1. Motor vehicle tax liability — Vehicles used exclusively within restricted premises without public access — Claim for exemption under Section 3, Andhra Pradesh Motor Vehicle Taxation Act, 1963. (Para 4 , 5 , 6 , 8 , 9 , 10 )
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2025 Supreme(SC) 1276
SUPREME COURT OF INDIA
MANOJ MISRA, UJJAL BHUYAN, JJ.
M/s. Tarachand Logistic Solutions Limited – Appellants
Versus
State Of Andhra Pradesh & Ors. – Respondents
Civil Appeal No. 11188 of 2025 (Arising Out Of SLP (Civil) No. 1547 of 2025)
Decided on : 29-08-2025
Advocates appeared:
For the Petitioner(s): Mr. Vijay Hansaria, Sr. Adv. Mr. Sanjay Sarin, Adv. Ms. Gagan Deep Kaur, Adv. Ms. Kavya Jhawar, Adv. Mr. Preshit D. Bagul, Adv. Mr. Dinkar Kalra, AOR
For the Respondent(s): Ms. Prerna Singh, Adv. Mr. Guntur Pramod Kumar, AOR Mr. Dhruv Yadav, Adv.
For the Petitioner(s): Mr. Vijay Hansaria, Sr. Adv. Mr. Sanjay Sarin, Adv. Ms. Gagan Deep Kaur, Adv. Ms. Kavya Jhawar, Adv. Mr. Preshit D. Bagul, Adv. Mr. Dinkar Kalra, AOR
For the Respondent(s): Ms. Prerna Singh, Adv. Mr. Guntur Pramod Kumar, AOR Mr. Dhruv Yadav, Adv.
IMPORTANT POINTS
(1) Levy of Road Tax – Exemption – If a motor vehicle is not used in a ‘public place’ or not kept for use in a ‘public place’ then person concerned should not be burdened with motor vehicle tax for such period.
(2) Taxation – Levy of tax has to be explicit – There cannot be exaction of tax by implication or by following an interpretative process.
Headnote:
(A) Taxation – Levy of tax has to be explicit – There cannot be exaction of tax by implication or by following an interpretative process – Charging section is core of a taxing statute – Generally speaking, a taxing statute has to be construed literally; this is more so in the case of a charging section – In a taxing statute one has to look merely at what is clearly said – There is no room for any intendment – There is no equity about a tax – There is no presumption as to tax – Nothing is to be read in, nothing is to be implied – A subject is not to be taxed unless words of relevant taxing statute unambiguously imposes tax on him. (Para 37)
(B) Motor Vehicles Act, 1988 – Section 2(34) – Andhra Pradesh Motor Vehicle Taxation Act, 1963 – Section 3 read with Rule 12A of Andhra Pradesh Motor Vehicles Taxation Rules, 1963 – Levy of Road Tax – Exemption – Requirement of law is that motor vehicle should be used or kept for use in a ‘public place’ – Motor vehicle tax is compensatory in nature – It has direct nexus with end use – Rationale for levy of motor vehicle tax is that a person who is using public infrastructure, such as, roads, highways etc. has to pay for such usage – If a motor vehicle is not used in a ‘public place’ or not kept for use in a ‘public place’ then person concerned is not deriving benefit from public infrastructure; he should not be burdened with motor vehicle tax for such period – Even in absence of any intimation in terms of Rule 12A, motor vehicles of appellant cannot be subjected to motor vehicle tax for the period those were used or kept confined within restricted premises of RINL. (Paras 46, 47 and 50)
Facts of the case:
Core issue which calls for adjudication in present appeal is whether premises of Visakhapatnam Steel Plant where appellant’s vehicles are exclusively used for handling and storage operations, constitute a ‘public place’ under A.P. Act, 1963? Corollary to the above, is issue as to whether such vehicles are liable to pay tax under Section 3 of A.P. Act, 1963 or entitled to exemption therefrom?
Findings of Court:
Impugned judgment and order dated 19.12.2024 passed by Division Bench of the High Court in Writ Appeal No. 711 of 2023 is set aside. Consequently, judgment and order of Single Judge dated 13.06.2023 passed in Writ Petition No. 38285 of 2022 is hereby restored.
Result : Appeal allowed.
