Transfer of the right to use motor vehicles attracts tax on amounts realised or realisable, regardless of possession timing.

Section 9-A of the Madhya Pradesh Vanijyik Kar Adhiniyam, 1994 taxes a dealer who transfers the right to use specified goods on the amount realised or realisable in the relevant year, and the provision is stated to be consistent with article 366(29A)(d) of the Constitution. The decisive factor is the transfer of the right to use, not merely the date on which physical possession of the motor vehicles was parted with. On the facts noted, the petitioner failed to place cogent material showing the levy was unsustainable, and the tax was upheld.

---

---

Issues: Whether tax under section 9-A of the Madhya Pradesh Vanijyik Kar Adhiniyam, 1994 was leviable on the transfer of the right to use motor vehicles where the possession of the vehicles had been parted with before the relevant period.

Analysis: Section 9-A, inserted with effect from 1 April 1995, taxes every dealer who transfers the right to use specified goods on the total amount realised or realisable during the year by way of payment for such transfer. The provision is consistent with article 366(29A)(d) of the Constitution of India. The decisive factor is the transfer of the right to use coupled with the amount realised or realisable in the relevant year, and not merely the date on which physical possession was parted with. On the facts, the petitioner did not produce cogent material to show that the levy was unsustainable.

Conclusion: Tax under section 9-A was rightly upheld and the challenge to the levy failed.

---