INDUSIND BANK LTD Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) THIS petition has been filed challenging the six notices all dated 28.03.2012 issued by the Commercial Tax Officer, Anti-Evasion Wing, Jaipur in respect of six different assessment years whereby the transfer of vehicles by the petitioner-Bank to third party on authority of the registered owners of the vehicles under bilateral contracts subsequent to taking of possession from the borrowers defaulting on payment of the loan advanced for the purchase of vehicle is sought to be taxed by the Commissioner, Commercial Tax Department, Jaipur as a sale by the petitioner-Bank.

(2.) THE case of the petitioner-Bank is that it neither owns the vehicle, nor claims any depreciation on the vehicles, nor operates or drives the vehicles for any purpose, nor adds any value to the vehicle, nor is in the business of sale and purchase of vehicle, nor has levied and collected VAT on any transaction of transfer of vehicle repossessed by it under hypothecation to it following the default on obligations by the borrower. It is submitted that even the transfer of vehicle to the petitioner-Bank under form 36 of the Central Motor Vehicles Rules, 1986 with reference to Rule 61(2) of the aforesaid Rules read with Section 51(5) of the Motor Vehicles Act, 1988 indicates that the petitioner-Bank is not the owner of the vehicle, nor is understood in law to be so, but is only authorized under law to merely facilitate the sale of repossessed vehicle such that the purchaser comes to have a lawful title thereof and the petitioner-Bank as the financier of the vehicle in issue is able to extract maximum amounts due and outstanding to it. It is submitted that where the price of vehicle obtained exceeds the outstandings, the registered owner of the vehicle is entitled to and in fact allowed to avail the surplus. It is submitted that the aforesaid transaction is being misconstrued by the respondent-Department to bring it within the ambit of the Rajasthan Value Added Tax Act, 2003 (hereinafter 'the Act of 2003') and to usurp jurisdiction otherwise non-existent to visit the petitioner-Bank with huge amounts of liability of a sale not to the petitioner-Bank's account but to that of the registered owner. THE show cause notices all dated 28.03.2012 in the aforesaid circumstances are impugned as without jurisdiction.

(3.) CONSEQUENTLY, even while not entertaining the writ petition, in my considered opinion, it would be proper for the petitioner-Bank to approach the Commissioner, Commercial Tax Department, Jaipur by moving an application in the prescribed manner under Section 36 of the Act of 2003 for determination of the various disputed questions which arise in the present case.