Case: Jagir Singh and Others Etc Vs. State of Bihar and Another Etc

In all these petitions the petitioners are all holders of permit in respect of public service motor vehicles.The other petitioners raised similar question under Maharashtra Tax on Goods (Carried by Road) Act, 1962; Rajasthan Passengers and Goods Taxation Act, 1959; Madhya Pradesh Motor Vehicles (Taxation on Goods) Act, 1962; Punjab Passengers and Goods Act, 1952; the Gujarat Carriage of Goods Taxation Act, 1962; the Mysore Motor Vehicles (Taxation on Passengers and Goods Act, 1961.3. Reference may be made to the Bihar Act as typical of all the cases covered by these petitions. The pattern of all the Acts is similar.

Court's reasoning:
These provisions indicate that the tax is payable by the owner, returns are to be furnished by the owner, the assessment is of the owner, the liability to pay is of the owner and if the owner fails to pay the money persons who are liable to pay money or owe money to the owner can be directed to pay to the Government.The definition of "owner" repels the interpretation submitted by the petitioners that the definition means not only the owner who is the permit holder but also a booking agency who may be in charge of the vehicle without being a permit holder. The entire accent in the definition of owner is on the holder of a permit in respect of the public service motor vehicle. It is the permit which entitles the holder to ply the vehicle. It is because the vehicle is being plied that the passengers and consignors of goods carried by that vehicle become liable to pay not only fare and freight to the owner but also tax thereon to the owner. The words "or any person for the time being in charge of such vehicle or responsible for the management of the place of business of such owner" indicate that the permit holder will include any person who is in charge of such vehicle of the permit holder or any person who is responsible for the management of the place of business of such owner. The owner cannot escape the liability by stating that any person is for the time being in charge of such vehicles, and, therefore, such person is the owner and not the permitperson who allows his vehicle to be used for the purpose is the permit holder, and, therefore, the liability to pay tax attaches to the permit holder as the owner of theplea that no machinery has been provided enabling the owner to collect or recover the tax from the owner of the goods is unacceptable. Once it is found that the legislature levies tax on passengers and goods carried by public service motor vehicle it becomes responsibility of the owner of the vehicle not to permit the vehicle to be used until the tax is paid. If the permit holder lets out the vehicle to any person on hire it is a matter of internal arrangement between the owner who is the permit holder and the person who is allowed by the permit holder to hire the vehicle to collect tax in order to enable the owner to discharge the liability. If the owner does not make adequate provision in that behalf the owner cannot escape liability by pleading that the hirer of the vehicle is liable to pay tax and the owner is not liable. The intention of these Acts is made clear if reference is made to other similar Acts. The Mysore Act speaks of "operator" meaning any person whose name is entered in the permit as the holder thereof. The Mysore Act speaks of tax being levied and collected on goods carried by stage carriages and further provides that if the operator collects from the passengers fares and freights inclusive of the tax the operator shall pay to the State Government on account of the tax one eleventh of the total amount of fares and freights, inclusive of tax collected by him from theBihar Act prescribes Rules made under the Bihar Act. The Bihar Act and Rules thereunder define agent to mean a person authorised in writing by owner to appear on his behalf before a prescribed authority. An agent under the Bihar Act is only one authorised by the owner to appear before a prescribed authority for different purposes mentioned in the Rules. The Bihar Act and the Rules do not recognise any agency in the matter of tax on fares and freights payable to the owner of the public service vehicle. The agents under public Carrier Rules are licensed to do the special task of collecting, forwarding and distributing goods carried by public carriers. They charge fees for such service and they have special responsibility and liability under terms of agency. These agents are not owners of public service vehicles. The fact that these licensed agents have to furnish the operators with correct figures of freight receivable by them shows not only that they are accountable to the owners or operators but also that licensed agents are not the owners or operators.The Motor Vehicles Act, 1939 in sections 54, 55 and 56 deal with applications for public carriers permit, procedure in considering application for public carriers permit and grant of public carriers permit. Section 59 ofthe Motor Vehicles Act, 1939 states that save as provided in section 61, a permit shall not be transferable from one person to another except with the permission of the transport authority which granted the permit and shall not without such permission operate to confer on any person to whom a vehicle covered by the permit is transferred any right to use that vehicle in the manner authorised by the permit. Section 61 speaks of transfer of permit on the death of the holder. Therefore, these provisions inthe Motor Vehicles Act, 1939 indicate that a permit cannot bepermit holder is the owner within the definition of the "owner" in the Bihar Act and other Acts and is also the "operator" within the meaning of the word "operator" in other Acts to which reference has been made. The liability to pay tax is of the permit holder in all cases.