1996 Supreme(Mad) 762

High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE S.M. ALI MOHAMED
Jasmin Roadways, Pondicherry - Appellant
Versus
Transport Commissioner, Madras - Respondents
Writ Petn. Nos. 2552 of 1995 and 561 of 1996 and W.M.P. Nos.4052 And-.4053 of 1995
Decided On : 30 July 1996

The transfer of a permit carries with it all incidental rights pertaining thereto, including the right to the benefit of single point tax under an Inter-State Agreement, and a delay in applying for the counter-signature does not affect the transferee's entitlement to such benefit.

Headnote:

MOTOR VEHICLES - TAXATION - INTER-STATE AGREEMENT - SINGLE POINT TAX - TRANSFER OF PERMIT - DELAY IN APPLYING FOR COUNTER-SIGNATURE - WHETHER ONE OF THE CONTRACTING STATES TO INTER-STATE AGREEMENT CAN CLAIM ADDITIONAL TAX FOR THE SAME PERIOD - NO - RULE 213(7) OF THE TAMIL NADU MOTOR VEHICLES RULES DEALS WITH THE TRANSFER OF PERMIT AND ENDORSEMENT OF TRANSFER - THERE IS NO SPECIFIC RULE FIXING THE PERIOD OF LIMITATION WITHIN WHICH AN APPLICATION TO BE MADE FOR COUNTER SIGNATURE AFTER TRANSFER OF PERMIT - THE VERY RULE SPECIFYING RATE OF FEES SAYS APPLICATION FOR CONTINUANCE OF COUNTER-SIGNATURE AND IT IS NOT FRESH COUNTER-SIGNATURE BUT CONTINUANCE OF COUNTER-SIGNATURE - THEREFORE, THE SAID RULE PROCEEDS ON THE BASIS THAT IT IS NOT AN ISSUANCE OF A FRESH COUNTER-SIGNATURE BUT CONTINUANCE OF COUNTER-SIGNATURE - IT IS, THEREFORE, A CONTINUANCE OF THE EARLIER COUNTER SIGNATURE - FURTHER, AS HELD BY THE DIVISION BENCH OF THIS COURT IN TAJ MAHAL TRANSPORTS (P) LIMITED, TIRUNELVELI V. SECRETARY, REGIONAL TRANSPORT AUTHORITY, TIRUNELVELI, 1966 AIR(MADRAS) 8, THAT ONCE A PERMIT IS TRANSFERRED RIGHT OF PROPERTY EMBODIED IN THE PERMIT IS ALSO TRANSFERRED AND THE DEVOLUTION OF INTEREST MUST CARRY WITH IT ALL INCIDENTAL RIGHTS PERTAINING THERETO - AS SUCH ONCE A PERMIT IS TRANSFERRED ALL RIGHTS OF PROPERTY EMBODIED IN A PERMIT INCLUDING ALL INCIDENTAL RIGHTS PERTAINING THERETO ARE ALSO TRANSFERRED - HENCE, SUCH A TRANSFER CARRIES WITH IT ALL INCIDENTAL RIGHTS PERTAINING THERETO, AND IN THE INSTANT CASE, THE RIGHT FOR SINGLE POINT MOTOR VEHICLE TAX AS AGREED BETWEEN THE CONTRACTING PARTIES, VIZ., GOVERNMENT OF TAMIL NADU AND THE GOVERNMENT OF PONDICHERRY AND IN PARTICULAR THE BENEFIT CONFERRED BY CLAUSE IV OF THE INTER-STATE AGREEMENT TO THE TRANSFEREE OF SINGLE POINT TAXATION.

Fact of the Case:

The petitioner, who operates a stage carriage on an inter-state route, challenged the demand notice issued by the respondent for payment of motor vehicle tax for a period during which the petitioner had not obtained a counter-signature from the respondent for the transfer of the permit. The petitioner contended that he was entitled to the benefit of single point tax under the Inter-State Agreement between the Government of Tamil Nadu and the Government of Pondicherry, and that the delay in applying for the counter-signature did not affect his entitlement to such benefit.

Finding of the Court:

The court held that the petitioner was entitled to the benefit of single point tax under the Inter-State Agreement, and that the delay in applying for the counter-signature did not affect his entitlement to such benefit. The court further held that there was no specific rule fixing the period of limitation within which an application for counter-signature had to be made after transfer of permit, and that the rule specifying the fee for continuance of counter-signature proceeded on the basis that it was not an issuance of a fresh counter-signature but a continuance of the earlier counter-signature.

Issues: 1. Whether the petitioner was entitled to the benefit of single point tax under the Inter-State Agreement between the Government of Tamil Nadu and the Government of Pondicherry? 2. Whether the delay in applying for the counter-signature affected the petitioner's entitlement to the benefit of single point tax?

Ratio Decidendi: 1. The court held that the petitioner was entitled to the benefit of single point tax under the Inter-State Agreement because: a. The route in question was covered by the Inter-State Agreement. b. The petitioner had paid the motor vehicle tax to the State of Pondicherry. c. There was no rule which specified any period of limitation within which the application for counter-signature had to be made after transfer of permit. d. The rule specifying the fee for continuance of counter-signature proceeded on the basis that it was not an issuance of a fresh counter-signature but a continuance of the earlier counter-signature. e. The transfer of the permit carried with it all incidental rights pertaining thereto, including the right to the benefit of single point tax under the Inter-State Agreement. 2. The court held that the delay in applying for the counter-signature did not affect the petitioner's entitlement to the benefit of single point tax because: a. There was no specific rule fixing the period of limitation within which an application for counter-signature had to be made after transfer of permit. b. The rule specifying the fee for continuance of counter-signature proceeded on the basis that it was not an issuance of a fresh counter-signature but a continuance of the earlier counter-signature.

Final Decision: The court quashed the demand notice issued by the respondent and directed the respondent to make the endorsement of continuance of counter-signature of permit in respect of the petitioner's bus.