Thursday, June 23, 2016

Kerala HC: Tax Exemption on Vehicle for disabled is financial privilege different from a Right [Judgement Included]

Dear Colleagues,
A double bench of the Kerala High Court has ruled that a cap on tax exemption on purchase value of vehicles by persons with disabilities can not be termed as discriminatory. The division bench comprising of Justice Antony Dominic and Justice Dama Seshadri Naidu opined  that the exemption made by the Government in the instant case, was in the nature of concession to persons with disabilities. And this exemption being a part of financial incentive, the Government was well within its powers to impose suitable conditions.

Brief Brackground  of the case

The Government, had by a notification, G.O. (MS) No. 16/98/Tran., dated 31.03.1998, granted a tax exemption for certain motor vehicles, including the luxury cars, being purchased by differently abled persons. However by a subsequent amendment, the Government had imposed a limit to the cap of Rs.5,00,000/- ,on the value of such vehicles entitled to such tax exemption.

Appellant, a person with 100% disability and a wheel chair user purchased a car of a value exceeding Rs. 5,00,000/. He argued that his son was also disabled being mentally retarded, a bigger car of a value more than 5,00,000/- cap was required to manage the daily activities of the family. He contended that limiting the cap on value of vehicles entitled to tax exemption for use by disabled, violated Article 14 of the Constitution of India. 

His writ petition in this regard, before the single bench was dismissed. Aggrieved by the same, he approached the division bench in an appeal.  Dismissing the writ appeal, the division bench observed:- “Be it a classification of discrimination in terms of Article 14 of the Constitution, it applies vis-a-vis the right that has been constitutionally consecrated. In that context, legion are the precedents that the classification or discrimination shall pass the judicial muster as regards the reasonableness or non-arbitrariness.” 

Judgement

The bench opined, “In the present instance, it is only a concession the Government has conferred on physically challenged persons. It being a financial incentive, the Government is well within its powers to impose suitable conditions. In other words, a privilege being entirely different from a right, a Fundamental Right at that, we are of the opinion that the contention of the learned counsel as regards discrimination or unreasonableness does not apply.” 



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