The High Court · 2025

""'BEqPONDENTS Egtition UnQgr Artigle 226 of lhe Constitution o{ tndis praying that in lhe cirqumpianceq stat.ed in the affidavit filed therewith, the High Court may be please( to i?Que an appropriate writ, order or direction more particularly one in the nature of writ of Mandamus a) Declaring the action of the 1st Bespondenl in passing the impugned assessment order dt. 4-2-2OOO in proceedings Rc No. 11107112003 IS/APGST as illegal, arbitrary, high handed and without authority of law and contrary to the provisions of the Act and set aside the same and declare that the petil io n e' Contract since t r': of any third Part'/. petitioners appea ' the impugned o rtle ground that no c-: and without autr:t aside ihe same a ^ ( disputed tax sin:,: Tax being the re<rtl not eligible to tax on the disputec tur ro"er under works )r)titioner has not transferred any propelty rn goods in favour )eclare the action of the 2nd Responrje'nt in rejecting the r r the assessment year 2OO4-20O5 ttnder thr,r APGST Act by dt. 1-7-2006 in procee{ings AR Sl No P/r162l2005 on the :" of payment waq prodqaed before him ;rs illegal, 4rbitrary, tv of law and Sontrary lq the provisions cf the Act and qet :ieclqre that the petitioneq need nQt depo:; i| he 1 2 5% of the lre p,qtitioner wea graqleq exemptian fron p,ayryrent of Saleq y'rizeQ- Spqcial Tqlrism PJoject undel the A I't. State Toutisl'!-l policy, 1998 Petition tJ A.NO:1 OF 200 6 ll,VPMP.NO:28718 OF 2006) nCi r Secfipn jSt CPO praying that in the circtm:;tances state( i1 the affi{avit file(l ir r;uppQrt qf the pgtitiop, the High eourt rnay be pleased tq grant stay ef ellf,rr ner preceedingP qursqent to tbe impusT-c ,'..-"_.:T:l]_11*t 9f the 19t respon(le rt dt 4-2-2006 in plocqBdilgs Rc.No 'l130 /'1r2004-051AP9ST Pending disposato lre writ petition. .A.NO: o 2007 ,WMP. N 223 _t oF 2007 Beween: 1 The gemrrr:r ,ral Tax OffiQer, Jubiiee flillp Cirqle Hyderabad. 2 The Appell:1t( l,)eputy CqmmiqsiQner (qT), Panjagutta Divisrc'n' Hyderabad. 9. Qpvernrnert 1 Andhra PJadqgtl, Hyderqbad, Rep py its Princ;ipal Secretary, ffeverlue rC T -)epartment. .....PETITIONERS/RESPONDENTS AryP

