State Of West Bengal & Ors vs Mani Bhushan Kumar

9,180/- towards tax and additional tax in respect of his vehicles for plying within the State of West Bengal. On 08.10.2009 vehicle no. BR-31P 5105 of the respondent was intercepted by the Enforcement Branch of the Motor Vehicle Department at Siliguri and the driver of the vehicle was asked to produce the papers including permit and proof of payment of tax relating to the vehicle. Since the permit produced by the driver of the vehicle was not counter-signed by the State Transport Authority, West Bengal, the vehicle was seized by the officials of the Motor Vehicle Department 3 and a notice was issued to the respondent under Section 16(4)(a) & (b) of the West Bengal Motor Vehicles Tax Act, 1970 (for short `the Motor Vehicles Tax Act') to produce the papers and documents showing payment of tax and additional tax due for the vehicle and other necessary documents relating to the vehicle failing which the vehicle will be sold.

4. Aggrieved, the respondent filed Writ Petition No. 17755 (W) of 2009 before the Calcutta High Court challenging the seizure of his vehicle and praying for release of the vehicle alongwith the seized documents. The appellants herein filed a reply in the said Writ Petition contending inter alia that the temporary Stage Carriage permit granted by the State Transport Authority, Bihar, in favour of the respondent for the route Motihari in Bihar to Siliguri in West Bengal had not been counter-signed by the State Transport Authority, West Bengal, as provided in Section 88 of the Motor Vehicles Act, 1988 (for short `the Motor Vehicles Act') and hence the vehicle of the respondent was plying without a valid permit and had to be seized under Section 207 of the said Act. In the reply, the appellants also contended that in 4 the facts of the case the duration of plying has to be reckoned as 17 weeks retrospective from the date of interception of the vehicle and the respondent is liable to pay a tax at the rate applicable for a period of 17 weeks together with a fine of equal amount and therefore the total of tax and penalty payable by the respondent works out to Rs.1,13,460/- as per the assessment memo dated 15.10.2009 of the Taxing Officer, Siliguri.

5. The learned Single Judge, who heard the Writ Petition, held in his order dated 04.03.2010 that while sub-section (1) of Section 88 of the Motor Vehicles Act provides that counter-signature is absolutely necessary for a permanent permit, it will be clear from sub-section (7) of Section 88 of the Motor Vehicles Act that for a temporary permit no such counter-signature is necessary. The learned Single Judge also held that the entire tax had been paid by the respondent relying on a notification dated 13.04.2007 of the State Government. Accordingly, the learned Single Judge allowed the Writ Petition and directed the appellants to forthwith release the vehicle of the respondent and awarded a cost of Rs.10,000/- in favour of the respondent against 5 the appellants. Aggrieved by the order of the learned Single Judge, the appellants filed an appeal before the Division Bench of the Calcutta High Court and by the impugned order, the Division Bench of the High Court sustained the findings of the learned Single Judge that a temporary permit issued under Section 87 of the Motor Vehicle Act to be valid in the State of West Bengal need not be counter-signed and that the respondent has paid the tax and additional tax to the State Transport Authorities in respect of the vehicle.

payment of tax within the prescribed time.

(4) (a) On the expiry of the period of thirty days the vehicle seized and detained may, subject to the provisions of this Act, be sold in auction unless the person liable to pay tax has, within a further period of fifteen days, paid to the Taxing Officer having jurisdiction double the amount of the total tax due, including the penalty under section 11, in respect of such vehicle (hereinafter referred to as the aggregate amount).] Provided that the terms and conditions in respect of auction of a motor vehicle under this sub-

section shall be specified by order, made in this behalf, by the State Government.

(b) The sale of the vehicle seized and detained [may be effected by the Taxing Officer] within whose jurisdiction the vehicle has been seized and detained under this section, and the proceeds of sale shall be disposed of in the same manner as an arrear of land revenue."

It will be clear from the provisions of sub-sections (3) and (4) of Section 16 of the Motor Vehicles Tax Act that power is vested in the Taxing Officer to decide whether tax in respect of the vehicle has been paid and if the same has not been paid, to recover the same from sale of the vehicle, if necessary. Thus, the High Court should not have straight away come to the conclusion in the writ petition that the tax in respect of the vehicle has been paid.

14. We, therefore, set aside the impugned order of the Division Bench of the Calcutta High Court as well as the order of the learned Single Judge and direct that the appellants will continue with the proceedings against the respondent in accordance with Section 16 and other provisions of the Motor Vehicles Tax Act for determining and recovering the tax amount after giving all due opportunity to the respondent. We direct that the Bank Guarantee for Rs.1,00,000/- furnished by the respondent shall remain in force for six months and in case the concerned authority holds that the respondent is liable for any amount of tax, the appellant would be entitled to encash the Bank Guarantee for Rs.1,00,000/- furnished by the respondent and recover the tax amount within a period of six months from today. We, however, direct that in the facts of the case no penalty will be recovered from the respondent because the State Transport Authority, Bihar had granted the temporary permit for the route upto Siliguri in West Bengal, in excess of the quota fixed between the two States and the respondent had in fact applied to the State Transport 15 Authority, West Bengal for counter-signature on the temporary permit.

15. The appeal is allowed to the extent indicated above.

There shall be no order as to costs.

Civil Appeal arising out of SLP (C) NO. 11876 OF 2010: