In Brief
The Supreme Court upheld the constitutional validity of Section 3-A(3) of the Himachal Pradesh Motor Vehicles Taxation Act, 1972, which imposes an additional special road tax on transport vehicles used without a valid permit. The High Court had struck down this provision as a penalty beyond the State's legislative power. The Supreme Court held that the tax is regulatory and compensatory in nature—designed to fund road maintenance in a hilly state and deter statutory violations—not a criminal penalty. No conflict exists with the central Motor Vehicles Act, 1988. The Court emphasized that tax statutes deserve judicial deference and must be struck down only if manifestly unjust or glaringly unconstitutional. Lumpsum taxation was upheld as valid. The appeals were allowed and the High Court's judgment set aside.
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