M/S TARACHAND LOGISTIC SOLUTIONS LIMITED versus STATE OF ANDHRA PRADESH & ORS.

Citation: [2025] 8 S.C.R. 2297 · Decided: 29-08-2025 · Supreme Court of India · Bench: MANOJ MISRA · Disposal: Appeal(s) allowed

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Judgment (excerpt)

[2025] 8 S.C.R. 2297 : 2025 INSC 1052
M/s Tarachand Logistic Solutions Limited  
v. 
State of Andhra Pradesh & Ors.
(Civil Appeal No. 11188 of 2025)
29 August 2025
[Manoj Misra and Ujjal Bhuyan,* JJ.]
Issue for Consideration
Whether the premises of Visakhapatnam Steel Plant where 
appellant’s vehicles are exclusively used for handling and storage 
operations, constitute a ‘public place’ under the Andhra Pradesh 
Motor Vehicle Taxation Act, 1963; whether such vehicles are liable 
to pay tax u/s.3 thereof or entitled to exemption therefrom.
Headnotes†
Andhra Pradesh Motor Vehicle Taxation Act, 1963 – s.3 – 
Interpretation – Andhra Pradesh Motor Vehicles Taxation 
Rules, 1963 – r.12A – Motor Vehicle Act, 1988 – s.2(34) – 
‘public place’ – Appellant was awarded a contract for handling 
and storage of iron and steel materials at central dispatch 
yard within Visakhapatnam Steel Plant, Andhra Pradesh, a 
corporate entity of Rashtriya Ispat Nigam Limited (RINL) – It 
deployed motor vehicles for plying within the central dispatch 
yard premises, a restricted area with members of the public 
not having access to enter the premises – Appellant sought 
exemption from payment of motor vehicle tax u/s.3 for 
the period the vehicles were confined and used within the 
premises – However, Respondent No.4 raised demand towards 
motor vehicle tax  – Paid by the appellant under protest – 
Eventually, Single Judge held that appellant was plying its 
vehicles within the central dispatch yard which is not a ‘public 
place’ and directed the respondents to refund the amount paid 
to the appellant – Division Bench relying upon r.12A, set aside 
the order of Single Judge – Challenge to:
Held: 1.1 Impugned judgment set aside and that of the Single 
Judge is restored – s.3 is the charging provision authorizing the 
State Government to impose tax on motor vehicles – The taxable 
* Author
2298
[2025] 8 S.C.R.
Supreme Court Reports
event u/s.3 is when a vehicle is used or kept for use in a ‘public 
place’ in the State – Therefore, the tax is on the user or intendment 
for use of motor vehicle in a ‘public place’ – Thus, if a vehicle is 
actually used in a ‘public place’ or kept in such a way that it is 
intended to be used in a ‘public place’ then the tax liability accrues. 
[Paras 45, 51]
1.2 Motor vehicle tax is compensatory in nature having a direct 
nexus with the end use – The rationale for levy of motor vehicle 
tax is that a person who is using public infrastructure, such as, 
roads, highways etc. has to pay for such usage – Legislature has 
consciously used the expression ‘public place’ in s.3 – If a motor 
vehicle is not used in a ‘public place’ or not kept for use in a ‘public 
place’ then the person concerned is not deriving benefit from the 
public infrastructure; therefore, he should not be burdened with 
the motor vehicle tax for such period – Under s.2(34), MV Act, 
‘public place’ inter alia means a road, street, way or other place, 
whether a thoroughfare or not, to which the public have a right of 
access. [Paras 28.1, 46]
1.3 Further, there is omission of the expression ‘public place’ in 
r.12A (Liability for payment of tax in respect of motor vehicles 
kept for use) – Opening words thereof are ‘for the purpose of 
Section 3 of the Act’ – Thus, purpose of r.12A is to give effect 
to s.3 – Question is not of the motor vehicle being deemed to 
be kept for use and hence liable to tax – Requirement of law is 
that the motor vehicle should be used or kept for use in a ‘public 
place’ – When admittedly the motor vehicles of the appellant were 
confined for use within the RINL premises which is a closed area 
then question of the vehicles being used or kept for being used 
in a ‘public place’ does not arise – The words appearing in r.12A 
i.e. ‘a motor vehicle shall be deemed to be kept for use’ has to 
be read as ‘a motor vehicle deemed to be kept for use in a public 
place’ – Also, s.4(1)(b) enables a person whose motor vehicle was 
not used during the period for which the motor vehicle tax has been 
paid to seek refund – The motor vehicles in question were used 
or kept for use only within the restricted premises of RINL which 
is not a ‘public place’ – Therefore, the said vehicles are not liable 
to be taxed for the period the said vehicles were used or kept for 
use within the restricted premises of RINL – Constitution of India – 
Art.265, Entry 57 of List II, Entry 35 of List III. [Paras 47, 49, 50]
Andhra Pradesh Motor Vehicle T

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