ALL KERALA DISTRIBUTORS ASSOCIATION, KOTTAYAM UNIT, REPRESENTED BY ITS SECRETARY v. THE STATE OF KERALA & ANR.

ABCDEFGH974SUPREME COURT REPORTS[2022] 17 S.C.R.production of certificate of insurance by every registered owneror person having possession or control of a motor vehicle. Section9 fastens liability to pay vehicle tax by person succeeding to theownership, possession or control of motor vehicles. Sections 10and 11 are of some relevance. Concededly, the validity of thesetwo provisions have not been assailed by the writ petitionersand, failure to do so, may have some bearing on the view that wepropose to take. From the scheme of the 1976 Act, it is amplyclear that it is specific to levy of tax on motor vehicle andpassengers and goods carried by such vehicle in the State ofKerala. It is not a law regulating the issuance of a permit by theAuthority under the 1988 Act as such. Indisputably, the permitissued by the Authority is hedged with conditions including thecondition of regular payment of vehicle tax. Section 15 providesfor the consequences for nonpayment of tax consistent withSections 10 and 11 of the 1976 Act. Thus understood, there is nooccasion for conflict between the two provisions much lessrepugnancy. [Paras 35, 36][1005-B-F; 1006-A-G, 1007-C]1.3 As regards the argument regarding bootstrapping ofliabilities of permit-holder under two different State legislations, it is to say the least tenuous. It is open to the Legislature tocombine levies for other purposes, such as education cess, etc.,for collection of tax due and payable by the same tax-payer. It isone thing to say that the person is being compelled to dischargeliability under two different State enactments, although he is notliable under one of the two. That is not the argument of thesewrit petitioners. The petitioners are not disputing their liabilityunder both the State Enactments. The argument, however, is thatthe writ petitioners may intend to invoke remedy of appeal andrevision in respect of liability fastened under the 1985 Act. Thisargument has been rightly negatived by the High Court inparagraph 18 of the impugned judgment by observing thatsufficient safeguard has been provided under the relevantenactment to file appeal/revision by remitting 50 per cent of theamount demanded. The High Court issued directions in thatregard in paragraph 19 of the impugned judgment. A circular hasbeen issued on 16.6.2007, clarifying that the aggrieved person, who prefers appeal on payment of 50 per cent of the contribution ABCDEFGH975under the Welfare Fund Act, is entitled to get a certificate to thateffect and on production of that certificate before the TaxingAuthorities, the vehicle tax could be received by the Authoritywithout payment of the entire Welfare Fund of contributions. TheHigh Court has already issued directions to extend similar benefiteven in cases where review petition is filed within the prescribedtime. The fact remains that no prejudice whatsoever is caused tothe permit-holder who intends to pursue remedy under the 1985Act against the demand received by him relating to thecontribution of the Welfare Fund. [Paras 37][1007-D-H; 1008-A]1.4 Reverting to the 1985 Act enacted by the StateLegislature, indisputably, it is a welfare legislation constituting afund to promote the welfare of motor transport workers in theState of Kerala. This Act is ascribable to Entries 23 and 24 ofList III – Concurrent List. Entry 23 deals with social securityand social insurance; employment and unemployment and Entry24 deals with welfare of labour including conditions of work, provident funds, employers’ liability, workmen’s compensation, invalidity and old age pensions and maternity benefits. Ostensibly, it may appear that the liability arising from the obligations underthe 1985 Act have nothing to do with the subject of vehicle tax. However, the 1985 Act has been enacted with the objects andreasons noted. As a vast number of employees were beingengaged in Motor Transport Industry in the State in the privatesector, the Government thought it necessary to provide for theconstitution of a Fund to promote the welfare of such of the motortransport workers in the private sector who are not covered bythe Employees’ Provident Funds and Miscellaneous ProvisionsAct, 1952 and the Payment of Gratuity Act, 1972. In other words, this Act came into being to ameliorate the difficulties encounteredby the motor transport workers in the State of Kerala. In duecourse, it came to the notice of the Government that the systemof determination and assessment of contribution from employersand adjudication of disputes, etc., as provided for in the 1985 Acthad certain loopholes resulting in loss of welfare fund contribution.In that, the bus operators set forth a defence by creating boguspartnerships and showing relatives as employees to evadepayment of contribution. Another device was to keep on changingALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA ABCDEFGH976SUPREME COURT REPORTS[2022] 17 S.C.R.the employees frequently. Thus, to check this mischief, anamendment was effected to the 1985 Act vide Act 23 of 2005including to reduce the arbitrariness in fixing the contribution. The activities of motor transport workers are directly linked tothe use and operation of the motor transport vehicles havingpermit issued under the 1988 Act in that regard. Under the saidAct, the permitholder is obliged to ensure that the vehicle tax ispaid regularly. The law clearly provides for action to be takenagainst the motor transport vehicle for failure to pay vehicle taxincluding to reject renewal of the permit. The stipulation in the1985 Act is in the nature of ensuring that the vehicle owner/permit-holder discharges both the liabilities and does not commit defaultin contributing to the welfare fund as also pay vehicle tax on time. Non-payment of vehicle tax may entail in stopping of motorvehicle by the Officers of Police or Motor Vehicles Departmentin exercise of power under Section 10 of the 1976 Act includingto seize and detain the same pending production of proofremittance of tax as predicated in Section 11 of the Act. Additionally, the vehicle owner may have to suffer penalty underSection 16 and face prosecution under Section 17, besides thepermit being rendered ineffective if tax is not paid by virtue ofSection 15. [Para 38][1008-B-H; 1009-A-B]1.5 Considering the scheme of the State legislations, it isincomprehensible to countenance the argument that the twoprovisions (of 1988 Act on the one hand and of 1976 Act and1985 Act on the other) are inconsistent in any manner whatsoever. Whereas, the State enactments are complementary and can begiven effect to without any disobedience to the Centrallegislations. As aforementioned, the 1988 Act does not coverthe field of the manner of levy of vehicle tax and collection thereof. The same is covered by the State legislations. Concededly, theappellants have not disputed their liability to pay the vehicle taxlevied under the 1976 Act as well as to pay contribution towardsthe workers’ welfare fund under the 1985 Act. So understood, the real grievance in these appeals by the motor transport vehicleowners/permit-holders is about compelling them to pay thewelfare contribution dues as a precondition for collection of vehicletax. We have no hesitation in taking the view that such ABCDEFGH977dispensation cannot be construed as unconstitutional. Further, such a plea cannot be countenanced at the instance of someonewho otherwise concedes liability to pay both the dues towardswelfare fund contribution and vehicle tax. It is beyondcomprehension that the vehicle owner/permit-holder can be heardto argue that he would not pay the dues under the 1985 Act and, yet, would continue with the business of motor transport as usualin the State of Kerala by exploiting the workers on the speciousplea that the validity of the permit to operate transport vehiclecannot be interdicted under a State legislation. The provision inthe form of Section 15 of the 1976 Act is in the nature of restatingthe consequences flowing from Sections 10 and 11 of the sameAct to stop motor vehicle and to seize and detain the same ifbeing used or operated without payment of vehicle tax. Whenaction is taken by the competent authority under Sections 10 and11 of the Act, inevitably, the transport vehicle in question forwhich permit has been taken is rendered unusable due to non-payment of vehicle tax. The liability of the vehicle owner/permit-holder to pay welfare fund contribution as well as to pay vehicletax arises under the legislation enacted by the State Legislature.As such, there is nothing wrong in State Legislature making itcompulsory to pay outstanding welfare fund contribution firstbefore accepting the vehicle tax which had become due andpayable. In this view of the matter, it would be unnecessary todilate on the argument regarding validity of Section 15 of the1976 Act because of lack of Presidential assent after coming intoeffect of the 1988 Act. [Paras 39, 40][1009-C; 1010-A-G]1.6 This Court cannot be oblivious about the legislativeintent for enacting the 1985 Act and the amendment effectedthereto in 2005. The same is a beneficial legislation with avowedobjective to ensure strict compliance of payment of welfare fundcontribution to protect the workers of the commercial operationsundertaken by the vehicle owners/permit-holders pursuant to apermit issued under the 1988 Act, and is to reach out to suchworkers who are typically unorganised and a part of informalworkforce. Neither the provisions of the 1985 Act or the 1976Act have the effect of interdicting the permit issued under the1988 Act. The real intent and purpose behind these provisions isALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA ABCDEFGH978SUPREME COURT REPORTS[2022] 17 S.C.R.to restate the mandate stated in the 1988 Act that the vehiclecannot be used on road without a valid permit and payment ofvehicle tax up to date. A priori, we have no hesitation in concludingthat the provisions of the 1976 Act and the 1985 Act, enacted bythe State Legislature, are only intended to ensure that the vehicleowner/permit-holder does not remain in arrears of either thewelfare fund contribution or the vehicle tax both payable underthe State enactments. These provisions are in no way in conflictwith the law made by the Parliament (1988 Act). The Stateenactments do not create any new liability or obligation in relationto the permit issued under the 1988 Act (Central legislation),but it provides for dispensation to ensure timely collection of thewelfare fund contribution as well as vehicle tax payable by thesame vehicle owner/permit-holder. the writ petitioners throughtheir counsel had fairly accepted during oral argument that afterthe 2005 amendment, for all these years they have been followingthe dispensation provided under the State legislations withoutexception. In that sense, the challenge has become academic.Be that as it may, we have negatived the stand taken by the writpetitioners regarding the validity of the amended provisions beingrepugnant to the law made by the Parliament. [Paras 41, 42][1010-H; 1011-A-D]Deep Chand vs. The State of Uttar Pradesh & Ors.[1959] Suppl. 2 SCR 8 – followed. The State of Bombay & Anr. vs. F.N. Balsara AIR 1951SC 318 : [1951] SCR 682, M. Karunanidhi vs. Unionof India AIR 1979 SC 898 : [1979] 3 SCR 254, HardevMotor Transport vs. State of M.P. & Ors (2006) 8 SCC613 : [2006] 7 Suppl. SCR 766, Zaverbhai Amaidasvs. The State of Bombay [1995] 1 SCR 799, Ch. TikaRamji & Ors., etc. vs. The State of Uttar Pradesh &Ors. [1956] SCR 393, Thirumuruga KirupanandaVariyar Thavathiru Sundara Swamigal MedicalEducational & Charitable Trust vs. State of Tamil Nadu& Ors. (1996) 3 SCC 15 : [1996] 2 SCR 422, KulwantKaur & Ors. vs. Gurdial Singh Mann (Dead) by LRs. &Ors. (2001) 4 SCC 262 : [2001] 2 SCR 525, Kaiser-I-Hind Pvt. Ltd. & Anr. vs. National Textile Corpn.(Maharashtra North) Ltd. & Ors. (2002) 8 SCC 182: ABCDEFGH979[2002] 2 Suppl. SCR 555, Hoechst PharmaceuticalsLtd. & Ors. vs. State of Bihar & Ors. (1983) 4 SCC 45: [1983] 3 SCR 130, State of Kerala & Ors. vs. MarAppraem Kuri Company Limited & Anr. (2012) 7 SCC106 : [2012] 4 SCR 448, Union of India & Ors. vs. Mohanlal Likumal Punjabi & Ors. (2004) 3 SCC 628:[2004] 2 SCR 468, Director of Elementary Education, Odisha & Ors. vs. Pramod Kumar Sahoo (2019) 10 SCC674, Association of Natural Gas & Ors. vs. Union ofIndia & Ors. (2004) 4 SCC 489 : [2004] 3 SCR 534,Dharappa vs. Bijapur Coop. Milk Producers SocietiesUnion Ltd. (2007) 9 SCC 109 : [2007] 5 SCR 729,Ashok Kumar alias Golu vs. Union of India & Ors.