Hero MotoCorp: No Temporary Registration Fee, Raj HC Rules

No Temporary Registration Fee for Trade Certificate Holders: Rajasthan High Court Quashes Demands Against Hero MotoCorp

Hero MotoCorp Ltd. v. Union of India & Ors. 2026:RJ-JP:45966-DB Decided 6 November 2026

Published: 7 November 2026 · NyayVidhan · 2 min read

Hero MotoCorp Ltd. v. Union of India (2026:RJ-JP:45966-DB): the Rajasthan High Court held that a vehicle manufacturer holding a valid trade certificate under Rule 33 of the Central Motor Vehicles Rules need not obtain temporary registration under Rule 4.2(1)(a) of the Rajasthan rules for vehicles sent to its dealers. It quashed temporary registration fee demands for 2014 to 2026, ordered refunds and directed parity with Honda (paras 63, 71, 78).

Key holdings

Temporary registration and a trade certificate are alternatives; a certificate holder needs no temporary registration for vehicles sent to dealers (paras 53, 63).

The State could not charge Hero MotoCorp a fee it did not charge Honda once both held renewed trade certificates (paras 67-71).

An affidavit of renewal backed by documents and left unanswered by the State was accepted (paras 65-66).

The challenge to the rule's validity and to fees on vehicles sold outside Rajasthan was left open (para 72).

Judgment digest by NyayVidhan: a summary of the court's judgment, not its text. The judgment itself is the authoritative version.

Brief Facts

Hero MotoCorp makes two-wheelers at Neemrana, Alwar, and sends them to dealers on trucks (paras 2, 5). From 2018 the transport authorities demanded temporary registration fee for vehicles sold to its dealers, beginning with Rs. 10,28,55,600 for 2014-2016 and Rs. 19,30,90,800 for 2016-2017; by the State's affidavit, demands for 2014-2015 to 2025-2026 totalled Rs. 1,65,67,64,600 (paras 6-9). Ten writ petitions, one for each year, challenged the demands and the validity of Rule 4.2(1)(a) (paras 2-3). The State said Honda paid no such fee because it held a valid trade certificate, while the petitioner's certificates had lapsed (paras 23-25).

Court's Findings

The Bench held that Rule 33 exempts a manufacturer or dealer holding a trade certificate from 'the necessity of registration', and nothing confines that to permanent registration (paras 49-50). Relying on Tata Motors Limited v. State of Jharkhand, it held that temporary registration under Section 43 and a trade certificate are two alternative routes, not a double requirement (paras 51-53). Rule 4.2(1)(a) covers only the journey from factory to dealer, which the trade certificate already covers, and Rule 42 applies on delivery to a purchaser, not to stock sent to a dealer for resale (paras 54-58). A fee must rest on specific authority, so the State rule applies only where no trade certificate is held (paras 59-61). The petitioner's unanswered affidavit proved its renewed certificates, so treating it differently from Honda breached Article 14; and having taxed it as a trade certificate holder under the 1951 Act, the State could not deny that status here (paras 64-71).

Legal Principle

A manufacturer holding a valid trade certificate under Rule 33 of the Central Motor Vehicles Rules, 1989 is exempt from registration, temporary or permanent, for vehicles in its possession in the course of business. Rule 4.2(1)(a) of the Rajasthan rules applies only where no such certificate is held, and no Rule 4.28 fee is then payable (paras 63, 74-75).

NyayVidhan's view · Practice note

Why It Matters

The ruling turns on the manufacturer holding a valid trade certificate under Rule 33: the Bench read Rule 4.2(1)(a) as applying only where no such certificate is held, so a manufacturer without one still needs temporary registration for the factory-to-dealer journey (paras 61, 63, 75). Proof of renewal matters; here the State filed nothing to answer the petitioner's affidavit (paras 65-66). The challenge to the rule's validity and to the fee on vehicles sold outside Rajasthan was left open, and the separate tax demand under Section 4(1)(d) of the 1951 Act is unaffected (paras 72, 78). Compare Shyam Prakash Meena v. Union of India, where a vehicle fitness late fee was struck down as a penalty beyond the delegate's power.

Editorial comment by the NyayVidhan Editorial Desk. It is not part of the Court's judgment and is not legal advice.

Precedents Relied Upon

Tata Motors Limited v. State of Jharkhand 2020 (15) SCC 438
Applied Discussed at ¶ 51, 52, 53, 74
Explains that a manufacturer or dealer without a trade certificate needs temporary registration under Section 43, while one holding a trade certificate is exempted by Rule 33 from the necessity of registration; the Bench read the two as alternatives (paras 41, 51-53, 62, 74).
Commissioner of Commercial Taxes v. K.T.C. Automobiles (2016) 4 SCC 82
Relied Upon Discussed at ¶ 33, 57, 58
Registration of a motor vehicle is a post-sale event applied for by or on behalf of the owner; the Bench held it supports reading Rule 42 as applying on delivery to a purchaser, not to stock sent to a dealer (paras 33, 57-58).
Ahmedabad Urban Development Authority v. Sharadkumar Jayantikumar Pasawalla (1992) 3 SCC 285
Relied Upon Discussed at ¶ 34, 60
A power of a delegated authority to impose a tax or fee must be very specific, with no scope for implied authority (paras 34, 60).

View all precedents (6)

Bimal Chandra Banerjee v. State of Madhya Pradesh (1970) 2 SCC 467
Relied Upon Discussed at ¶ 34, 60
A rule-making authority has no plenary power and must act within the limits of the power granted to it (paras 34, 60).
Association of Registration Plates v. Union of India (2004) 5 SCC 364
Referred To Discussed at ¶ 57
Quoted through K.T.C. Automobiles: until a vehicle is sold by a dealer, the registering authority does not come into the picture (para 57).
State of Uttar Pradesh v. Joginder Singh AIR 1963 SC 1618
Distinguished Discussed at ¶ 40, 62
Relied on by the State on the word 'may'; the Bench held it did not affect the question, which is whether a person the Central law exempts from registration can still be made to obtain it (paras 40, 62).