the petitioner had submitted application for renewal of the permit, the same was not granted and, therefore, the petitioner's vehicle was not covered by a valid permit. Resultantly, the petitioner's vehicle is taken out of the purview of Entry 7. The petitioner's vehicle is not covered by any of the other Entries in the Schedule except Entry 12. Consequently, accordingly toe petitioner, the petitioner is liable to pay tax on his vehicle only under Entry 12. O.P.2393/01 3 2. A counter affidavit has been filed by the respondent disputing the contentions of the petitioner. The first contention is that in so far as filing of G forms in time is mandatory for claiming exemption from payment of tax and the petitioner has not submitted G forms in time, the petitioner cannot claim exemption from tax. Regarding the second contention, the respondent would contend that since the application for regular permit was pending, the question of permitting the petitioner to pay tax under Entry 12 does not arise. It is also pointed out that in letter No.B3/11617/TC/2000 dated 10.4.2002 from the Transport Commissioner, Thiruvananthapuram, addressed to the Regional Transport Officer, Kollam, it has been clarified that a stage carriage whose permit has expired or whose permit has been surrendered would also fall within the ambit of the proviso to the Schedule of the Act and therefore, a permitless stage carriage plying for hire or reward and used for transport of passengers would be chargeable with the appropriate rate of tax specified in Entry 7 of the Schedule in view of the said proviso. Going by the said clarification, in so far as the there is nothing to show that the petitioner has not used the stage carriage during the period in question for transport of passengers, the petitioner is liable to pay tax under Entry 7 itself, is the contention raised. 3. I have considered the rival contentions in detail. O.P.2393/01 4 4. In so far as the petitioner does not dispute the applicability of the Full Bench decisions referred to above, which categorically holds that under Section 5 of the Kerala Motor Vehicles Taxation Act 1976 read with Rule 10, for claiming exemption from tax submission of G forms in time is mandatory, the petitioner cannot now claim exemption from tax in so far as admittedly the petitioner has not submitted G forms in time. However, I find considerable merit in the contentions raised by the petitioner in respect of the rate of tax applicable to the petitioner's stage carriage. Admittedly the permit for the stage carriage expired on 9.2.2000 and although the petitioner had submitted application for renewal of the permit, the respondent has not passed any orders on the application even as on today. Therefore, the petitioner's vehicle does not have a valid permit. Entry 7 of the Schedule to the Motor Vehicle Taxation Act is applicable only to motor vehicles plying for hire or reward and used for transport of passengers and in respect of which permits have been issued under the Motor Vehicles Act, 1988. Therefore, for roping in a vehicle under Entry 7, existence of a permit issued under the Motor Vehicles Act is a necessary requirement. After 9/2000 the petitioner's vehicle did not have a permit since the permit which expired on 9.2.2000 had not been renewed, that too, not because of any fault of the petitioner but because the respondent failed to pass orders on the application for O.P.2393/01 5 renewal submitted by the petitioner. In the standing instructions issued by the Motor Vehicles Department to the officers of the department, it is stated thus: “In respect of stage carriages, the liability to pay tax at stage carriage rate commences only from the date on which a permit is issued to the vehicle. Normally, there may not be any long time lag between the issue of tax endorsement and the issue of permit to a stage carriage. But, if the permit could not be issued to the stage carriage during the month of issuing the tax endorsement, the Regional Transport Officer may issue a provisional tax endorsement to the stage carriage on the basis of its unladen weight as per clause 7 of the Schedule (entry 12 of the Schedule drawn from 1.4.1997 onwards). Similar tax endorsement may be issued for idle stage carriages having no valid permit. This tax endorsement will be cancelled and a revised tax endorsement issued for payment of the additional tax payable at stage carriage rate, when a stage carriage permit is granted for the vehicle.” Apart from that, in the letter of the Transport Commissioner, dated 10.4.2002, relied by the learned Government Pleader, it is stated thus: “A Stage Carriage whose permit has expired or whose permit has been surrendered would also fall within the ambit of the above said proviso. Accordingly, a permitless Stage Carriage plying for hire or reward and used for transport of passengers would be chargeable with the appropriate rate of tax specified in item 7 of the schedule in view of the said proviso.” These provisions would certainly show that the department is also of opinion that all stage carriages in respect of which there is no valid permit, tax under Entry 7 is not payable, unless that stage carriage is plying for hire or reward and actually used for transport of passengers. The proviso referred to in the letter reads thus: “(2) in the case of motor vehicle in respect of which permit has not been issued under the Motor Vehicles Act but which has been used for transport of passengers for hire or reward, tax shall be levied at such rate O.P.2393/01 6 as is specified for similar motor vehicles in item 7 of this Schedule, as if permit had been issued for the vehicles;” Therefore, unless the petitioner's vehicle was in fact plying for hire or reward and used for transport of passengers, even though it had no valid permit, no tax is payable under Entry 7. The petitioner's vehicle is not covered under any of the other entries also except Entry 12. If the petitioner is able to show that the petitioner's vehicle was not plying for hire or reward and used for transport of passengers, the petitioner is not liable to pay tax under Entry 7, in which case, the petitioner would be liable to pay tax only under Entry 12 in so far as the petitioner's vehicle is not covered by any of the other entries in the Schedule. In that view, I quash Ext.P2 and direct the respondent to reconsider the issue after affording an opportunity to the petitioner to prove that his vehicle was not plying for hire or reward during the period in question in the light of the findings hereinabove. The original petition is disposed of as above. Sd/- sdk+ S.SIRI JAGAN, JUDGE ///True copy/// P.A. to Judge O.P.2393/01 7 S.SIRI JAGAN, J. ================== O.P.No.2393 of 2001-I ================== J U D G M E N T 24th September, 2009