(1991) 3 SCC 498 : [1991] 2 SCR 858, State of TamilNadu & Ors. vs. K. Shyam Sunder & Ors. (2011) 8 SCC737 : [2011] 11 SCR 1094, Ajay Hasia & Ors. vs. KhalidMujib Sehravardi & Ors. (1981) 1 SCC 722 : [1981] 2SCR 79, The Collector of Customs, Madras vs. NathellaSampathu Chetty & Anr. AIR 1962 SC 316 : [1962] SCR 786, New Central Jute Mills Co. Ltd. vs. AssistantCollector of Central Excise, Allahabad & Ors. (1970)2 SCC 820 : [1971] 2 SCR 92 – referred to.A.L.S.P.P.L. Subrahmanyan Chettiar vs. MuttuswamiGoundan AIR 1941 FC 47, Prafulla Kumar Mukherjee& Ors. vs. Bank of Commerce Ltd., Khulna AIR (34)1947 PC 60 – referred to. Case Law Reference[1951] SCR 682referred toPara 9[1979] 3 SCR 254referred toPara 9[2006] 7 Suppl. SCR 766referred toPara 11[1959] Suppl. 2 SCR 8followedPara 32[1995] 1 SCR 799referred toPara 12[1956] SCR 393referred toPara 12[1996] 2 SCR 422referred toPara 33[2001] 2 SCR 525referred toPara 12ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA ABCDEFGH980SUPREME COURT REPORTS[2022] 17 S.C.R.[2002] 2 Suppl. SCR 555referred toPara 13[1983] 3 SCR 130referred toPara 13[2012] 4 SCR 448referred toPara 13[2004] 2 SCR 468referred toPara 14[2004] 3 SCR 534 referred toPara 17[2007] 5 SCR 729referred toPara 17[1991] 2 SCR 858referred toPara 18[2011] 11 SCR 1094referred toPara 18[1981] 2 SCR 79 referred toPara 19[1962] SCR 786referred toPara 27[1971] 2 SCR 92referred toPara 27CIVIL APPELLATE JURISDICTION : Civil Appeal No.4502of 2009.From the Judgment and Order dated 30.07.2007 of the High Courtof Kerala at Ernakulam in WP (C) No.9971 of 2006.WithCivil Appeal Nos.878 And 879 of 2010.K. Radhakrishnan, P.N. Ravindran, Sr. Advs., Abhisth Kumar, K.Parameshwar, Alex Joseph, Linto K. B., Sonali S.S., Prasad Hegde, S.Begurupriya, S. K. Bose, Ranjith K. C., Bikas Kar Gupta, AvijitBhattacharjee, Mrs. Debarati Sadhu, Abraham Mathews, Nishe RajenShonker, Mrs. Anu K. Joy, Alim Anvar, P.S. Sudheer, Rishi Maheshwari, Ms. Anne Mathew, Ms. Shruti Jose, Advs. for the appearing parties. The Judgment of the Court was delivered byA. M. KHANWILKAR, J.1. These appeals involve challenge to the constitutional validity ofsub-sections (7) and (8) of Section 4 [introduced by way of the KeralaMotor Vehicles Taxation (Amendment) Act, 20051 in the Kerala MotorVehicles Taxation Act, 19762], Section 15 of the 1976 Act and Section8A of the Kerala Motor Transport Workers’ Welfare Fund Act, 19853inserted by Act 23 of 2005.1 for short, “the Amendment Act”2 for short, “the 1976 Act”3 for short, “the 1985 Act” ABCDEFGH9812. The thrust of the challenge is on the ground that the StateLegislature by way of stated amendments to the welfare legislation haseffectively bootstrapped the obligation to make contribution to theworkers’ welfare fund with the obligation to pay tax for operating motorvehicles. In other words, the welfare legislation is intertwined with thecompensatory legislation by the impugned Amendment Act of 2005 andtogether they substantially encroach and override the relevant provisionsof the Central legislation i.e., the Motor Vehicles Act, 19884 to paralysethe Stage and Goods Carriage Operation or to undermine the effectivenessof the transport permit provided under the 1988 Act.3. The 1976 Act was enacted by the State Legislature when theerstwhile Motor Vehicles Act, 19395 was in force. It was so enactedunder Entry 56 (Taxes on goods and passengers carried by road or oninland waterways) and Entry 57 (Taxes on vehicles, whethermechanically propelled or not, suitable for use on roads, includingtramcars subject to the provisions of entry 35 of List III) of List II of theSeventh Schedule to the Constitution. Section 15 of the 1976 Actpostulates that non-payment of tax due in respect of a transport vehiclewithin the prescribed period would render the transport permit for suchvehicle ineffective from the date of expiry of the said period until suchtime as the tax is actually paid. The State of Kerala had sought Presidentialassent for the 1976 Act and the same was granted on 25.3.1976.However, in due course, the 1939 Act was repealed by the Parliamentand it was replaced by the 1988 Act, introducing a new regime toconsolidate and amend the law related to motor vehicles. This Act (the1988 Act) was enacted by the Parliament under Entry 35 of List III(Mechanically propelled vehicles including the principles on which taxeson such vehicles are to be levied). Chapter V of the 1988 Act deals withcontrol of transport vehicles, including the procedure of RegionalTransport Authority in considering application for stage carriage permitand the duration and renewal of permits. According to the appellants, the 1988 Act exhaustively covered all aspects of grant, control and validityof transport permits. Further, the State of Kerala did not seek Presidentialassent in respect of the State Act i.e., 1976 Act, after coming into forceof the Central Act, despite the repugnancy between the existing StateAct and the newly introduced the 1988 Act.4 for short, “the 1988 Act” or “the Central Act”, as the case may be5 for short, “the 1939 Act”ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH982SUPREME COURT REPORTS[2022] 17 S.C.R.4. Furthermore, in the year 2005, the State of Kerala amendedthe 1976 Act and the 1985 Act thereby introducing sub-sections (7) and(8) of Section 46 in the 1976 Act and Section 8A7 in the 1985 Act. Theeffect of these amendments is to mandate production of receipt of6 4. Payment of tax and issue of license.-(1) The Tax levied under Sub Section (1) of Section 3 shall be paid in advancewith such period and in such manner as may be prescribed, by the registered owner orperson having possession or control of the Motor Vehicle, for a quarter or year, at hischoice, upon a quarterly or annual licence to be taken out by him. Provided that, in the case of fleet owner, the Government may direct that thetax shall be paid in monthly instalments before such date, in such manner and subject tosuch conditions, as may be specified in the direction:Provided further that where the tax payable in respect of a motor vehicle otherthan a motorcycle (including a motor scooter and cycle with attachment for propellingthe same by mechanical power) or a three wheeler as specified in items 1 and 2 of theschedule or a motor car as specified in item 11 of the Schedule, for a year does notexceed Rupees one thousand five hundred, the tax shall be paid yearly upon an annuallicence:Provided also that the registered owner, or person having possession or controlof the motor vehicle may, at his /her choice, pay the yearly tax payable under thesecond proviso in advance for any period upto 5 years, upon a licence for such period:Provided also that the registered owner, or a person having possession orcontrol of a motor cycle (including motor scooters and cycles, with attachment forpropelling the same by mechanical power) specified in item 1 of the Schedule or threewheelers (including tricycles and cycle rickshaws with attachment for propelling thesame by mechanical power) not used for transport of goods or passengers specified initem 2 of the Schedule or a motor car specified in item 11 of the said Schedule shall paytax in respect of those vehicles in advance for a period of two years in lumpsum upona licence for such period. Provided also that a registered owner or person liable to pay tax for a period oftwo years in respect of motor vehicles specified in serial numbers 1 and 2 of theschedule may at his choice pay tax in advance for any period exceeding two years at therates specified in the Schedule:Provided also that the owner or a person liable to pay tax in respect of vehiclesspecified in items 1,2,11 and 12 of the Schedule shall not be liable to pay any periodicalincrease in tax for which he has paid tax for such vehicles. Provided also that a registered owner or a person liable to pay tax for a periodof two years under the preceding proviso may, at his choice, pay tax in advance for aperiod of five years or ten years or fifteen years in lumpsum upon a licence for suchperiod. Explanation:- (1) The tax for an annual licence shall not exceed four times taxfor two years licence shall not exceed eight times, tax for 5 years’ licence shall notexceed twenty times, tax for 10 years’ licence shall not exceed forty times and tax for 15years’ licence shall not exceed sixty times, the tax for a quarterly licence.(1A) Notwithstanding anything contained in any other provision of this Act,‘year’ in relation to a motor vehicle in respect of which tax has to be paid yearly uponan annual licence in pursuance of the second proviso to sub section (1), shall mean aperiod of twelve months commencing on the first day of the quarter in which the ABCDEFGH983remittance of welfare fund contribution at the time of making paymentof vehicle tax before the Taxation Officer. In this context, it is urged thatvehicle has been or is, first registered in the State and annual tax licence in respect ofsuch a vehicle shall be taken accordingly:Provided that if the tax in respect of a motor vehicle for any portion of the yearso reckoned has already been paid, the tax payable for the remaining period of that yearshall be calculated at the rate of one-twelth of the annual tax for each calendar month orpart thereof. Provided further that in the case of a motor vehicle in respect of which tax hasto be paid yearly upon an annual licence in pursuance of the second proviso to sub-section (1), the tax for the period from the 1st day of April 1985, to the commencementof the year in relation to such a vehicle shall be paid as if the Kerala Motor VehiclesTaxation (Amendment) Act, 1986 had not been enacted.(2) In the case of licence for a year or more, such rebate in respect of the tax, asmay be prescribed, shall be granted.(3) When any person pays the amount of tax in respect of a motor vehicle usedor kept for use in the State of the vehicle by the Regional Transport Officer concernedthat no tax is payable in respect of such vehicle, the Taxation Officer shall-(a) grant to such person a licence in the prescribed form: and(b) record that the tax has been paid for the specified period, or that no tax ispayable in respect of that vehicle, as the case may be. Provided that no licence shall be granted in respect of a motor vehicle, which isexempt from payment of tax under sub-section (1) of Section 5.(4) No motor vehicle liable to tax under Section 3 shall be kept for use in theState unless the registered owner or the person having possession or control of suchvehicle has obtained a tax licence under sub-section (3) in respect of that vehicle.(5) No motor vehicle liable to tax under Section 3 shall be used in the Stateunless a valid tax licence obtained under sub section (3) is displayed on the vehicle inthe prescribed manner.(6) Notwithstanding anything contained in sub-section (1), no person shall beliable to tax during any period on account of any taxable motor vehicle, the tax due inrespect of which for the same period has already been paid by some other person.(7) Notwithstanding anything contained in any other provision of this Act, every registered owner or person having possession or control of a motor vehicle inrespect of a motor transport undertaking liable to pay contribution under the KeralaMotor Transport Worker’s Welfare Fund Act, 1985 (21 of 1985) shall, before effectingpayment of tax produce before the Taxation Officer the receipt of remittance of thecontribution towards welfare fund due upto the preceding month.(8.) No tax under this Act shall be collected unless the receipt of remittance ofcontribution towards welfare fund mentioned in sub-section (7) is produced.7 8A. Production of receipt of remittance of welfare fund contribution.-Notwithstanding anything contained in any other law for the time being in force everyregistered owner or person having possession or control of a motor vehicle in respect ofa motor transport undertaking liable to pay contribution (other than autorickshawscovered under the provisions the Kerala Autorickshaw Workers’ Welfare Fund Scheme,1991) shall, at the time of making payment of the tax under the Kerala Motor VehiclesTaxation Act, 1976 (19 of 1976) produce before the Taxation Officer the receipt ofremittance of the contribution to the fund upto the preceding month.ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH984SUPREME COURT REPORTS[2022] 17 S.C.R.the amendment of 2005 effected by the State legislation has effectivelybootstrapped the obligation to make contribution to the workers’ welfarefund with the obligation to pay tax for operating motor vehicles, whichare otherwise governed by the permit issued under the 1988 Act. In theprocess, it undermined the effectiveness of the permit so issued by thecompetent authority.5. It is urged that the amendments to the 1976 Act as also to the1985 Act, including Section 15 of the 1976 Act, are unconstitutional asthe entire field is already occupied by the Central Act of 1988, withrespect to permits to be issued for operating transport vehicles. Thus, the provisions of the State Act(s) referred to above are repugnant to theCentral Act and that no Presidential assent had been obtained by theState of Kerala despite the repugnancy with the Central Act. Further, even if there is no direct conflict, the impugned provisions in the StateAct(s) are ultra vires for want of legislative competence.6. Notably, in the writ petitions filed before the High Court ofKerala, challenging the stated provisions in the State enactments, norelief or declaration was sought in respect of Section 8A of the 1985Act. Moreover, the Division Bench of the High Court in the impugnedjudgment noted that the counsel for the petitioner(s) had given up thechallenge to the validity of Section 15 of the 1976 Act. Being consciousof this indisputable position, it is urged that there can be no estoppel onlegal questions or the concessions made by the counsel on the questionof law before the High Court. That cannot come in the way of theappellants to pursue the challenge to the impugned provisions before thisCourt.7. Be that as it may, the Division Bench of the High Courtexhaustively considered the arguments canvassed on behalf of the partiesand on thorough scrutiny thereof, it negatived the challenge vide impugnedjudgment dated 30.7.2007. The High Court opined that the combinedeffect of sub-sections (7) and (8) of Section 4 and Section 15 of the1976 Act, is that if a clearance certificate is not obtained from theAssessing Officer under the 1985 Act, the motor vehicle tax would notbe received by the Taxation Officer in connection with the permit. As aconsequence of which, the permit would be rendered ineffective, disentitling the owner of a stage carriage from operating his vehicleunder such permit for the relevant period. ABCDEFGH9858. The High Court further noted that the 1988 Act had been enactedby the Parliament on subjects falling under Entry 35 of List III which, however, did not cover the field concerningimposition and the manner ofrecovery of vehicle tax. Section 81(1)8 of the 1988 Act envisages that apermit other than a temporary permit issued under Section 879 or a specialpermit issued under sub-section (8)10 of Section 88 shall be effectivefrom the date of issuance or renewal thereof for a period of five years.8 81. Duration and renewal of permits.—(1) A permit other than a temporary permitissued under section 87 or a special permit issued under sub-section (8) of section 88shall be effective from the date of issuance or renewal thereof for a period of five years:Provided that where the permit is countersigned under sub-section (1) of section88, such counter-signature shall remain effective without renewal for such period so asto synchronise with the validity of the primary permit.…..9 87. Temporary permits.—(1) A Regional Transport Authority and the State TransportAuthority may without following the procedure laid down in section 80, grant permitsto be effective for a limited period which shall, not in any case exceed four months, toauthorise the use of a transport vehicle temporarily—(a) for the conveyance of passengers on special occasions such as to and fromfairs and religious gatherings, or(b) for the purposes of a seasonal business, or(c) to meet a particular temporary need, or(d) pending decision on an application for the renewal of a permit, and may attach to any such permit such condition as it may think fit:Provided that a Regional Transport Authority or, as the case may be, StateTransport Authority may, in the case of goods carriages, under the circumstances of anexceptional nature, and for reasons to be recorded in writing, grant a permit for a periodexceeding four months, but not exceeding one year.(2) Notwithstanding anything contained in sub-section (1), a temporary permit may begranted thereunder in respect of any route or area where—(i) no permit could be issued under section 72 or section 74 or section 76 or section 79in respect of that route or area by reason of an order of a Court or other competentauthority restraining the issue of the same, for a period not exceeding the period forwhich the issue of the permit has been so restrained; or(ii) as a result of the suspension by a Court or other competent authority of the permitof any vehicle in respect of that route or area, there is no transport vehicle of the sameclass with a valid permit in respect of that route or area, or there is no adequate numberof such vehicles in respect of that route or area, for a period not exceeding the period ofsuch suspension:Provided that the number of transport vehicles in respect of which temporarypermits are so granted shall not exceed the number of vehicles in respect of which theissue of the permits have been restrained or, as the case may be, the permit has beensuspended.10 88. Validation of permits for use outside region in which granted.—…..ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH986SUPREME COURT REPORTS[2022] 17 S.C.R.Whereas, the State Act i.e., the 1976 Act, came to be enacted underEntry 57 of List II of the Seventh Schedule to the Constitution, which issolely concerned with tax on vehicles whether mechanically propelledor not. Whilst, the 1985 Act is also a State legislation covered underEntries 23 and 24 of List III for promoting the welfare of motor transportworkers.9. Dealing with the challenge to the validity of the stated provisionsin the State enactments, the Division Bench of the High Court plainlyopined that there was no lack of legislative competence in the StateLegislature and that the 1976 Act as well as the 1985 Act, fall substantiallywithin the powers expressly conferred upon the State Legislature whichhad enacted both the legislations, including the Amendment Act of 2005.It further held that merely because the 1976 Act had also dealt with asubject which falls under Entries 23 and 24 of List III of the ConcurrentList, it cannot be held that the provisions of the 1976 Act are bad in law.To buttress the view taken by it, the High Court relied upon the expositionin A.L.S.P.P.L. Subrahmanyan Chettiar vs. Muttuswami Goundan11;Prafulla Kumar Mukherjee & Ors. vs. Bank of Commerce Ltd.,Khulna12; TheState of Bombay & Anr. vs. F.N. Balsara13; and M.Karunanidhi vs. Union of India14. The High Court opined that theState enactments and the impugned amendments substantially fall withinthe powers expressly conferred upon the State Legislature and cannotbe held to be invalid solely because it incidentally touches upon another(8) Notwithstanding anything contained in sub-section (1), but subject to any rulesthat may be made under this Act by the Central Government, the Regional TransportAuthority of any one region or, as the case may be, the State Transport Authority, may, for the convenience of the public, grant a special permit to any public service vehicleincluding any vehicle covered by a permit issued under section 72 (including a reservestage carriage) or under section 74 or under sub-section (9) of this section for carryinga passenger or passengers for hire or reward under a contract, express or implied, forthe use of the vehicle as a whole without stopping to pick up or set down along the lineof route passengers not included in the contract, and in every case where such specialpermit is granted, the Regional Transport Authority shall assign to the vehicle, fordisplay thereon, a special distinguishing mark in the form and manner specified by theCentral Government and such special permit shall be valid in any other region or Statewithout the countersignature of the Regional Transport Authority of the other regionor of the State Transport Authority of the other State, as the case may be.…..11 AIR 1941 FC 4712 AIR (34) 1947 PC 6013 AIR 1951 SC 31814 AIR 1979 SC 898 ABCDEFGH987legislation. The doctrine of pith and substance would clearly get attractedin the fact situation of the present case. Whilst dealing with the argumentof the appellants that the right of appeal and review available to theappellants under the 1985 Act would be curtailed, the High Court inparagraphs 18 and 19 noted thus:“18. Petitioners, as we have already indicated, have raised acontention that because of the introduction of sub-sections (7)and (8) to Section 4 of the Taxation Act, remedy of filing a reviewas well as appeal under Section 8 of the Welfare Fund Act hasbeen effectively curtailed. Sub-section (2) of Section 8 enables aperson to file a review petition before the authority who haddetermined the arrears showing the detailed facts and reasonsfor reviewing the original determination. Right is also conferredon the aggrieved party if he is dissatisfied with the order passedby the authority on the review petition to file appeal before theDistrict Labour Officer of the concerned district. To maintain anappeal he need remit only 50% of the amount demanded. Theabove right to file review or appeal has been effectively takenaway by sub-sections (7) and (8) of Section 4 that is, only onproduction of certificate of payment of contribution the officerwill accept tax. We have already indicated that a Circular dated16.06.2007 has been issued receipt of 50% of the contributiondue under the Welfare Fund Act enabling the aggrieved person topay tax. Therefore an aggrieved party who files an appeal onpayment of 50% of the contribution under the Welfare Fund Actis entitled to get a certificate to that effect and on production ofthat certificate before the taxing authorities he would receive tax. Circular of course does not deal with review petition. We thereforeorder that if a properly constituted review petition is filed withinthe prescribed time, and the same is pending the Chief ExecutiveOfficer or any other officer appointed under section 8 of theWelfare Fund Act that officer has to issue a certificate to thateffect and on production of that certificate the taxing authorityshould receive tax under the Taxation Act. The right to file areview petition as well as an appeal is therefore effectivelyprotected.19. We therefore hold that sub-sections (7) and (8) of Section 4of Act 24 of 2005 is constitutionally valid; so also Section 8Aintroduced under the Welfare Fund (Amendment) Act. However, ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH988SUPREME COURT REPORTS[2022] 17 S.C.R.we hold if a review petition filed under sub-section (2) of Section8 as well as appeal under Section 4 read with Section 7 is pendingconsideration before the authorities concerned, they are obligedto issue a certificate during the pendency of the review petitionand if an appeal is pending and pre condition for filing appeal hasbeen satisfied, certificate has to be issued by the appellate authorityand if those certificates are produced before the taxing authoritythey would receive tax under the Taxation Act. The writ appealand the writ petitions are disposed of accordingly.”10. In substance, the High Court has noted that the permit holderswere neither disputing their obligation to pay vehicle tax under the 1976Act nor are they denying the obligation to pay contribution towards thewelfare fund under the 1985 Act. The purport of the impugnedamendments, including Section 15, was merely to ensure that both theseobligations are duly discharged so as to permit the transport operators tocontinue with their business uninterrupted. It is neither a case of levy oftax not permitted under the 1988 Act nor deviating from the spirit of thesaid Act, which clearly predicates that for grant of stage carriage permit, the Regional Transport Authority is obliged to consider the satisfactoryperformance of the applicant as a stage carriage operator, includingpayment of tax by the applicant. The provision(s) in the State Legislationis not to suspend the permit issued under the 1988 Act, but the expression“ineffective” ought to be construed as enabling the permit holder to availof the permit only upon payment of vehicle tax under the 1976 Act, asamended from time to time. On this analysis, the High Court rejectedthe challenge and dismissed the writ petitions and writ appeals videimpugned judgment.11. The appellants have assailed the view taken by the High Court.It is urged by Mr. K. Parameshwar, learned counsel appearing for theappellants that the Central legislation i.e., the 1988 Act, occupies theentire field of permits and the said legislation is a self-contained code asexpounded by this Court in Hardev Motor Transport vs. State of M.P.