Raja Devaputhran Cunniah vs The Regional Transport Officer

Janarthanam, J.—One Raja Devaputhran Cunniah, a resident of Trivandrum, holds a permit for the vehicle KRV 7270 granted by the State

Transport Authority, Kerala, to use the vehicle as an All India Tourist Vehicle. It can operate throughout India without any endorsement from any

other State. Its liability to pay tax is only to the parent State viz. the Kerala Government. This had been paid and the vehicle had been used as a

contract carriage.

The vehicle was checked by the Motor Vehicles Inspector, Grade II, Salem on 27.6.1983. A check report was issued alleging that the vehicle

was coming from Trichy to Bangalore along with 35 adult passengers, collecting Rs. 40 for the journey as individual fare. Based on the check

report, the Regional Transport Officer, Salem, issued a show cause notice stating that the vehicle was being used as a stage carriage and hence the

permit holder is liable to pay proportionate lax of Rs. 3,267 for the month of June, 1983 to the Government of Tamil Nadu. On 3.8.1983, the

petitioner submitted an explanation that the vehicle had been hired to a travel agency as a contract carriage for a specified purpose and, therefore,

no liability arises for payment of any tax whatever, especially when tax had already been paid to the Government of Kerala. This was not accepted

by the respondent who passed an order in R. No. 69173/B4/83, dated 27.5.1984, confirming the proposal and demanding a sum of Rs. 3,267. It

is this order that is challenged in W.P. No. 7333 of 1984.

Similarly, the vehicle was previously stated to have been checked by the Motor Vehicles Inspector, Grade II, Salem on 21.2.1983. A check

report was issued alleging that the vehicle was coming from Salem to Bangalore with 37 adult passengers collecting Rs. 20 per individual. Based

on the check report, the respondent issued a show cause notice on 17.3.1983 stating that the vehicle was being used as a stage carriage and

demanding Rs. 2,683 as proportionate tax for February, 1983, to the Government of Tamil Nadu. On 4.6.1983, the petitioner gave an explanation

that the vehicle was not used as a stage carriage and that no individual fare was collected. The explanation was not accepted by the respondent

who passed an order in R. No. 17390/B4/83, dated 27.5.1984, confirming the proposal and demanding a tax of Rs. 2,683. It is this order that is

challenged in W.P. No. 7334 of 1984.

It could be seen from the above facts that the petitioner, respondent, the vehicle demand etc., are one and the same and the difference is only

with regard to the month and amount demanded.

In this background and setting up of facts, the two writ petitions had been taken up for disposal together.

What the petitioner contended before the respondent in his explanation and equally so here with all vigour and vehemence, is that his vehicle had

been hired to travel agents as a whole for fixed sums of money and if the agents collected individual fare from each passenger, the petitioner could

not be made liable for the same. The further contention is that the collection of separate fares is not prohibited u/s 2(3) of the Motor Vehicles Act,

1939 (hereinafter referred to as ''the Act''), when it defines ''contract carriage'' and his vehicle plied between points without stopping to pick up or

set down along the line of the routes, passengers not included in the contract. These contentions were, however, repelled by the respondents.

The tenability or otherwise of the rival submissions made may now fall for consideration. The tangle posed in these writ petitions is capable of

solution, with case and grace, if the distinction between a contract carriage and a stage carriage is understood properly. Section 2(3) defines

''contract carriage'' as follows:

''contract carriage'' means a motor vehicle which carries a passenger or passengers for hire or reward under a contract, expressed or implied for

the use of the vehicle as whole at or for a fixed or agreed rate or sum-

(i) on a time basis whether or not with reference to any route or distances, or

(ii) from one point to another and in either case without stopping to pick up, or set down along the line of route passengers not included in the

contract and includes a motor cab notwithstanding that the passengers may pay separate fares.

Section 2(29) defines ''stage carriage'' as follows

''stage carriage'' means a motor vehicle carrying or adapted to carry more than six persons excluding the driver which carries passengers for hire or

reward at separate fares paid by or for individual passengers either for the whole journey or for stages of the journey.

The criteria to be adopted to distinguish a contract carriage from a stage carriage as set down in the pronouncement of the Supreme Court in

Shri Roshanlal Gautam Vs. State of Uttar Pradesh and Others, , may be usefully referred to here:

By Section 2(3) a contract carriage is defined as a motor vehicle which carries a passenger or passengers for hire or reward under a contract from

one point to another without stopping to pick up or set down along with the line of that route passengers not included in the contract. A stage

carriage is defined as a motor vehicle carrying or adapted to any passengers for hire or reward at separate fares paid for the whole journey or for

stages of the journey. The distinction between the two is this : the contract carriage is engaged for the whole of the journey between two points for

carriage of a person or persons hiring it, but it has not the right to pick up other passengers en route. The stage carriage, on the other hand, runs

between two points irrespective of any prior contract and it is boarded by passengers en route who pay the fare for the distance they propose to

travel.

It is not at all the case of the respondent, that the vehicle was picking up other passengers en route, so as to come within the mischief of the

above ratio. As we could see from the definition of ''contract carriage'' by the collection of separate fares from the passengers, it would not lead to

the deduction that the vehicle has been used as a stage carriage and not as a contract carriage. I am, therefore of the view that there are no

materials on the basis of which the impugned orders could be sustained. In similar circumstances this Court in Krishnasami Chetty v. The Licensing

Officer 100 L.W. 654, has taken the view that collection of separate fares from passengers would not lead to the conclusion that the vehicle was

being used as a stage carriage and not a contract carriage.

For the abovestated reasons, I am unable to uphold the impugned orders and accordingly, these writ petitions are allowed as prayed for. No

costs.