K.M. Khader Nawaz Khan vs Transport Commr. Bangalore

K.V. Narayana Raju, M.-This appeal under Section 15 of the Karnataka Motor Vehicles Taxation Act is from an alleged order dated 19-3-1980 of the Commissioner of Transport, Bangalore in No. T.C. Tax. II PR 343/79-80 directing that the appellant herein may not be prosecuted if he paid smaller penalty of Rs. 2000 for non-payment of tax due in respect of his motor vehicle MYD 637 for quarter 1-4-1978 to 30-6-78.

On 28-7-1979 the appellant addressed the Regional Transport Officer saying that he had not paid the tax due to major repairs and financial troubles, that he was ready to pay the tax and therefore his case may be recommended to the Commissioner for levying nominal penalty. He appears to have enclosed certificates that the vehicle was in the garage for some days in May and June 1978. It may be noticed that even if the certificates are genuine the vehicle was in garage only for a few days during the quarter for which the tax was not paid. Such certificates are of no consequence when there is no denying that the vehicle was kept for use in the State and tax had not been paid. The appellant had not taken action to surrender the registration certificate. Besides, whether the vehicle was liable to tax at all is irrelevant since proceedings are initiated at the instance of and on appellant admitting commission of offence and requesting composition.

The Regional Transport Officer reported by letter dated 21-8-1979 that tax due of Rs. 4257 for the quarter ending 30-6-78 was paid on 30-7-1979 and that the request of the owner may be considered. He did not say whether or not a good case was made out for imposition of penalty less than what he was competent to collect.

We may on this occasion point out that very rarely the Regional Transport Officer records his satisfaction that the case recommended for a smaller penalty under Rule 29(B) of the Motor Vehicles Taxation Rules was really one warranting leniency. It is necessary to impress on the Regional Transport Officers the need to record what grounds demand imposition of less than normal penalty.

The Regional Transport Officer, Bangalore enclosed a proforma in which he said that the offence reported was the second offence; tax had been paid on 30-7-1979, that the default was for a period of 16 months and normal penalty worked out to Rs. 34056. The Regional Transport Officer himself was competent to collect only 10 percent in the case of first offence and 25 percent in the case of second offence. Here we desire to point out that the sub-clauses of rule 29(B) as amended by Notification dated 11-12-1975 do not in fact lay down guidelines for the exercise of the discretion vested in the Regional Transport Officer. The sub-rules only lay down the limits of the power of the Regional Transport Officer and afford no guide lines whatsoever as to the conditions and circumstances in which he could levy only 10 percent or 25 percent of the normal penalty. The power conferred on him appears too wide and unguided with the result there is great scope for arbitrariness. We are of the opinion that there is need for making amendments.

Proviso to Rule 29(B)(ii) which deals with imposition of still smaller penalty lays down that such penalty may be fixed with the sanction of the Transport Commissioner if the delay in payment of tax was beyond the control of the accused under most unavoidable circumstances.

There can be no doubt that the Regional Transport Officer is expected to make a reference to the Transport Commissioner only if the delay in payment was for reasons beyond the control of the accused under most unavoidable circumstances. It may be possible to say that the discretion vested in the Regional Transport Officer to collect either 10 per cent or 25 percent of the normal penalty could be exercised only if the person liable to pay tax made out a case more or less of the same kind as what would warrant a reference to the Commissioner.

The advocates appearing in similar cases have been contending before this Tribunal that power is exercised by the Regional Transport Officer or the Commissioner in a highly arbitrary and capricious manner and that there have been instances where the Transport Commissioner has levied only penalty of Rs. 5 or 20 without assigning any special reason, and that there have also been instances where penalty of thousands of rupees has been demanded without giving reasons. Out experience also has been that neither the Regional Transport Officer nor the Transport Commissioner is stating reasons for levying smaller penalty which the Regional Transport Officer is competent to collect, or still smaller penalty which the Transport Commissioner could impose.

What is more, wherever record is called for, the Transport Commissioner sends only copies of some documents and withholds all original papers including the memorandum of the proceedings in which he sometimes records reasons in support of the amount fixed by him. In a certain case Appeal No. 553 of 1980 dt. 25-4-1981 a representative of the Trans port Commissioner produced the record for our perusal and despite our request the said representative Smt. Shamala took back the papers. This indeed is a highly unsatisfactory state of affairs. We are unable to find any good reason for the office of the Transport Commissioner sending copies of the documents and withholding important documents from this tribunal We trust and hope that the powers that be would see that what is proper and appropriate is done by the Regional Transport Officer and the Transport Commissioner.

Reverting to the matter on hand, the appellant has contended that the Transport Commissioner erred in demanding penalty of Rs. 2000 for late payment, that he did not operate the vehicle during the quarter for which the tax was not paid within time and that when the vehicle was not used there was no liability to pay tax etc.

We have heard the counsel for the appellant. None of the contentions raised appears valid. Even if the vehicle was kept in a garage for repairs it is not possible to say that the vehicle was not fit and was not kept for use in the State of Karnataka,

Under the Motor Vehicles Taxation Act and Rules a person could save himself the liability to pay tax by keeping the transport officer informed well before the vehicle is sent to garage for repairs. When that precaution is not taken by the operator it is reasonable to hold that there was no cesser of liability to pay tax. What is more the appellant cannot be heard to say that the vehicle was not kept for use or used and therefore no offence was committed, for the simple reason that he admitted in his letter the delay in payment of tax and that recommendation may be made for fixing a smaller penalty. Having so admitted it is not open to him to prefer an appeal against the imposition of penalty. He may of course complain if the R.T.O. or Commissioner has not exercised discretion fairly or properly.

While the Transport Commissioner is under a duty to act fairly and reasonably in exercising his discretion and as a demonstration of such fairness he should state reasons, we are of the opinion that in the case before us the appellant has not made out how the demand of Rs. 2000-00 against normal penalty of over Rs. 34,000-00 is excessive. Without approving the manner in which the Transport Commissioner has disposed of the matter before him, we decline to interfere with the amount fixed by him.

For the foregoing reasons the appeal is dismissed. A copy of this Judgment shall be sent to each of the Commissioner for Home, and Transport Commissioner.

[1981](1) KAR.L.J. 67

Karnataka Cooperative Societies Act (11 of 1959), S. 70(2)(d) as amended by Act 19 of 1976 - Industrial Disputes Act, 1947 - Dispute relating to service matters in cooperative society - Jurisdiction of Registrar.

Industrial Disputes Act, 1947 and the Karnataka Cooperative Societies Act 1959 as amended by Act 19 of 1976 can coexist, that is side by side and the question of one prevailing over the other does not arise.

The jurisdiction of the Registrar to entertain and determine disputes falling under S. 70(2)(d) of the Cooperative Societies Act is not affected by the Industrial Disputes Act; and he can exercise jurisdiction in respect of all employees and workmen in the societies as if he were a civil court.