Registered owner liability under trade tax law depends on proving genuine vehicle hiring and rebutting the presumption of sale.

A registered owner could avoid liability under section 28B of the U.P. Trade Tax Act only by proving with cogent evidence that the vehicle was actually given on hire to a transport company. The authorities found that the applicant failed to prove any genuine hiring arrangement, and the uncancelled forms 34, together with carriage of goods within Uttar Pradesh, supported the statutory presumption that the goods had been disposed of or sold in the State. The finding that the applicant remained involved in the transportation was treated as a factual conclusion based on evidence and not shown to be arbitrary or perverse, so the applicant remained liable for trade tax and sales tax dues.

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Issues: Whether the applicant could avoid liability under section 28B of the U.P. Trade Tax Act, 1948 by establishing that the vehicle was given on hire to transport companies and was not used by him for transportation of the goods.

Analysis: Protection under the Explanation to section 28B is available only when the person in whose name the vehicle stands registered proves, on cogent material, that the vehicle had in fact been given on hire to a transport company. The authorities below concurrently found, on the basis of relevant material, that the applicant failed to prove the alleged hiring arrangement. The forms 34 obtained at the entry check-post were not cancelled and the goods were carried within Uttar Pradesh, which justified the statutory presumption that the goods had been disposed of or sold in the State. The finding that the applicant remained involved in the transportation was a finding of fact based on evidence and was not shown to be arbitrary or perverse.

Conclusion: The applicant was rightly treated as the owner of the vehicle for the purposes of section 28B and remained liable to pay the trade tax and sales tax dues.

Ratio Decidendi: A registered owner can claim the benefit of the Explanation to section 28B only by proving actual hiring of the vehicle to a transport company and rebutting the statutory presumption of sale with cogent evidence.

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