Court okay for vehicle tax levy

There is bad news for vehicles owners in the state of West Bengal - the Calcutta High Court yesterday stayed the single judge order of March 26, which had declared the West Bengal Additional Tax and One Time Tax on Motor Vehicles (Amendment ) Act 2003, as ultra vires of the Constitution of India.

By this ad-interim stay, the state will now be able to collect one-time tax for the vehicles and also not refund tax it had already collected prior to the March 26 order.

The West Bengal government yesterday filed an appeal against the single judge order. The order had directed the state to refund the tax already collected with interest.

Chief Justice A K Mathur and Justice A K Bannerjee, while staying the operation of the March 26 order, fixed the case for final hearing on June 10, 2004, and observed, "no penal action would be taken against the tax payer for default in payment of taxes payable under the 2003 Act".

Balai Ray, state advocate general, argued, "The state is in need of revenue and if stay of single judge order not granted, there would be a huge loss of revenue for state".

It was also argued that the 2003 amendment act was a legislative action of the government which a writ court could not adjudicate.

Automobile Association of Eastern India (AAEI) and some other parties had moved several writ petitions challenging the legality of amendment. P K Ray and Promit Ray, counsel for AAEI, raised preliminary objection regarding filing of only one appeal.

They stated the judge had passed one order but its covered all the writ petitions. So the state should file appeals challenging all the writ petitions.

AAEI said after March 26, the state had already collected annual tax in place of one-time tax, so if any stay was granted it would lead to confusion amongst people. So a stay should not be granted, AAEI added.