1.,

1. 2 M/s. E B.t']L- nfraqtructure l.iryited,, (Fgrme1ly (qown as Swgety Builflq6 Pvt Lid ) Il-2 :'12, Plot No. 4, Sth Flogr, G.S. Plaza Road \o 1 , Banjara Hills, HydefAbarl. F :rp by its Managing Director Mr. Gowrishankar {)upta. Governme nt , 1 Andhra Pradesh, Youth Advancement. Tou risrn and Culture (PMU) Deol , -lyderabad, Rep by its Principal Secretary .....RESPONDENTS Petition LJ r,it r Section 151 CPC praying that in the ,:ircums;tances stated in the affidavit filerl ir :;upport of the petition, the High Court rnav be pleased to vacate the lnterim Order granted on 01.11.2006 granted in W.P.lVl_P.No.28718 of 2006 in W P.No.226'15 of 2006. |.A.NO:1 OF 2023 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to permit lhe pelitioner herslp to file addl mateqial papers i! W.P.No.22615/2006. Coynsel for the Pgtitiongr : qBl VENKAT PBASAP UKKALAM Counsql for the Repponflent Nos.1tp3&5:Sffl DANTU SRINIVAS (SPL Sg FOR cr) Gounsel for lhe ReFpondpnt No.4 : $.P FOR TOIIRISM ANQ QULTURE Thq Coqrt mede the folloying CoMIUPN QRAER THIi ]I(] \I'BLE SRI JUSTICE T. VINOD KUMAIT And TTII] tI( IYBLE SMT. JUSTICE P.SREE SUI)IIA WRI'l 'ETITION Nos.22510 and22615 of 20()6 COMMOI{ C RDER: (Per Hon'ble Sri Juslice T.Vinot!,{ut,tt r) \\.ir'.\,r 2510 of 2006 is filed with the follou'in3 prryers (tr,, .t,c ', ttlry the action of the 2'd respondent in pLtss,ni: tte t,11;11 '211,'v2virscl assessment order dated 4-)'-2(t('t'. n i)t t I t .lings Rc. No.I /3 071/2003-}4/APGST ,t:; ll':gt l, t, I ;r . t.t. high handecl and v,ithout authoriD) o,/ lc,y at d t't 1) t'j: lo tlte provisions of the Act and sel asidt tlt: :an,e tit( ( .l te lhut the petitioner is not exigible t() iax a t lt'e ,1,s,,, ,,1 lurnover under Works Conlrocl ltin(e tl,e ,,ttt ti ' rcr has nol transferred any property in goort.; n .,,(,r.)t ()i (tny third party. it, '): r 't)l t' i() lt rh: :/ llL'-\ 1 , llrc action oJ'the 3't respondent in rt'fectin1, tl e ,cr s appeal for the assessmenl yeat 200.j-)0(1 h': APGST Act by the impugned order drteci t), -0'- ; proceedings AR Sl.No.P/261/2005 on tle yrntd ' prooJ oJ paymenl was produced berttre l, ,i ,,s trbitrary and without authority of lavt atttl ccn t uiy ,r'ot'isions of the Act and set aside the sun,e ud thot the petitioner need not deposit th,: 12.5 r:' ,l ' ttiled since lhe petitioner was granted exernpt o t.fi r 't of Sales Tox being the recognizeat I p,:,-'i,rl ,r Pro.iect under the A.P. State Tourism Poiicl '998 r s such other order or orders ...." ) W.['lro ] 3l-s of 2006 is fited with the followins :)rt\3r.s \ (a) Declaring the action of the 1", respondent in pa.r:jing the impugned/revi-red assessment order dated 4_2_2006 in proceedings Rc.No. t/307 l/20a+05/ApGST as iltegal, arbitrary, high handed and withoul authority of law and contrary to the provisions of the /lct and set asicle the same and declare that lhe petitioner is not exigible to tex on lhe disputed turnover uruler llorks Conlracl since the petitioner hos not transferred ctny property in goods infavour of any third party. (b) Declare the action of the 2nd respondent in rejecting the petitioner's appeal for the assessment year 2001_2005 under the APGST Act by the impugned order tlatetl 01-07-2006 in proceedings AR Sl. No. p/262/2005 on the ground that no proof of paymenl was produced before him as illegal, arbitrary and u,.ithout ctuthorill, 6f 1sy, and conlrary to the provisions of the Act and set a.side the same and declare that the pelitioner need not deposit the 12.5% of the disputed since the petitioner was granted exemption for payment of Sales Tar being the recognizetl Special T'ourism project uruler the A.p. State Tourism Policy, 1998 and pass such other ord.er or orders ...."

3. Since, the parties are one and the. issue involved is same, these Writ Petitions are being disposed of by this common order.

4. The facts set out in W.P.No.225l0 of 2006 are taken for consideration of these Writ Petitions 3 -. 5. Hea.ll I:l L'-rcd counsel for the petitioner and leaflte(l Special ,:l for Commercial Taxes appearing orL ltelLalf of Standinll (-i oL.Lr respondt:nt:;. t r,l perused the record.

