Charge vehicle tax on discounted price, says UT consumer panel

Dushyant Singh Pundir

Tribune News Service

Chandigarh, December 25

In a major decision, the State Consumer Disputes Redressal Commission, Chandigarh, has ordered the Punjab Transport Department to consider discounted price of a vehicle, not the ex-showroom price, for charging motor vehicle tax.

Preet Kamal Singh of Mohali, who is the complainant in the case, had purchased a car from Joshi Hyundai. The ex-showroom price of the car was Rs 4.90 lakh on which the car dealer gave a discount of Rs 98,062 and the net selling price of the car came down to Rs 3.92 lakh.

Preet Kamal submitted that when CGST and UTGST had been charged on the discounted price of Rs 3.92 lakh, then the same principle ought to have been applied by the Department of Transport, Punjab, and the State Transport Commissioner, Punjab, while calculating the motor vehicle tax.

On the other hand, Sukhwinder Kumar, Secretary, Regional Transport Authority, SAS Nagar, submitted that as per the Punjab Motor Vehicles Taxation Act, 1924, the tax on motor car and motorcycle is leviable in lumpsum on the actual price of the vehicle (excluding tax).

The Commission observed that the judgment of the High Court of Telangana in Kishore Rai Sohni’s case “has made it very clear that it is the ‘cost of the vehicle’, which the purchaser has actually paid to the dealer for purchasing the vehicle, that has to be taken into consideration for levying motor vehicle tax”.

“In the instant case, the total price of the vehicle was Rs 4.90 lakh. The complainant was given a discount of Rs 98,062 by the dealer. After discount, the complainant actually paid Rs 3.92 lakh to the dealer. Thus, the ‘cost of the vehicle’ cannot be taken as Rs 4.90 lakh. It is actually the paid up amount (Rs 3.92 lakh),” observed the Commission. It added that the motor vehicle tax couldn’t be charged on the total price of the vehicle but on the discounted price of Rs 3.92 lakh.

While setting aside an order of the District Consumer Disputes Redressal Forum of Chandigarh, the Commission directed the Punjab Transport Department and State Transport Commissioner to refund the excess amount to the complainant along with interest at the rate of 9 per cent per annum with effect from January 9 this year. It has also been directed to give a compensation of Rs 10,000 for mental agony and physical harassment, and Rs 5,000 towards cost of litigation to the complainant.