2018 (10) TMI 1156 - HC - Indian Laws

Levy of Urban Transport and Parking Development Fee from petitioner/dealer - demand of service tax - recovery of parking fee at different rates on the vehicle sold and registered within the municipal limits of Indore - petitioner argued that vide Resolution dated 23.03.2013, the Municipal Corporation has not authorized the petitioner or any dealer to recovery the parking fee from the customers unless such authorization is made, the dealers are not suppose to charge any amount from the customers over and above the price of vehicle. By Resolution dated 22.03.2013, the Municipal Corporation has decided to setup a counter in RTO Office and appoint Officer / employee to recover the parking fee, therefore, now the Corporation cannot compel the petitioner to deposit amount, which was not recovered. Held that - Vide Resolution dated 22.03.2013, the Municipal Corporation has imposed the parking fee, which is one time payable by the purchasers of the vehicles at the time of purchase of the vehicle / registration of the vehicle. Vide Resolution dated 22.03.2013, if the dealers are supplying the vehicles to sub-dealers, situated out side the city of Indore, then no fee is chargeable. The Municipal Corporation has decided to setup the counter at RTO Office for those vehicles, which are coming to RTO for its registration. The parking fee is also liable to be recovered from the purchasers whose addresses are within the Municipal Corporation. The setting up of counter at RTO Office is an additional arrangement for recovery of such tax for those who brought before the Registering Authority for registration if the dealers escaped to charge the parking fee as it is one time payable fee. If the dealer has recovered the amount then the purchaser is not liable to pay the same at the time of registration, therefore, the learned Commissioner vide order dated 21.03.2017 has rightly directed the petitioner to produce the details about the sale and the documents to establish that the parking fee has not been recovered during the said period, for which petitioner ought not to have any grievance. If the petitioner did not recover or collect then, the material can be produced before the Commissioner for its satisfaction. The petitioner is required to submit the details of the purchasers who purchased the vehicles during the said period, so that the Municipal Corporation can recover the parking fee, as per condition No.3 of Resolution dated 22.03.2013. Petition dismissed.

Issues:
1. Validity of demand for Urban Transport and Parking Development Fee.
2. Authority of Municipal Corporation to impose parking fee.
3. Obligation of dealers to recover parking fee.
4. Compliance with the resolution for recovery of parking fee.
5. Legal basis for recovery of parking fee from purchasers.
6. Dismissal of the writ petition challenging the recovery order.

Analysis:
1. The petitioner challenged the demand of ?14,42,000 under the Urban Transport and Parking Development Fee imposed by the Municipal Corporation. The resolution passed for recovery of parking fee at different rates on vehicles sold and registered within the municipal limits was contested by the petitioner as illegal and unjustified.

2. The Municipal Corporation, through resolutions, authorized the imposition of a one-time Urban Transport and Parking Development Fee at the time of vehicle purchase. The Corporation justified this fee as part of a program for upgrading parking facilities and services in the city, citing the authority to impose taxes and fees within its jurisdiction.

3. The petitioner argued that dealers were not authorized to recover parking fees from customers unless specifically directed by the Corporation. The contention was that once a vehicle is sold, the dealer is not obligated to pay any amount not collected from the purchaser, making the recovery demand unjustified.

4. The court noted that the petitioner had not challenged the resolutions authorizing the parking fee. The petitioner was directed to provide details of vehicle sales to establish non-recovery of parking fees during the specified period, allowing the Municipal Corporation to recover the outstanding fees.

5. The legal basis for recovering parking fees from purchasers was established through resolutions empowering dealers to collect the fee along with service tax. The court emphasized the obligation of dealers to ensure fee collection and submission to the Municipal Corporation, as per the specified conditions.

6. Ultimately, the court found no grounds to interfere with the order directing compliance with the recovery of parking fees. The writ petition challenging the recovery order was dismissed, and the petitioner was instructed to comply with the impugned order issued by the Municipal Corporation.

This detailed analysis of the judgment addresses the issues raised by the petitioner regarding the validity of the parking fee demand, the authority of the Municipal Corporation to impose such fees, the obligations of dealers in fee recovery, compliance with the resolution, the legal basis for fee recovery from purchasers, and the dismissal of the writ petition challenging the recovery order.

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