6. 1'ht: p,:l it , ner has filed the present Writ Petition; 3sr.ailing the acticn t I )nr rcspondent in passing the revised its ies slnent order dati: tl- )l-2006 lor the assessment year 20l)!-01 and 2004-05 urrrl: the provisions of the Andhra Pradesh Coneral Salcs Trr .,\t t 1957 ( for short 'the Act') by trerLtir.g the petitionr:r' Irl :; aving executed works contract of constrrction and sub.]ect inL ic purchases made by it by adding 159/o pr,:tit as being illeg:r 1. r r lr itrarv and without authority of larl an d cc,ntrary to thc prc,r rsi.' :i olthe Act. l. It ir; th. lasc of the petitioner that agg|ievr'd t,y the afbresairl ,r ',1 ' of assessment, it had availed the rr:medy provide<l r r d ' Section 19 of the Act by appr-oac rirLg the .rdJ resp()nCell ,.rrthority, and the 3'd respondent bl orcer dated 0 1-07-2r_)()( r,.l rejected the appeal on the groun<l r-hrrt the petitionc:r'lrrl :riled to make payment of 12.5o/o of the dir;puted tax as p>r'e- c ir lition for admission of the appeal as crr,vided under Sr:r:r-io r' 1) of the Act. 'rt 4

8. Petitioner contends that originally, a Development Agreement dated 27-06-2001 was entered inro by one Sri Gowrishanker Gupta and Smt.Sarita Gupta with the owners of a piece of land to an extent of 7214 sq. yards siruated at Panjagutta, Hyderabad, for deveroping the aforesaid rand for construction of a multi-storied cornmercial complex, which was lollowed by supplementary agreement dated 05_07_2002.

9. Petitioner fufther contends that while the above mentioned agreement between the above mentioned parties was in force, it had entered into an Agreement of Sale and Irrevocable power of Attorney dated. 23-09-ZOO4 with the original owners and Gowrishanker Gupta and Smt.Sarita Gupta by superseeding the earlier agreements/documents entered into between the original land owners and the Developers to purchase all the piece o[ land to an extent of 7214 sq. yards situated at panjagutta, Hyderabad for valuable consideration and took up construction of commercial complex therein on its own.

10. It is the further case of the petitioner that by virtue of the agreement of sale and irrevocable poA entered into with the owners and earlier developers, the petitioner took up r / 5 t construcli(rr L ( comnlercial complex on its orvn an I lbr undertaki:rg tl , said construction, it had purche.se J vrrrl0us material drLr i r1 he year' 2003 -04 and as such, it cannot b,: tr eated as execul-io| ', vorks contract ll. It is the l r.ther case of the petitioner that since. it drd not undertak,: an\ ( {ecution of works contract and srnce ro sales rvere mar[,: it trad filed Nil returns with the 2"d r,:spondent authority. rn \''rose rolls the petitioner is registe.ed utidi'r the provisionr; cl tl , Act.

12. Petit orrr.r. . ontcnds that ir.ritially, Nil retums filed b1 it were accepted b,r r-J [ " respondent by issuing formal p 'c ce :ding dated 26-():i--l- . ,f I3. Petitioru': t,Lrther contends that notwithstandinq th,: lactthat formal proce.r'rq has been issued by the l't respor.cienr, the 2nd respc,n,J: rt n purported exercise of power undel Se'ction l4(4) of t're .\. , had proposed to set aside the aforesaic tirrmal assessment l the provisio-r ; r : eding and to assess the petitioner lo -a x r rnder ' Scction 5-F of the Act on the gror:nr1 thl,.t tire value o1'the :l rds purchased and incorporated into t,rt: r,rorks contract br t h petitioner to the tune of Rs.9,07,,)6, 1 :g - by X 6 adding the profit element of l5%, amounring to Rs.i0,44,15,616/- would have to consider as the value of goods incorporated in execution of works contract and liable to tax AS per Section 5-F of the Act

14. Petitioner fur1her contends that on the 2nd respondent proposing to revise the assessment in purported exercise of power under Section la() of the Act, it was issued with show cause notice dated, 02-12-2005, upon which the petitioner had submitted its explanation on 19-12-2005.

