No motor vehicle tax if not used in public place: SC

Motor vehicle tax is compensatory in nature and if a vehicle is not used or not kept for use in a ‘public place’, then its owner should not be burdened with motor vehicle tax for such period, the Supreme Court has said.

- PRESS TRUST OF INDIA

A bench of Justices Manoj Misra and Ujjal Bhuyan delivered its verdict on an appeal challenging a December 2024 judgement of the Andhra Pradesh High Court.

“Motor vehicle tax is compensatory in nature. It has a direct nexus with the end use. The rationale for levy of motor vehicle tax is that a person who is using public infrastructure, such as, roads, highways etc. has to pay for such usage,” the apex court said.

Referring to section 3 of The Andhra Pradesh Motor Vehicle Taxation Act, 1963, the bench said the legislature has consciously used the expression ‘public place’ in this provision. Section 3 of the Act deals with levy of tax on motor vehicles.