& Ors.15. He would submit that Chapter V of the 1988 Act deals withall aspects of permits, including their issuance, effectiveness, duration ofvalidity, renewal, transfer and penal consequences for any breach ofconditions. Section 81(1) of the 1988 Act envisages that the permit issuedby the competent authority shall be effective from the date of issuance15 (2006) 8 SCC 613 (paras 4, 11 and 12) ABCDEFGH989or renewal thereof for a period of five years. Once such permit is issued, the same cannot be interdicted by a State legislation during its validityperiod. Section 8216 of the 1988 Act also allows transfer of permit fromone person to another and Section 8317 allows the permit holder to replacethe vehicle covered by the permit by any other vehicle of the samenature. Moreover, Section 192A18 of the 1988 Act specifically imposespunishment of imprisonment for a term specified therein for using a16 82. Transfer of permit.—(1) Save as provided in sub-section (2), a permit shall notbe transferable from one person to another except with the permission of the transportauthority which granted the permit and shall not, without such permission, operate toconfer on any person to whom a vehicle covered by the permit is transferred any rightto use that vehicle in the manner authorised by the permit.(2) Where the holder of a permit dies, the person succeeding to the possession of thevehicle covered by the permit may, for a period of three months, use the permit as if ithad been granted to himself:Provided that such person has, within thirty days of the death of the holder, informed the transport authority which granted the permit of the death of the holderand of his own intention to use the permit:Provided further that no permit shall be so used after the date on which itwould have ceased to be effective without renewal in the hands of the deceased holder.(3) The transport authority may, on application made to it within three monthsof the death of the holder of a permit, transfer the permit to the person succeeding tothe possession of the vehicles covered by the permit:Provided that the transport authority may entertain an application made afterthe expiry of the said period of three months if it is satisfied that the applicant wasprevented by good and sufficient cause from making an application within the timespecified.17 83. Replacement of vehicles.—The holder of a permit may, with the permission ofthe authority by which the permit was granted, replace any vehicle covered by thepermit by any other vehicle of the same nature.18 192A. Using vehicle without permit.—(1) Whoever drives a motor vehicle orcauses or allows a motor vehicle to be used in contravention of the provisions of sub-section (1) of section 66 or in contravention of any condition of a permit relating to theroute on which or the area in which or the purpose for which the vehicle may be used, shall be punishable for the first offence with imprisonment for a term which mayextend to six months and a fine of ten thousand rupees and for any subsequent offencewith imprisonment which may extend to one year but shall not be less than six monthsor with fine of ten thousand rupees or with both:Provided that the court may for reasons to be recorded, impose a lesserpunishment.(2) Nothing in this section shall apply to the use of a motor vehicle in anemergency for the conveyance of persons suffering from sickness or injury or for thetransport of materials for repair or for the transport of food or materials to relievedistress or of medical supplies for a like purpose:Provided that the person using the vehicle reports about the same to the RegionalTransport Authority within seven days from the date of such use.ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH990SUPREME COURT REPORTS[2022] 17 S.C.R.vehicle without a permit and Section 17719 of the 1988 Act is a generalprovision for punishment owing to contravention of the provisions of theAct or of any rule, regulation, or notification made thereunder. Section20720 of the 1988 Act also provides for seizure and detention of anyvehicle that is plying without a permit. In other words, there is an inbuiltmechanism in the 1988 Act for situations to deal with violation of conditionsof permit or using the vehicle without a valid permit. This being a completecode, it would not be open to the State Legislature to impinge upon theoccupied field. Hence, Section 15 of the 1976 Act is in direct conflictwith the legislative scheme under the Central legislation, dealing withpermit of transport vehicles. The State legislation would only be limitedto tax on vehicles and cannot transcend on matters relating to permits orits effectiveness during the term of five years provided for under Section8121of the 1988 Act. Whereas, Section 15 of the 1976 renders the transport(3) The court to which an appeal lies from any conviction in respect of anoffence of the nature specified in sub-section (1), may set aside or vary any order madeby the court below, notwithstanding that no appeal lies against the conviction inconnection with which such order was made.19 177. General provision for punishment of offences.—Whoever contravenes anyprovision of this Act or of any rule, regulation or notification made thereunder shall, ifno penalty is provided for the offence be punishable for the first offence with finewhich may extend to five hundred rupees, and for any second or subsequent offencewith fine which may extend to one thousand and five hundred rupees.20 207. Power to detain vehicles used without certificate of registration permit, etc.—(1) Any police officer or other person authorised in this behalf by the StateGovernment may, if he has reason to believe that a motor vehicle has been or is beingused in contravention of the provisions of section 3 or section 4 or section 39 orwithout the permit required by sub-section (1) of section 66 or in contravention of anycondition of such permit relating to the route on which or the area in which or thepurpose for which the vehicle may be used, seize and detain the vehicle, in the prescribedmanner and for this purpose take or cause to be taken any steps he may considerproper for the temporary safe custody of the vehicle:Provided that where any such officer or person has reason to believe that amotor vehicle has been or is being used in contravention of section 3 or section 4 orwithout the permit required by sub-section (1) of section 66 he may, instead of seizingthe vehicle, seize the certificate of registration of the vehicle and shall issue anacknowledgment in respect thereof.(2) Where a motor vehicle has been seized and detained under sub-section (1), theowner or person in charge of the motor vehicle may apply to the transport authority orany officer authorised in this behalf by the State Government together with the relevantdocuments for the release of the vehicle and such authority or officer may, afterverification of such documents, by order release the vehicle subject to such conditionsas the authority or officer may deem fit to impose.21 81. Duration and renewal of permits.—(1) A permit other than a temporarypermit issued under section 87 or a special permit issued under sub-section (8) of ABCDEFGH991permit ineffective. Thus, it exposes the permit holder to multiplepunishment under the 1988 Act as well as the 1976 Act.12. He further submits that repugnancy can arise even in theabsence of direct or irreconcilable conflict, if it touches upon the fieldoccupied by the Central legislation. Reliance is placed on Deep Chandvs. The State of Uttar Pradesh & Ors.22 which had followed thesection 88 shall be effective from the date of issuance or renewal thereof for a period offive years:Provided that where the permit is countersigned under sub-section (1) of section88, such counter-signature shall remain effective without renewal for such period so asto synchronise with the validity of the primary permit.(2) A permit may be renewed on an application made not less than fifteen days beforethe date of its expiry.(3) Notwithstanding anything contained in sub-section (2), the Regional TransportAuthority or the State Transport Authority, as the case may be, entertain an applicationfor the renewal of a permit after the last date specified in that sub-section if it issatisfied that the applicant was prevented by good and sufficient cause from making anapplication within the time specified.(4) The Regional Transport Authority or the State Transport Authority, as the casemay be, may reject an application for the renewal of a permit on one or more of thefollowing grounds, namely:—(a) the financial condition of the applicant as evidenced by insolvency, ordecrees for payment of debts remaining unsatisfied for a period of thirty days, prior to the date of consideration of the application;(b) the applicant had been punished twice or more for any of the followingoffences within twelve months reckoned from fifteen days prior to the date ofconsideration of the application committed as a result of the operation of astage carriage service by the applicant, namely:—(i) plying any vehicle—(1) without payment of tax due on such vehicle;(2) without payment of tax during the grace period allowed for paymentof such tax and then stop the plying of such vehicle;(3) on any unauthorised route;(ii) making unauthorised trips:Provided that in computing the number of punishments for the purpose ofclause (b), any punishment stayed by the order of an appellate authority shall not betaken into account:Provided further that no application under this sub-section shall be rejectedunless an opportunity of being heard is given to the applicant.(5) Where a permit has been renewed under this section after the expiry of the periodthereof, such renewal shall have effect from the date of such expiry irrespective ofwhether or not a temporary permit has been granted under clause (d) of section 87, andwhere a temporary permit has been granted, the fee paid in respect of such temporarypermit shall be refunded.22 (1959) Supp. 2 SCR 8 (para 28)ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH992SUPREME COURT REPORTS[2022] 17 S.C.R.decisions in Zaverbhai Amaidas vs. The State of Bombay23 and Ch.Tika Ramji & Ors., etc. vs. The State of Uttar Pradesh & Ors.24.Reliance is also placed on Thirumuruga Kirupananda VariyarThavathiru Sundara Swamigal Medical Educational & CharitableTrust vs. State of Tamil Nadu & Ors.25; and Kulwant Kaur & Ors.vs. Gurdial Singh Mann (Dead) by LRs. & Ors.26.13. It is urged that as there is repugnancy, the State of Keralaought to have obtained Presidential assent in respect of the 1976 Actafter coming into force of the 1988 Act as was obtained under the provisoto Article 304(b) of the Constitution on 25.3.1976 in reference to theprovisions of the 1939 Act. In absence of such Presidential assent, Section15 of the 1976 Act is rendered ultra vires, being repugnant with Section81 of the 1988 Act. Reliance is placed on Kaiser-I-Hind Pvt. Ltd. &Anr. vs. National Textile Corpn. (Maharashtra North) Ltd. & Ors.27.For the same reason, the State of Kerala ought to have obtainedPresidential assent under Article 304(b) of the Constitution in respect ofamended provisions vide the Amendment Act of 2005. Reliance is alsoplaced on Hoechst Pharmaceuticals Ltd. & Ors. vs. State of Bihar &Ors.28 to contend that the question of repugnancy under Article 254(1)between a law made by the Parliament and a law made by the StateLegislature arises only in case both the legislations occupy the samefield with respect to one of the matters enumerated in the ConcurrentList, and there is direct conflict between the two laws. But, Article 254(1)has no application to cases of repugnancy due to overlapping foundbetween List II on the one hand, and Lists I and III on the other. If suchoverlapping exists, the State law will be ultra vires because of the nonobstante clause in Article 246(1) read with Article 246(3). The State lawin that case would eventually fail for lack of legislative competence andnot because of repugnancy. Reliance is also placed on State of Kerala& Ors. vs. Mar Appraem Kuri Company Limited & Anr.29 whichhad dealt with the efficacy of Article 246(1) of the Constitution.14. It is also urged that the appellants cannot be non-suited fromarguing the validity of Section 15 of the 1976 Act, being in conflict with23 (1955) 1 SCR 79924 (1956) SCR 39325 (1996) 3 SCC 15 (para 26)26 (2001) 4 SCC 262 (para 14)27 (2002) 8 SCC 182 (paras 72 to 76)28 (1983) 4 SCC 45 (para 69)29 (2012) 7 SCC 106 (para 39) ABCDEFGH993Section 81 of the 1988 Act, merely because of the concession of thecounsel on the question of law before the High Court. To