15. Petitioner contends that by the aforesaid explanation/reply subrnitted by it to the show cause notice issued by the 2nd respondent, it had contended that there is no taxable tumover as per the profit and loss Account; that the assessment made on the basis of AA9 return with Nil turnover is conect; that as thc construction is not meant for saie, the estimation of turnover based on purchases is not correct; that the project is approved by the Tourism Department as eligible for incentives; that if any, construction is for resale, the Tourism Department will not approve the project for incentives as the end use will vary depending upon the buyer's wish; and that as there is no sale fr/ '( 1 .'! receipts, r oLl r rs , d to drop the proposal to levy tax rrnder Se:tion 5-F' of thr: 1ct : , treating the activity of the petitioner a; v,,orks contract

16. Petition e r lso contended that the 2nd respondr:nt. clirt not agiee with tlu' , planation submitted by it and by obser r' n1 that the petition,:' tl. r"rgh had claimed of it is being Tourism LIni- and is eligible lt,r t r,: incentives as are in vogue and the ce lilicate dated 29-0:j--lC 4 issued to the petitioner for Multiplex-:um- Shopping \'11 I r. Panjagutta, Hyderabad by treating the :;arre as a tourisln rrr it e titled for incentives, however, did itot pl tcr ilny matelial on 'r'r: r, d of it being glanted special incenlivt's ar.d as such, not I alrlr: r tax on the turnover, had assessed rlLe petit oner to tax at 8'l:r c n r -re purchase valuc of tl-re goods incoqtot.at rd in execution :f ,iclis contract by adding l5% profit rnarE.irr under Section 5 - F o f re Act resulting in demand of tax in iL su n o1' Rs.83,53,115( i I 7. Petitron : rntends that on the aloresaid assessmcnt r,rder being pass,:,C try he 2"d respondent, the petitioner had ava lerl the remedy o1- aFf e in terms of Section 19 of the Act betb-e the 3'd respondent b y 1r ng appeal on 04-03-2006. \ .l X 8

18. Petitioner further contends that since, it has been issued with certificate dared 29-05-2004 by the youth Advancement, Tourism & Culture Development, Govemment of Andhra Pradesh extending various concessions, which inter alia included, 100% sales tax exemption for 5 years for new units, the petitioner did not make the payment of l2.5yo of the disputed tax as prescribed under proviso to Section 19 of the Act for maintaining the appeal.

19. Petitioner contends that since, it is granted exemption by treating the petitioner as a Tourism Unit, the said exemption would be applicable in relation to filing and maintaining of the appeat. The 3'd respondent authority however, without considering the same, had rejected the appeal by its order dated 0l-07-2006, obserwing that the petitioner failed to produce proof of payment ol l2.5Yo of the disputed tax and since the Second proviso appended to Section 19(l) of the Act explicitly provides for payment of l2.5Yo of the disputed as a pre-condition for admission of the appeal, and in the absence of fulhllment of condition of payment of 12.5Yo of the disputed tax, the appeal filed by the pctitioner against the revised assessment order of the 2nd respondent lor the year 2OO3-04 under the Act stands as 'not ') J i entertainab l,: f i r f-ailure of payment of l2.5yo of the d sp -ited 9

20. Petitioner rntends that since the petitioner. hirs t,een granted ince r trr : I in the form ol exemption by lhe \irutl.r Adrlancemr:nt ,- r ..r.istr and Culture Development, ( io\,.cr_Irr,ent of Andh.a Prad:: . the 3'd respondent ought not to h,\.c reiected the appeal otr the: r lbrementioned ground.

21. lt is alsc c:,r ,,:nded by the petitioner that though. a flrftrrer appeal is pl()r/ (o 21 of the A,:.. I under the Act 1o the Tribunal uncler liecticn ir,.e, the Tribunal being an instr.urrrcn al tv created und,:r tl- <r . \.crt cannot over ride the statutory pro,,isic,n, and thus, th,: s r rl ,:medy would not be an efficaciorrs r,:rter ly and as such, the pe tioner is entitled to maintain the pre:;en r Wr ir Petition by rrsst;li r-; the Revised assessment order as rveil rLs appellate order.

22. Responclt:r.r \,i r;.I and 4 hled counter_affidavit 23 Bv the <:,t u n Le rffidavit filed on behalf of 1,, resf,ond:nr, learned Special lj lnding Counsel would contend thal thr: petitioner in fact I r,,l obtained G-Form on two occasir:ns 1br purchasing gqrtl ; r:oncessional rate of tax, which bereiit / r 10 only available if the pctitioner is executing works contract and not purchasing the goods for being used for its own construction.

