ANKIT PATEL Vs. THE STATE OF MADHYA PRADESH AND OTHERS

Madhya Pradesh High Court (Division Bench (DB)- Two Judge)

WA, 702 of 2021, Judgment Date: Aug 05, 2021

Law laid down:-

Writ Appeal under Section 2(1) of the M.P. Uchcha Nyayalaya (Khand Nyay Peeth Ko Appeal) Adhiniyam, 2005 assailing the order passed by the writ court dismissing the petition under Article 226 of the Constitution of India seeking benefit of discount/exemption to the extent of 90% on the motor vehicle tax penalty in terms of Notification dated 02.08.2019 issued by the Transport Department, Govt. of M.P. under Section 21(1) of the M.P. Motor Vehicles Taxation Act, 1991 – Held – The union of the words “terms” and “conditions” clearly denotes plural and not a singular. Moreover, all the four conditions have been enumerated one after another and have not been disjuncted by use of the word “or”. Not only, therefore, as per the sub-clause (1) of Clause 1 vehicle should have completed 20 years from the date of manufacture and still registered in the Transport Department but the sub-clause (2) also has to be satisfied. Admittedly, the vehicle of the petitioner does not fulfill the very first condition of having completed 20 years from the date of manufacture and therefore, merely because it is still registered in the Transport Department that by itself will not bring the case of the petitioner within the purview of first clause of the exemption notification. There is, therefore, no need to apply the test contained in the subsequent three sub-clauses namely the sub-clauses (2), (3) and (4). The petitioner is therefore, not entitled to the benefit of Clause 1 of the Notification. Since vehicle of the petitioner is 9 years old, his case will fall in Clause 2(1)2, his vehicle being more than 5 years old but not more than 10 years old registered from the date of notification and thus, disentitling him to the discount of only 40%.

It is trite that exemptions are to be strictly interpreted in fiscal statute and the important principle of interpretation interpreting them is that in construing an exemption notification, the question of equity does not arise and the exemption provision has to be strictly construed. Any exemption notification or any clause of any notification of exemption in regard to taxation has to be strictly construed.

The interpretation of the exemption notification is required to be made in the light of the words used therein and not by any other method. Nothing can be added or subtracted from what has been stated in the notification granting exemption and that such notifications are required to be strictly construed. When the language is simple, clear and unambiguous, the words used in the notification granting exemption have to be given their natural meaning.

While exemptions should generally be interpreted strictly and in case of ambiguity it has to be interpreted in favour of the revenue but the expressions regarding beneficiary exemptions have to be interpreted differently, keeping in view the purpose of encouragement of industrial activities, encouraging capital investment, promoting development of industry and trade etc., which exemption provisions may be interpreted liberally.

ANKIT PATEL Vs. THE STATE OF MADHYA PRADESH AND OTHERS