High Court of KeralaSingle Judge2018-02-23Petition dismissed; respondent's demand for hig...

PUTHIYAVALAPPIL SHAHUL HAMEED v. DEPUTY TAHSILDAR, KANNUR TALUK; REGIONAL TRANSPORT OFFICER, KANNUR; STATE OF KERALA

Case / Petition Number:WP(C).No. 4977 of 2018

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: P.B. SURESH KUMAR
Judgment Date: 2018-02-23
Court Decision / Holding: Writ petition dismissed; petitioner permitted to remit the additional demand in six equal monthly installments commencing from 15.03.2018.
Final Disposition: Petition dismissed; respondent's demand for higher one-time tax upheld, but petitioner allowed to pay in six monthly installments starting 15.03.2018.

Parties to the Case

Appellants / Petitioners

PUTHIYAVALAPPIL SHAHUL HAMEED, S/O. MAHMOOD, 'SHAZEEB' HOUSE, POOTHAPPARA, AZHEEKODE P.O., KANNUR-670009

Respondents

Deputy Tahsildar, Kannur Taluk, Kannur-670001
Regional Transport Officer, Kannur, Kannur District, Pin-670001
State of Kerala, represented by its Secretary to Government, Department of Taxes, Secretariat, Thiruvananthapuram-695001

Legal Representation & Advocates

Counsels for Petitioners

• Sri M. Sasindran
• Sri S. Shyam Kumar
• (Advocates for the petitioner)

Counsels for Respondents

• Sri V.K. Shamsudheen, Government Pleader

Case Synopsis & Summary

The petitioner, Puthiyavalappil Shahul Hameed, challenged a revised one-time motor vehicle tax under the Kerala Motor Vehicles Taxation Act, arguing that the amendment of 13.11.2014, which increased the one-time tax from 15% to 20% for new motor vehicles, should not apply to his vehicle since the first registration contemplated under the Act occurred at the time of temporary registration (27.09.2014). He had already paid 15% at temporary registration and contended that the subsequent rate revision should not be exigible. The Court examined Section 3(1) of the Act and its second proviso, which prescribes onetime tax at the rate in Annexure-I at the time of first registration for new vehicles, with the understanding that the taxable event is the first registration, though liability may arise earlier. Relying on two prior decisions—W.P.(C).No.8154 of 2012 and Hilal v. State of Kerala (2012(3) KLT 438)—which held that the first registration for tax purposes is the permanent registration and that temporary registration has no bearing, the Court dismissed the petition. However, it permitted the petitioner to remit the additional demand in six equal monthly installments commencing 15.03.2018. Ultimately, the writ petition was denied, but a phased payment arrangement was allowed.

Provisions of Law Cited

Kerala Motor Vehicles Taxation Act, Section 3(1)Second proviso to Section 3(1)Annexure-IAnnexure-IIProvisos to Sub-section (1) of Section 4 (fourth proviso, seventh proviso)Section 4Revenue Recovery Act (as referenced in Exhibits P7 and P8)Schedule to the Act (items 1, 2, 6, 10(iii) and 11)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contends that the first registration for tax purposes, under the second proviso to Section 3(1) of the Kerala Motor Vehicles Taxation Act, should be the permanent registration, rendering the 2014 amendment (effective 13.11.2014) inapplicable to his vehicle registered on 27.09.2014. He had already paid 15% at temporary registration and argues against payment of the higher revised rate. He relies on W.P.(C).No.8154 of 2012 and Hilal v. State of Kerala (2012(3) KLT 438) to assert that temporary registration cannot trigger the amended rate. The petitioner prays for quashing the revised demand (Ext. P4) and seeking relief of non-payment or refund if any. respondents: The respondents defend the levy under Section 3(1) and its provisos, emphasizing that the first registration for tax purposes is the act that triggers one-time tax at Annexure-I rates. They rely on the amendment and the scheme of the Act, as well as the statutory notices under the Revenue Recovery Act to justify the enhanced levy.

Contentions of Respondents

The respondents contend that the tax liability arises from the first registration event as contemplated by the second proviso to Section 3(1) of the Kerala Motor Vehicles Taxation Act, and that the amendment introduced on 13.11.2014 governs the rate at which one-time tax is calculated. They argue that the first registration is permanent and that temporary registration does not alter the tax regime. The department issued notices under the Revenue Recovery Act (P7 and P8) and asserts that the higher rate is legally due, with the Taxation Act provisions clearly prescribing the applicable rate at the time of first registration and subsequent renewals.