24. Leamed Special Standing Counsel appearing on behalf of respondents would further submit that since the petitioner at the first instance having chosen to avail the remedy ofappeal, cannot abandon the said coursc of action midway and assail the order of assessment as well as rejcction order in a Writ petition, after about 8 months fron.r the date of passing of the order.

25. Learned Special Standing Counsel would further submit that insofar as the claim of the petitioner of it having granted exemption from payrnent of sales tax and as such, the 3'd respondent ought to have entertained the appeal filed by the petitioner without insisting for payment of pre-deposit of 12.5ok of the disputed tax, it is contended that from a perusal of the order of the 3'd respondent lejecting the appeal, it would be clear that the petitioner had failed to produce any exemption certificate granted by the Commercial Tax authorities in respect of petitioner's project from levy of sales tax to justiff the claim of it not being liable to make pre-deposit in terms of second proviso to Section 19 of the Act. ) 1-1

26. Learrrrr<l I pecial Standing Counsel would furtht:r crtntend that tholLg I (l Youth Advancement, Tourism and C ulture Developrnent. (lovernment of Andhra Pradeslt hai I issued ccrtificatc .lz l.:cl 29-05-2004 recognizing thi: p c.iticner''s Multiplor-t t n lihopping Mall as a touristn urjt urrd,rr tlte Andhla [:'r arL, : h Tourism Policy, 1998, the pctit one was required io t,1: irt necessary approvals from the c,'rttct rnetl local bodies and L)r -('r agenc'es in order to avail such berrelit and inasmucl- r : exemption certificate has been issue,i lr1 the Commerr:i:l . r.x Department, the petitioner cannol r'lrLinL o1- it being exe'rrptr. 1r'om payment of sales tax 27, Lcalrrt:ri i:rccial Standing Counsel appear-ir-rg on lrel alf' of respondt:r.rt:; ,r l'r.rld further contend that as the petitit,rcl nevr-r approacl-red t r Commercial Tax Authorities lirr gr anting exempti,rn fi o r payment of Sales Tax in terms of the c:rtificate issued ry i , Youth Advancement, Tourism an I C ulture Developmcnr. itrvemment of Andhra Pradesh rr:cor:n zirrg the petitioncr as a ourism Unit, the petitioner cannot clai r ot it not being liable o 1 rv sales tax on execution of works conlrrlct \

28. Learned Special Sanding Counsel would also contend that the exemption provided under the Andhra pr.adesh Tourism Policy is to be extended by the concemed agencies as would be evident from the certificate issued by the Tourism Authorities and the said exemption is also in respect ofoutput tax payable on the tourism unit commencing its activity and not in relation to construction undertaken by the petitioner as a builder.

29. Leamed Special Standing Counsel would fufther contend that the claim of the petitioner of it having undertaken construction for itself IS also belied by the fact that the Agreement of Sale and Irevocable poA entered into by it with the owners and earlier Developers is dated 23 _Og_2004, till such time, the petitioner is onry considered as a contractor on beharf of the owners and the developers, who had entered into agreement initially on 27-06-2001 with a supplementary agreement again on 05-07-2002.

30. Learned Special Standing Counsel thus, contends that the petitioner during the period 2003-04 was acting as builder / contractor for which it had purchased various goods to the tune of Rs.9,07,96y'8r8l- and incorporared the same in works contracr :'..: ..----"-!.!-.r.'t #- 13 execute(l r\ it, and for the said reai( n. the ^nJI respo']cc11 ,,r, its revised assessment order, hacl brcught the atbresaicl tr r-r ' er to tax under the provisions of Sect on .i_F of the Act by a<l ttg 15Yo as profit margin to the value of Soods purchascC iLs 1,,: petitioner did not disclose the rletai s of it.s purchase s lur I r les and had filed only 'Nil, return. 3 I Learn,-'l ! that s inc,: ir r 1 :cial Standing Counsel would furlhe- corrtend , ,pect of the same construction, t_he pr:tit ioner having br:,,'n rs ;:sscd to tax under the provisions cl5-l: cI thc Act fbr thr' ,i e:r 1002-03, it is not open for the petitioner.ro claim thatduring,tr: works c,lrtrirc construction a r.r lbr se If p Lrrp c,-..' ',ar 2003-04, it had not undertaken €,xecrrti()n ol by incorporating the materizLl in _o the iat the said construction is being unrle r1a kins

