IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) SATURDAY, THE NINETEENTH DAY OF APRIL TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE B.PRAKASH RAO And THE HON'BLE MR JUSTICE C.Y.SOMAYAJULU WRIT PETITION NO.6364 of 1997 Between: M/s Jayasree Educational Society, Rep. by its Chairman, K. Srinivas. Karimnagar. ...PETITIONER AND 1 The Licensing Officer, Karimnagar. 2 The Assistant Motor Vehicles Inspector, Huzurabad, Karimnagar District. ...RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to issue a Writ or writs, order or direction, more particularly Writ of Mandamus - 1) declaring the action of the respondent authorities in issuing demand notice dt. 18.12.96 in No. 6077/A1/96 as illegal, arbitrary, unreasonable and violative of Art. 14 of the Constitution of India. 2) Quash the proceedings dt. 18.12.96 in No. 6077/A1/96 on the file of the first respondent, award costs and pass such other or further orders as are deemed fit and proper in the circumstances of the case. Counsel for the Petitioner: MR.A.SUDERSHAN REDDY Counsel for the Respondents: GP FOR TRANSPORT The Court made the following: THE HON'BLE MR JUSTICE B.PRAKASH RAO And THE HON'BLE MR JUSTICE C.Y.SOMAYAJULU WRIT PETITION NO.6364 of 1997 ORDER: (Per the Hon’ble Mr Justice B.Prakash Rao) The petitioner, which is an educational society, files this Writ Petition, inter alia, seeking to assail the correctness of the demand notice dated 18.12.1996 in No.6077/A1/96 issued by the first respondent demanding the petitioner to pay the tax and penalty and also to assail the entire proceedings of the even date. The contention of the petitioner is that when the school Bus bearing No.AP 15 T 3025 was checked on 23.04.1996 near Kothagudem, it was found that the vehicle was plying without permit as contract carriage and without payment of tax besides other irregularities. In reply, it was contended on behalf of the petitioner that the said vehicle was being used by the staff of the institution for the purpose of attending a marriage at one of their staff members’ place and therefore, it is only a casual trip. As such the question of imposition of the said tax and penalty is not sustainable. Further, reliance is placed on the decision of the Division Bench of this Court in S.V.Rao v. Joint R.t.O., Vijayawada[1], wherein considering the provisions of Andhra Pradesh Motor Vehicles Taxation Act, 1963 it was held that even a casual use of a tourist-carriage as a stage-carriage is liable to additional tax when vehicle is found to be so used but order of penalty without prior demand of tax is liable to be set aside. Hence, the Writ Petition. The main contention urged on behalf of the petitioner is to the effect that no doubt the vehicle has to be given for the purpose of carrying students. However, such use, which is a casual one by the staff members for the institution itself for attending a marriage, would not amount to any violation nor attract any penalty, much less tax. These submissions are sought to be repelled on behalf of the respondents denying the above said contentions. Having considered the submissions made on either side and on perusal of the material available on record, the point that arises for consideration is whether under the facts and circumstances, the petitioner can be held liable for payment of tax and penalty. There is no dispute of the fact that the bus belongs to the petitioner and at the time of check, the bus was being used by the staff members to attend a marriage at one of the staff members’ place and therefore, alleging that the said vehicle is virtually being used as a contract carriage, the respondents-authorities have seized the same and initiated proceedings under the provisions of the Andhra Pradesh Motor Vehicles Taxation Rules. After issuance of show cause notice and considering the explanation, they ultimately issued demand notice dated 18.12.2006, where under a total amount of Rs.1,07,100/- (Rupees one lakh seven thousand one hundred only) was being demanded, which shows Rs.53,550/- (Rupees fifty three thousand five hundred and fifty only) towards tax and Rs.53,550/- (Rupees fifty three thousand five hundred and fifty only) towards penalty. Thus, there being no serious dispute as such by the petitioner being the owner of the said vehicle and there being no allegation coming forth from the respondents’ side to the effect that the petitioner is using the said vehicle all along or at another point of time as contract carriage regularly or found using the said vehicle at any time earlier, this occasional use by the staff members of the petitioner would not amount to any regular use of the vehicle as contract carriage but only a casual one as pointed out by the decision of the Division Bench of this Court in S.V.Rao v. Joint R.t.O., Vijayawada (1 supra). In the said decision, this Court has held that such casual carriage would only attract tax but not the penalty. We do not find any reason to come to any different conclusion with the said finding and we hold that the petitioner is liable for payment of tax but not the penalty. Accordingly, the Writ Petition is allowed in part setting aside the demand towards penalty while confirming the demand towards tax. As per the interim order dated 29.03.1997 in W.P.M.P.No.7618 of 1997, the petitioner has paid half of the demanded amount for grant of stay and therefore, no further amount need be deposited. Any how, it is for the authorities to verify the same and in the event if any further tax is found due, the same shall be paid by the petitioner. No costs. _________________ (B.PRAKASH RAO, J) __________________ (C.Y.SOMAYAJULU, J) 19th April 2008 RRB [1] AIR 1971 AP 186