Order
1. These appeals are filed against the judgment of the Andhra Pradesh High Court dated 22-7-1999.
2. Briefly stated, the facts are as follows:
The Government of Andhra Pradesh issued GOM No. 224 dated 7-11-1996. This GO is issued in exercise of power under Section 9(1)(a)(i) of the Andhra Pradesh Motor Vehicles Taxation Act, 1963 (for short “the Act”). By this GO concessional rate of duty was granted to certain categories of contract carriages but such concession was granted, inter alia, on the following two conditions:
“(vi) The vehicle shall be engaged by a homogeneous group having a common purpose.
(vii) Violation of any of the conditions specified above will entail on levy of full quarterly tax applicable to State-wide contract carriages.”
3. It was found that many persons having taken advantage of the GO had in fact obtained special permits for limited stage carriage. Therefore, a demand was made on them under the aforementioned clause (vii) of the GO. A number of writ petitions came to be filed. All those writ petitions were disposed of by the impugned judgment wherein it has been held that clause (vii) is ultra vires Section 9 of the said Act and that therefore no tax can be demanded under clause (vii). It is finally held that, as the conditions of the GO have been violated, the parties would be liable to pay tax on the basis of “limited stage carriage” as prescribed in the said Act.
4. Most of the respondents have remained absent in spite of being served. The respondent in Civil Appeal No. 2883 of 2000 was represented but counsel informed us that he has no instructions from his client as his client has already sold the vehicle.
5. We have heard Mr D. Ramakrishna Reddy, learned counsel appearing on behalf of the appellant at great length. He submitted that the respondents having taken advantage of the GO and having obtained permits under the GO were bound by the conditions of the GO and they could not be allowed to approbate or reprobate. It was submitted that once they took advantage of the GO, if there was any violation, they were bound to pay tax as per clause (vii) of the GO. It was further submitted that in the petition there was no prayer that clause (vii) of the GO be declared ultra vires. It was submitted that in the absence of any such prayer, the High Court should not have allowed an argument to be made and should not have held that clause (vii) was not enforceable as being ultra vires Section 9 of the Andhra Pradesh Motor Vehicles Taxation Act, 1963.
6. We find from the judgment of the High Court that even though there was no specific prayer, such a contention had been specifically taken in the petition. This contention was fully argued by both the parties. The High Court was thus right in concluding that no prejudice was being caused and that it can go into the question as to whether the demand for tax was under any authority of law.
7. It is an admitted position that the GO has been issued under Section 9 of the Andhra Pradesh Motor Vehicles Taxation Act, 1963 which reads as follows:
“9. Exemption, reduction or other modification of tax.—The Government may, by notification:
(a) grant an exemption, make a reduction in the rate or order other modification not involving an enhancement in the rate of the tax payable—
(i) by any person or class of persons, or
(ii) in respect of any motor vehicle or class of motor vehicles or motor vehicles running in any particular area; and
(b) cancel or vary such exemption, reduction or other modification.
(2) Any notification issued under sub-section (1) shall be laid, soon as may be after it is issued, on the table of the Legislative Assembly of the State while it is in session for a total period of fourteen days which may be comprised in one session or in two successive sessions.”
(emphasis supplied)
8. Thus Section 9 merely gives the Government power to issue a notification granting an exemption, making a reduction in the rate. But it specifically prohibits an enhancement in the rate of tax payable. Section 9 only permits cancellation of the exemption or the reduction which had been granted. Thus, at the highest, what the Government could have provided was that if there was violation of the GO then the normal tax, as payable under the said Act, would become payable. In this case what is sought to be recovered is more than the normal tax which would be payable in respect of the limited stage carriage. The High Court has therefore correctly held that there was no power to levy additional tax. In fact the law prohibits an enhancement of tax.
9. It was then submitted that the High Court was wrong in directing tax to be levied on the basis that it was a limited stage carriage. It was submitted that the High Court should have left it to the appellants to levy tax on the basis that it was an unlimited stage carriage. We however find that the notice had been issued to the respondents on the footing that they had taken special permits for limited halts. It is thus clear that it was a limited halt stage carriage. Therefore, the High Court was right in limiting the tax payable to the rate as specified under the Act for such stage carriages.
10. In this view of the matter, we see no infirmity in the High Court's judgment. We see no reason to interfere. The appeals stand dismissed. There shall however be no order as to costs.