The ruling was given on an appeal filed by Tamil Nadu government challenging a Madras high court order . The order had quashed the scheme of one-time tax based on cost and weight of the vehicle.
In its judgement a bench comprising Justice SN Variava, Justice AR Lakshmanan and Justice SH Kapadia observed: For administrative reasons in the matter of collection of tax, one-time payment of tax is administratively convenient and at the same time, it is also beneficial to the users of the vehicles who do not have to the RTO every year to pay the annual taxes, Justice Kapadia said.
While agreeing with the government that weight alone could not be the criterion for levying a tax on the new vehicles, the apex court gave an example of Honda CRV car which weighs 1,500 kg and is priced at Rs 15.24 lakh while a Tata Indigo, weighing 1,490 kg, was priced at Rs 5.08 lakh. In these circumstances, we reiterate that introduction of weight-cum-value index will not make the levy non-regulatory/non-compensatory, it said.
If weight alone was taken as the criterion, then both the vehicle owners would have to pay almost the same road tax, which would create an anamolous situation, the bench said.