IMG Enterprises Pvt Ltd v. State of Kerala and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE GOPINATH P.** **FRIDAY, THE 16[TH] DAY OF SEPTEMBER 2022 / 25TH BHADRA, 1944** ## **WP(C) NO. 30724 OF 2021** ## **PETITIONER:** IMG ENTERPRISES PVT LTD, #12 PAMPA LAYOUT, EXTENSION HEBBAL, BANGALORE, KARNATAKA-560 024, REPRESENTED BY AUTHORIZED REPRESENTATIVE, MR. JYOTI PRAKASH MEHRA S/O. LATE MR. YASHPAL MEHRA # 40, KRISHNASAMY NAGAR EXTENSION, NS PURAM, KUNIAMUTHUR, COIMBATORE 641 008. BY ADVS. JOLLY JOHN LIZA MEGHAN CYRIAC IRENE BABU ## **RESPONDENTS:** 1 STATE OF KERALA, REPRESENTED BY THE PRINCIPAL SECRETARY TO GOVERNMENT, TRANSPORT DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM695 001 2 TRANSPORT COMMISSIONER, TRANSPORT COMMISSIONERATE, 2ND FLOOR TRANS TOWERS, VAZHUTHACAUD, THYCAUD P.O, THIRUVANANTHAPURAM-695 014. 3 MOTOR VEHICLES INSPECTOR, RTO (ENFORCEMENT), CIVIL STATION, S FORT ROAD, KUNATHURMEDU, PALAKKAD 678 002. BY SMT. THUSHARA JAMES – SR.GOVERNMENT PLEADER THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 16.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C)No.30724/2021 2 ## **JUDGMENT** The short question that arises for consideration, in this case, is whether the petitioner could have been mulcted with liability, as in Ext.P.1, on the ground that the validity of Ext.P.3 authorization certificate of a national permit (goods) issued by the Transport Department of the Government of Karnataka had expired on 11.5.2021. Ext P.1 was issued on the premise that the vehicle of the petitioner bearing registration No. KA-50-A-1772 had been used in the State of Kerala after 11.5.2021. The petitioner contends that no liability could have been imposed as the validity of Ext.P.3 stood extended automatically till 31.10.2021 through Ext.P.4 notification issued by the Government of India in the Ministry of Road Transport & Highways. 2. Ms. Irene Babu, the learned counsel appearing for the petitioner vehemently contends that on the petitioner's goods carriage vehicle having obtained a national permit and authorization, no offence as alleged in Ext.P1 can be found against the petitioner. It is submitted that by virtue of Ext.P.4 notification, the validity of all authorizations including Ext.P.3 stood extended till 31.10.2021. She refers to the provisions of Section 88 of the Motor Vehicles Act 1988 W.P.(C)No.30724/2021 3 and Rules 86 to 90 of the Central Motor Vehicles Rules, 1989. She also placed reliance on the decision of this Court in _**P.K. Balan** v._ _**State of Kerala and others; 2004 (1) KLT 479**_ and the decision of the Madras High Court in _**M/s. Hamad Transport** v._ _**Union of India and others**_ in W.P.(MD)No.16385/2022 to contend _inter alia_ that the provisions of the Kerala Motor Vehicles Taxation Act, 1976 do not warrant imposition of tax under the said Act on the vehicle with a national permit. It is also pointed out that the imposition of penalty under Section 192A of the Motor Vehicles Act, 1988 is not warranted in the facts and circumstances of this case. 3. Smt. Thushara James, the learned senior Government Pleader appearing for the respondents contends that, on the petitioner's own showing, the validity of Ext.P.3 had expired on 11.5.2021. It is submitted that the petitioner was found using the vehicle within Kerala, on 16.10.2021, which was clearly beyond the period contemplated in Ext.P.3. It is pointed out that if the vehicle had been used within the validity of the authorization (Ext.P.3), the petitioner would not have been mulcted with any liability or penalty. It is submitted that since the use of the vehicle was admittedly beyond 11.5.2021, i.e., after the expiry of the validity of the authorization, the petitioner was clearly liable to pay the amounts demanded by way of W.P.(C)No.30724/2021 4 Ext.P.1. It is submitted that the petitioner is not entitled to refund of the amounts paid under Ext.P.2. 4. Section 88[12] of the Motor Vehicle Act, 1988 provides for the grant of a national permit in respect of goods carriages for the purpose of encouraging long-distance inter-state road transport. A national permit is defined under Explanation [c] of section 88 as a permit granted by the appropriate authority to goods carriages to operate throughout the territory of India or in such contiguous states, not being less than 4 in number, (including the state in which the permit is issued) as may be specified in such permit in accordance with the choice indicated in the application. Authorization fee is also defined under explanation [b] to section 88 as the annual fee not exceeding 1,000/- rupees which may be charged by the appropriate authority of the state to enable a motor vehicle covered by the permit referred to in sub-section 12 to be used in other states subject to payment of taxes or fees, if any, levied by the state concerned. Therefore, it can be seen that an authorization is required for enabling a motor vehicle covered by a permit referred to in Section 88[12] to be used in other states, for which an authorization fee is to be paid. W.P.