AUTOMOTIVE MANUFACTURERS (P.) LTD. v. GOVT. OF A.P. (Mitter, J.)

593 **A** **B** #### c **D** E F G **H** _Andhra Pradesh· Motor Ve/licks Taxation_ _Act_ (5 _of_ 1963 _)-Ss._ 3, 9 _and item_ 4 _of Notification under_ _s._ _9-Levy of tax_ _on_ _chassis_ _used_ _on_ _road--Chassis need not_ _have_ _body attached to it before it_ _can_ _be "used"_ _'Within_ _meaning_ _qf s._ _3-Exemption under item_ 4 _limited_ _to_ _journey_ _of_ _: chassis_ _for_ _the express purpose_ _of body being_ attac~d _to it._ Section 3 of the Andhra Pradesh Motor Vehicles Taxation Act (5 of 1963) authorised levy of tax on motor vehicles "used or kept in use in a public place in the State". Item 4 in the table of the notification issued under s. 9 of the Act exempted from the tax "any chassis of motor vehicle when driven to any place in order that a body may be attached it." The Automotive Manufacturers (P) Ltd. in the State of Andhr.i Pra· desh, were dealers, among other things, in chassis received by it from manufacturers outside the State. The chassis were driven by transport contractors of the manufacturers themselves under temponuy certificate of registration under the Motor Vehicles Act and delivered tn the appellant in the State of Andhra Pradesh. The Ashok Leyland Ltd. transported motor chassis by road from their factory in Madras tn dealers in various parts of India. These chassis were . driven through the State of Andhra Pradesh either for delivery there or in other States of India. The Automoth'e Manufac;turers and the Ashok Leyland challenged the imposition of tax under the Act.. The High Court dismissed the petitions. In appeals to this Court it was contended that (i) se4ion 3 of the Act was not applicable, because, there could be no =r or keeping for use of the chassis of a motor vehicle as a motor vehicle unless a body was attached to it; (ii) **as** **the** **ch'!lssis** **v."ere** **invariably driven to their respecJive destination, in** order that bodies may be attached to them, they came directly under the notification of exemption issued by the State Government; and (iii) the impugned levv operated as an impediment to free trade and commerce in violation of Art. 301 of the Constitution. Dismissing tile appeals. HELD : (i) It is not necessary for a chassis to have a body attached to it before it can be used within the meaning of the Act, inasmuch as, it can be used by the man who drives it. and such use of it on public roads would be enough to attract the levy. L596 DJ (ii) Item 4 in the table of the notification limits the exemption from the tax to the journey of the chassis for the express purpose of body being attached to it. The Automotive Manufacturers, being dealers; could and probably did deal with or dispose of the chassis as such. Further, it was not the case of the appellant that the chassis were coming from outside the State for the purpose of having bodies attached to them at the workshop of the appellant. So far· as Ashok Leyland was concerned the chassis v.ere being driven along the roads of Andhra Pradesh for disposal at the journey's end and it would be for the purchaser at the destination to have a body fixed to **AUTOMOTIVE** **MANUFACTURERS** **(P)** **LTD.** **ETC.** ##### _v._ **GOVT.** **OF** **ANDHRA** **PRADESH** **AND** **ORS.** **ETC.** _November_ 25, 1971 [S. M. Snoo, C.J., J. M. SHELAT, I. D. DUA AND ##### 0. K. MITTER, JJ.] 594 SUPREME COURT Rl!PORTS [1972] 2 s.c.R. the chassis according to bis own need and on the specification given by him. Merely because bodies were going to be attached by the ultimate purchasers it could not be said that the running of the chassis on the roads of Andhra Pradesh would attract exemption under item ( 4) ol the notifi· cation. [597 C-E) [The contention that there was no previous sanction of the President in respect of the bill as envisaged by Art. 304 ( b) was not allowed _to_ be raised inasmuch as it was not urged in writ petitions. Therefore, the ' Court did not examine the merits of the contentions urged in this regard.) CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 2180 #### to 2182 ot 1968. Appeals by Special Leave from the judgment and order dated October 6, 1967 of the Andhra Pradesh High Court in Writ Petitions Nos. 1456 of 1965, 376 and 2006 Qf 1966. _M._ _C._ _Chagla,_ _P._ _Ramachandra Rao_ and _B. R. Agarwala,_ for the appellants (in all the appeals). _P._ _Ram Reddy_ and _A. V._ _V._ _Nair,_ for the respondeints (in all the appeals) . The Judgment of the Comt was delivered by Mitter, J.