THE REGIONAL TRANSPORT OFFICER-CUM-TAXING AUTHORITY, ROURKE vs STEEL AUTHORITY OF INDIA LTD.

The Supreme Court addressed the taxation of buses owned by the Steel Authority of India Ltd. under the Orissa Motor Vehicles Taxation Act, 1975. The Court found that the High Court erred in assuming a change from Item 6 to Item 4 of the Schedule, as the vehicles were used for employee transport without hire charges, thus potentially falling under Item 6. The Court held that the Steel Authority is liable for tax but should be taxed under Item 6, pending a fact-finding inquiry to determine the appropriate tax rate, thereby ensuring the State does not act arbitrarily.