Non-Karnataka vehicles not needed to pay tax, says HC

Bengaluru, March 11: Anupam Jain (name changed) is a relieved man now. The man, who hails from Kolkata, came to the city last year in connection with his job. He shifted his entire household from Kolkata to Bengaluru, including his vehicle which bears a registration number of West Bengal.

The reason for Jain to feel relieved is that the Karnataka High Court has on Thursday declared the Karnataka Motor Vehicle Taxation (Amendment) Act 2014, which calls for collecting life-time tax on vehicles registered outside the state as unconstitutional.

"People told me that traffic cops often impound non-Karnataka vehicles on the roads and impose huge fine. I don't know how long will I stay in Bengaluru and my vehicle is also quite new. So it didn't make sense either to pay a life-time tax or sell off the vehicle, which again is a hassle. The court's decision has made it easier for people like us," he told Oneindia.

The high court also cancelled the demand notices issued by the Regional Transport Offices (RTOs) to people who own non-KA vehicles to pay the tax, the amount of which could be quite exhorbitant at times. Transport department officials seized several vehicles not bearing KA numberplate for not paying the tax and yet plying in the state for more than 30 days.

The order was announced by Justice Anand Byrareddy on a batch of please by non-KA vehicles and declared the 2014 Act unconstitutional. The amendment to the Act was proposed in the 2014-15 state budget to regulate vehicles from outside Karnataka to raise revenue but it was challenged on the ground of "harassment" as the tax was "illegal and unreasonable".

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".

A Facebook community called 'Drive Without Borders' had been fighting the clause that made payment of lifetime tax mandatory for two years now. The court's order will boost their campaign on road tax reforms.

Justice Reddy said lifetime tax which has been levied at the point of registration of a vehicle as per the taxation Act cannot be levied on a vehicle which is already registered, just by assuming that a non-KA vehicle has remained in the state for more than a month.

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 court said the payment of life-time tax will continue to depend on registration or re-registration in terms of sections 40 and 47 of the Motor Vehicle Act, 1988.

Oneindia News