Introduction
The Kerala High Court has held that Rule 167(7) of the Central Motor Vehicles Rules, 1989, which restricts the processing of certain driving licence and vehicle registration applications when traffic challans remain unpaid beyond 90 days, operates prospectively.
Justice Murali Purushothaman held that the provision cannot be invoked against challans issued before October 1, 2020, when the amended rule came into force. Applying the provision to earlier challans would amount to giving retrospective effect to a substantive provision that creates a new restriction on vehicle owners.
Background
The petitioner, a registered owner of a motor car, approached the Regional Transport Officer seeking cancellation of the hypothecation entry in the vehicle’s Registration Certificate after repaying a loan obtained from Bank of Baroda.
However, the Regional Transport Officer declined to process the application because the vehicle had been blacklisted due to certain unpaid traffic challans that had remained pending for more than 90 days.
The petitioner submitted that the challans related to alleged traffic violations committed between 2015 and 2019. These violations predated the introduction of Rule 167 through the Central Motor Vehicles (Eleventh Amendment) Rules, 2020, which came into force on October 1, 2020.
The petitioner argued that Rule 167(7) introduced a new statutory restriction and could not retrospectively prevent the processing of applications based on challans issued before the amendment.
Legal Issue
The principal issue before the High Court was whether Rule 167(7) of the Central Motor Vehicles Rules, 1989, could be applied to traffic challans issued before October 1, 2020.
The Court also examined whether an administrative mechanism for flagging vehicles with pending challans could extend the operation of the amended rule to earlier violations.
Court Ruling
The High Court examined the scheme under Rule 167 of the Central Motor Vehicles Rules.
Rule 167(5) requires challans to be disposed of within 90 days from their issuance, except where proceedings for the offence have been instituted before a court. Rule 167(6) provides for an additional payment notice where a challan remains unpaid beyond the prescribed period.
Under Rule 167(7), applications relating to an offender’s driving licence or the registration of a motor vehicle cannot be processed by the licensing or registering authority when a challan remains due beyond the period specified under sub-rule (5). The provision excludes applications relating to permits, fitness and payment of motor vehicle taxes.
The Court also considered Item No. 9(d) of the Ministry of Road Transport and Highways Advisory dated January 2, 2023. It provides for vehicles against which challans remain pending for more than 90 days to be flagged as “NOT TO BE TRANSACTED” on the VAHAN portal.
However, the Bench held that this administrative mechanism could not expand the scope of Rule 167(7) or give the provision retrospective operation.
The Court relied on the Supreme Court’s decisions in Panchi Devi v. State of Rajasthan and Commissioner of Income Tax (Central)-I, New Delhi v. Vatika Township Private Limited. These decisions recognise the general principle that subordinate legislation and provisions creating new liabilities or disabilities operate prospectively unless retrospective application is expressly provided or necessarily implied.
The Court also referred to Zile Singh v. State of Haryana, where the Supreme Court reiterated the presumption against retrospective operation of legislation unless a contrary intention emerges from its language or necessary implication.
Applying these principles, the High Court observed that Rule 167(7) introduced a restriction that did not exist before the 2020 amendment. The mere pendency of a traffic challan did not previously create a statutory bar against processing an application relating to vehicle registration.
Accordingly, the Court directed the Regional Transport Officer, Ernakulam, to receive and process the petitioner’s application for cancellation of the hypothecation entry without taking into account the pendency of challans issued before October 1, 2020. The writ petition was disposed of.
Implications
The ruling clarifies that Rule 167(7) cannot be used to impose a new statutory restriction on vehicle owners based on traffic challans issued before the provision came into force.
It also distinguishes the administrative process of flagging vehicles on the VAHAN portal from the substantive legal authority under the Central Motor Vehicles Rules. An administrative advisory cannot extend a statutory restriction beyond the period permitted by the rule itself.
The judgment adds clarity on the prospective operation of amended motor vehicle rules and the limits of administrative action in dealing with pending traffic challans.