buttress thissubmission, reliance is placed on the dictum in Union of India & Ors.vs. Mohanlal Likumal Punjabi & Ors.30 and Director of ElementaryEducation, Odisha & Ors. vs. Pramod Kumar Sahoo31.15. It is, thus, submitted that the appellants are entitled to assailthe constitutional validity of not only sub-Sections (7) and (8) of Section4, as inserted by the Amendment Act of 2005 in the 1976 Act, but alsoSection 15 of the 1976 Act. In the submission of the appellants, theseprovisions are unconstitutional.16. Mr. K. Radhakrishnan, learned senior counsel appearing forthe appellants in the connected matters, more or less, pursued the sameline of challenge to the amended provisions and Section 15 of the 1976Act, but in addition, he also assailed the validity of Section 8A, as insertedby Act 23 of 2005 in the 1985 Act. According to him, Section 8A of the1985 Act with its non-obstante clause in effect overrides the Centrallegislation i.e., the 1988 Act. He submits that the High Court, in paragraph19 of the impugned judgment, has upheld the constitutional validity ofSection 8A of the 1985 Act; and, hence, it is open to the appellants tochallenge the validity of this provision in the present appeals. In hissubmission, Entry 57 of List II (State List) is made subject to Entry 35 ofthe Concurrent List (List III). Hence, the impugned amendments inSection 4 of the 1976 Act cannot encroach and override the Centrallegislation i.e., the 1988 Act, much less undermine the Stage and GoodsCarriage Operations as per the permit issued under that Act.17. It is further urged that Entry 57 of List II (State List) is notmade subject to Entry 24 of the Concurrent List and for which reason, the 1976 Act cannot be made subservient to the 1985 Act. The 1985 Actis a labour welfare legislation, whereas the 1976 Act is a legislationwhich is compensatory in nature. In any case, the 1988 Act is a completecode and a regulatory legislation. In his submission, the welfare legislationhas been intertwined by the State of Kerala with the compensatorylegislation vide impugned amendments/insertions and together theseprovisions substantially encroach and override the dispensations andprovisions predicated in the 1988 Act concerning issuance of permitsand its effectiveness. In his submission, the impugned State enactments30 (2004) 3 SCC 628 (paras 8 and 9)31 (2019) 10 SCC 674 (para 11)ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH994SUPREME COURT REPORTS[2022] 17 S.C.R.are repugnant with the Central law and there exist irreconcilable conflictand direct collision between the State and Central legislations, impingingupon the mandate of Article 254(1) of the Constitution which declaresthat the Central legislations must prevail. He submits that the impugnedState enactments are, therefore, void and unconstitutional. The same donot have the protection under Article 254(2) of the Constitution and inabsence of Presidential assent, it cannot prevail. He has placed relianceon M. Karunanidhi32; Association of Natural Gas & Ors. vs. Unionof India & Ors.33; and Dharappa vs. Bijapur Coop. Milk ProducersSocieties Union Ltd.34.18. It is his submission the State enactments suffer from the viceof the lack of legislative competence and are colourable legislations. The field of legislation in Entry 57 of the State List and Entry 24 of theConcurrent List are distinct and different. However, two State legislationsare operating in different fields to achieve different goals. For that reason, the impugned amendments/insertions in the concerned provisions arebordering on transgression of the limits of the powers to achieve indirectlythe collection of welfare fund contribution. The State Legislature is notcompetent to frame such law for ensuring collection of welfare funddues through the medium of a taxation statute. In the process, the taxationstatute is made to yield to the welfare fund statute. To buttress thissubmission, reliance has been placed on the dictum in Ashok Kumaralias Golu vs. Union of India & Ors.35 and State of Tamil Nadu &Ors. vs. K. Shyam Sunder & Ors.36.19. It is then submitted that the impugned amendments/insertionsare manifestly arbitrary and inevitably impinge upon the fundamentalrights inasmuch as, the substantive unreasonableness is apparent on theface of the impugned insertions by way of sub-Section (8) of Section 4which declares that no tax shall be collected unless the receipt ofremittance of contribution towards welfare fund mentioned in sub-Section(7) of Section 4 is produced. This is manifestly arbitrary and unreasonable.In that, the Taxation Officer is duty bound to accept tax when offeredby the tax payer and he cannot refuse to do so much less to impact theStage and Goods Carriage Operations with valid permits issued under32 Supra at Footnote No.14 (para 8)33 (2004) 4 SCC 489 (paras 13 and 15)34 (2007) 9 SCC 109 (para 12)35 (1991) 3 SCC 498 (para 9)36 (2011) 8 SCC 737 (para 36) ABCDEFGH995the Central legislations i.e., the 1988 Act. The permit so issued cannotbe rendered ineffective by a State legislation. In that sense, the impugnedamendments/insertions are hit by Article 254(1) and 254(2) of theConstitution. The presumption of constitutionality cannot come to theaid of the impugned amendments/insertions which are vitiated by manifestlegislative arbitrariness and have deleterious impact on the permit ofStage and Goods Carriage Operations. The impugned insertions, therefore, fall foul of Article 19(1)(g) of the Constitution as well. Relianceis placed on Ajay Hasia & Ors. vs. Khalid Mujib Sehravardi & Ors.37and K. Shyam Sunder38. It is, therefore, submitted that the appeals beallowed and the impugned provisions in the State enactments be declaredas unconstitutional.20. Mr. Abraham Mathews, learned counsel appearing for theState of Kerala, has adopted the reasons recorded by the Division Benchof the High Court in the impugned judgment. Additionally, it is submittedthat the appellants conceded their liability to pay the tax levied under the1976 Act as well as their dues/contribution under the 1985 Act. In thatsense, the only challenge in these appeals is that the amendment makespayment of the welfare dues a precondition for the collection of the tax, thereby dovetailed with a tax, merely for the purpose of compliance. Such a provision cannot be construed as unconstitutional. It is alwaysopen to the Legislature to combine levies for other purposes such aseducation cess, etc. Moreover, in paragraph 19 of the impugned judgment, the Division Bench of the High Court has clearly provided by directingthe statutory authorities that if a tax payer produces proof of havingpreferred an appeal in the prescribed mode in respect of legitimate disputeover the quantum of levy, that be regarded as sufficient compliance. This is a safeguard and must be good enough to assuage the apprehensionof the appellants, who intend to dispute the quantum of levy under the1985 Act. In other words, if the permit holder has resorted to remedy ofappeal/review in respect of demand under the 1985 Act, that would beregarded as sufficient compliance so as to accept the vehicle tax by theTaxation Officer under the 1976 Act. Therefore, no prejudice whatsoeverwould be caused to such permit holder. In any case, the permit holdercannot be heard to argue that he would not pay the dues under the 1985Act and yet would want to continue with the business as usual, exploitingthe workers sheerly because of the validity of the permit to operate37 (1981) 1 SCC 722 (para 16)38 Supra at Footnote No.36 (paras 50 to 53)ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH996SUPREME COURT REPORTS[2022] 17 S.C.R.transport vehicle used in the same business as usual. As a matter offact, the levy under the 1985 Act is covered by Entry 24 of the ConcurrentList. Whereas, the vehicle tax is levied as per Entry 35 thereof. The twofields are different and there is no encroachment into the legislativedomain of the Parliament.21. It is further urged that even if it is a case of encroachmentinto the legislative domain of the Parliament, such encroachment, beingincidental one, is protected by the doctrine of pith and substance asexpounded in Hoechst Pharmaceuticals Ltd.39.22. It is also urged that the levy of contribution to the workers’welfare fund is a socially beneficial legislation intended to protect theworkers of the commercial operations undertaken by the appellants andother similarly placed vehicle operators pursuant to permit issued underthe Central legislation. The workers engaged by them may not be eligibleto avail of the pension and provident fund scheme. In most of the cases, they are typically unorganised and part of the informal workforce of thecountry and often left to fend for themselves. The 1985 Act is to reachout to such workers and provide them with support on the basis of thecollection made from the Stage and Goods Carriage Operators. In thepast, there has been any number of instances where the operators haddeliberately avoided to pay and contribute to the workers’ welfare fundwhich was frowned upon even by the High Court warrantingamendments to the State legislations which are impugned in the presentproceedings.23. It is, thus, urged that the challenge set forth by the appellantsis devoid of merit. In that, the provisions of the State enactments, whichare impugned in the present proceedings, do not undo the permit issuedunder the Central legislation as such, but merely restates the mandate ofthe Central legislation itself that the vehicle cannot be used without permitand payment of vehicle tax. Merely because permit is issued under theCentral legislation which provides for a term of five years from the dateof issuance, it does not follow that the permit holder or the vehicle ownercan operate the vehicle under such a permit without payment of taxpayable by virtue of the State legislation and more so linked to theactivities relatable to the vehicle. It is open to the State to stop anyvehicle or seize and detain the vehicle despite a valid permit if it is usedor kept for use within the State without payment of tax payable under39 Supra at Footnote No.28 ABCDEFGH997the 1976 Act. That is a consequence under the State legislation. In onesense, the amended provisions using the expression “ineffective” wouldmean that despite a valid permit, action can be taken under the Statelegislation concerning the vehicle which is used or kept for use withinthe State without payment of tax.24. It is a different matter that precondition of production of proofof payment of dues under the 1985 Act has been provided for beforeaccepting the vehicle tax by the Taxation Officer. If so understood, Section15 of the 1976 Act cannot be regarded as in conflict or repugnant withSection 81 of the 1988 Act. Even under the 1988 Act, the permit holderis obliged to pay tax regularly, failing which, it can entail cancellation orrejection of permit/renewal, including penal consequences for violation.25. Mr. P.N. Ravindran, learned senior counsel, appearing for theKerala Motor Transport Workers Welfare Fund Board40, has alsodefended the view taken by the Division Bench of the High Court. Hesubmits that in the State of Kerala, the levy of tax on motor vehicles isgoverned by the 1976 Act, a law enacted by the State Legislature underEntry 57 of List II of the Seventh Schedule to the Constitution. This Acthad received Presidential assent on 15.3.1976. Whereas, the 1985 Actwas enacted by the State Legislature under Entry 24 of List III of theSeventh Schedule to the Constitution. Under Section 341 of this Act, theState Government has formulated a scheme known as ‘the Kerala MotorTransport Workers Welfare Fund Board Scheme, 1985’42. As per Section943of the 1985 Act and paragraph 29 of the 1985 Scheme, every employer,40 for short, “the Welfare Fund Board”41 3.Motor Transport Workers Welfare Fund.-(1) The Government may, by notification in the Gazette, frame a scheme to be calledthe Kerala Motor Transport Workers’ Welfare Fund Scheme for the establishment of aFund under this Act for employees and there shall be established, as soon as may beafter the framing of the scheme, a Fund in accordance with the provisions of this Actand the scheme.(2) The Fund shall vest in, and be administered by, the Board.(3) Subject to the provisions of this Act, the scheme may provide for all or any of thematters specified in the Schedule.42 for short, “the 1985 Scheme”43 9. Remittance of monthly contribution.- (1) Every employer, employer and self-employed person shall, pay the contributiondue from him every month as provided for in the scheme.(2) The monthly contribution shall become payable on or before the 7th day of thesucceeding month.ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH998SUPREME COURT REPORTS[2022] 17 S.C.R.employee and self-employed person are obliged to remit the monthlycontribution on or before the 7th day of the succeeding month. Section844 of the 1985 Act and paragraph 28 of the 1985 Scheme provide fordetermination of the amount due under the Act and the Scheme fromthe employer, employee and self-employed person. It provides for remedyof review petition before the authority, who determined the arrears; anappeal before the District Labour Officer; and, in cases where arrearsin dispute exceed Rs.1,00,000/-, a second appeal to the Kerala MotorTransport Workers Welfare Fund Board. The appeal can be entertainedonly if 50% of the amount, as mentioned in the order under challenge, ispaid. It was noticed that mandate of the 1985 Act and the 1985 Schemewas not being complied with in most of the cases. This aspect wastaken note of by the High Court in O.P. No.7440 of 2003 filed by theKerala Private Bus Operators Federation and pursuant to the directions44 8 Determination of amount due.-(1) The Chief Executive Officer or any other officer appointed under sub-section (1) ofsection 7 authorised by him in this behalf may, by order, determine the amount dueunder the provisions of this Act or of the Scheme from the employer, employee andself-employed person and if the amount due is not paid on or before the due date heshall issue a demand notice to the defaulter showing the amount of arrears.(2) Any person aggrieved by the determination of arrears under sub-section (1) may filea review petition before the authority who had determined the arrears, showing detailedfacts and reasons for reviewing the original determination within seven days of receiptof demand notice.(3) A review petition filed under sub-section (2) shall be disposed of by the authoritywithin a period of thirty days from the date of its receipt.(4) Any person aggrieved by an order under sub-section (3) may prefer an appealbefore the District Labour Officer of the concerned district and it staff be disposed ofby him within a period of sixty days from the date of its receipt.(5) If the amount of arrears in dispute exceeds rupees one lakh, any person aggrieved byan order under sub-section (4) may prefer a second appeal before the Board and it shallbe disposed of within a period of sixty days from the date of its receipt.(6) Every order passed under sub-section (4) or sub-section (5) as the case may be, shall be final.(7) No appeal under this section shall be entertained unless the amount in accordancewith the order against which the appeal has been preferred is paid.(8) If the appellate authority in an appeal decides that the amount paid is in excess ofwhat is due from the appellant, it may, by order, direct for the refund of the excessamount.(9) An officer or authority exercising the power of appeal under sub-section (5) ofsection 8 of the Kerala Motor Transport Workers’ Welfare Fund Act. 1985, immediatelybefore the commencement of the Kerala Motor Transport Workers’ Welfare Fund(Amendment) Ordinance, 2005 shall continue to exercise such powers, in respect of thecase pending before such officer or authority. ABCDEFGH999issued by the High Court, not only the Scheme was amended, but Section8A came to be inserted in the 1985 Act vide Act 23 of 2005.Simultaneously, by Act 24 of 2005, the 1976 Act came to be amended byinserting sub-Sections (7) and (8) in Section 4 of that Act. The purportof the inserted sub-Sections (7) and (8) of Section 4 was more or less inline with the regime specified in Section 15 of the 1976 Act. Under the1976 Act, by virtue of Section 10, any officer of the Motor VehiclesDepartment not below the rank of Assistant Motor Vehicles Inspectoror any police officer in uniform not below the rank of Sub-Inspector, hasbeen empowered to stop any vehicle for the purpose of satisfying himselfthat the amount of the tax due in respect of such vehicle has been paid.26. Section 11 of the 1976 Act empowers the stated officers toseize and detain taxable motor vehicles used or kept for use in the Stateof Kerala without payment of tax pending production of proof of paymentof the tax. Notably, these provisions have not been challenged. In onesense, without the amended provisions, the permit issued under the 1988Act would become ineffective in cases where action is taken underSections 10 and 11 of the 1976 Act. Thus understood, Section 15 as wellas the amended Section 4(7) and (8) of the 1976 Act and Section 8A ofthe 1985 Act would have the same effect in case of action taken by thestated officers under Sections 10 and 11 of 1976 Act. The amendedprovisions merely declare that position. It is nobody’s case merely becauseon the basis of permit, the permit holder would be entitled to use vehicleor keep the vehicle for use within the State of Kerala without paymentof tax. The levy of tax shall be on the basis of rate specified underSection 345 of the 1976 Act. Despite the repeal of 1939 Act, theseprovisions of the 1976 Act continue to operate, thereby empowering the45 3. Levy of Tax.-(1) Subject to the provisions of this Act, on and from the date of commencement of thisAct, a tax shall be levied on every motor vehicle used or kept for use in the State, at therate specified for such vehicle in the Schedule:Provided that no such tax shall be levied on a motor vehicle kept by a dealer in, or a manufacturer of, such vehicle, for the purpose of trade and used under theauthorization of a trade certificate granted by the registering authority; provided further that in respect of a new motor vehicle of any of the classesspecified in item Nos.1(b), 2 and 11 of the Schedule to this Act, there shall be leviedfrom the date of purchase of the vehicle ‘one time tax’ at the rates specified in theAnnexure at the time of the first registration of the vehicle, and thereafter tax shall belevied in the schedule as per the fourth proviso to sub-section (1) of Section 4.Provided further that in respect of new motor vehicle of any of the descriptionsspecified in item No.1(a) of the Schedule to this Act, there shall be levied from the dateALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH1000SUPREME COURT REPORTS[2022] 17 S.C.R.stated officers to act against the vehicle used or kept for use within theState of Kerala without payment of vehicle tax.27. Section 15 merely makes reference to the 1939 Act withoutincorporation of any provision thereof. Resultantly, the repeal of thatAct will have no impact on the provisions of the 1976 Act, including inlight of Section 8(1) of the General Clauses Act, 1897. In support of thisof purchase of the vehicle a tax in advance for a period of five years at the rate specifiedin the schedule, at the time of first registration of the vehicle, and thereafter tax shall belevied at the rate specified in the Schedule in accordance with the fourth proviso to subsection (1) of Section 4.(2) The Government may from time to time by notification in the Gazette, increase therate of tax specified in the Schedule:Provided that such increase shall not in the aggregate exceed fifty per cent ofsuch rate.(3) The registered owner of, or any person having possession or control of a motorvehicle shall, for the purpose of this Act, be deemed to use or kept such vehicle for usein the State, except during any period for which no tax is payable on such motor vehicleunder sub section (1) of Section 5.(4) Notwithstanding anything contained in sub-section (1), the Government may, fromtime to time, by notification in the Gazette, direct that a temporary licence for a periodnot exceeding seven days or thirty days at a time may be issued in respect of any classof motor vehicles specified in the Schedule on payment of the tax specified in sub-section (5), and subject to such conditions as may be specified in such notification.(5) The tax payable for a temporary licence in respect of a motor vehicle shall be-(a) where the temporary licence is for period not exceeding seven days, at therate of one-tenth of the quarterly tax on that motor vehicle; and(b) where the temporary licence is for a period exceeding seven days but notexceeding thirty days, at the rate of one third of the quarterly tax on that motorvehicle:Provided also that in the case of vehicles covered with permit under sub-section (9) of Section 88 of the Motor Vehicles Act, 1988 (Central Act 59 of1988) and registered in any State other than the State of Kerala and entering theState of Kerala and staying therein, then, the tax payable for such vehicle shallbe-(a) if such stay. does not exceed seven days one-tenth of the quarterlytax; and(b) if such stay exceeds seven days but does not exceed thirty days onethird of the quarterly tax(6) In the case of motor vehicles in respect of which any reciprocal arrangement relatingto taxation has been entered into between the Government of Kerala and any otherState Government, the levy of tax shall, notwithstanding anything contained in this Actbe in accordance with the terms and conditions of such reciprocal arrangement.:Provided that the terms and conditions of every such reciprocal arrangementshall be published in the Gazette and a copy thereof shall be placed before the LegislativeAssembly of the State. ABCDEFGH1001submission, reliance is placed on The Collector of Customs, Madrasvs. Nathella Sampathu Chetty & Anr.46 and New Central Jute MillsCo. Ltd. vs. Assistant Collector of Central Excise, Allahabad & Ors.47.28. Coming to the challenge to the amended provisions vide Statelegislation in 2005, it is urged that the Parliament has not enacted anylaw regarding levy of tax on motor vehicles. The 1988 Act does not dealwith levy of tax on motor vehicles and the consequence of non-paymentof such tax. Whereas, the 1976 Act has been enacted by the StateLegislature under Entry 57 of List II of the Seventh Schedule to theConstitution, which is exclusively within the domain of the StateLegislature. The regime regarding payment of tax in respect of motorvehicles and the consequence of non-payment, are, therefore, exclusiveto the 1976 Act. Thus understood, there is no question of repugnancybetween the provisions of the 1988 Act and the State legislation in thefield occupied by the 1976 Act. Suffice it to observe contends the learnedsenior counsel that Section 15 of the 1976 Act does not reduce the periodof validity of the permit issued under the 1988 Act, but it only stipulatesthat the vehicle tax due in respect of transport vehicle must be paidwithin the prescribed period and thereby declaring that in case of non-payment of tax, the validity period of permit cannot come in the way ofinitiating action against the vehicle used or kept for use within the Stateof Kerala without payment of vehicle tax. If so understood, there is noconflict between the period prescribed in terms of Section 81(1) of the1988 Act and the provisions in the State legislation — be it the 1976 Actor the 1985 Act.29. As submitted earlier, the appellants have not challenged thevalidity of Sections 10 and 11 of the 1976 Act in particular which empowerthe stated officers to stop or seize and detain motor vehicles used orkept for use in the State of Kerala without payment of vehicle tax. Theamended provisions of the 1976 Act and the 1985 Act merely prescribethe modalities for payment and collection of vehicle tax or payment ofcontribution to the Kerala Motor Transport Workers’ Welfare Fund byrequiring the employer/vehicle owner to produce receipt regardingpayment of contribution to the welfare fund before the Taxation Officerwhile offering to pay vehicle tax under the 1976 Act.30. It is further urged that no argument can be countenanced thatthe State Legislature lacks legislative competence to enact a law on the46 AIR 1962 SC 31647 (1970) 2 SCC 820ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH1002SUPREME COURT REPORTS[2022] 17 S.C.R.subject of vehicle tax falling under Entry 57 of List II of the SeventhSchedule to the Constitution. The 1988 Act does not deal with either themodalities for the payment or collection of vehicle tax as such. For whichreason, there is no inconsistency between the Central Act and the StateAct. According to the learned senior counsel, these appeals are devoidof merits and, therefore, the decision of the Division Bench of the HighCourt under appeal needs to be affirmed.31. We have heard learned counsel appearing for both parties atlength.32. After cogitating over the oral arguments and perusing thewritten submissions, it needs to be noted at the outset that there is nochallenge on the ground of legislative competence in respect of the 1976Act and amendments thereto as