-These appeals are directed against the imposition of taxes under the Andhra Pradesh Motor Vehicles Taxation Act (V of 1963). The appellant in the first two appeals is the Automotive Manufacturers (P.) Ltd., a dealer, among other automobile equipment, of motor chassis, motor vehicles etc. received by it from manufacturers outside the State of Andhra Pradesh. The first appeal arises out of a writ petition against the levy in respect of motor chassis delivered to it by Ashok Leyland Ltld. of Madras. These chassis are said to be driven by transport contractors of the manufacturers themselves under temporary certificates of registration under the Motor Vehicles Act and delivered to the appellant at Secunderabad. The second appeal by the same appellant arises out of a writ petition chellenging the levy on jeeps, jeep truck chassis, jeep station wagons of the manufacture of Mahf:ndra & Mahindra Ltd. of Bombay, besides pick-up vans, scooters etc. from Bajaj Auto Ltd. of Poona. The scooters are carried to Secunderabad in lorries. The appellants in Civil Appeal No. 2182 of 1968 are Ashok Leyland Ltd. Madras who transport motor chassis by road from their factory at Ennore to dealers in various parts of India, State Transport Undertakings etc. According to their writ petition, these chassis have to traverse long distances in the State of Andhra Pradesh every month destined for delivery not only in the said State but also ~yond the same. These chassis are driven from Ennore to their respective destinations' in the several States under temporary certificates of registration obtained from the A B ### c D E F G H ; B D E AUTOMOTIVE MFC. LTD. _v._ GOVT. OF A.P. _(Mitter,_ _J.)_ 595 Madras State on payment of requisite tax in that behalf, such certificates of registration under s. 28 of the Motor Vehicles Act bt'ling effective throughout India. The appellants' case is that the levy is illegal and unconstitutional. The grounds urged in the writ petitions filed in the High Court _inter_ _alia_ are as follows : 1. S. 3 of the Act only authorises a levy of tax on a motor vehicles "used or kept for use in a public place in the State". There can be no user or keepin_g,for use of the chassis of a motor vehicle as a motor vehicle unless a body is attached to it. In the case of vehicles other than chassis such user or keeping for use in a public place can only take place when they are put to the required user or kept for use by the customers for whom the vehicles are transported in the manner contemplated by the Motor Vehicles Act. 2. S. 9 of the Act exempts from payment of tax chassis of a motor vehicle "driven to another place in order that a body may ##### be attached to it". As the chassis are invariably driven t.o their respe·~tive destinatio)ls in order that bodies may be attached to them, they come directly under the notification of exemption issued by the State Government. 3. As the chassis or the vehicles are covered by temporary certificates of registration taken out by the manufacturers entitling transportation throughout the territory of India, the impugned levy operates as an impediment to the free trade and commerce of the petitioners in violation of Art. 301 of the Constitution. The High Court turned down all the contentions. Hence the appeals. F . Before this Court Mr. Chagla for the appellants limited his first and second contentions to the cases of chassis only. His first con• tention was that s. 3 of the Act was not applicable to the appellants. Sub-s. (I) of that section runs as follows : G H "The Government may, by notification from time to ##### time direct that a tax shall be levied on every motor vehicle used or kept for use. in a public place in the State." Under snb-s. (2) of s. 3 the notification issued under sub-s. (1) is to specify the class of motor vehicles on which, the rates for the periods at which and the date from which the tax shall be levied. A motor vehicle has not been defined in this Act but under s. 2(j) of the Act it is to have the same meaning as is assigned to it in the Motor Vehicles Act. Under s. 2(18) of the last mentioned Act, "a motor vehicle means any mechanically propelled vehicle adapt 596 SUPREME COURT REPORT.S [1972]2 S.C.R. ed for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails-or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises." The argument of learned counsel was that a chassis as such could neither be used no~ kej?b for use in a public place before a b(ldy was fitted to it and so long as the said step was not taken, the question of levy of tax unqer the Act would not arise. We were referred to the different meanings of the word "use" in the Oxford Dictionary ~ome of which are as follows : "To make use of as a means or instrument; To employ for a profitable end;" A B ## c In ous/view, it is not necessary for a chassis to have a body attached to it before it can be used within the meaning of the Act inasmuch as it can be used by the man who drives it and such use of it on -. 