Holding

The Supreme Court held that the petitioners had not discharged the initial burden of furnishing quantifiable data, rendering the High Court’s judgment unassailable, and therefore allowed the appeals to be withdrawn with liberty to file a fresh writ petition.

Summary

The petitioners challenged the Tamil Nadu Motor Vehicles Taxation (Amendment) Act, 1998 which raised tax rates for contract carriage, alleging that the increased levy imposed an uneven burden compared to stage carriage and violated Article 14's principle of proportionality. The High Court dismissed the writ petition, and the petitioners appealed to the Supreme Court. The Court observed that the petitioners' pleadings were sketchy and lacked the requisite statistical data to establish disproportionality, placing the initial burden of proof on them. Consequently, the Supreme Court found no infirmity in the High Court’s judgment. However, recognizing the public importance of the issue, the Court permitted the appellants to withdraw the appeals and file a fresh writ petition with detailed data. The appeals were dismissed without costs.

Issues considered

Whether the petitioners' writ petition sufficiently pleaded the claim of violation of Article 14 and proportionality in the increased tax rates.
Whether the High Court's judgment can be interfered with given the insufficiency of the initial pleadings.
Whether the Supreme Court may allow withdrawal of the appeals and liberty to file a fresh writ petition in the High Court.

Subjects

Constitutional lawTaxationArticle 14Principle of proportionalityContract carriageStage carriageWrit petitionPublic interestTamil Nadu Motor Vehicles Taxation Act

Judgment

(2008] 17 S.C.R. 631

R. SENTHIL BABU A
v.
STATE OF TAMIL NADU AND A,NR.
(Civil Appeal No. 7304 of 2008)

DECEMBER 16, 2008
8
[DR. ARIJIT PASAYAT AND DR. MUKUNDAKAM
SHARMA, JJ.]

Constitution of India, 1950 - Arts. 226 and 14 - Writ
petition raising issues of public importance - Requirement of c
pleadings with sufficient data and details - Contract carriage
vis-a-vis stage carriage - Taxation - Principle of
proportionality - Amendment Act providing for increased
rates of tax in respect of contract carriage - Order of High
Court on the writ petition filed by appellants challenging
constitutional validity of the said Act - Appeals against - Held: D
Petition before High Court was very sketchy - Pleadings at
the initial stage was thus insufficient- No infirmity in judgment
of High Court- However, since questions of public importance
were involved, appellants permitted to withdraw the appeals
with liberty to file fresh writ petition in High Court with proper E
details and data - Tamil Nadu Motor Vehicles Taxation
(Amendment) Act, 1998.
The Tamil Nadu Motor Vehicles Taxation
(Amendment) Act, 1998 provided for increased rates of
tax in respect of contract carriage. Appellants filed writ F
petition challenging constitutional validity of the 1948 Act
on the ground that it placed uneven burden on owners
of contract carriage vis-a-vis stage carriage. The order
passed by the High Court on the petition was challenged
in the present appeals. G
Dismissing the appeals, the Court
HELD: 1.1. Generally, in a matter of this nature, the
quantifiable data forms the basis of the challenge. At the
631 H
-(
632 SUPREME COURT REPORTS [2008] 17 S.C.R.

A initial stage when the petition is filed in such cases there
has to be a precise formulation of the ground of challenge
from the side of the appellants based on some statistical
data as to disproportionality of the rate of tax. It is only
thereafter that the burden will shift on to the State to
8 submit quantifiable and measurable data. In the present
case, the initial burden on the appellants itself has not
been discharged in the sense that the petitions filed
before the High Court were very sketchy. A challenge of
this nature requires the appellants to furnish greater
details before the State could be called upon to submit
C quantifiable and measurable data justifying the
impugned rate. Ultimately, it is the State which has to
meet the allegations made in the writ petitions and if
those allegations made in the writ petitions are vague,
inaccurate or insufficient then !t would not be possible
D for the State to submit its reply/data to the Court. The
repeated increase in the rate of tax, particularly the
incidence of which is more on the contract carriage vis.-
a-vis stage carriage raises question of public importance.
At the same time the State can certainly. rely upon the
E data available to show cross subsidization, if it so exists
in a given case, by which stage carriage gets subsidized
in public interest. Keeping in mind the gamut of the
dispute involved, this Court cannot interfere with the
impugned judgment of the High Court, particularly whe_n
F the pleadings at the initial stage were insufficient. [Paras
4, 5, 7 and 8) [634-8-C-D-E, G]
-j·
1.2. The appellants sought permission of this Cour:t
to withdraw the civil appeals/special leave petitions with
liberty to file proper writ petition in the High Court giving
G requisite details and available data. Normally, such
permission cannot be granted. However, questions· of
public importance ari~es in these matters, particularly in·
the context of the principles of proportionality under Article . ·
14 of the Constitution and the later development of law, as
indicated by this Court in the case of Jindal Stainless
H. Steel*. In the circumstances, the appellants are permitted