Cited Precedents (2)

Case Name	Citation	Treatment	Explanation
W.P.(C).No.8154 of 2012	W.P.(C).No.8154 of 2012	Positive	This decision held that the first registration contemplated under the second proviso to Section 3(1) of the Act is the permanent registration; temporary registration has no bearing.
Hilal v. State of Kerala	2012(3) KLT 438	Positive	The Hilal decision affirmed the view that the first registration for tax purposes is permanent, reinforcing the petitioner's reliance on earlier decision.

Diagnostic Tool

Beta

Does this judgment govern your specific facts?

Don't risk relying on a distinguishable precedent. Enter your facts or proposition below. We will test it against PUTHIYAVALAPPIL SHAHUL HAMEED v. DEPUTY TAHSILDAR, KANNUR TALUK; REGIONAL TRANSPORT OFFICER, KANNUR; STATE OF KERALA and instantly map out authorities that support, challenge, or govern your position.

Extracted Judgment Text

Exact text extracted from official judgment records.

**IN THE HIGH COURT OF KERALA AT ERNAKULAM** **THE HONOURABLE MR. JUSTICE P.B.SURESH KUMAR** **FRIDAY, THE 23RD DAY OF FEBRUARY 2018 / 4TH PHALGUNA, 1939** ## **PETITIONER(S)** **PUTHIYAVALAPPIL SHAHUL HAMEED, S/O. MAHMOOD, 'SHAZEEB' HOUSE, POOTHAPPARA, AZHEEKODE P.O., KANNUR-670009.** **BY ADVS.SRI.M.SASINDRAN SRI.S.SHYAM KUMAR** ## **RESPONDENT(S):** ## **1. THE DEPUTY TAHSILDAR,** **KANNUR TALUK, KANNUR-670001.** **2. THE REGIONAL TRANSPORT OFFICER, KANNUR, KANNUR DISTRICT, PIN-670001.** **3. STATE OF KERALA, REPRESENTED BY ITS SECRETARY TO GOVERNMENT, DEPARTMENT OF TAXES, SECRETARIAT, THIRUVANANTHAPURAM-695001.** **R BY SR.GOVERNMENT PLEADER SRI.V.K.SHAMSUDHEEN.** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23-02-2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **WP(C).No. 4977 of 2018 (V)** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** **EXHIBIT P1 A TRUE COPY OF THE REGISTRATION CERTIFICATE IN WHICH THE DETAILS OF TAX PAID IS ALSO INCORPORATED.** **EXHIBIT P2 A TRUE COPY OF THE NOTICE DATED 9.8.2017 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P3 A TRUE COPY OF THE REPLY DATED 24.8.2017 SUBMITTED BY THE WIFE OF THE PETITIONER ON HIS BEHALF.** **EXHIBIT P4 A TRUE COPY OF THE NOTICE DATED 25.08.2017 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER.** **EXHIBIT P5 A TRUE COPY OF THE NOTIFICATION DATED 1.1.2015. EXHIBIT P6 A TRUE COPY OF THE NOTIFICATION DATED 13.11.2014. EXHIBIT P7 A TRUE COPY OF THE NOTICE DATED 2.2.2018 ISSUED UNDER SECTION 7 OF THE REVENUE RECOVERY ACT. EXHIBIT P8 TRUE COPY OF NOTICE DATED 2.2.2018 ISSUED UNDER SECTION 34 OF THE REVENUE RECOVERY ACT.** **// true copy //** _**Sd/-**_ **PS TO JUDGE** _**Kvs/-**_ ## **P.B.SURESH KUMAR, J.** **= = = = = = = = = = = = =** ## **W.P.(C).No.4977 of 2018** **= = = = = = = = = = = = =** ## **Dated this the 23[rd] day of February, 2018** ## **J U D G M E N T** Petitioner purchased a light motor vehicle and registered the same temporarily on 27.09.2014. At the time of temporary registration of the vehicle, the petitioner was called upon to pay 15% of the purchase value of the vehicle towards the one time tax payable under the Kerala Motor Vehicles Taxation Act (the Act) and the petitioner remitted the same. After about three years, the petitioner was called upon to pay 5% of the purchase value of the vehicle more towards the one time tax payable in respect of the vehicle, in the light of the amendment brought to the relevant provision in the statute with effect from 13.11.2014. In terms of the said amendment, the rate of one time tax payable in respect of the vehicle purchased by the petitioner has been revised from 15% of the purchase price to 20% of WPC.No.4977 of 2018 2 the purchase price. The petitioner objected the additional demand made on him. Ext.P3 is the objection of the petitioner. Ext.P3 objection has now been turned down by the competent authority in terms of Ext.P4 communication. Ext.P4 communication is under challenge in the writ petition. 2. Heard the learned counsel for the petitioner as also the learned Government Pleader. 