Bengaluru, Mar 11: In a major relief to those using non-Karnataka registered vehicles in the State, the High Court on Thursday declared as unconstitutional the Karnataka Motor Vehicle Taxation (Amendment) Act, 2014 which provides for collecting lifetime tax on such vehicles.
The court also quashed the demand notices issued by the Regional Transport Offices (RTOs) to owners of several such vehicles to pay the tax. Several non-KA numberplate bearing vehicles were seized by the Transport Department for non-payment of tax and plying in Karnataka beyond 30 days.
Justice Anand Byrareddy pronounced the orders on a batch of pleas filed by non-KA registration vehicle owners and declared the 2014 Act unconstitutional and ultra vires. The challenged amendment to the Act was proposed in the 2014-2015 state budget to regulate non-KA registration vehicles and augment revenue. The petitioners contended it amounted to “harassment” as the tax was “illegal and unreasonable”.
Justice Reddy stated: “Lifetime tax that is levied at the point of registration of a vehicle as per the KMVT Act cannot be levied on a vehicle that is already registered, merely on a presumption that a vehicle registered outside Karnataka has remained in the State for a period exceeding 30 days.”
The bench said the State Legislature does not have competence to do so and took umbrage to the language employed in its explanation. “Notwithstanding anything contained in the provision of Motor Vehicle Act, 1988 (Central Act 59 of 1988) and in any order or direction contained in any judgment or order of any court would indicate the “clumsy” and “ham-handed” manner in which the State Legislature has sought to undo the effect of a decision of this court which has never been questioned and which has attained finality.”
The court said the basis of the government's decision still subsists and the payment of lifetime tax continues to be dependent on registration or re-registration in terms of sections 40 and 47 of the Motor Vehicle Act, 1988. The bench said the Explanation 2 (extracts of the amendment) to section 3 of the KMVT Act inserted by the Karnataka Motor Vehicles Taxation (Amendment) Act, 2014 is unconstitutional and ultra vires.
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