Don’t collect tax from omni buses for COVID period, Madras HC tells TN govt
The judge wrote that the petitioners were not liable to pay tax when their vehicles were not used or put on the road, as they sustained huge losses to restart service after the lockdown.
Madras High Court (File)
CHENNAI: The Madras High Court directed the State to permit the Omni bus operators to ply their vehicles on public roads without demanding the payment of tax for the COVID-19 pandemic period and quashed the order of the State Transport Authority refusing the vehicle stoppage report submitted by the bus operators.
“Once the vehicles were stopped and not operated on any public road, the State cannot levy tax,” wrote Justice GK Ilanthiraiyan while allowing a batch of petitions moved by Omni bus operators seeking to direct the State to permit them to operate the buses without payment of tax for the pandemic period.
The judge wrote that the petitioners were not liable to pay tax when their vehicles were not used or put on the road, as they sustained huge losses to restart service after the lockdown. He also quashed the Transport Authority’s order to return the stoppage report and directed the governing body to accept it and permit the Omni buses to operate on the permitted routes without insisting on the tax for the period of COVID-19.
During the COVID-19 lockdown, omni bus operators of the state ceased operation and submitted a stoppage report for the period of September 2021 - December 2022.
Despite the State permitting the operation of buses with 50 per cent occupancy (on September 22, 2021), the operators restrained from plying services due to losses and people’s non-interest in travelling by bus during the pandemic. They requested the State Transport Authority to allow them to continue operating without paying the taxes for the lockdown period.
The State Transport Authority refused to accept the report and did not permit the operators to continue service after the lockdown was lifted due to non-payment of taxes. The court intervened and passed an interim order directing the government to permit the Omni buses to operate.
Nevertheless, the Transport Authority has been persistent in collecting tax for the stoppage period since the State had green signalled the plying of buses.
Aggrieved by this, the bus operators moved the court.
The State submitted that per rule 172 (6) of the Tamil Nadu Motor Vehicles Rules, the fee should be paid for every 20 days stoppage. The State said the petitioners cannot escape paying taxes by submitting the stoppage applications. If the reports were accepted, it would cause great loss to the exchequer, as well as difficulty for the general public.
The court refused the State’s submission and wrote, “Though Rule 172 (6) and 254 of TN Motor Vehicles rules read about the stoppage or suspension of permits for certain period with prior permission and withdrawal of vehicle from service, it was not possible during COVID-19” and allowed the Omni bus owners’ petitions.
Chronology
*During the COVID-19 lockdown, omni bus operators of the state ceased operation and submitted a stoppage report for the period of September 2021 - December 2022
*The State permitted the operation of buses with 50 per cent occupancy on September 22, 2021, the operators restrained from plying services due to losses and people’s non-interest in travelling by bus during the pandemic
*The State Transport Authority refused to accept the report and did not permit the operators to continue service after the lockdown was lifted due to non-payment of taxes
*The court intervened and passed an interim order directing the government to permit the Omni buses to operate