The court upheld the levy of tax under the Tamil Nadu Motor Vehicles Taxation Act, 1974, and distinguished between disciplinary action for permit violations and the levy of tax under the Motor Vehicles Act, 1988.

The challenge to this Writ Petition is a demand notice dated 210. 2002 issued by first respondent, wherein the petitioner has been directed to pay the tax of Rs.34,000/-for the month of October 2002, within 7 days from the date of receipt of the notice.

2. It is the case of the petitioner that he is a State-wide Contract Carriage Permit holder issued by the Kerala State Transport Authority, in respect of vehicle No.KL-09-J-1117. The vehicle was under repair and after carrying out the repairs, he took the vehicle for a test drive. When he crossed the State border of Kerala and entered into the State of Tamilnadu, the subordinates of the Motor Vehicles Inspector, K.G.Chawadi Checkpost (incoming), the second respondent herein stopped his vehicle and checked the documents and he replied to the authorities that the vehicle was operated only as a test drive. Thereafter, second respondent issued a check report dated 10. 2002 alleging that the vehicle is operated with 35 passengers without temporary permit and other records. The vehicle was detained by second respondent on the side of the main road from 10. 2002. The original copies of the Registration Certificate, Insurance Certificate, Tax Receipt and permit of the vehicle were submitted along with his representation dated 210. 2002, as contemplated under Section 207(2) of the Motor Vehicles Act, 1988. The first respondent without considering his representation, issued a show cause notice dated 210. 2002 as to why a sum of Rs.34,000/-should not be collected from him for the month of October 2002. He submitted his reply stating that the amount demanded is very high and requested them to drop further action. Aggrieved by the impugned order, the petitioner has preferred this Writ Petition for the relief as stated above.

3. Learned counsel for the petitioner submitted that the vehicle was operated only against a test drive and the allegation of the second respondent that the vehicle carried 35 passengers without temporary permit, is contrary to facts. He further submitted that even if there was any violation of the conditions of the permit, the respondents cannot demand tax and only a disciplinary action could be taken for suspension or cancellation of licence. He further submitted that the respondents ought to have forwarded the check report to the permit issuing authority enabling them to take appropriate action.

4. Learned Government Advocate submitted that the respondent is permitted to levy tax for the use of the road within the territory of Tamil Nadu under the Motor Vehicles Taxation Act.

5. Heard the learned counsel appearing for the parties and perused the material available on record.

6. It is evident from the impugned order dated 210. 2002 that on 10. 2002, the Motor Vehicles Inspector, K.G.Chawadi Checkpost (incoming), Coimbatore checked the Contract Carriage Omni bus KL 09-J-1117 and detained the vehicle for the following irregularities:

"i) Temprary permit or pucca permit are not available. Hence the vehicle plied without permit to ply in Tamilnadu.

ii) Tax due to Tamilnadu has not been paid.

7. The impugned order reads that show cause notice was issued to the owner of the vehicle, namely Thiru I.Shajahan, S/o.Thiru Ismail, Thampattu House, West Yakkara, Palakkadam, Kerala State and that he is liable to pay a sum of Rs.34,000/-for the month of October 2002 as due to Tamilnadu State. The order further reads that the owner of the vehicle had not denied the charges and contended that a demand notice be issued so as to enable him to approach the Court.

8. Though Motor Vehicles Act, 1988 has contemplated disciplinary action for violation of the conditions of the permit, if the holder of the permit has violated the permit conditions, as per Section 3 of the Tamil Nadu Motor Vehicles Taxation Act, 1974, the State Government can levy tax on every motor used or kept for use in the State of Tamil Nadu. Section 3 of the above Act is extracted:

"3. Levy of tax: (1) Sub