IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.T.RAVIKUMAR WEDNESDAY, THE 8TH DECEMBER 2010 / 17TH AGRAHAYANA 1932 WP(C).No. 33518 of 2010(L) -------------------------- PETITIONER(S): --------------- S.N.MADHU KARTHA, S/O.T.N.NARAYANAN KARTHA, AGED 56 YEARS, NANDANAM (KARIYAMATTATH HOUSE), PULLUVAZHY P.O, PERUMBAVOOR. BY ADV. SRI.M.A.FAYAZ RESPONDENT(S): --------------- REGIONAL TRANSPORT OFFICER, MUVATTUPUZHA-686 661. GOVERNMENT PLEADER SRI.BASANT BALAJI SRI.P.M.MANOJ THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08/12/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.T.RAVIKUMAR, J. ---------------------------- W.P.(C)No.33518 of 2010 ---------------------------- Dated 8th December, 2010 JUDGMENT Whether production of Prototype Test Certificate under Rule 126B of the Central Motor Vehicles Rules, 1989 (for short `the Rules') is sine qua non for consideration of an application for the grant of a Trade Certificate under Rule 35 of the Rules is the issue posed for consideration in this writ petition. Certain other incidental questions may also crop up for consideration. These questions arise for consideration in the following factual matrix:- 2. The petitioner who is a businessman, with a view to augment his business activities, obtained a dealership of Road Rollers made by M/s. Shakti Industries. Thereupon, he started an establishment by name M/s.Gangai Enterprises at Perumbavoor. For the purpose of engaging in the said business he submitted an application for grant of Trade Certificate under Rule 35 of the Rules. The said application, was submitted in Form No.16 as enjoined under Rule 34 of the Rules. Exts.P4 and P4(a) would reveal that such an application was submitted before the respondent. Thereupon, the petitioner was served with Ext.P5. As per Ext.P5, the respondent required the petitioner to produce the copy of Prototype approval certificate from the authorized testing WP(C).No.33518/2010 2 agency obtained by the manufacturer or any order of exemption from the Central Motor Vehicles Rule 126B granted by the competent authority for verification and disposal of the application. It is challenging Ext.P5 that this writ petition has been filed. 2. Grant or renewal of a trade certificate is governed by the provisions under Rule 35 of the Rules. It is submitted that a scrutiny of Rule 35 would reveal that the scope of enquiry consideration under Rule 35 is only for the purpose of satisfying whether the applicant is a bona fide dealer or not. It is further submitted that for the said purpose the registering authority could definitely require the applicant to produce necessary materials besides conducting an inspection of the intended place of business for arriving at such satisfaction. In this case, admittedly, on receipt of the applications from the petitioner such an inspection was conducted. Apparently, there is no objection with respect to the place of business. So also, evidently, there is no case for the respondent that the petitioner had not obtained any authorization from the manufacturer. Still, the respondent is declining to grant trade certificate only on the ground that the petitioner has not produced the prototype test certificate in terms of Rule 126B of the Rules obtained by the manufacturer. According to the petitioner, for the purpose of taking WP(C).No.33518/2010 3 a decision on an application submitted under Rule 35 of the Rules those matters are totally irrelevant and therefore, cannot be raised as a reason for denying and delaying issuance of trade certificate. 3. A counter affidavit has been filed in this writ petition by the respondent. The essence of the contentions thereunder is that the combined effect of section 39 of the Motor Vehicles Act, 1988 (for short `the Act') and Rules 35, 40, 41 & 42 of the Rules, makes it incumbent on an applicant for a trade certificate under Rule 35 to produce the prototype test certificate issued under Rule 126B of the Rules in order to prove his bona fides. Therefore, the question is whether such insistence for production of prototype test certificate for consideration of an application for trade certificate is sustainable. In view of the rival contentions it is relevant to refer to the relevant provisions of law on the subject. Section 39 of the Act reads thus:- “39. Necessity for registration:- No person shall drive any motor vehicle and no owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place unless the vehicle is registered in accordance with this Chapter and the certificate of registration of the vehicle has not been suspended or cancelled and the vehicle carries a registration mark displayed in the prescribed manner; Provided that nothing in this section shall apply to a motor vehicle in possession of a dealer subject to WP(C).No.33518/2010 4 such conditions as may be prescribed by the Central Government.” Section 39 thus enjoins that no person shall drive any motor vehicle and no owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place unless the said vehicle is registered. Rule 41 of the Rules deals with the purpose for which motor vehicle with trade certificate may be used. It virtually enables the holder of a trade certificate to use the vehicle in public place under the said certificate only for the purposes specifically enumerated thereunder as (a) to (h). Rule 41 reads thus:- “41. Purposes for which motor vehicle with trade certificate may be used:- The holder of a trade certificate shall not use any vehicle in a public place under that certificate for any purpose other than the following:- (a) for test, by or on behalf of the holder of a trade certificate during the course of, or after completion of, construction or repair; or (b) for proceeding to or returning from a weigh bridge for or after weighment, or to and from any place for its registration; or (c) for a reasonable trial or demonstration by or for the benefit of prospective purchaser and for proceeding to or returning from the place where such person intends to keep it; or (d) for proceeding to or returning from the premises of the dealer of the dealer or of purchase of any WP(C).No.33518/2010 5 other dealer for the purpose of delivery; or (e) for proceeding to or returning from a workshop with the objective of fitting a body to the vehicle or painting or for repairs; or (f) for proceeding to and returning from airport, railway station, wharf for or after being transported; or (g) for proceeding to or returning from an exhibition of motor vehicles or any place at which the vehicle is to be or has been offered for sale; or (h) for removing the vehicle after it has been taken possession of by or on behalf of the financier due to any default on the part of the other party under the provisions of an agreement, of hire-purchase, lease or hypothecation.” Rule 