Whether the tax payable in respect of the motor vehicle, a stage carriage, is to be fixed on the basis of the 'seating capacity' or on the basis of the 'actual seats' provided therein (particularly when the vehicle was initially registered in some other State with lesser number of seats; whereas on re-registration in Kerala, the vehicle is found to have the actual 'seating capacity' to a higher extent, in view of the relevant rules) is the issue involved in this Writ Petition.

2. The stage carriage bearing No. KL 14/C 9292 was originally registered in the State of Karnataka, in the name of one B.K.Viswanath of Prasad Motors; from whom, the same was purchased by the wife of the petitioner on 11.12.2001. But when the vehicle was brought over to Kerala and sought to be re-registered here, the registering authority in Kanhangad refused to re-register the vehicle which forced her to approach this Court by filing OP 14994/2002, leading to the judgment reported in 2002 (3) KLT 72.

3. As per the dictum therein, it was held by this Court that, the refusal on the part of the registering authority (pointing out the higher 'seating capacity' in view of the measurements of the 'wheel base' as per Rule 269 of the Kerala Motor Vehicles Rules 1989) was not correct or sustainable, as the reason given was in no the way connected with the issue of re-registration of the vehicle as contemplated under Section 47 of the Motor Vehicles Act, 1988, read with Rule 54 of the Central Motor Vehicles Rules. This Court observed that the instance of re-registration, when a vehicle is brought forth into the State from some other State, is specifically dealt with under Section 47 of the Act and the procedure to be followed is prescribed in Rule 54 of the Central Rules. It was held that the registering authority was bound to effect the re-registration of the vehicle and that the issue regarding higher element of tax payable by the owner, based on the 'seating capacity' of the vehicle as prescribed under Rule 269 of the Kerala Motor \Vehicles Rules, would be relevant only at the time of issuance of the 'permit' and not at the time of re- registration. Accordingly, the registering authority was directed to reregister the vehicle in the name of the petitioner in the said case (wife of the petitioner in the present Writ Petition) and thus the re-registration was effected, allotting the present number to the vehicle. Subsequently, the vehicle was transferred again to the name of the petitioner, with effect from 22.08.2003. All the way, the petitioner's wife as well as the petitioner have been effecting the tax at the rate of Rs.26,700/- per quarter, based on the actual number of seats ('41+2').

4. While so, during the course of auditing, it was observed that the vehicle was having a higher 'seating capacity' and as such, there was "short collection" of tax from September, 2002 onwards; particularly since as per Rule 269, the vehicle in the instant case, having a wheel base of '519.5 cm', was to have a minimum seating capacity of '50'; subject to the extent of reduction by two seats as stipulated in the proviso thereunder. Accordingly, Ext.P3 notice was issued to the wife of the petitioner, referring to the factual position involved in the "short collection" of tax and pointing out that, the tax was liable to be paid in respect of the seating capacity of '46+2', at the rate as prescribed.

5. In response to Ext.P3 notice, Ext.P4 reply was submitted by the wife of the petitioner, stating that she had already transferred the vehicle to Mr. A.K. Velayudhan (her husband and the petitioner in the present Writ Petition) with effect from 22.08.2003; that the vehicle was originally registered in Karnataka with the seating capacity of '41+2'; no material alteration was effected in the vehicle either before or at the time of re registration in Kerala or ever since thereafter and hence that she was not liable to effect any payment as demanded. On receipt of Ext.P4 expl