Case Background
The case was a civil writ petition filed before the Patna High Court as Civil Writ Jurisdiction Case No. 15727 of 2024. It was heard by a Division Bench comprising Hon’ble the Chief Justice and Hon’ble Mr. Justice Partha Sarthy. The oral judgment was delivered on 22.10.2024.
There were three petitioners. All of them were registered owners of different stage carriage vehicles (buses). They approached the Court together with a common grievance against officers of the Transport Department of the State of Bihar, including the State Transport Commissioner and District Transport Officers of Madhubani, Sitamarhi and Muzaffarpur.
The petitioners wanted the authorities to issue them provisional Motor Vehicles Tax Tokens for the current period. A tax token is necessary for legally using a vehicle on the road. However, the vehicles had outstanding arrears of tax for earlier years which had not been paid.
The petitioners’ case was that they had already applied to the authorities seeking exemption or “write off” of motor vehicles tax for several past periods. They said that during those periods the vehicles were not run on the road. According to them, the vehicles were lying idle because there was an ongoing dispute with Bihar State Road Transport Corporation (BSRTC). Due to this dispute, and on the basis of demands allegedly raised by BSRTC against the owners, the Road Transport Authority (RTA) did not grant permits to these stage carriages.
On this basis, the petitioners argued that, since the vehicles were not being operated, they should be exempted from paying tax for those earlier years. Once the arrears were treated as exempt, the Transport Department should, according to them, issue fresh tax tokens for the current period on payment of current tax only.
What the Court Examined and Decided
The Patna High Court first examined the documents on which the petitioners relied. One key document was Annexure-P/2, which was a judgment of a learned Single Judge of the same Court. That earlier case had been filed only by the first petitioner and concerned rejection of permit applications for two specific stage carriages bearing registration numbers BR06PB9099 and BR06PB9095.
In that earlier judgment, the Single Judge had directed the authority to consider the permit application afresh on its own merits, without taking into account any amounts allegedly due to BSRTC. BSRTC was given liberty to recover its dues separately in accordance with law, but it was made clear that the permit renewal could not be rejected only because BSRTC claimed some dues.
The present Bench carefully noted that this earlier judgment dealt only with permit renewal and the issue of dues owed to BSRTC. It had nothing to do with liability to pay motor vehicles tax under the taxation law. Therefore, the Court held that Annexure-P/2 could not assist the petitioners on the question of tax exemption or tax token issuance.
The Bench also pointed out a basic procedural problem. The present writ petition had been filed jointly by three different vehicle owners. The tax dues related to different vehicles and different time periods for each of them. The Court held that there was a clear mis-joinder of parties because there was no common cause of action: each vehicle’s tax liability and exemption period was separate and distinct. Despite this, the Court went on to examine the merits.
The petitioners also relied upon a Division Bench judgment of the Patna High Court in Nirbhay Kumar and Others v. State of Bihar and Others, 1993 SCC Online Pat 27 : 1995 (1) PLJR 60. That case had interpreted Section 9A of the Bihar and Orissa Motor Vehicles Taxation Act, 1930. Section 9A dealt with exemption from tax when a vehicle was not used due to breakdown or other reasons.
In Nirbhay Kumar, the Court had recorded that the State Government, by order dated 12.12.1991, prescribed the mode of inquiry and procedure for exemption claims under Section 9A. The owner had to submit a claim in a prescribed form with an affidavit and supporting documents. The Division Bench had clearly held that, in view of this statutory procedure, no exemption claim could be entertained unless that procedure was followed. It also observed that while Section 9A did not fix an explicit time limit for filing, the owner must intimate breakdown or intention not to operate the vehicle within a reasonable time, close to the event.
The petitioners in the present case argued, on the basis of this earlier decision, that they too should be exempted from tax for periods when the vehicles supposedly did not run. They produced Annexure-P/1, showing validity of tax coupons and permits for some of the vehicles, and Annexure-P/6, a communication from BSRTC listing periods when permits were valid and stating that the vehicles were not operated thereafter under BSRTC.
The High Court carefully examined these materials. From Annexure-P/1 it appeared that, for some vehicles including those earlier involved in Annexure-P/2, tax arrears had remained unpaid from as far back as 2013 and 2014. The petitioners claimed that permits had not been granted during those years, and therefore the vehicles could not be run.
However, the Court found a major legal gap in the petitioners’ case. The applications seeking exemption, produced as Annexure-P/5 series, were all made on 05.09.2024. This was many years after the periods starting from 2013 and 2014 for which they sought exemption. Even if one applied the reasoning in Nirbhay Kumar under the old Act of 1930, such delayed applications could not be considered as made within a “reasonable time” from the relevant events. Hence, on the face of it, no exemption could be granted on this basis.
Next, the Bench noted that the law had changed. The Bihar and Orissa Motor Vehicles Taxation Act, 1930 had been replaced by the Bihar Motor Vehicles Taxation Act, 1994. Under this new Act, Section 17 specifically deals with prior intimation of temporary discontinuation of a vehicle.
Section 17 says that if a vehicle becomes incapable of use for more than one month due to mechanical breakdown, litigation, natural calamities, compelling personal reasons or other notified causes, the owner must make an application to the Tax Officer before the expiry of the term for which tax has been paid. The application must be in the prescribed form, include an undertaking specifying the period and the place where the vehicle is kept, and be accompanied by the registration certificate, fitness certificate, tax token and other required particulars. Even then, the period mentioned in one undertaking cannot exceed six months at a time.
Along with the Act, the Bihar Motor Vehicle Taxation Rules, 1994 were also brought into force. Rule 13 prescribes Form J for such application for temporary discontinuance. Unlike the older Section 9A regime discussed in Nirbhay Kumar, the new Section 17 and Rule 13 clearly fix a time limit: the intimation must be given on or before the date of expiry of the term for which tax has been paid.