well as the 1985 Act as amended. Theargument is essentially about repugnancy owing to the application of theState laws to the vehicle permit issued under the law made by Parliament. The tests of repugnancy have been delineated by the Constitution Benchin Deep Chand48. Three principles have been noted in this decision asfollows:“(1)Whether there is direct conflict between the two provisions;(2)Whether Parliament intended to lay down an exhaustivecode in respect of the subject-matter replacing the Act ofthe State Legislature; and(3)Whether the law made by Parliament and the law made byState Legislature occupy the same field.”33. We may usefully also refer to the decision in ThirumurugaKirupananda Variyar Thavathiru Sundara Swamigal MedicalEducational & Charitable Trust49 wherein the Court observed inparagraph 26 as follows:“26. It cannot, therefore, be said that the test of two legislationscontaining contradictory provisions is the only criterion ofrepugnance. Repugnancy may arise between two enactmentseven though obedience to each of them is possible withoutdisobeying the other if a competent legislature with a superiorefficacy expressly or impliedly evinces by its legislation an intention48 Supra at Footnote No.2249 Supra at Footnote No.25 ABCDEFGH1003to cover the whole field. The contention of Shri Sanghi that thereis no repugnancy between the proviso to Section 5(5) of theMedical University Act and Section 10-A of the Indian MedicalCouncil Act because both can be complied with, cannot, therefore, be accepted. What has to be seen is whether in enacting Section10-A of the Indian Medical Council Act, Parliament has evincedan intention to cover the whole field relating to establishment ofnew medical colleges in the country.”34. Keeping in mind the exposition of this Court in theaforementioned decisions, we would immediately turn to the Act enactedby the Parliament in 1988. This Act had repealed the erstwhile MotorVehicles Act, 1939. The Parliament has obviously enacted the 1988 Actin reference to Entry 35 in List III – Concurrent List which concerns themechanically propelled vehicles including the principles on which taxeson such vehicles are to be levied. Notably, the 1988 Act provides forprocedure of Regional Transport Authority in considering application forstage carriage permit as predicated in Section 7150 of the 1988 Act. TheAuthority while considering an application for grant of a stage carriage50 71. Procedure of Regional Transport Authority in considering application forstage carriage permit.— (1) A Regional Transport Authority shall, while consideringan application for a stage carriage permit, have regard to the objects of this Act.(2) A Regional Transport Authority shall refuse to grant a stage carriage permit if itappears from any time-table furnished that the provisions of this Act relating to thespeed at which vehicles may be driven are likely to be contravened:Provided that before such refusal an opportunity shall be given to the applicant toamend the time-table so as to conform to the said provisions.(3)(a) The State Government shall, if so directed by the Central Government havingregard to the number of vehicles, road conditions and other relevant matters, bynotification in the Official Gazette, direct a State Transport Authority and a RegionalTransport Authority to limit the number of stage carriages generally or of any specifiedtype, as may be fixed and specified in the notification, operating on city routes intowns with a population of not less than five lakhs.(b) Where the number of stage carriages are fixed under clause (a), the Government ofthe State shall reserve in the State certain percentage of stage carriage permits for thescheduled castes and the scheduled tribes in the same ratio as in the case of appointmentsmade by direct recruitment to public services in the State.(c) Where the number of stage carriages are fixed under clause (a), the Regional TransportAuthority shall reserve such number of permits for the scheduled castes and the scheduledtribes as may be fixed by the State Government under sub-clause (b).(d) After reserving such number of permits as is referred to in clause (c), the RegionalTransport Authority shall in considering an application have regard to the followingmatters, namely:—(i) financial stability of the applicant; ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH1004SUPREME COURT REPORTS[2022] 17 S.C.R.permit is obliged to have regard to the objects of the 1988 Act includingabout the satisfactory performance of the applicant as a stage carriageoperator and payment of tax [Section 71(3)(d)(ii)]. The other relevantprovision for considering the subject-matter of this appeal is Section 81dealing with duration and renewal of permits. It postulates that the permitissued by the Authority under the Act shall be effective from the date ofissuance or renewal thereof for a period of five years. The proviso tosub-section (1) envisages that where the permit is countersigned undersub-section (1) of Section 88, such countersignature shall remain effectivewithout renewal for such period so as to synchronise with the validity ofthe primary permit. We are not concerned with the effect of the provisoin the present case. The relevant sub-section dealing with the power ofthe Authority to reject an application for the renewal of a permit is sub-section (4) of Section 81. It provides for the grounds on which the renewalof a permit can be rejected. The same includes plying any vehicle withoutpayment of tax due on such vehicle; and on any unauthorised route. Besides these provisions, there is nothing in the 1988 Act to deal withthe manner of levy of vehicle tax or the collection thereof. In otherwords, the law made by the Parliament does not occupy the field ofmanner of levy of vehicle tax and collection thereof. If so, it is not possibleto hold that there is direct conflict between the two provisions, namely, in the law made by the Parliament and by the State Legislature. Furthermore, on analysing the legislative intent and the efficacy of theimpugned provisions enacted by the State Legislature concerning themanner of levy of vehicle tax and collection thereof, it will be amplyclear that obedience to each of the laws (made by the Parliament andState Legislature) is possible without disobeying the other. We shall(ii) satisfactory performance as a stage carriage operator including payment oftax if the applicant is or has been an operator of stage carriage service; and(iii) such other matters as may be prescribed by the State Government:Provided that, other conditions being equal, preference shall be given toapplications for permits from—(i) State transport undertakings;(ii) co-operative societies registered or deemed to have been registered underany enactment for the time being in force;(iii) ex-servicemen; or(iv) any other class or category of persons, as the State Government may, forreasons to be recorded in writing consider necessary. Explanation.—For the purposes of this section “company” means any body corporate, and includes a firm or other association of individuals; and “director”, in relation to afirm, means a partner in the firm. ABCDEFGH1005elaborate on this aspect while dealing with efficacy of the law made bythe State Legislature a little later. Suffice it to observe that the argumentregarding repugnancy is devoid of merit.35. As regards the 1976 Act enacted by the State Legislature, thesame is ascribable to Entries 56 and 57 of List II – State List. Entry 56deals with taxes on goods and passengers carried by road or on inlandwaterways. Entry 57 deals with taxes on vehicles, whether mechanicallypropelled or not, suitable for use on roads, including tramcars subject tothe provisions of Entry 35 of List III. In one sense, the law made by theState Legislature is also ascribable to Entry 35 of List III under whichthe Parliament has already enacted 1988 Act. However, asaforementioned, the law made by the Parliament, being 1988 Act, doesnot touch upon or deal with the field of manner of levy of vehicle tax andcollection thereof. Whereas, the 1976 Act enacted by the StateLegislature is to consolidate and amend the laws relating to the levy oftax on motor vehicles and on passengers and goods carried by suchvehicles in the State of Kerala. The levy of tax is spelt out in Section 3 ofthis Act. Section 4 deals with payment of tax and issue of licence. Thewrit petitioners have challenged the amendment made to this provisionvide Act 24 of 2005 inserting sub-sections (7) and (8) therein. By thisamendment, it is provided that every registered owner or person havingpossession or control of a motor vehicle in respect of a motor transportundertaking liable to pay contribution under the 1985 Act shall, beforeeffecting payment of vehicle tax under the 1976 Act, produce before theTaxation Officer the receipt of remittance of the contribution towardswelfare fund due upto the preceding month and failure to do so, wouldentail in refusal to collect the vehicle tax under the 1976 Act. In thecontext of this provision, it has been urged that such a provision is in thenature of bootstrapping of two different liabilities. Section 851 mandatesproduction of certificate of insurance by every registered owner or personhaving possession or control of a motor vehicle. Section 952 fastens liability51 8.Production of certificate of insurance.- Every registered owner or person havingpossession or control of a motor vehicle shall, at the time of making payment of the tax, produce before the Taxation Officer a certificate of insurance in respect of the vehicle, which is valid at the time of making such payment, complying with the requirements ofChapter VIII of the Motor Vehicles Act, 1939 (Central Act 4 of 1939).52 9.Liability to payment of tax by persons succeeding to the ownership, possessionor control of motor vehicles.-(1) If the tax leviable in respect of any motor vehicle remains unpaid by any personliable for the payment thereof and such person before payment of tax has transferredALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH1006SUPREME COURT REPORTS[2022] 17 S.C.R.to pay vehicle tax by person succeeding to the ownership, possession orcontrol of motor vehicles. Sections 10 and 11 are of some relevance. The same reads thus:“10. Power of officers of Police or Motor VehiclesDepartment to stop motor vehicles.-(1) Any officer of the Motor Vehicles Department not below therank of Assistant Motor Vehicles Inspector or any police officerin uniform who is not below the rank of a Sub Inspector mayrequire the driver of any motor vehicle in any place to stop suchvehicle and cause it to remain stationary so long as may reasonablybe necessary for the purpose of satisfying himself that the amountof the tax due in accordance with the provisions of this Act inrespect of such vehicle has been paid.(2) Any person failing to stop a motor vehicle when required to doso under sub-section (1) by any officer referred to in that sub-section or resisting any such officer when required under thatsub-section to stop a motor vehicle shall, on conviction, bepunishable with the same penalty as provided in section 16.11. Seizure and detention of motor vehicles pendingproduction of proof of remittance of tax. – Any Officer notbelow the rank of Assistant Motor Vehicles Inspector authorizedin this behalf by the Government or any police officer not belowthe rank of Sub-Inspector may, if he has reason to believe that ataxable motor vehicle is used or kept for use in the State withoutpaying the tax, seize and detain that vehicle and makearrangements for the safe custody of that vehicle pendingproduction of proof of payment of the tax.”Concededly, the validity of these two provisions have not beenassailed by the writ petitioners and, failure to do so, may have somebearing on the view that we propose to take. Additionally, we may alsoadvert to Section 15 of the Act which is the subject-matter of challengein these proceedings. The same reads thus:the ownership of such vehicle or has ceased to be in possession control of such vehicle, the person to whom the ownership of the vehicle has been transferred or the personwho has possession or control of such vehicle shall be liable to pay the said tax.(2) Nothing contained in Sub-section (1) shall be deemed to affect the liability to paythe said tax of the person who has transferred the ownership or has ceased to be inpossession or control of such vehicle. ABCDEFGH1007“15. Transport Vehicle permit to be ineffective if tax notpaid.