32. l.ear,r:,-l :,1 , :ial Standing Counsel would furrher c..,end that the 3''r r:,r ndent before rejecting the appeal flerl by thc petitioner as r. ,aintainabre on 0r-07-2006, had issrred rlrst notice datc.rl _l - ) l-2006 termed as ,Check Memo, c:a.llil; upon the petitioncr rc 1;roduce proof of payment of 12.:j% rf the disputed taxl\Ll_-,,r which the petitioner had filed lcttcr dirted i{ 1,4 23-02-2006 claiming that it had filed a representation before the Principal Secretary, Revenue Deparlment, Government of Andhra Pradesh requesting to exempt from payment of l2.5oh of the disputed tax and pteaded for an opportunity of personal hearing.

33. Learned Special Standing Counsel lurther submits that on petitioner submitting the aforesaid letter, the 3.d respondent has issued another notice dated 29-04-2006 directing the petitioner to fumish proof of payment of 12.5%o of the disputed tax within 7 days from the date of receipt of said notice, and thereafter the 3'd respondent also afforded an opportunity of hearing to the petrtloner.

34. Leamed Special Standing Counsel fur1her submits that in response to the aforesaid notice issued by the 3'd respondent, the authorized representative of the petitioner appeared before the 3'd respondent, but however, did not produce any prool of payment of 12.5%o of the disputed tax or it having been granted any exemption from the Govemment from payment of 12.5%o of the disputed tax 15

35. Learned ! 1 :cial Standing Counsel would thus, conrer,:d that since, thc I)(,ri ()lter had neither made payment of lnlnrlatory deposit c,l' 1i.: r ir of the disputed tax for maintaining th: irppeal nor filed ,ru1, r . rlificate granting it exemption frorn pln rnr,:nt of tax. thc l'r r:: -,ondent authority issued the order dat,:c Cl-07- 2006 r'ejcL:tirr! the appeal filed by the petitioner as,not maintaineb l. r'

16. Learrr,:,1 ;ccial Standing Counsel would con:end that since, [hr: ,:,rrs r.rction undertaken by the petitioner du \n .Irl ,v'ear 2003-C4 Lntended for the land owner and d,:r.elr;pers under the fr,::lopment Agreement dated 27-06-20()1. the petitionel ur,u il be liable to tax on the value of €oods incorpora[c,-l .n he execution of works contract at the rel:vant point ol tiLnc rr . it is for the said reason, the 2nd respor cl.-n had assessed r.lt,: lrr r cver tax under Section 5F of the Act .ri g%o provided r.rncer ,l Act.

37. By stat r I its above, leamed Special Standing (tor nsel sceks for d isr n i s rl of the Writ petitions.

38. 'l'he .l r .i :; , rndent by the counter-affidavit filed conter Lded that pctir-i.u,: \is Lot registered with the Director of .I.,:ur.is rn and , t 1,6 therefore not entitled for exemption under the Andhra pradesh Tourism Policy, 1998.

