The levy of tax on motor vehicles is based on the user or intention to use the vehicle on public roads, and not solely on the permit.

( 1 ) THIS batch of writ petitions by the petitioners under Article 226 of the Constitution of India is to challenge the validity of levy of tax and penalty on their vehicles covered by contract carriage permits when plied as stage carriages.

( 2 ) THE material facts in all the writ petitions being almost similar, we feel it sufficient to briefly stated, the facts in the main W. P. No. 3565 of 1967. The petitioner is a motor transport operator playing his tourist bus A. D. B. 166. At the instance of one M. Madhava Rao who approached him to take a pilgrim party to Tirupati, the petitioner obtained a temporary permit for his vehicle after paying the requisite tax for the quarter ending 31-12-1967 for the conveyance of a tourist party from Masulipatnam to Tirupathi and Tirupathi to Masulipatnam.

( 3 ) ON 5-12-1967, the petitioners vehicle on its way to Tirupathi was checked by the Motor Vehicle Inspector. P. M. and it was found that four persons not included in the contract were traveling in the vehicle and the fares were collected from them. Alleging that the vehicle was used as a stage carriage. the Motor Vehicle Inspector seized the Vehicle and kept in the police station. On the basis of the check report, the notice on 8-12-1967 directing the petitioner to pay a sum of Rs. 2,232. 00 towards quarterly tax for the quarter ending with 31-12-1967 and a sum of Rs. 4,465-00 towards penalty on the ground that the vehicle was used as a stage carriage without a stage carriage permit. Hence, these writ petitions.

( 4 ) SMT. Amareswari and M/s. G. Suryanarayana K. Srinivasa Murthy K. Mangachari, P. Ramakoti and other learned counsel for the petitioners contended that the authorities under the Motor Vehicles Taxation Act are not competent to levy tax and penalty as state carriages in respect of vehicles covered by contract carriage permits for violation of any conditions of the permits and in any event the levy of full quarter tax where the offence has been detected in the second or third month of the quarter is contrary to the notification, dated 21-12-164. The learned IV Government Pleader opposed these applications contending inter alia that the transport authorities are empowered in these cases to levy the tax and penalty and there is no illegality.

( 5 ) ON these facts and contentions raised by the respective counsel, the following questions arise for consideration. (1) Whether on the facts and in the circumstances, the authorities under the Motor vehicle Taxation Act are competent to levy the tax as a stage carriage in respect of Vehicles covered by contract carriage. permits (2) if question No. 1 is answered in the affirmative. Whether in the circumstances the penalty is livable and if so to what extent (3) where the offence of using the contract carriage as a state carriage is detected in the second or last month of the quarter, whether the authorities are entitled to levy full quarter tax and penalty

( 6 ) FOR a proper appreciation of the question it is necessary to advert to the scheme and intendment of the Andhra Pradesh Motor Vehicles Taxation Act. 1963 hereinafter called the Act and the relevant provisions of the Motor Vehicles Act. 1939.

( 7 ) IN the year 1939, with a view to consolidate and armed the law relating to motor vehicles and to control transport, the Motor Vehicles Act, 1939 was enacted by the center. The Madras Motor Vehicles Taxation Act (Madras Act XIII of 1939) was enacted by the state legislature to provide for the levy of tax in respect of the Motor Vehicles Passengers and Goods Act, providing for levy for of tax on passenger fare and goods freight, which was adopted by Andhra, was passed. The Hyderabad Motor Vehicles Taxation Act was in force in so far as the Telangana Area was concerned. With the object of consolidating and amending the law relating to the levy of tax on motor vehicles in the State of Andhra Pradesh, the present Act V of 1963 has been enacted by the Andhra Pradesh State Legisla