- Notwithstanding anything contained in the Motor VehiclesAct, 1939 (Central Act 4 of 1939) if the tax due in respect of atransport vehicle is not paid within the prescribed period, the validityof the permit for that vehicle shall become ineffective from thedate of expiry of the said period until such time as the tax is actuallypaid.”36. From the scheme of the 1976 Act, it is amply clear that it isspecific to levy of tax on motor vehicle and passengers and goods carriedby such vehicle in the State of Kerala. It is not a law regulating theissuance of a permit by the Authority under the 1988 Act as such. Indisputably, the permit issued by the Authority is hedged with conditionsincluding the condition of regular payment of vehicle tax. Section 15provides for the consequences for non-payment of tax consistent withSections 10 and 11 of the 1976 Act. Thus understood, there is no occasionfor conflict between the two provisions much less repugnancy.37. As regards the argument regarding bootstrapping of liabilitiesof permit-holder under two different State legislations, it is to say theleast tenuous. It is open to the Legislature to combine levies for otherpurposes, such as education cess, etc., for collection of tax due andpayable by the same tax-payer. It is one thing to say that the person isbeing compelled to discharge liability under two different State enactments, although he is not liable under one of the two. That is not the argumentof these writ petitioners. The petitioners are not disputing their liabilityunder both the State Enactments. The argument, however, is that thewrit petitioners may intend to invoke remedy of appeal and revision inrespect of liability fastened under the 1985 Act. This argument has beenrightly negatived by the High Court in paragraph 18 of the impugnedjudgment by observing that sufficient safeguard has been provided underthe relevant enactment to file appeal/revision by remitting 50 per cent ofthe amount demanded. The High Court issued directions in that regardin paragraph 19 of the impugned judgment. A circular has been issuedon 16.6.2007, clarifying that the aggrieved person, who prefers appealon payment of 50 per cent of the contribution under the Welfare FundAct, is entitled to get a certificate to that effect and on production of thatcertificate before the Taxing Authorities, the vehicle tax could be receivedby the Authority without payment of the entire Welfare Fund ofcontributions. The High Court has already issued directions to extendALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH1008SUPREME COURT REPORTS[2022] 17 S.C.R.similar benefit even in cases where review petition is filed within theprescribed time. The fact remains that no prejudice whatsoever is causedto the permit-holder who intends to pursue remedy under the 1985 Actagainst the demand received by him relating to the contribution of theWelfare Fund.38. Reverting to the 1985 Act enacted by the State Legislature, indisputably, it is a welfare legislation constituting a fund to promote thewelfare of motor transport workers in the State of Kerala. This Act isascribable to Entries 23 and 24 of List III – Concurrent List. Entry 23deals with social security and social insurance; employment andunemployment and Entry 24 deals with welfare of labour includingconditions of work, provident funds, employers’ liability, workmen’scompensation, invalidity and old age pensions and maternity benefits. Ostensibly, it may appear that the liability arising from the obligationsunder the 1985 Act have nothing to do with the subject of vehicle tax. However, the 1985 Act has been enacted with the objects and reasonsnoted. As a vast number of employees were being engaged in MotorTransport Industry in the State in the private sector, the Governmentthought it necessary to provide for the constitution of a Fund to promotethe welfare of such of the motor transport workers in the private sectorwho are not covered by the Employees’ Provident Funds andMiscellaneous Provisions Act, 1952 and the Payment of Gratuity Act,1972. In other words, this Act came into being to ameliorate the difficultiesencountered by the motor transport workers in the State of Kerala. Indue course, it came to the notice of the Government that the system ofdetermination and assessment of contribution from employers andadjudication of disputes, etc., as provided for in the 1985 Act had certainloopholes resulting in loss of welfare fund contribution. In that, the busoperators set forth a defence by creating bogus partnerships and showingrelatives as employees to evade payment of contribution. Another devicewas to keep on changing the employees frequently. Thus, to check thismischief, an amendment was effected to the 1985 Act vide Act 23 of2005 including to reduce the arbitrariness in fixing the contribution. Theactivities of motor transport workers are directly linked to the use andoperation of the motor transport vehicles having permit issued under the1988 Act in that regard. Under the said Act, the permit-holder is obligedto ensure that the vehicle tax is paid regularly. The law clearly providesfor action to be taken against the motor transport vehicle for failure topay vehicle tax including to reject renewal of the permit. The stipulation ABCDEFGH1009in the 1985 Act is in the nature of ensuring that the vehicle owner/permit-holder discharges both the liabilities and does not commit default incontributing to the welfare fund as also pay vehicle tax on time. Non-payment of vehicle tax may entail in stopping of motor vehicle by theOfficers of Police or Motor Vehicles Department in exercise of powerunder Section 10 of the 1976 Act including to seize and detain the samepending production of proof remittance of tax as predicated in Section11 of the Act. Additionally, the vehicle owner may have to suffer penaltyunder Section 1653 and face prosecution under Section 1754, besides thepermit being rendered ineffective if tax is not paid by virtue of Section15.39. Considering the scheme of the State legislations, it isincomprehensible to countenance the argument that the two provisions(of 1988 Act on the one hand and of 1976 Act and 1985 Act on the53 16. Penalties.- Whoever contravenes any of the provisions of this Act or any rulemade thereunder shall, on conviction, if no other penalty is elsewhere provided in thisAct or the rules for such contravention, be punishable with fine which may extend toone hundred rupees and, in the event of such person having been previously convictedof an offence under this Act or any rule made thereunder with fine which may extend totwo hundred rupees.54 17. Offences by companies.-(1) Where an offence under this Act has been committed by a company, every personwho, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be liable to be proceeded against and punished accordingly:Provided that nothing contained in this sub-section shall render any suchperson liable to any punishment if he proves that the offence was committed withouthis knowledge or that he exercised all due diligence to prevent the commission of suchoffence.(2) Notwithstanding anything contained in sub-section (1) where an offence under thisAct has been committed by a company and it is proved that the offence has beencommitted with the consent or connivance of or is attributable to any neglect on thepart of any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence andshall be liable to be proceeded against and punished accordingly. Explanation:- For the purpose of this section-(a)”company” means a body corporate, and includes a firm or other association ofindividuals; and(b) “director”, in relation to -(i) a firm, means a partner in the firm.,(ii) a society or other association of individuals, means the person who isentrusted under the rules of the society or other association with the managementof the affairs of the society or other association, as the case may be.ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.] ABCDEFGH1010SUPREME COURT REPORTS[2022] 17 S.C.R.other) are inconsistent in any manner whatsoever. Whereas, the Stateenactments are complementary and can be given effect to without anydisobedience to the Central legislations. As aforementioned, the 1988Act does not cover the field of the manner of levy of vehicle tax andcollection thereof. The same is covered by the State legislations.40. Concededly, the appellants have not disputed their liability topay the vehicle tax levied under the 1976 Act as well as to pay contributiontowards the workers’ welfare fund under the 1985 Act. So understood, the real grievance in these appeals by the motor transport vehicle owners/permit-holders is about compelling them to pay the welfare contributiondues as a precondition for collection of vehicle tax. We have no hesitationin taking the view that such dispensation cannot be construed asunconstitutional. Further, such a plea cannot be countenanced at theinstance of someone who otherwise concedes liability to pay both thedues towards welfare fund contribution and vehicle tax. It is beyondcomprehension that the vehicle owner/permit-holder can be heard toargue that he would not pay the dues under the 1985 Act and, yet, wouldcontinue with the business of motor transport as usual in the State ofKerala by exploiting the workers on the specious plea that the validity ofthe permit to operate transport vehicle cannot be interdicted under aState legislation. The provision in the form of Section 15 of the 1976 Actis in the nature of restating the consequences flowing from Sections 10and 11 of the same Act to stop motor vehicle and to seize and detain thesame if being used or operated without payment of vehicle tax. Whenaction is taken by the competent authority under Sections 10 and 11 ofthe Act, inevitably, the transport vehicle in question for which permit hasbeen taken is rendered unusable due to non-payment of vehicle tax. Theliability of the vehicle owner/permit-holder to pay welfare fundcontribution as well as to pay vehicle tax arises under the legislationenacted by the State Legislature. As such, there is nothing wrong inState Legislature making it compulsory to pay outstanding welfare fundcontribution first before accepting the vehicle tax which had becomedue and payable. In this view of the matter, it would be unnecessary todilate on the argument regarding validity of Section 15 of the 1976 Actbecause of lack of Presidential assent after coming into effect of the1988 Act.41. We cannot be oblivious about the legislative intent for enactingthe 1985 Act and the amendment effected thereto in 2005. The same is ABCDEFGH1011a beneficial legislation with avowed objective to ensure strict complianceof payment of welfare fund contribution to protect the workers of thecommercial operations undertaken by the vehicle owners/permit-holderspursuant to a permit issued under the 1988 Act, and is to reach out tosuch workers who are typically unorganised and a part of informalworkforce. Neither the provisions of the 1985 Act or the 1976 Act havethe effect of interdicting the permit issued under the 1988 Act. The realintent and purpose behind these provisions is to restate the mandatestated in the 1988 Act that the vehicle cannot be used on road without avalid permit and payment of vehicle tax up to date.42. A priori, we have no hesitation in concluding that the provisionsof the 1976 Act and the 1985 Act, enacted by the State Legislature, areonly intended to ensure that the vehicle owner/permit-holder does notremain in arrears of either the welfare fund contribution or the vehicletax both payable under the State enactments. These provisions are in noway in conflict with the law made by the Parliament (1988 Act). TheState enactments do not create any new liability or obligation in relationto the permit issued under the 1988 Act (Central legislation), but it providesfor dispensation to ensure timely collection of the welfare fund contributionas well as vehicle tax payable by the same vehicle owner/permit-holder.43. While parting, we must note that the writ petitioners throughtheir counsel had fairly accepted during oral argument that after the2005 amendment, for all these years they have been following thedispensation provided under the State legislations without exception. Inthat sense, the challenge has become academic. Be that as it may, wehave negatived the stand taken by the writ petitioners regarding thevalidity of the amended provisions being repugnant to the law made bythe Parliament.44. In view of the above, these appeals must fail and the sameare dismissed with costs. Pending application(s), if any, stands disposed of. Divya Pandey and Amarendra KumarAppeals dismissed.(Assisted by : Pragya Samal, LCRA)ALL KERALA DISTRIBUTORS ASSN., KOTTAYAM UNIT, REP. BYITS SECY. v. THE STATE OF KERALA [A. M. KHANWILKAR, J.]