Karnataka High Court: Responding to the growing cries against the amendment, which introduced Lifetime Tax for outside vehicles staying within Karnataka for more than thirty days, the single bench of Anand Byrareddy J. quashed the amending Act restoring the mandate of Lifetime Tax as prescribed under the Motor Vehicles Act, 1988 (MV Act).
Hearing an array of clubbed petitions advanced by people coming from different states and occupations, many of whom were prompted to frequent traveling, the Bench focused upon the constitutionality and reasonability of the Karnataka Motor Vehicles Taxation (Amendment) Act, 2014 – an amending Act which provided for levying Lifetime Tax from all outside vehicles for their stay beyond thirty days within the state territory. The petitioners strongly argued claiming the Act to be ultra vires as the State Government did not have the legislative competence to pass the amendment, since it fell under Entry 35 of List III of Schedule VII to the Constitution and was already covered by the MV Act. Citing doctrine of repugnancy enshrined under Article 254(1) of the Constitution, the petitioners claimed that the Central Act would prevail over the State Act and to the extent of the repugnancy be void. The respondents represented by A.S. Ponnanna (AAG) argued that Entry 35 provides that the Central Government could lay down the principles on which taxes on such vehicles are to be levied, but no such principles have been laid down by the Central Government, either in the MV Act or otherwise, hence the doctrine of repugnancy would not apply. Also, the respondents claimed that the amendment was in the nature of a mere clarification.
Coming heavily upon the amending provision, the court called it a clumsy and ham handed attempt to undo the effect of a prior decision of the court. Further acknowledging the dependency of lifetime tax upon registration or re-registration, the court established that such levying of the lifetime tax as incorporated under the amending Act was unwarranted. [Jagadev Biradar v. State of Karnataka, 2016 SCC OnLine Kar 455, decided on 10/03/2016]
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