The Court found that the petitioners had not complied with these mandatory requirements. They had not made timely applications for temporary discontinuance, in the prescribed Form J, and within the period specified under Section 17. Instead, they approached the authorities years later, in 2024, seeking exemption for non-use going back to 2013 and 2014.
The Bench also referred to the judgment of the Hon’ble Supreme Court in Taxing Officer, Kalahandi v. Ajit Singh, reported in 1987 PLJR 52 (SC). The Supreme Court had clarified that vehicle tax is payable by the person who keeps the motor vehicle for his use. What needs to be proved is not that the vehicle is actually plied on the road, but that it is kept for use. If an owner does not intend to use the vehicle temporarily, he must intimate the Taxing Officer under the relevant exemption provision. Only then, and only if conditions are met, can he avoid tax for that period.
Relying on this principle, the Patna High Court held that the mere fact that the vehicles were not actually run on the road does not automatically grant tax exemption. Nor does the fact that permits were not issued, by itself, wipe out tax liability. Unless the owner timely informs the authority and fulfills the statutory conditions, tax remains payable if the vehicle is kept for use.
The Court considered Annexure-P/6, the BSRTC communication, and held it was “of no avail” to the petitioners. It only recorded the periods of valid permits and that operations were not made under BSRTC after those periods. It did not show that the vehicles were not kept for use in the State of Bihar. Therefore, it did not support an exemption claim.
Another important statutory bar was noticed. Section 12 of the Bihar Motor Vehicles Taxation Act, 1994 prohibits the Taxing Officer from accepting tax or penalty for the current period in respect of any vehicle that has outstanding arrears of tax and penalty. This meant that, as long as the old dues and penalties remained unpaid and not validly exempted, the authorities could not accept current tax and could not issue a current tax token.
Putting all these aspects together, the Bench concluded that there was absolutely no merit in the writ petition. The earlier Single Judge’s order in Annexure-P/2 did not deal with tax exemption and did not control the operation of the taxation statute. The reliance on Nirbhay Kumar was held to be totally misconceived because that judgment applied to the old 1930 Act where there was no fixed statutory time limit, while the current law in Section 17 of the 1994 Act clearly lays down specific timing and procedural requirements which the petitioners had failed to meet.
On these grounds, the Patna High Court rejected the writ petition in limine, meaning at the threshold itself, without issuing notice for a detailed hearing or calling for a full reply from the respondents.
Why This Judgment Matters
This judgment is important for bus owners and other commercial vehicle operators in Bihar who may keep vehicles idle for some time. It makes clear that simply not using a vehicle, or not getting a permit, does not cancel tax liability by itself.
The Court has underlined that, under the Bihar Motor Vehicles Taxation Act, 1994, if an owner wants relief from tax because the vehicle is not being used, he must strictly follow the law. This includes applying in the prescribed form, before expiry of the paid tax period, and giving full details of where the vehicle is kept and for how long it will be off the road.
The decision also shows that the Transport Department cannot legally accept current tax or issue fresh tax tokens when old tax dues are pending. Vehicle owners who are in arrears cannot expect to regularize only the current period without first clearing or lawfully getting exemption from old dues.
For lawyers and laypersons alike, the ruling reinforces that earlier court orders about permits or disputes with corporations like BSRTC do not, by themselves, wipe out tax dues under a separate taxation statute.
Legal Issues and Answers
- Issue: Can vehicle owners, who did not timely apply for exemption under the Bihar Motor Vehicles Taxation Act, 1994, claim tax exemption for long past periods when their buses allegedly did not run due to non-grant of permits and disputes with BSRTC, and still demand fresh tax tokens for the current period?
Answer: No. The Court held that tax is payable if the vehicle is kept for use, regardless of actual running. Exemption requires strict compliance with Section 17 and Rule 13, including prior and timely intimation in the prescribed form. Since the petitioners made delayed applications and failed to follow the statutory procedure, they were not entitled to exemption, and the authorities could not issue current tax tokens while arrears remained pending.
Cases Cited by the Court
- Nirbhay Kumar and Others v. State of Bihar and Others, 1993 SCC Online Pat 27 : 1995 (1) PLJR 60 (Division Bench of Patna High Court, interpreting Section 9A of the Bihar and Orissa Motor Vehicles Taxation Act, 1930).
- Taxing Officer, Kalahandi v. Ajit Singh, 1987 PLJR 52 (SC) (Supreme Court decision on liability to tax where vehicle is “kept for use”).
Case Details
Case Number: Civil Writ Jurisdiction Case No. 15727 of 2024
Case Title: Krishna Kumar Jha & Ors v. The State of Bihar & Ors
Citation: 2024 (4) PLJR 698
Coram: Hon’ble the Chief Justice; Hon’ble Mr. Justice Partha Sarthy
Date of Judgment: 22.10.2024
Advocates for Petitioners: Mr. Prince Kumar Mishra, Advocate; Mr. Vikas Kumar Jha, Advocate
Advocates for Respondents: Mr. Raghwanand, GA-11; Mr. Pratik Kuma, AC to GA-11
Nature of the Case: Civil writ petition seeking direction for issuance of provisional Motor Vehicles Tax Tokens without clearing past tax arrears, based on alleged non-use of vehicles and applications for tax exemption.
Relevant Statutes and Rules: Bihar Motor Vehicles Taxation Act, 1994 (particularly Sections 12 and 17); Bihar Motor Vehicle Taxation Rules, 1994 (particularly Rule 13); reference to earlier Bihar and Orissa Motor Vehicles Taxation Act, 1930, Section 9A (for historical comparison).
Link to Full Judgment: Click here to read the official judgment of the Patna High Court
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