JABALPUR BUS OPERATORS ASSOCIATION Vs. UNION OF INDIA

JUDGEMENT

(1.) This order shall also govern disposal of Misc. Petition No. 979 of 1993 (Jagdish Singh v. Stale of M.P.), Misc. Petition No. 1388 of 1993 (M/s. Public Travels v. Union of India), 1562 of 1993 (M/s. Akhtari Begum v. Union of India), Misc. Petition No. 1808 of 1993 (Kanker Roadways v. State of M.P.), Misc. Petition No. 1945 of 1993 (Janki Prasad Singhal v. State of M.P.) and 1970 of 1993 (Capital Roadways v. Union of India).

(2.) The petitioners are transport operators operating their vehicles under the permits granted to them by the transport authorities of the State of Madhya Pradesh under the provisions of the Motor Vehicles Act, 1988, falling under category of Vehicles shown in Schedule-I, Clauses (iv) (d) (i) (ii) (2) of the Madhya Pradesh Motoryan Karadhan Adhiniyam, 1991.

(3.) The State Legislature enacted an Act called the Madhya Pradesh Motoryan Karadhan Adhiniyam, 1991 (Act No. 25 of 1991), as amended by Act No. 26 of 1991, which received the assent of the Governor on 21st September, 1991 and published in the M.P. Gazette (Extraordinary) dated 27/11/1991. The Madhya Pradesh Motoryan Karadhan Rules, 1991 were framed in exercise of the powers conferred under Section 24 of the Karadhan Adhiniyam, 1991 and on 11/10/1992 the Rules were amended. The Adhiniyam was brought into force to consolidate and amend the law relating to levy of tax on the motor vehicle in the State of Madhya Pradesh. The Adhiniyam of 1991 was challenged in this Court by filing writ petitions by various transport operators; one of them was registered as Misc. Petition No. 39 of 1992 and this Court by order dated 1-10-1992 upheld the constitutional validity of the provisions of the Adhiniyam, 1991, by rejecting the challenge on the ground of lack of legislative competence and violation of Articles 301 and 19(l)(g) of the Constitution of India. However, it was held by the Division Bench of this Court that the Legislature in its wisdom may fix any rate of tax, but total negation for procedure for assessment of tax is an arbitrary act which tantamounts to denial of fair procedure ordinarily available under the taxing statutes; the right to appeal provided, of the tax assessed in not effective and the procedure for refund would not cure the defect of levy of tax without assessment. The demand of tax without assessment is extraction without authority of law and hence ultra vires under Articles 14 and 19(l)(g) of the Constitution of India. The effect of the judgment in Misc. Petition No. 39 of 1992 was that although the provisions of the Adhiniyam of 1991 are intra vires, but no tax can be collected unless a fair procedure is prescribed for assessment of tax under the Adhiniyam of 1991. This is apparent from para 47 of the order of this Court wherein the respondents were restrained from recovering any tax over and above levied immediately before coming into force of Act No. 25 of 1991 and 26 of 1991. The petitioners were directed to deposit tax on their motor vehicles at the rate prevailing immediately before the commencement of Act No. 25 of 1991 and 26 of 1991. This direction was given in respect of the vehicle falling in Schedule-I, Clauses (iv) (d) (i) (ii) (2) of the M.P. Motoryan Karadhan Adhiniyam, 1991. As far as the other vehicles, by whatever name they are called, are concerned, tax was directed to be deposited at the rates mentioned in Schedule-I of Act No. 25 of 1991 as amended by Act No. 26 of 1991.