Messrs. Sundaram Finance Ltd., Madras vs The District Transport Officer, Tiruchirapalli and others

Ramanujam, J.—These petitions have been filed by the same party, M/s. Sundaram Finance, Ltd., in reaped of two different vehicles. The

petitioner is carrying on the business of hire purchase financing in motor vehicles end other items. In the course of business, the petitioner financed

certain amounts in respect of two vehicles bearing registration be TNY 3461 and TNY 3569, repayable in 35 monthly instalments commencing

from 6th August, 1973 and 12th September, 1973, respectively. According to the petitioner, as on the date of filing of the writ petitions, a sum of

Rs. 58,985 and Rs. 59,080 is payable under the hire purchase agreement. Since the hirer of the two vehicles committed default in the payment of

the instalments due under the two respective hire purchase agreements, the petitioner exercised its right under the hire purchase agreement and

seized the two vehicles on 26th August, 1974 and 18th July, 1974, respectively. The petitioner intimated the first respondent that the vehicles had

been seized and that the vehicles have stopped plying on the routes. The petitioner also issued notices to the hirer and the guarantor on 4th

September, 1974 and 7th August, 1974 respectively. The registration certificates and permits pertaining to the two vehicles were also surrendered

by the petitioner on 9th December, 1974, and the surrender of documents was acknowledged by the first respondent on 14th December, 1974.

The petitioner thereafter applied to the first respondent on 30th December, 1974 for the issue of the Tax Clearance Certificates in respect of the

vehicles the petitioner''s applications for the issue of the said certificates were returned by the first respondent on the ground that the Tax Clearance

Certificates can be obtained only by the hirer and not by the petitioner. The petitioner is aggrieved by the rejection of its applications for the issue

of the Tax Clearance Certificates and has crone to this court for the issue of a direction to the first respondent to entertain the application for the

issue of the Tax Clearance Certificates and for the grant of the same. On the facts of there cases, I am of the view that the first respondent is not

justified in returning the applications of the petitioner for the issue of the Tax Clearance Certificates on the ground that the permit holder alone

should apply for the tax clearance certificates. Admittedly, the petitioner has got an interest in the vehicles and it has in fact possession of the

vehicles in pursuance of the hire purchase agreement. It is also authorised to dispose of the vehicles under the hire purchase agreement. Therefore,

it is entitled to ask for the issue of a Tax Clearance Certificate in respect of the vehicles in its own rights and it is not correct to reject the

applications of the petitioner for the issued the Tax Clearance Certificate on the ground that it is not the permit holder in respect of the vehicles.

The learned Government Pleader who has taken notice of the petitions is not able to sustain the stand taken by the first respondent in returning

the applications of the petitioner for the issue of a Tax Clearance Certificate on the only ground that the permit holder alone should apply for a Tax

Clearance Certificate. The writ petitions are therefore allowed, and there will be a direction to the first respondent to consider the applications of

the petitioner for the issue of a Tax Clearance Certificate in respect of the two vehicles and dispose them of on merits. There will be no order as to

costs in both the petitions. Learned counsel for the petitioner submits that as the vehicles have stopped plying and stoppage reports have been sent

and the relevant documents have been surrendered, there is no tax liability for the vehicles on of after 30th September, 1974, and the petitioner is

not liable to pay tax subsequent to 31st December, 1974 If really the vehicles have stopped plying on the routes and if the statutory requirements

have been complied with by the petitioner before 31st December, 1974, as contended then there cannot be any tax liability for these vehicles. But

these are all matters which have to be considered by the first respondent while considering the applications for the issue of the Tax Clearance

Certificates.