AIR 1976 SUPREME COURT 997 ::1976 TAX. L. R. 1549 ::1976 SCC (Tax) 204 ::1976 2 SCC 942 ::1976 PatLJR 389 ::1976 2 SCR 809

Supreme Court Of India

Hon'ble Judge(s): A. N. Ray, K. K. Mathew, N. L. Untwalia , JJJ

(A) Bihar Taxation on Passengers and Goods (Carried by Public Service Motor Vehicles) Act (17 of 1961) , S.3— Public service vehicles hired to booking or forwarding agencies by permit holders - Liability to pay tax under the Act is of the permit holder and not hirer. Where the petitioners, holders of permit in respect of public service motor vehicles, hired their vehicles to booking or forwarding agencies who had direct link with persons whose goods are carried on the hired transport vehicles and who collected the fare and freight as well as the tax, it is not such agencies but the permit holders who are liable to pay tax under the Bihar Act.(Para 28) The taxing event is the transporting of goods by public service vehicle. The consignor is to pay the tax. The owner of the vehicle, namely, the permit holder who allows the goods to be transported on his vehicle has a duty eo instanti he allows the goods to be loaded for transhipment, to see that the tax payable in the event of transportation is paid. Similarly, the tax is on passengers carried by public service vehicles and the owner becomes liable to pay tax on the fares payable by passengers to the owners.(Para 22) The operational arrangement viz. That the vehicles are let out on hire, has no relevance to the liability to taxation.(Para 23) ....