·•
R. SENTHIL BABU v. STATE OF TAMIL NADU AND ANR. 633

to withdraw the appeals with liberty to file proper writ A
petition, if so advised. There is no infirmity in the impugned
judgment of the High Court based on the petition originally
filed before it. [Paras 9 and 10] [635-A-D]
*Jindal Stainless Ltd. (2) and Another vs. State of
Haryana and Others (2006) 7 SCC 241 and Tamil Nadu B
Omni Bus Owners Association v. State of Tamil Nadu & Anr.
i.e. C.A.No.1177 of 2006 disposed of by Supreme Court
on 28.11.2007, referred to.
Case Law Reference:
(2006) 7 SCC 241 relied on Para 6 C
CIVIL AP PELLATE JURISDICTION : Civil Appeal No.
7304 of 2008.
From the final Judgment and Order dated 29.11.2005 of
the High Court of Judicature at Madras in Writ Petition (Civil)
No. 4066 of 2002. D
·WITH
C.A. No. 7305 of 2008.
Aribam Guneshwar Sharma for the Appellant.
R. Nedumaran for the Respondents. E
The Judgment of the Court was delivered by
DR. ARIJIT PASAYAT, J. 1. Leave granted.
2. The short question which arises for determination in
these Civil Appeals concerns challenge to the Constitutional
F
validity of Tamil Nadu Motor Vehicles Taxation (Amendment)
t-
Act, 1998, by which initially the rate of tax in respect of contract
carriage stood increased from Rs.1500/- per seat per quarter
to Rs.2000/- per seat per quarter, and subsequently the said
rate stood enhanced from Rs.2000/- per seat per quarter to
Rs.3000/- per seat per quarter vide Notification No.1184 dated G
30.11.2001 with effect from 1st December 2001.
3. The basis of the challenge rests on the uneven burden
placed on the owners of contract carriage vis-a-vis stage
carriage. Broadly it is contended that there is no rational in the
H
634 SUPREME COURT REPORTS [2008] 17 S.C.R.
e
A imposition of the levy, that tax is imposed indiscriminately, that

-
it is levied to cross-subsidize stage carriage and that uneven
burden has been placed on the owners of contract carriage
which has no nexus with the services or amenities provided.
4. Generally, in a matter of this nature, the quantifiable data
B forms the basis of the challenge. At the initial stage when the
petition is filed in such cases there has got to be a precise
formulation of the ground of challenge from the side of the
appellants based on some statistical data as to
disproportionality of the rate of tax. It is only thereafter that the
C burden will shift on to the State to submit quantifiable and
measurable data.
5. In the present case we find that the initial burden on the
appellants itself has not been discharged in the sense that the
petitions filed before the High Court were very sketchy. A
challenge of this nature requires the appellants to furnish
D greaterdetails before the State could be called upon to submit
quantifiable and measurable data justif'jing the impugned rate.
..•
I

Ultimately, it is the State which has to meet the allegations
made in the writ .petitions and if those a!legations made in the
writ petitions are vague, inaccurate 9r insufficient then it wou!d
E not be possible for the State to submit its replyidata to the Court.
6 .. One more aspect in these cases also needs to be
mentioned; It has been argued before us that the tax in question
is a compensatory tax. Certain judgments of this Court are also
relied upon in this regard, the latest being the judgment in the
F case of Jindal Stainless Ltd. (2) and Another vs. State of 1-
_, I
Haryana and Others [(2006) 7 SCC 241].
7. In our view, this repeated increase in the rate of tax,
particularly the incidence of which is more on the contract
carriage vis-a-:-vis s'tage carriage raises question of public
G importance. At the same time the State can certainly rely upon
the data available to show cross subsidization, if it so exists in
a given case, by which stage carriage gets subsidized in public
.
interest.
8. Keeping in mind the gamut of the dispute involved, we
H are of the view that we cannot interfere with the impugned
- '
I
)
R. SENTHIL BABU v. STATE OF TAMIL NADU AND ANR. 635
[DR. ARIJIT PASAYAT, J.]

judgment of the High Court, particularly when the pleadings at A
.... the .initial stage were insufficient.
9. Realizing this difficulty, learned co~sel appearing on
behalf of the appellants fairly stated th t he would seek
permission of this Court to withdraw the Civ)t appeals/special
leave petitions with liberty to file proper writ peti~ion in the High B
Court giving requisite details and available data. Normally, we
would not have granted such permission. However, as stated
above, questions of public importance arises in these matters,
particularly in the context of the principles of proportionality
under Article 14 of the Constitution and the later development
of law as indicated by this Court in the case of Jindal Stainless
c
---... Ltd. (Supra).
10. In the circumstances we permit the appellants herein
to withdraw the Civil Appeals with liberty to file proper writ
petition, if so advised. We make it clear that we do not find any
D
infirmity in the impugned judgment of the High Court which is
-.I,
based on the petition originally filed by the petitioners. Subject
to above, Civil Appeals stand dismissed with no order as to ·
costs. We make it clear that if a proper writ petition is filed
giving requisite data to the satisfaction o_f the High Court, then
any observation made in the impugned judgment will not come E
in the way of the appellants. All contentions of both sides are
expressly kept open.
11. Similar order was passed in a group of cases i.e. Tamil
Nadu Omni Bus Owners Association v. State of Tamil Nadu
& Anr. (i.e. Civil Appeal No.1177 of 2006 etc. disposed of on F
" t-
28.11.2007).
12. Subject to the above, the Civil Appeals are dismissed
with no orders as to costs.
B.B.B. Appeals dismissed.
G
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