Dmt 1 wp6313-11 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 6313 OF 2011 WITH CIVIL APPLICATION NO. 1964 OF 2011 (For Intervention) Meru Cab Company Pvt. Ltd., ... Petitioners. V/s. State of Maharashtra & Ors. ,... Respondents. Mr. Prakash Shah with Mr. Prasad Paranjape i/by PDS Legal for Petitioners. Mr. Nitin Deshpande, AGP. for Respondent Nos. 1 to 4. Mr. Sanjay Khemkar Applicant present in person. CORAM : DR. D.Y. CHANDRACHUD & A.A.SAYED, JJ. DATE : 19TH SEPTEMBER, 2011. P.C. Dmt 2 wp6313-11 . The Petitioners are running a fleet of taxis in respect of which they have obtained endorsements from the original holders of permits issued by the Road Transport Authority under the Fleet Taxi Service Scheme, 2006. It has been specified in clause 8 (k) of the Scheme that the holder of a licence is required to pay inter alia professional tax whenever demanded by the Authority. The original holder of a permit entered into an agreement with the Petitioners under the Fleet Taxi Service Scheme. The R.T.O has endorsed the name of the Petitioners on the original permit under the Scheme. According to the Petitioners, all the arrears payable under the Maharashtra State Tax on Profession, Trades, Callings and Employments Act, 1975 have been duly paid by the Petitioners with effect from the date on which each permit was endorsed in favour of the Petitioners by the permit holder. A communication was issued to the Petitioners on 3rd September 2010 to inform all the permit holders to submit proof of payment of profession tax or to pay the profession tax leviable, if not paid earlier. The grievance of the Petitioners is that though the officers of the R.T.O. at Tardeo and Wadala have renewed the permits, the R.T.O. at Andheri is not renewing the permits on the ground that certain arrears on account of profession tax are due and payable by the holder of the permit prior to the date on which the permit was endorsed in favour of the Petitioners. In this proceeding the Petitioners have challenged the validity of the Dmt 3 wp6313-11 communication dated 3 September 2010 issued by the Deputy Commissioner, (Profession Tax), Regional Transport Office, Andheri (West) besides seeking a direction for the renewal of the applications filed by the Petitioners for permits in respect of 213 taxis. 2. Counsel states that out of 213 permits only 38 are outstanding whereas the permits of the other taxis have been renewed. From the records it appears that a circular has been issued on 11 May 2011 by the Regional Transport Officer, Mumbai (Central) clarifying that where agreements have been entered into under the Fleet Taxi Service Scheme, the permit holder would be liable to pay profession tax for the period prior to the agreement under the Scheme and that the profession tax prior to the date of the agreement should be recovered from the original permit holder. In the affidavit in reply it has been stated that under Entry 13 of Schedule I to the Act, holders of permits in respect of vehicles granted registration under the Motor Vehicles Act, 1988 which are used or adapted for use for hire or reward are liable to the payment of profession tax. In the present case, it has been stated that the Petitioners are not a permit holder but an operator within the meaning of the Scheme. The contention of the Deponent is that a permit holder has to pay profession tax in order to continue his profession every year and that unless a permit holder pays the tax, he cannot be Dmt 4 wp6313-11 permitted to continue in the profession. It appears from the affidavit in reply that the Government of Maharashtra has by a notification dated 3 November 2006 appointed the officers of the Transport Department under the Profession Tax Act for implementing Entry 13 of Schedule I. The 3rd and 4th Respondents have stated that they are in possession of the records of vehicles on the basis of the registration number but that the record in regard to the payment of profession tax prior to the notification of 2006 is not available with the office of the 3rd and the 4th Respondents. 3. The Act, as in the case of other revenue legislation, contains a provision for levy of tax in Section 3 and makes provisions for the filing of returns and for the assessment and collection of tax in Sections 6 and 7 respectively. The payment of tax is provided for in Section 8. Section 9 provides for the consequences of a failure to pay tax. Section 9 (2) provides for the payment of simple interest on the amount in default. Section 10 provides for a penalty for non-payment of tax. There is no provision in the Act by which a professional can be barred from practising his or her profession on account of a default in the payment of tax. A default attracts the consequences provided in the Act but a prohibition on practising a profession is not what the legislation has provided. Revenue collecting authorities must equally abide by the law. Dmt 5 wp6313-11 4. Under the terms of the Fleet Taxi Service Scheme, 2006 the Petitioners have assumed the obligation as a holder of the licence governed under the Scheme to pay profession tax under clause 8 (k). The Licensing Authority, in the event that there is a breach of the conditions of the licence, is empowered to take action under Clause 10 of the Scheme including for cancellation or suspension of the licence. No such action has been initiated or taken against the Petitioners. In the event that any dues remain to be paid, it is open to the Assessing Authority to pass necessary orders in accordance with law under the Act including by way of assessment and by way of penalty and interest. In so far as the Petitioners are concerned, a statement has been made before the Court by learned Counsel that all the arrears upto date from the date of endorsement of the permit in favour of the Petitioners by the R.T.O. have been paid. It is open to the R.T.O. to verify the authenticity and correctness of the statement which is made on behalf of the Petitioners on instructions. As we have already noted earlier, on 11 May 2011 a circular was issued by the R.T.O. Mumbai requiring licence holders such as the Petitioners to pay profession tax with effect from the date on which the permit holder has entered into an agreement with the Petitioners. The Court has not been informed that the circular has been withdrawn or that it has been superseded by any subsequent circular of the Authority. The Court has also been informed that all the other permits Dmt 6 wp6313-11 which have been endorsed in favour of the Petitioners have been duly renewed by the Authorities at Tardeo and Wadala but it is only the R.T.O. at Andheri (West) that has declined to do so. 5. We, accordingly direct that on the Petitioners paying all the arrears on account of profession tax, under the obligation assumed in Clause 8 (k) of the Fleet Taxi Service Scheme, 2006 with effect from the date of the endorsement of the permit in favour of the Petitioners by the R.T.O., the R.T.O. would issue a renewal of the permit in accordance with law and subject to observance of all other conditions required to be fulfilled in law. In the event that any arrears still remain due and payable and which are liable to be recovered in terms of the circular dated 11 May 2011, the R.T.O. will be at liberty to take recourse inter alia to the provisions of Sections 9 and 10 of the Act for recovery of the outstanding dues. 6. ` The Petition is accordingly disposed of. 7. In view of the intervention application, the Applicant is allowed to intervene in the petition. (A.A.SAYED, J.) (DR. D.Y. CHANDRACHUD) Dmt 7 wp6313-11