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The State of Madhya Pradesh v. Rakesh Sethi

Civil Appeal · 2020 INSC 506Decided 26 Aug 2020
Civil Appeal No. 7074 of 2008
Justice L. Nageswara Rao · Justice S. Ravindra Bhat

Background

A motorcycle owner in Madhya Pradesh wanted a specific, easy-to-remember registration number for his new vehicle but the registering authority refused to allot it unless he paid a special fee, under a state rule (Rule 55A of the Madhya Pradesh Motor Vehicles Rules) that reserved certain "fancy" numbers for allotment only on payment of an extra charge. He challenged the rule in the High Court, arguing the state government had no power to create such a fee-based reservation scheme under the central Motor Vehicles Act, and the High Court agreed and struck the rule down. The state government appealed to the Supreme Court.

Decision Breakdown

The Supreme Court held that assigning distinctive registration numbers to vehicles, including reserving special/preferred numbers for a fee, is a legitimate service that state governments and their registering authorities are entitled to charge for, and that Rule 55A was validly made within the rule-making power granted to states under the Motor Vehicles Act and was not inconsistent with the central rules. The Court found the High Court had wrongly proceeded on the assumption that the state lacked legislative competence altogether, when the real question was only whether the specific rule exceeded delegated authority, which it did not. The appeal was allowed and the High Court's judgment striking down Rule 55A was set aside.

Lesson Learnt

State governments can validly charge a fee for allotting preferred or "fancy" vehicle registration numbers, as this falls within their rule-making powers under the Motor Vehicles Act; a rule is not invalid merely because it creates a differential fee structure for special numbers.

Official source (sci.gov.in)View Judgment (PDF)

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