Strict construction of taxing definitions limits operator liability for passenger tax arrears and penalty under amended law.

The amended definition of "operator" in the Bombay Motor Vehicles (Taxation of Passengers) Act, 1958 was held to apply only to the limited class of cases expressly covered by the amendment, namely where a stage carriage was used without a permit. A wider reading that would treat mere possession or control as sufficient in every situation was rejected. On that construction, the financer who had resumed possession of vehicles under hire purchase agreements could not be fastened with passenger tax arrears or the consequential penalty. The High Court's view in favour of the financer was left undisturbed.

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Issues: Whether, on a proper construction of the amended definition of "operator" in the Bombay Motor Vehicles (Taxation of Passengers) Act, 1958, the financer who had resumed possession of vehicles under hire purchase agreements could be treated as liable for arrears of passenger tax and consequential penalty.

Analysis: The original definition of "operator" was expanded by amendment to cover cases where a stage carriage was used without a permit, and in that limited situation the expression included the person in whose name the vehicle was registered or the person having possession or control of it. The wider construction urged by the State, by which mere possession or control would make a person an operator in all situations, was rejected. On the correct reading, the definition applied only within the specific class of cases contemplated by the amended clause. Since the first respondent was not the operator for the purpose of fastening the tax liability in the manner contended, the Division Bench had rightly held that the arrears of passenger tax and the penalty could not be recovered from it.

Conclusion: The first respondent was not liable as an operator for the arrears of passenger tax or the penalty.

Final Conclusion: The appeal failed, and the High Court's decision in favour of the first respondent was left undisturbed.

Ratio Decidendi: A taxing definition expanding liability must be construed according to its precise wording, and liability cannot be imposed by extending the statutory meaning beyond the specific class of cases expressly covered.

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