1993 (9) TMI 365 - HC - Indian Laws

Summary

Issues Involved:
1. Constitutional validity of the M.P. State Legislature (Delegation of Power) Act, 1993.
2. Validity of the M.P. Motoryan Karadhan (Amendment) Act, 1993.
3. Provision of machinery for assessment of tax.
4. Adequacy of the refund mechanism under the Act and Rules.

Detailed Analysis:

1. Constitutional Validity of the M.P. State Legislature (Delegation of Power) Act, 1993:
The petitioners challenged the M.P. State Legislature (Delegation of Power) Act, 1993, arguing that delegating legislative power to the President is permissible only when Parliament is not in session. They also contended that the President did not consult the requisite committee and that the Act was not laid before each House of Parliament, making it a colorable exercise of power.

The court held that the delegation of legislative power to the President is permissible under Article 357(1)(a) of the Constitution, which allows Parliament to confer on the President the power of the State Legislature to make laws. The court clarified that the President's satisfaction regarding the practicability of consulting the committee is subjective and not subject to judicial review. Additionally, the court found no allegations in the petition to support the claim that the Act was not laid before each House of Parliament. Therefore, the Act was held to be constitutionally valid.

2. Validity of the M.P. Motoryan Karadhan (Amendment) Act, 1993:
The petitioners argued that the M.P. Motoryan Karadhan (Amendment) Act, 1993, enacted by the President, was a colorable exercise of legislative power and lacked legislative competence.

The court referred to Supreme Court precedents, emphasizing that the propriety, expediency, and necessity of legislation are determined by the legislative authority, not by the courts. The court found that the conditions in Act No. 9 of 1993 did not strip the President of legislative competence. The Amending Act was enacted to ensure continuity of tax provisions and was not a colorable legislation. Thus, the court upheld the validity of the Amending Act.

3. Provision of Machinery for Assessment of Tax:
The petitioners contended that the Amending Act did not provide a proper machinery for tax assessment, including the submission of returns by vehicle owners.

The court examined Section 8 of the Amending Act, which mandates vehicle owners to file a declaration of their tax liability and allows for additional declarations if the vehicle is altered. The Taxation Authority is required to conduct an inquiry, provide an opportunity for the owner to be heard, and determine the tax payable. The court found that the Act and Rules provided sufficient guidelines for self-assessment by vehicle owners and included provisions for hearings and refunds, thereby addressing the concerns raised in Misc. Petition No. 39 of 1992. The court concluded that the machinery for assessment of tax was adequately provided.

4. Adequacy of the Refund Mechanism under the Act and Rules:
The petitioners argued that the Act and Rules did not provide an adequate mechanism for refunds.

The court reviewed Section 14 of the Act and Rules 12, 13, 13-A, and 14, which outline the procedures for intimation of non-use of permits, non-operation due to unforeseen circumstances, and refunds. The amended Sub-rule (6) of Rule 14 requires the Taxation Authority to give vehicle owners an opportunity to be heard before deciding on refund applications. The court found that these provisions offered reasonable protection and safeguards against arbitrary actions by the authorities. Additionally, Section 20 of the Act and Rule 18 provide for an appeal against assessment orders, offering further protection to vehicle owners.

Conclusion:
The court held that the provisions of the Presidential Amending Act No. 10 of 1993 are intra vires and do not suffer from any constitutional illegality or infirmity. The Act provides for the assessment of tax liability and includes adequate mechanisms for hearings and refunds. Consequently, all petitions were dismissed with costs. The petitioners were advised to file appeals under Section 20 read with Rule 18 if they wished to challenge the assessment orders and demand notices.