42 provides that no holder of a trade certificate shall deliver a motor vehicle to a purchaser without registration, whether temporary or permanent. In short, the impact of section 39 and Rules 41 and 42 would virtually prevent a holder of a trade certificate from delivering a motor vehicle to a purchaser without registration either temporary or permanent. The learned Government Pleader submitted that in view of the said legal position a failure on the part of an applicant for a trade certificate to produce the prototype test certificate contemplated under Rule 126B might result in delivery of a vehicle to a purchaser without registration and in which event it would put the concerned purchaser in WP(C).No.33518/2010 6 precarious situation. No doubt, in case holder of a trade certificate delivers a motor vehicle to a purchaser without registration either temporary or permanent, it would result in violation of the provisions under section 39 of the Act and would, definitely, invite the inevitable consequences, such as making the holder of the trade certificate liable for violation of the provisions under the Act and may also result in cancellation of the registration under Rule 44 of the Rules. In short, in violation of the provisions of section 39 of the Act and Rule 43 of the Rules would definitely entail the consequences contemplated under Rule 44. In other words, it can be seen that the consequence of violation of any of the provisions under section 39 and Rule 43 has been envisaged and dealt with under Rule 44 of the Rules. 4. Rule 126B of the Rules also assume relevance in this context. It reads thus:- “126B Prototype of every construction equipment vehicle to be subject to test. (1) On and from the date of commencement of the Central Motor Vehicle (6th Amendment) Rules, 2000, every manufacturer of construction equipment vehicle shall submit the prototype of the construction equipment vehicle to be manufactured by him for test by any of the agencies referred to in rule 126 for granting a certificate by that agency as to the compliance of provisions of the Act and these rules. WP(C).No.33518/2010 7 (2) The testing agencies referred to in rule 126 shall in accordance with the procedure laid down by the Central Government conduct tests on vehicles drawn from the production line of the manufacturer to verify whether the vehicles conform to the provisions of the Act, or rules or orders issued thereunder.” A scanning of Rule 126B of the Rules would undoubtedly reveal that it cast a duty on every manufacturer of construction equipment vehicle to submit the prototype of the construction equipment vehicle to be manufactured by him for test by any of the agencies referred to in Rule 126 for granting a certificate by that agency as to the compliance of provisions of the Act and the Rules. Evidently, the manufacturer of a vehicle is duty bound to submit the prototype of the construction equipment vehicle to be manufactured for test by any of the agencies referred to in Rule 126 for granting a certificate. Thus, it can be seen that a prototype test certificate contemplated under Rule 126B will be granted by the agencies referred to in Rule 126 of the Rules to a manufacturer only if the concerned manufacturer submits the prototype of the construction equipment vehicle to the said agent. The expression `prototype of the construction equipment vehicle to be manufactured' would definitely suggest that even prior to the construction of the vehicle WP(C).No.33518/2010 8 commercially it is incumbent on every manufacturer of construction equipment vehicle to submit the prototype of the construction equipment vehicle to be manufactured. Therefore, whenever a vehicle is manufactured commercially the inevitable conclusion is that the manufacturer has constructed the equipment vehicle only after getting the mandatory certificate from the concerned agency referred to under Rule 126. In other words, without obtaining such a prototype test certificate as enjoined under Rule 126B it would not be possible for a manufacturer even to construct an equipment vehicle. Necessarily, it is up to the concerned manufacturer to obtain the certificate contemplated under Rule 126B and then and then only the concerned manufacturer would be able to construct an equipment vehicle. In case Rule 126B is violated, the competent authority can take action only against the concerned manufacturer. A perusal of the provisions extracted and discussed above would undoubtedly reveal that there is nothing under Rule 35 of the Rules which makes it mandatory for an applicant for a trade certificate to produce the prototype test certificate contemplated under Rule 126B before the registering authority as a pre-condition for consideration of his application for trade certificate in order to avert apprehension in the mind of the registering authority of a possible WP(C).No.33518/2010 9 violation of section 39. At any rate, when a vehicle is produced before the registering authority for registration such authority could verify all those aspects. The relevant provisions as extracted above would reveal that sufficient safeguards have been provided under the relevant rules to prevent violation of section 39 of the Act and, in case of violation of such provisions consequences have also been specifically given under the relevant provisions. At any rate, the scope of power for consideration of an application under Rule 35 of the Rules is only for the purpose of arriving at a satisfaction as to whether the applicant is a bona fide dealer. Beyond its scope as contemplated under Rule 35 the registering authority to insist for production of prototype test certificate which must be in the possession of the manufacturer, for the purpose of deciding whether an applicant should be granted with a trade certificate. On consideration of the relevant provisions extracted above, I am of the view that insisting production of a prototype test certificate under Rule 126B of the Rules by an applicant for a trade certificate as a pre- condition for consideration of his application for trade certificate is not contemplated or envisaged under Rule 35. Therefore, according to me, for the purpose of granting or renewing trade certificate production of the certificate contemplated under Rule 126B is not necessary and it WP(C).No.33518/2010 10 cannot be insisted as a pre-condition for consideration of application for trade certificate. Therefore, Ext.P5 is liable to be set aside. Accordingly, it is set aside. The respondent is directed to consider the application submitted by the petitioner for trade certificate strictly in accordance with the provisions under Rule 35 of the Rules. This writ petition is disposed of accordingly. Sd/- C.T.RAVIKUMAR Judge TKS // True copy // P.S. to Judge