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PETITIONER: AUTOMOTIVE MANUFACTURERS (P) LTD.  ETC.

       Vs.

RESPONDENT: GOVT.  OF ANDHRA PRADESH AND ORS.  ETC.

DATE OF JUDGMENT25/11/1971

BENCH: MITTER, G.K. BENCH: MITTER, G.K. SIKRI, S.M. (CJ) SHELAT, J.M. DUA, I.D.

CITATION:  1972 AIR  229            1972 SCR  (2) 593  1972 SCC  (1) 125

ACT: Andhra Pradesh Motor- Vehicles Taxation Act (5 of  1963)-Ss. 3,  9  and item 4 of Notification under s.--Levy of  tax  on chassis used on road-Chassis need not have body attached  to it before it can be "used" within meaning of s.  3-Exemption under  item 4 limited to journey of chassis for the  express purpose of body being attached to it.

HEADNOTE: Section 3 of the Andhra Pradesh Motor Vehicles Taxation  Act (5  of 1963) authorised levy of tax on motor vehicles  "used or  kept in use in a public place in the State".  Item 4  in the  table of the notification issued under s. 9 of the  Act exempted  from  the tax "any chassis of motor  vehicle  when driven  to  any Place in order that a body may  be  attached it." The Automotive Manufacturers (P) Ltd. in the State of Andhra Pradesh,  were  dealers,  among  other  things,  in  chassis received  by it from manufacturers outside the  State.   The chassis   were  driven  by  transport  contractors  of   the manufacturers  themselves  under  temporary  certificate  of registration  under the Motor Vehicles Act and delivered  to the  appellant  in the State of Andhra Pradesh.   The  Ashok Leyland  Ltd. transported motor chassis by road  from  their factory  in  Madras to dealers in various  parts  of  India. These  chassis  were  driven through  the  State  of  Andhra Pradesh  either  for delivery there or in  other  States  of India.   The Automotive Manufacturers and the Ashok  Leyland challenged  the imposition of tax under the Act.   The  High Court dismissed the petitions.  In appeals to this Court  it was  contended that (i) section 3 of the Act was not  appli- cable, because, there could be no user or keeping for use of the  chassis of a motor vehicle as a motor vehicle unless  a body was attached to it; (ii) as the chassis were invariably driven to their respective destination, in order that bodies may  be  attached  to them, they  came  directly  under  the notification  of exemption issued by the  State  Government; and  (iii)  the impugned levy operated as an  impediment  to free  trade  and commerce in violation of Art.  301  of  the Constitution.

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Dismissing the appeals. HELD : (i) It is not necessary for a chassis to have a  body attached  to it before it ran be used within the meaning  of the  Act, inasmuch as, it can be used by the man who  drives it  and  such use of it on public roads would be  enough  to attract the levy. [596 D] (ii) Item  4  in the table of the  notification  limits  the exemption from the tax to the journey of the chassis for the express   purpose  of  body  being  attached  to  it.    The Automotive Manufacturers, being dealers, could and  probably did  deal with or dispose of the chassis as such.   Further, it  was not the case of the appellant that the chassis  were coming  from  outside the State for the  purpose  of  having bodies attached to them at the workshop of the appellant. So far as Ashok Leyland was concerned the chassis were being driven along the roads of Andhra Pradesh for disposal at the journey’s  end  and  it would be for the  purchaser  at  the destination to have a body fixed to 594 the   chassis  according  to  his  own  need  and   on   the specification  given  by him., Merely  because  bodies  were going to be attached by the ultimate purchasers it could not be  said  that the running of the chassis on  the  roads  of Andhra Pradesh would attract exemption under item (4) of the notification. [597 C-E] [The  contention that there was no previous sanction of  the President  in respect of the bill as envisaged by  Art.  304 (b)  was  not allowed to be raised inasmuch as  it  was  not urged  in  writ  petitions.  Therefore, the  Court  did  not examine the merits of the contentions urged in this regard.

