RAKESH CREDITS Vs. STATE OF KERALA

JUDGEMENT

(1.) Appeal is filed against the judgment of the learned Single Judge dismissing appellant's challenge against demand of Motor vehicle tax in respect of stage carriage financed by the appellant. The stage carriage bearing registration No. KL10/N 2905 is a 1996 model Tata Bus purchased by the 6th respondent with finance provided by the appellant. Hypothecation in favour of the appellant is endorsed in the registration certificate of the vehicle. However, on account of default in re-payment of installment of loan committed by the registered owner, appellant re-possessed the vehicle on 10-07-2003. Since registered owner committed default in payment of motor vehicle tax from 01-07-2003 onwards arrears of tax were sought to be recovered against the appellant through Ext. P4 demand followed by recovery proceedings which were challenged before the Single Judge, but without success. It is against this judgment writ appeal is filed.

(2.) We have heard counsel for the appellant and also Government Pleader appearing for respondents. Registered owner of the vehicle from whom appellant took over possession of the vehicle has not entered appearance. The contention raised by the appellant's counsel is that when registered owner is traceable recovery of motor vehicle tax arrears has to be initiated against registered owner and liability of financer or the person in possession of the vehicle arises only in the event of failure to recover the arrears of tax from the registered owner. However, Government Pleader has specifically referred Section 3(3) and Section 9(2) of Kerala Motor Vehicle Taxation Act which provide for recovery of motor vehicle tax from either the registered owner or the person in possession and control of the motor vehicle. In this case neither the registered owner nor the appellant has submitted any form-G claiming exemption under Section 5 of the Act read with Rule 10 of the Motor vehicle Taxation Rules for claiming exemption for the period for which tax is demanded.

(3.) The specific case canvassed by the appellant's counsel is that going by Section 5, form-G claiming exemption under Rule 10 has to be made by the registered owner and not by the person in possession and control of the vehicle. So much so appellant could not file form-G for claiming exemption even after re-possessing the vehicle and therefore tax should not be recovered from the appellant. Section 5 however provides for filing of G-form for claiming exemption not only by the registered owner but the person in possession or control of the vehicle. For easy reference Section 5(1) of the Motor Vehicle Taxation Act is extracted hereunder.