(C)No.30724/2021 5 5. Section 88 (14) [a] gives power to the Central Government to make rules for carrying out the provision of section 88[12] and Section-88 (14)[b][1] provides for the authorization fee payable for the issue of a permit referred to in section 88[12]. 6. Invoking the Rule making power vested upon the Central Government under the Motor Vehicles Act, 1988, the Central Government has framed the Central Motor Vehicles Rules. Rule 86 of the Central Motor Vehicles Rules provides for the form of the application for the grant of a national permit. Similarly, Rule 87 of the Central Motor Vehicles Rules provides for the form of the application for authorization for a national permit and the manner in which the authorization has to be granted. A perusal of form 46 (form of application for grant of authorization for a national permit) contained in the Central Motor Vehicles Rules would show that the applicant has to enclose bank drafts towards payment of the authorization fee and the same is for the purpose of payment of the composite tax levied by each state. Accordingly, while submitting an application for authorization in form 46 for enabling the use of a vehicle covered by a national permit in other states, bank drafts towards payment of the authorization fee has to be submitted for payment of composite W.P.(C)No.30724/2021 6 fee/taxes in respect of each state and authorization is issued in Form 47, as prescribed under the Central Motor Vehicles Rules,1989. 7. The authorization issued in respect of the petitioner's vehicle bearing registration No. KA50.A.1772 (produced as Exhibit.P.3) shows that the same is valid upto 11-5-2022 and that a consolidated fee of Rs.16,500/- has been paid by the permit holder. Exhibit.P.3 authorization enables the permit holder to operate his vehicle all throughout the territory of India till 11-5-2022 and there is no requirement for payment of any additional tax, since he had already paid a consolidated fee of Rs16,500/- for operating throughout the territory of India. There is no provision either in the Act or Rules for payment of tax in respect of a vehicle covered by a national permit, other than the consolidated fee payable at the time of issuance of the authorization under Rule 87[2] of the Central Motor Vehicles Rules, 1989. Admittedly, the authorization issued in respect of the petitioner’s vehicle was valid till 11-5-2022 and the validity of the same was extended by Exhibit.P.4 communication, till 31-10-2021 and therefore the same includes the validity of the consolidated fee paid for taxes in respect of various states. The vehicle in question was admittedly checked on 16-10-2021, which is within the period of validity of the authorization issued in respect of the vehicle, since W.P.(C)No.30724/2021 7 Exhibit.P4 has extended the validity of the authorization which includes the validity of the composite fee paid for taxes in respect of different states. No offence can be therefore be made out against the petitioner, alleging the non-payment of tax in the state. 8. In the light of the above finding, this writ petition is allowed. The demands raised on the petitioner vide Ext.P.1 will stand quashed. Any amount paid by the petitioner vide Ext.P.2, (e-payment receipt) shall be refunded to the petitioner within a period of one month from the date of receipt of a certified copy of this judgment. Sd/- **GOPINATH.P JUDGE.** acd W.P.(C)No.30724/2021 8 ## **APPENDIX OF WP(C) 30724/2021** PETITIONER EXHIBITS Exhibit P1 THE TRUE COPY OF THE TRAFFIC CHALLAN NO. KL103326211016121127 DATED 16.10.2021 ISSUED BY RESPONDENT NO. 3. Exhibit P2 A TRUE COPY OF THE E-PAYMENT RECEIPT DATED 18.10.2021 WITH TRANSACTION ID KL18102ITI602 639. Exhibit P3 THE TRUE COPY OF THE AUTHORIZATION CERTIFICATE OF NATIONAL PERMIT WITH AUTHORIZATION NO. NP/KA/50/052020/21585 DATED 26.05.2020. Exhibit P4 A TRUE COPY OF THE NOTIFICATION RT 11036/35/2020-MVL DATED 30.09.2021 ISSUED BY THE MINISTRY OF ROAD TRANSPORT AND HIGHWAYS, MVL SECTION. Exhibit P5 THE TRUE COPY OF THE NOTICE OF PAYMENT UNDER PROTEST DATED 22.10.2021. Exhibit P6 THE TRUE COPY OF THE ACKNOWLEDGMENT DATED 22.10.2021 TO EXHIBIT P5 NOTICE WITH CORRESPONDENCE NO. 262292/2021/INWARD TC.