JUDGMENT: CIVIL  APPELLATE  JURISDICTION: Civil Appeals Nos.  2180  to 2182 of 1968. Appeals  by Special Leave from the judgment and order  dated October  6,  1967 of the Andhra Pradesh High Court  in  Writ Petitions Nos. 1456 of 1965, 376 and 2006 of 1966. M. C. Chagla, P. Ramachandra Rao and B. R. Agarwala, for the appellants (in all the appeals). P. Ram Reddy and A. V. V. Nair, for the respondents (in all the  appeals). The Judgment of the Court was delivered by Mitter, J.-These appeals are directed against the imposition of  taxes under the Andhra Pradesh Motor  Vehicles  Taxation Act (V of 1963).  The appellant in the first two appeals  is the  Automotive  Manufacturers (P.) Ltd.,  a  dealer,  among other automobile equipment, of motor chassis, motor vehicles etc. received by it from manufacturers outside the State  of Andhra  Pradesh.   The  first appeal arises out  of  a  writ petition  against  the  levy in  respect  of  motor  chassis delivered  to  it by Ashok Leyland Ltd.  of  Madras.   These chassis  are said to be driven by transport  contractors  of the  manufacturers themselves under temporary,  certificates of  registration under the Motor Vehicles Act and  delivered to the appellant at Secunderabad.  The second appeal by  the same appellant arises out of a writ petition challenging the levy  on jeeps, jeep truck chassis, jeep station  wagons  of the  manufacture  of  Mahindra & Mahindra  Ltd.  of  Bombay, besides pick-up vans, scooters etc. from Bajaj Auto Ltd.  of Poona.  The scooters are carried to Secunderabad in lorries. The  appellants in Civil Appeal No. 2182 of 1968  are  Ashok Leyland  Ltd.   Madras who transport motor chassis  by  road from their factory at Encore to dealers in various parts  of

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India, State Transport Undertakings etc.  According to their writ petition, these chassis have to traverse long distances in  the  State of Andhra Pradesh every  month  destined  for delivery  not  only in the said State but  also  beyond  the same.   These  chassis  are  driven  from  Ennore  to  their respective   destinations  in  the  several   States   under temporary certificates of registration obtained from the  595 Madras  State  on payment of requisite tax in  that  behalf, such  certificates of registration under s. 28 of the  Motor Vehicles Act being effective throughout India. The  appellants’  case  is  that the  levy  is  illegal  and unconstitutional.   The grounds urged in the writ  petitions filed in the High Court inter alia are as follows :- 1.   S.3 of the Act only authorises a levy of tax on a motor vehicles  "used  or kept for use in a public  place  in  the State".   There  can be no user or keeping for use:  of  the chassis of a motor vehicle as a motor vehicle unless a  body is  attached  to it.  ’In the, case of vehicles  other  than chassis such user or keeping for use in ’a public place  can only  take place when they are put to the required  user  or kept  for  use by the customers for whom  the  vehicles  are transported in the manner contemplated by the Motor Vehicles Act. 2.   S. 9 of the Act exempts from payment of tax chassis  of a  motor  vehicle "driven to another place in order  that  a body may be attached to it".  As the chassis are  invariably driven to their respective destinations in order that bodies may  be  attached  to them, they  come  directly  under  the notification of exemption issued by the State Government. As  the  chassis or the vehicles are  covered  by  temporary certificates of registration taken out by the  manufacturers entitling transportation throughout the territory of  India, the  impugned  levy operates as an impediment  to  the  free trade  and commerce of the petitioners in violation of  Art. 301 of the Constitution. The  High Court turned down all the contentions.  Hence  the appeals. Before this Court Mr. Chagla for the appellants limited  his first  and second contentions to the cases of chassis  only. His  first  contention  was that s. 3 of  the  Act  was  not applicable to the appellants. Sub-s. (1) of that section, runs as follows :-               "The Government may, by notification from time               to  time direct that a tax shall be levied  on               every motor vehicle used or kept for use, in a               public place in the State." Under sub-s. (2) of s. 3 the notification issued under  sub- s.  (1) is to specify the class of motor vehicles on  which, the  rates for the periods at which and the date from  which the tax shall be levied. A  motor vehicle has not been defined in this Act but  under s.  2(j)  of the Act it is to have, the same meaning  as  is assigned to it in the Motor Vehicles Act.  Under s. 2(18) of the   last  mentioned  Act,  "a  motor  vehicle  means   any mechanically propelled vehicle adapt- 596 ed  for  use upon roads whether the power of  propulsion  is transmitted thereto from an external or internal source  and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises." The  argument of learned counsel was that a chassis as  such could  neither be used nor kept for use in a  public  place,