0 public roads would be enough to attract the levy. Ordinarily chassis have bodies attached to them for commerdally profitable use but even without a body a chassis can be used and is actually used when it is taken over public roads. The second submission was that the appellants qualified for . exemption under the Government notification under s. 9 of the E Act. SectiOlll 9 _inter_ _alia_ provides : " _(_ 1) The Government may, by notification( a) grant an exemption, make a reduction in the rate or order other modification not mvolving an enhancement in the rate, of tax payable- p (i) by any person or class of persons; or (ii) in respect of any motor vehicle or class of motor vehic~s or motor vehicles running in any particular area; ##### xx xx xx." The notification issued ran as follows : "In exercise of the powers conferred by sub-section (1) of section 9 of the Andhra Pradesh Motor Vehicles Taxation Act, 1963 (Andhra Pradesh Act _5_ of 1963), the Governor of Andhra Pradesh hereby grants exemp~ tion of the tax payable in respect of motor vehicles speci.· fied in column (1) of the Table below subject to the conditions, if any, specified in column (2) thereof'. G H A B #### c D E F G H AUTOMOTIVE MFC. LTD. _v._ GOVT. OF A.P. _(Mitter,!.)_ 597 Item (4) of the table reads: "Any chassis of a motor vehicle" the condition for exemption bdng : "When driven to any place in order that a body may be attached to it." It was argued that as the use of a chassis would be meaningless unless a body is attached to it and all chassis, as a matter of fact, have to have bodies atta.ched to them, the driving of the chassis on the road without a body would qualify for exemption under the above notification. We find ourselves unable to accept this view. Item (4) .in the table of the above notification limits the exemption from the tax to the journey of the chassis for the express purpose of a body being attached to it· The Automotive Manufacturers being dealers can and do probably deal with or dispose of the chassis as such. There is no allegation in any of the two writ petitions tiled by these appellants that the chassis were coming from Madras or Bombay for the purpose of having bodies attached to them at the workshop of the appellant. In so far as Ashok Leyland Ltd. is concerned, it is their positive case that the chassis were being driven through the State of Andhra Pradesh either for delivery there or in other States of India. They were certainly being driven along the roads of Ancihra Pradesh for disposal at the journey's end and it would be for the purchaser at the destination to have a body fixed to the chassis according to his own need and on the specification given by him. Merely because bodies were going to be attached by the ultimate purchasers, it cannot be said that the running of the chassis on the roads of Andhra Pradesh would attract exemption under item (4) of the notification. The last point urged by counsel was that inasmuch as registration of a vehicle in any State under s. 28 of the Motor Vehicles Act is to be effective throughout India any tax by a State on motor vehicles be they merely chassis or otherwise would run counter to Art. 301 of the Constitution according tb which trade, commerce and intercourse throughout the territory of India is to be free subject to the other provisions of Part XIII. Under Art. 304(b) however it is open to the Legislative of a State to impose such reasonable restrictions on the freedom of trade, commerce or int~course with or within that State as may be required in the public interest. This again is subeject to the proviso that no Bill or amendment for the purpose of the said cl. (b) is to be introduced in the State Legislature withput the previous sanction of the President. Learned counsel wanted to urge that the impost was not saved by Art. 304(b) _inter alia,_ on the ground that there was no previous sanction of the President in respe_ct of the Bill as envisaged by Art. 304(b ). We did not allow counsel to press this point inasmuch as it had 598 SUPREME COURT REPORTS [1972]2 S.C.R. oot been urged in the writ petition and we hereby make it clear that we ai·e not examini!lg the merits of the contention urged by counsel in this regard and it will be open to his clients, if .so advised, to urge it in any future proceedings they may choose to take. These appeals were originally heard by a Bench of five Judges including S. C. Roy, J. ~ho expired a few days back. The above judgment wa:; concurred in by our late colleague. We however gave a 'further hearing to the parties at which nothing was addressed to us to make ns change our opinion already formed. In the result, the appeals fail and are dismissed with costs. One :.et of costs including hearing fee. fC.B.N. _Appeals dismissed._ A ll