Legal Category Hierarchy
Table of Contents
2. Whether restricted premises of a government company constitute a public place — Interplay between charging section and deeming provision regarding non-use intimation for tax exemption. (Para 21 , 22 )
3. Tax is compensatory with nexus to public infrastructure — Restricted areas without public access are not public places — Subordinate rules cannot expand the scope of the charging section. (Para 25 , 28 , 29 , 31 , 32 , 34 , 45 , 46 , 47 , 48 )
4. Motor vehicle tax is exigible only if the vehicle is used or kept for use in a public place; restricted premises without public access do not constitute such place. (Para 45 , 47 , 50 )
5. Appeal allowed — Judgment of Division Bench set aside — Order of Single Judge restoring tax exemption and refund restored. (Para 51 )
6. What constitutes a public place for the purpose of motor vehicle tax liability?
A public place is a road, street, way, or other place to which the public have a right of access. Premises that are restricted, enclosed, and where unauthorized persons are not allowed entry without prior permission do not constitute a public place. (Para 28 , 45 )
7. Does the failure to provide a non-use intimation under Rule 12A automatically attract tax liability?
No. Rule 12A is intended to give effect to Section 3 and cannot traverse beyond the parent statute. The deeming provision in Rule 12A must be read as a vehicle deemed to be kept for use in a public place. (Para 29 , 47 , 48 , 50 )
8. What is the nature and rationale behind the levy of motor vehicle tax?
Motor vehicle tax is compensatory in nature, having a direct nexus with the end use of public infrastructure. It is levied on those using public roads and highways to fund their maintenance. (Para 46 )
9. Does the fact that a company is government-funded automatically make its premises a public place?
No. The status of the owner as a government company does not automatically render its restricted operational areas public places if the public does not have a right of access. (Para 40 , 42 )
JUDGMENT :
UJJAL BHUYAN, J.
Leave granted.
2. This appeal arises out of the judgment and order dated 19.12.2024 passed by the High Court of Andhra Pradesh at Amravati (‘High Court’ for short) in Writ Appeal No. 711/2023.
3. Facts of the case may be briefly noted.
4. Appellant is a company incorporated under the Companies Act, 1956. It is engaged in the business of providing logistic support since the year 1985, further diversifying its business activities into deployment of heavy lifting equipments required for infrastructure and construction projects. Appellant is the owner of various motor vehicles which are used as heavy lifting equipments.
5. Appellant was awarded a contract dated 17.11.2020 for handling and storage of iron and steel materials at central dispatch yard within Visakhapatnam Steel Plant, Andhra Pradesh, a corporate entity of Rashtriya Ispat Nigam Limited (‘RINL’).
6. Pursuant to the contract and consequential work order dated 19.01.2021, appellant deployed 36 numbers of motor vehicles bearing various registration numbers, details of which are mentioned in the paperbook, for plying within the central dispatch yard premises.
7. It may be mentioned that prior to the contract, appellant had duly paid the requisite tax for the aforesaid registered motor vehicles and had obtained fitness certificate, insurance certificate and pollution under control certificate as per requirement of the statutory provisions.
8. Upon allotment of the contract, appellant deployed the motor vehicles inside the central dispatch yard premises and with effect from 01.04.2021 all the motor vehicles stopped plying on the public roads as those were confined to within the central dispatch yard premises only. Appellant was under obligation to retain these vehicles within the premises till continuation of the contract period and not be used on public roads.
9. According to the appellant, the central dispatch yard is enclosed by compound walls and ingress and egress thereto is regulated through the gates where Central Industrial Security Force (CISF) personnel are deployed. No member of the public has any right to access the central dispatch yard. Only those persons who are authorized to enter are given gate passes by the CISF to enter the premises of the central dispatch yard.
10. Appellant wrote to respondent No. 1 i.e. State of Andhra Pradesh represented by its Principal Secretary, Transport Department vide letters dated 07.12.2020 and 05.10.2021 intimating the state authority that the motor vehicles of the appellant used in the central dispatch yard premises belonging to Visakhapatnam Steel Plant of RINL were not being used on public roads and, therefore, requested for exemption from payment of motor vehicle tax for the period the vehicles were confined and used within the central dispatch yard premises. The aforesaid prayer was made in terms of Section 3 of The Andhra Pradesh Motor Vehicle Taxation Act, 1963 (briefly ‘the A.P. Act, 1963’ hereinafter).
11. Respondent No. 3 i.e. Regional Transport Officer, Gajuwaka did not pass any order on the request made by the appellant. On the contrary, the fourth respondent i.e. Motor Vehicle Inspector, Gajuwaka inspected the motor vehicles stationed in the central dispatch yard premises and, thereafter, raised a demand of Rs. 7,37,960.00 against such motor vehicles on 16.11.2021. In addition, a further demand of Rs. 15,33,740.00 were raised against the other vehicles stationed in the said premises towards motor vehicle tax. Appellant paid the said amount of Rs. 7,37,960.00 and Rs. 15,33,740.00, totaling Rs. 22,71,700.00, towards motor vehicle tax under protest. It is stated that appellant was compelled to pay the amount demanded under protest as it was threatened with seizure of all the motor vehicles operating within the premises of the central dispatch yard of RINL. While making the payment, appellant stated that it reserved its liberty to seek exemption from payment of such tax under the A.P. Act, 1963.
12. On
