The Transport Department has served notices on industrial houses and private vehicle operators in Baddi, Barotiwala and Nalagarh, accused of evading the annual permit fee for private service vehicles and token tax.

Regional Transport Authority Raman Sharma confirmed the action and said the department had issued the delinquents an ultimatum — pay outstanding taxes within 15 days or face legal action.

Corporations with units in the region have engaged over 500 vehicles, including buses, for transportation of employees from such locations as Chandigarh, Pinjore, Baddi, and Nalagarh.

Sources in the department said complaints from the public prompted authorities to begin gathering information on these vehicles at inter-state tax collection barriers and exit points.

The survey concluded that though some companies had hired vehicles in accordance with the Contract Carriage Rule (CCR), many others continue to violate the law. About 80 buses and 100 maxi cabs were observed to have not been paying taxes and causing losses to the tune of lakhs to the state exchequer.

According to the CCR, owners of all commercial vehicles must deposit an annual fee of Rs 1,050 for a Private Service Vehicles Permit and pay Rs 500 per seat annually as token tax. In some cases, operators providing buses to industrial units have got their vehicles registered as school buses to avoid taxes.