KERALA TRANSPORT COMPANY Vs. REGIONAL TRANSPORT OFFICER

JUDGEMENT

(1.) The Writ Appeals are directed against the judgment of the learned Single Judge in W.P.(C) Nos.15955/2012 and 15143/2014. Both of which were dismissed vide common judgment dated 21.12.2017. The petitioner, in both appeals, is the Kerala Transport Company (KTC) and W.P.(C) No.15725/2012, which too was heard along with the two Writs, was filed by Bharatiya Vidya Bhavan (BVB), a Trust which runs educational institutions, for which the KTC is running the buses, challenging the demand for tax raised by the respondents denying the petitioner's benefit of reduced rate of tax applicable to the vehicles owned by educational institutions, used solely for the purpose of transporting of students and staff.

(2.) The KTC is a company which operates contract carriages as well as stage carriages. However, contract carriages and stage carriages, aged more than 15 years, had to be taken off the route. KTC had a large number of buses, for running of which, large number of employees were also employed in the company. There was no embargo as per the law for more than 15 year old vehicles plying as educational institution vehicles for transporting students. Hence, the KTC transferred some of their buses to BVB on condition that the vehicles would be operated and managed by the KTC on payment of Rs. 1400/- per day by the BVB. According to the appellant, the transfer was effected without any sale consideration as part of their social obligation. Transportation fee was collected by the BVB from the students and the daily amount as agreed was paid to the KTC. The mutual agreement between the KTC and BVB was termed as "transfer and management of operation of buses" (TMOB agreement). As per the registration certificate pertaining to the buses, BVB is the registered owner. Even though the buses were all being operated and managed by the KTC, tax at a reduced rate was being levied for the vehicles, being the vehicles belonging to the educational institution. An "educational institution bus" is defined under Section 2(11) of the Motor Vehicles Act as thus:-

(3.) The two conditions required for a vehicle to be termed as an 'educational institution bus' are, first that it should be owned by an educational institution, and secondly, that it should be used solely for the purpose of use for the students or the staff of the educational institution in connection with any of its activities. Only the vehicles plied with these two requirements would be entitled to reduced rate of tax applicable to educational institutions.