The order was passed on the plea from a Chandigarh resident, Alankar Narula, who in 2022 had approached the high court after he was asked to deposit 8% of vehicle’s price as road tax in place of 6%
The Punjab and Haryana high court has ordered refund of excess road tax levied by the Chandigarh administration on registration of a car.
As per Chandigarh rules, vehicles costing less than ₹20 lakh are registered subject to a 6% road tax, while those above this threshold incur 8% tax. (HT Photo)
The order was passed on the plea from a city resident, Alankar Narula, who in 2022 had approached the high court after he was asked to deposit 8% of vehicle’s price as road tax in place of 6%.
He had purchased a car, Skoda Octavia on December 3, 2021, for ₹19.79 lakh and applied for formal registration of the vehicle in June 2022.
However, during this period, the vehicle’s price on the Vahan Portal increased to ₹20.16 lakh leading to a demand for 8% motor vehicle tax instead of the originally applicable 6%.
As per UT rules, vehicles costing less than ₹20 lakh are registered subject to a 6% road tax, while those above this threshold incur 8% tax.
UT had argued that the portal was managed at the central level and the price got automatically reflected.
However, the court observed that the price increase occurred after the purchase but before the application for permanent registration.
The petitioner had bought the vehicle at a price below ₹20 lakh and should have been charged accordingly.
The court, thus, directed the authorities to refund the excess tax, equivalent to 2% of the new price, and to process the refund within three weeks, along with 6% interest.
Narula, who himself had appeared in the case, said the ruling clarified that vehicle owners should be taxed based on the price at the time of purchase, regardless of subsequent price hikes reflected on registration portals.
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News/Cities/Chandigarh/ High court orders Chandigarh admn to refund excess road tax on vehicle registration