The authority to impose taxes under state legislation prevails over conflicting provisions of subordinate legislation related to permits under all-India rules.

1. These writ petitions have been filed challenging a circular dated 19/10/2022, issued by the Transport Commissioner, Kerala, essentially withdrawing an earlier circular dated 03/04/2021 and stating that tourist buses which have obtained permits in terms of the All India Tourist Vehicles (Authorisation or Permit) Rules, 2021, (hereinafter referred to as 'All India Rules') have to pay tax in terms of the provisions contained in the Kerala Motor Vehicles Taxation Act, notwithstanding the fact that the provisions of the All India Rules do not contemplate or envisage the collection of tax under the law providing for levy of tax on motor vehicles in respective States. The jurisdiction and authority of the Transport Commissioner to issue a circular of the nature referred to above has also been called into question in these writ petitions.

2. Advocates G. Hariharan, G. Harikumar and P. A. Abhilash for the petitioners in these cases, would contend that the Transport Commissioner has absolutely no jurisdiction or authority to issue a circular of the nature referred to above. Reference is made to the provisions contained in the All India Rules and in particular to the definition of 'authorisation' and 'permit' contained in R.2(1)(b) and (d). It is pointed out that when a vehicle is issued with a permit as defined in R.2(1)(d), no further tax can be collected from the said vehicle under the Kerala Motor Vehicles Taxation Act. It is also pointed out that the Rules contemplate the sharing of revenue between the States and reference is made in this regard to R.6. It is also pointed out with reference to Ext.P13 in W.P.(C)No.34708/2022 that there has been a sharing of revenue collected for the issuance of permits by the Central Government with the States, including the State of Kerala. It is pointed out that in the month of September 2022, an amount of nearly Rupees One Crore was paid to the State Government by the Central Government as a share of the fee collected for the issuance of permits in terms of the All India Rules. The provisions of S.88A of the Motor Vehicles Act , 1988 and the provisions of R.86 of the Central Motor Vehicles Rules, 1989, are referred to point out that the All India Rules are valid and the Transport Commissioner has no jurisdiction or authority to issue a circular contrary to the provisions contained in statutory rules issued by the Union of India in the exercise of rule making power under the provisions of the , 1988. It is also pointed out that this Court in the judgment dated 16/09/2022 in W.P (C) 30724 of 2021, has taken a view in favour of the petitioners in almost identical circumstances.

3. The learned Special Government Pleader Adv. Mohammed Rafeeque and learned Senior Government Pleader Adv. Thusara James appearing for the State of Kerala would submit that the provisions of the Motor Vehicles Act , 1988, do not authorise the Central Government to issue Rules in the nature of the All India Rules. It is submitted that the provisions of S.88 of the , 1988, (which deal with the validation of permits for use outside the region in which they are granted) make it clear that the Rules made by the Central Government cannot exempt Motor Vehicles from taxation under the State Laws, while they could authorise the issuance of a permit for operation outside the State from which such permit is issued. It is also submitted that the Kerala Motor Vehicles Taxation Act is a piece of legislation that can be traced to Entry 57 of List II of the 7th Schedule of the Constitution of India. It is submitted that while Entry 35 of List III of the 7th Schedule read along with Entry 57 of List II contemplates that there could be legislation by the Union Parliament regarding the taxation of Motor Vehicles, in the