Andhra Pradesh High Court rules life tax be collected based on invoice price of vehicle

Andhra Pradesh High Court rules life tax be collected based on invoice price of vehicle

The petitioners were subject to excessive amounts by the authorities

The Andhra Pradesh High Court has ruled that that life tax collected from vehicle owners upon registration should be based on the net invoice price of the vehicle at the time of sale, rather than the ex-showroom price.

The Bench of Justice V. Sujatha observed that life tax can only be levied on the ‘cost of the vehicle’ as specified in the Sixth Schedule of the A.P. Motor Vehicles Taxation Act, 1963, unless there was a notification indicating otherwise.

The petitioner had purchased a Hyundai Venue and was compelled to pay additional tax on the net invoice price, which included Central Goods and Services Tax (CGST) State Goods and Services Tax (SGST), and compensation cess.

The petitioner argued that the tax lacked the authority and referred to a government order allowing for a refund of excess or mistakenly paid tax within a limited time frame.

The Bench granted the writ petitions and directed the respondents to refund an amount of Rs.52,168 to the petitioner (W.P. No. 12089 of 2019) and an amount of Rs.1,16,000 to the petitioner (W.P. No. 3049 of 2021).