Tarachand Logistic Solutions Limited Vs State of Andhra Pradesh & Ors. (Supreme Court of India)
Conclusion: Vehicles operating exclusively within the enclosed premises of a factory or plant were not liable to pay motor vehicle tax, as such areas did not constitute a “public place.”
Held: The issue arose from a contract between Appellant and the Respondent- Visakhapatnam Steel Plant (RINL) for logistical work within the plant’s central dispatch yard. The company deployed 36 vehicles which, from April 2021, operated solely inside the steel plant’s premises, an area surrounded by compound walls with access controlled by CISF personnel. The vehicles never plied on public roads. Believing this exclusive internal use made them exempt, Appellant sought relief from paying motor vehicle tax. The State Transport Department rejected the request and demanded over ₹22 lakh, which the company paid under protest. Andhra Pradesh High Court’s Division Bench later upheld this demand, leading to the appeal in the Supreme Court. It was held that requirement of law was that the motor vehicle should be used or kept for use in a ‘public place’. When admittedly the motor vehicles of the appellant were confined for use within the RINL premises which was a closed area then question of the vehicles being used or kept for being used in a ‘public place’ did not arise.”, the court said. “In the instant case, the motor vehicles in question were used or kept for use only within the restricted premises of RINL which was not a ‘public place’. Therefore, the said vehicles were not liable to be taxed for the period the said vehicles were used or kept for use within the restricted premises of RINL. Argument of the respondent that appellant had not intimated non-use of the motor vehicles in terms of Rule 12A did not carry much persuasion in view of what was discussed. Thus, even in the absence of any intimation in terms of Rule 12A, motor vehicles of the appellant could not be subjected to motor vehicle tax for the period those were used or kept confined within the restricted premises of RINL.”