3. The fact that the vehicle of the petitioner is one falling within the classes mentioned in the second proviso to sub-section (1) of Section 3 of the Act and the fact that the petitioner is, therefore, liable to pay one time tax for the vehicle at the rate specified in Annexure-I, are not disputed by the petitioner. The case of the petitioner, on the other hand, is only that he has paid the one time tax payable in respect of the vehicle at the rate of 15% of the purchase value of the vehicle at the time of temporary registration of the vehicle itself and therefore, he cannot be called upon to pay additional tax on the basis the revision of WPC.No.4977 of 2018 3 the rate of tax introduced later with effect from 13.11.2014. Sub-section (1) of Section 3 of the Act, which is relevant in the context, reads thus: “ **Levy of tax** :- (1) Subject to the provisions of this Act, on and from the date of commencement of this Act, a tax shall be levied on every motor vehicle used or kept for use in the State, at the rate specified for such vehicle in the Schedule: Provided that no such tax shall be levied on a motor vehicle kept by a dealer in, or a manufacturer of, such vehicle, for the purpose of trade and used under the authorisation of a trade certificate granted by the registering authority: Provided further that in respect of a new motor vehicle of any of the classes specified in item numbers 1, 2, 6, 10(iii) and 11 of the Schedule to this Act, there shall be levied from the date of purchase of the vehicle onetime tax at the rate specified in Annexure-I, at the time of first registration of the vehicle and thereafter tax shall be levied at the time of renewal of such vehicle at the rate specified in the Schedule as per fourth proviso to subsection (1) of Section 4: Provided further that in respect of new motor vehicle of any of the descriptions specified in item No.1(a) of the Schedule to this Act, there shall be levied from the date of purchase of the vehicle a tax in advance for a period of five years at the rate specified in the Schedule, at the time of first registration of the vehicle, and thereafter tax shall be levied at the rate specified in the Schedule in accordance with the fourth proviso to sub-section (1) of Section 4: Provided also that in respect of new autorickshaws specified in item number 7(i)(b) of the Schedule to this Act, there shall be levied from the date of purchase of the new vehicle, a tax in advance for a period of five years at the WPC.No.4977 of 2018 4 rate specified in Annexure II, at the time of first registration of the vehicle and thereafter tax shall be levied for 5 years or for one year at the rate specified in the seventh proviso to sub-section (1) of Section 4.” Sub-section (1) of Section 3 of the Act which is a charging provision under the Act provides only that subject to the provisions of the Act, on and from the date of commencement of the Act, a tax shall be levied on every motor vehicle used or kept for use in the State, at the rate specified for such vehicle in the Schedule. The second proviso to sub-section (1) of Section 3, however, clarifies that in respect of a new motor vehicle of any of the classes specified in item numbers 1, 2, 6, 10(iii) and 11 of the Schedule to the Act, there shall be levied from the date of purchase of the vehicle one-time tax at the rate specified in Annexure-I, at the time of first registration of the vehicle. Going by the second proviso to sub-section (1) of Section 3 of the Act, the taxable event is the first registration of the vehicle, though the liability to pay tax arises in terms of the said provision from the date of purchase. It is conceded by WPC.No.4977 of 2018 5 the petitioner that he has obtained permanent registration for the vehicle only on 5.12.2014. The case of the petitioner is that the first registration contemplated under the second proviso to sub-section (1) of Section 3 of the Act in the case of the petitioner is the temporary registration obtained by him for the vehicle on 27.09.2014 and therefore, the revision of the rate of tax introduced in terms of the amendment brought into force with effect from 13.11.2014 does not apply to the vehicle of the petitioner. In W.P. (C).No.8154 of 2012, this Court took the view that the first registration provided for under the second proviso to subsection (1) of Section 3 of the Act is the permanent registration of the vehicle and the temporary registration of the vehicle has nothing to do with the same. The said view has been affirmed by the Division Bench of this Court in **Hilal v. State of Kerala** (2012(3) KLT 438). In the light of the said decisions, the writ petition is liable to be dismissed and I do so. However, in the light of the request made by WPC.No.4977 of 2018 6 the learned counsel for the petitioner, the petitioner is permitted to remit the additional demand in six equal monthly instalments commencing from 15.03.2018. _**Sd/-**_ **P.B.SURESH KUMAR, JUDGE.** _**Kvs/-**_ _**// true copy //**_