Case Law Details
Mahindra and Mahindra Financial Services Ltd. Vs State of U.P. (Supreme Court)
As per Section 2(h) of the Act,1997 read with Section 2(30) of the Act, 1988, even a person in possession of the vehicle under the hire-purchase agreement or an agreement of sell or an agreement of hypothecation can also be said to be the ‘owner’. Therefore, a financier like the appellant, who is in possession of the transport vehicle in question owing to non-payment of the loan amount is an “owner” under the relevant provisions of the Act, 1997 and Act, 1988.
SC held that financier of a motor vehicle/transport vehicle in respect of which a hire-purchase or lease or hypothecation agreement has been entered, is liable to tax from the date of taking possession of the said vehicle under the said agreement. If, after the payment of tax, the vehicle is not used for a month or more, then such an owner may apply for refund under Section 12 of the Act, 1997 and has to comply with all the requirements for seeking the refund as mentioned in Section 12, and on fulfilling and/or complying with all the conditions mentioned in Section 12(1), he may get the refund to the extent provided in sub-section (1) of Section 12, as even under Section 12(1), the owner / operator shall not be entitled to the full refund but shall be entitled to the refund of an amount equal to one-third of the rate of quarterly tax or one twelfth of the yearly tax, as the case may be, payable in respect of such vehicle for each thirty days of such period for which such tax has been paid. However, only in a case, which falls under sub-section (2) of Section 12 and subject to surrender of the necessary documents as mentioned in sub-section (2) of Section 12, the liability to pay the tax shall not arise, otherwise the liability to pay the tax by such owner/operator shall continue.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 16.12.2019 passed by the Full Bench of the High Court of judicature at Allahabad, Bench Lucknow in Writ Petition No. 4529 of 2018 by which the High Court has dismissed the said writ petition preferred by the appellant herein and held that the appellant herein as a financier-in-possession of the transport vehicle is liable to pay tax under the U.P. Motor Vehicles Taxation Act, 1997, the original writ petitioner, the financier has preferred the present appeal. The said financier had extended a loan for the purchase of the transport vehicle and on default in payment of the loan is in possession of the vehicle in question.
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