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before a body was fitted to it and so long as the said  step was  not  taken, the question of levy of tax under  the  Act would not arise.  We were referred to the different meanings of the word "use" in the Oxford Dictionary some of which are as follows :-               "To  make use of as a means or instrument;  To               employ for a profitable end;" In  our  view, it is not necessary for a chassis to  have  a body attached to it before it can be used within the meaning of the Act inasmuch as it can be used by the man who  drives it  and  such use of it on public roads would be  enough  to attract the levy.  Ordinary chassis have bodies attached  to them for commercially profitable use but even without a body a chassis can be used and is actually used when it is  taken over public roads. The second submission was that the appellants qualified  for exemption  under the Government notification under s.  9  of the Act.  Section 9 inter alia provides :               "(1) 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  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;               xx              xx              XX. "               The notification issued ran as follows:-               " In exercise of the powers conferred by  sub-               section (1) of section 9 of the Andhra Pradesh               Motor  Vehicles  Taxation  Act,  1963  (Andhra               Pradesh Act 5 of 1963), the Governor of Andhra               Pradesh  hereby  grants exemption of  the  tax               payable in respect of motor vehicles specified               in  column (1) of the Table below  subject  to               the  conditions, if any, specified  in  column               (2) thereof’.                597               Item (4) of the table reads :               "Any chassis of a motor vehicle"               the condition for exemption being :               "When driven to any place in order that a body               may be attached to it." It  was  argued  that  as the use  of  a  chassis  would  be meaningless unless a body is attached to it and all chassis, as  a matter of fact, have to have bodies attached to  them, the driving of the chassis on the road without a body’ would qualify  for  exemption under, the above  notification.   We find ourselves unable to accept this view.  Item (4) in  the table  of the above notification limits the  exemption  from the  tax  to  the journey of the  chassis  for  the  express purpose  of  a body being attached to  it.   The  Automotive Manufacturers being dealers can and do probably deal with or dispose  of the chassis as such.  There is no allegation  in any of the two writ petitions tiled by these appellants that the  chassis  were  coming from Madras  or  Bombay  for  the purpose of having bodies attached to them at the workshop of the  appellant.   In  so  far  as  Ashok  Leyland  Ltd.   is concerned,  it is their positive case that the chassis  were being driven through the State of Andhra Pradesh either  for delivery  there  or  in other States of  India.   They  were certainly being driven along the roads of Andhra Pradesh for disposal  at  the  joumey’s  end and it  would  be  for  the purchaser  at  the destination to have a body fixed  to  the

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chassis  according to Ms own need and on  the  specification given  by  him.   Merely because bodies  were  going  to  be attached by the ultimate purchasers, it cannot be said  that the  running of the chassis on the roads of  Andhra  Pradesh would attract exemption under item (4) of the notification. The  last  point  urged  by counsel  was  that  inasmuch  as registration  of a vehicle in any State under s. 28  of  the Motor  Vehicles Act is to be effective throughout India  any tax  by a State on motor vehicles be they merely chassis  or otherwise would run counter to Art. 301 of the  Constitution according   to   which  trade,  commerce   and   intercourse throughout  the territory of India is to be free subject  to the  other provisions of Part XIII.  Under Art. 304(b)  how- ever it is open to the Legislative of a State to impose such reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State as may be required  in the  public interest.  This again is subject to the  proviso that  no Bill or amendment for the purpose of the  said  cl. (b) is to be introduced in the State Legislature without the previous sanction of the President.  Learned counsel  wanted to  urge that the impost was not saved by Art. 304(b)  inter alia,  on the ground that there was no previous sanction  of the  President in respect of the Bill as envisaged  by  Art. 304(b).   We  did  not allow counsel  to  press  this  point inasmuch as it had 598 not  been urged in the writ petition and we hereby  make  it clear that we are not examining the merits of the contention urged  by counsel in this regard and it will be open to  his clients, if so advised, to urge it in any future proceedings they may choose to take. These  appeals  were  originally heard by a  Bench  of  five Judges including S. C. Roy, J. who expired a few days  back. The  above judgment was concurred in by our late  colleague. We  however gave a further hearing to the parties  at  which nothing  was addressed to us to make us change  our  opinion already formed. In  the  result,  the appeals fail and  are  dismissed  with costs.  One set of costs including hearing fee. K. B. N.                  Appeals dismissed. 599