9911796707
TMI Blog1983 (8) TMI 305X X X X Extracts X X X X X X X X Extracts X X X X ..... transport authority of any one region shall not be valid in any other region, unless the permit has been counter signed by the regional transport authority of that other region, and a permit granted in any one state shall not be valid in any other state unless counter-signed by the State Transport Authority of that other state or by the regional transport authority concerned. The procedure prescribed for obtaining the counter-signature of the transport authorities of other regions and states was cumbersome and was not conducive to the development of all India or inter-state tourist traffic. In order to remedy the situation and promote all India and inter-state tourist traffic, the Parliament amended the Motor Vehicles Act and introduced sec. 63 (7) by amending Act 56 of 1969. This new provision enables the State Transport Authority of every state to grant permits valid for the whole or any part of India, in respect of such number of tourist vehicles as the Central Government may, in respect of that state specify in that behalf. Preference is to be given, to applications for permits from the India Tourism Development Corporation, a State Tourism Development Corporation, a State Tou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holding permits under sec. 63 (7), that is, tax should be paid in the 'home state' and the vehicle should be exempted from payment of tax in states other than the home state. This could be done by the respective State Governments issuing notifications under their taxation legislation exempting tourist vehicles registered in other states from payment of tax, if tax has already been paid in the home state. The Government of India accepted the E- suggestion and requested the State Governments and Union Administrations to issue necessary notifications. The suggestion ran into trouble right from the start. While the Governments of Andhra Pradesh, Bihar, Goa, Daman and Diu, Maharashtra, Nagaland and Uttar Pradesh readily agreed to issue such notifications on the basis of reciprocity, there was no such ready response from some other states. The Government of Karnataka was in particular opposed to the grant of any such exemption. Finally, the Government of Karnataka and the Governments of other states too were persuaded to agree to issue such notifications. In the meanwhile the Government of India, in exercise of its power under sec. 63 (7) of the Motor Vehicles Act, issued notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the grant of 'All India Permits', designed as it was to promote all India and inter-state tourist traffic. soon fell into abuse at the hands of scheming transport operators. Within the scheme itself lay the seeds for abuse. The scheme enabled the State Transport Authority of each State, to issue fifty all India permits, uniformly, irrespective of the size of the State, its resources, its accessibility, its communications, its facilities, the availability of transport services and operators in the State with the necessary expertise, experience and finance to operate all-India tourist services and a host of such other factors. Apparently it was thought undesirable to make a distinction between State and State on what were perhaps thought to be elusive criteria and possibly the scheme was expected to give a boost to the transport business in the smaller and less advanced States. And, of course, it was necessary to obtain the agreement and cooperation of all the States. But, the result was that transport operators from, big and comparatively prosperous and advanced States, well versed in the intricacies of the transport business very soon flocked to small and comparatively po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rification of the passengers, it was found that the passengers found in the vehicle were not genuine tourists and the drivers or the persons incharge of the vehicles were not in a position to produce the trip sheet, name list with whom they entered into contract. It was also found that the passengers found in the vehicles had boarded the buses from one point without any contract or otherwise and without they being tourists. The passengers found in the tourist buses are regular passengers going from one place to another for purposes other than tourism. These vehicles were found catering to the needs of general travellers who can make use of the Stage Carriages operated by the K.S.R.T.C., or other private stage carriage operators. The respondent produces herewith statements as ANNEXURF.S 1 to 9 showing the clandestine operation of the vehicles covered by All India Tourist Permits, the remarks and irregularities noticed by the Motor Vehicles Inspectors while checking the vehicles covered by All India Tourist permit, the frequent detection of these vehicles running as Stage Carriages by collecting individual fares and picking passengers from one point and setting down them at another p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e found that as many as 115 All India Tourist Buses are regularly playing on this route. After making an analysis of these 115 All India Tourist Buses,' he found that 41 permits had been issued by the State Transport Authority of Manipur. 17 had been issued by State Transport Authority Nagar Haveli, 8 by the State Transport Authority, Meghalaya and 5 by the State Transport Authority Nagaland. A large number of All India Tourist Buses operating with their base in Bombay appear to have been issued by Manipur Nagaland and the Union Territory of Dadra Nagar Haveli . The petitioners, who are transport operators holding all- India permits, deny that any of them was guilty of any malpractice or misuse of the permits held by them. But, notwithstanding the petitioners' denial we do not have the slightest doubt that the allegations of misuse and malpractice made in the counter-affidavit, filed on behalf of the Karnataka Government, are generally and substantially correct. Complaints about the abuse of the scheme appear to have been made to the Central Government and the Transport Advisory Council also. We are also told that the question of meeting the challenge posed by these abus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e must say that everyone was brief and none over stated his case. It was submitted that see. 63 (7) of the Motor Vehicles Act was designed to promote All India and inter-state tourist traffic and thus to advance trade, Commerce and inter-course throughout the territory of India. It was implicit in sec. 63 (7) that the States would exercise their power of taxation in such a way as not to impose an additional burden on tourist Vehicles registered in other states and plying on permits issued under sec. 63(7), over and above the tax paid in the home State. In other words, it was implicit that all the States would exempt from taxation tourist vehicles registered in other States and plying on permits issued under sec. 67 (7) was withdrawing the exemption, the object of sec. 63 (7) was defeated and therefore, freedom of trade, Commerce and inter-course throughout the territory of India, guaranteed by Art. 301 of the Constitution was impaired. The withdrawal of exemption was, therefore, unconstitutional and bad in law. The transport operators of Karnataka who were not directly hit by the withdrawal of the exemption by the Government of Karnataka advanced a subtler argument and suggested ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... neral nature nor can there be any objection to more or less expenditure being incurred on the object behind the compensatory and regulatory levy than the realisation from the levy .(6) It should be patent that it would ordinarily be well-nigh impossible to identify and measure with any exactitude the benefits received and the expenditure incurred and levy the tax according to the benefits received and the expenditure incurred . Nor is the court to interpose itself by assuming the role of a cost accountant and attempt to balance meticulously the cost of the services, benefits and facilities against the realisation from the levy. And, if the levy as a whole is justified by the need generally, it does not have to be separately justified with reference to every group of persons claiming to require and receive less service than others. Once the nexus between the levy and service is seen, the levy must be upheld unless the compensatory character is shown to be wholly or partly, a mere mockery and in truth a design which is destructive of the freedom of inter-state trade, commerce and inter-course. By virtue of the power given to them by Entries 56 and 57 of List II every one of the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eases as each State adds its bit of straw, but, then, each State is concerned with its coffers and has the right to tax vehicles using its roads; and, the contribution which a tourist carriage is required to make to its treasury is no more than what other contract carriages are required to make. We are firmly of the view that there is no impairment of the freedom under Art. 301. The special submission on behalf of the 'Karnataka operators' that the withdrawal by the Karnataka Government of the exemption granted to 'outsiders' has resulted in the Karnataka operators having to pay tax in every State in the country and, therefore, the withdrawal has impaired the freedom under Art. 301 is but the same general sub- mission, seen through glasses of a different tint. It does not even have the merit that the withdrawal of the Karnataka exemption affects them directly. The submission is rejected. One of the submissions made to us was that if there was a misuse of the all-India permits, the remedy was to punish the wrong doers by taking appropriate action against the wrong-doers by cancelling the permit, if necessary, but not to withdraw the benefit of the exemption altoge ..... X X X X Extracts X X X X X X X X Extracts X X X X
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