39. We have taken note of respective contentions urged.

40. Though, on behalf of the petitioner it has been vehementll, contended that the petitioner being the owner of the subject property and having undertaken the construction for itself cannot be considered as works contractor, as if it is executing the contract for a third party for it to be liable to tax, as rightly contended by the learned Special Standing Counsel appearing on behalfofthe respondents the Agreement of Sale and lrrevocable PoA under which the petitioner claims itself as purchaser has come into existence on 23-09-2004, which is subsequcnt to the assessment year involved i.e. 2003-04 w.e.f. 0l-04-2003 to 3l- 03-2004. It is also pertinent to note that though, the petitioner had claimed of it being a purchaser of the subject propefty and thus, the construction undertaken by it is for self, and thus not being liable to tax, a reading of the aforesaid Agreement of Salc and Irrevocable Power of Attorney, in particular Clause-5 thereol reads as under: t] .. .ltt ( ,ter.s hereby confrm thal they shall onl-\' be deln'tt i ti: 1 otl c \( c'l 1( ant ttltt l u plu (h(se pur(l'Lt.\('. affiriag r: signlt )t \ pu t l'L : c rel0i( (l D tl sati:lit'(t it Per|r ., ',li, thut ,l,t )\ Lleei t)t ,'l t :;session of the schedule property to the ptLrclrtrser t,t the sale deed for the schedule properly ()r ort ' itgreed terms/date belween the owner.; atul I lN ' ,hich will be evidenced by lhe owner: antl the 'tir.:h lhe purchaser has agreed to and con-firt t b1 ,cul ulr.trtg with the signature of its outho"i:e a .',,to and covenonls v,ith the owners ihu' lhe ; ting perused aLl the necessary docuntenls Lma s in respect of the schedule property atul htt';n8 :t./ in all aspects that the ou,ners have qooa Lma i title and duthority to the schedule proDcrq dna t,zrs have not done or knowingly done an; Lrc't, t :' r,hereby the .schedule properly is in dnv 1)(t) , ,:rntbered or tille o.f the owners alfected. '' 4 1 . A grt:r'r L: a ri the aforesaid clause would clearl'y g o to show that thcrc i ; n , Lransfer of title in favour of the petitior e r eitl-rer during the \ r.,r 2003-04 or 2004-05 under the :rlt,resaid docurnen: rr() r so, when the same is titled as 'Agrecm,:nt of Sale and In e r' , :able Power of Attorney' granted in falo ur of the petitioner lt r Lnderlaking the construction of Nlultip el -cunl- Shopping I\1ri l-hus, the said document cannot be cons de'red as a salc dr:::l r c .1-erring absolute right on the petitioner rs :.,ought to be urgri:r.l

42. F'urther.r: noted above, the said agreement o1'seLlt: e ltered into is on \ ,n 23-09-2004 and as such, cannot be made t] l 18 applicable in relation to goods purchased by the petitioner for the earlier period.

43. It is trite law that under an agreement of sale, no rights lor the property can be vested and by the said document, the parties only agree to do future act and it is only upon execution of sale deed, which is duly registered in terms of Section 17 of the Registration Act, one can claim absolute right and title to the property. (See: Sanjay Sharma Vs. Kotak Mahindra Bonk Limitetl tnd otherst;.

44. In the facts of the present case, as noted herein above. sincc Clause-5 of the agreement of sale clearly records the owners executing sale deed at a later date, the petitioner under the said agreement cannot claim having vested with any right or interest or title in the subject property, and the said agreement of sale cannot be considered as a sale deed. It is also not out of place to mention that the petitioner has not placed before this Courl the details of the stamp duty paid on the Agreement of Sale and Irrevocable Power of Attomey for this Court to accept the r 2024 SCC Online SC 4589 19 contenlicr tf . t under the said document, a right antl int,:resl in tl-re prope rL, Lr ing been created in favour of the petitic,ne r.

45. Since.;l , petitioner cannot claim itself to be th e o., vner of the procer-r . re construction/work executed by t1-ri: petiti,.tner by incorporat t. r: he material purchased by it during; s,rc )r period, would rrly I r ',,e to be considered as for and ot-r beh rlf of the owners rrt f c . ,re lopers who had entered into the agr e(lll ent lor developing tl i subject propefty under agreement dated 27-06- 2001 r'rctu irl r'anding the lact that the developers who had entcred irtr t are Dire.c l cls r: albresaid agreement in their individual clpacity ,rl the petitioner, which is a priva te . imited contpant, :l - |. . relevant point of time.

46. Th,:Lrg,l . n behalf of the petitioner, it has beon c:nr.ended of it havirLl, ir , n granted exemptions by treating it as a .lrurism Unit b1' tir: ( ' rvernment of Andhra pradesh under Corlificate dated 2!)..() i. il ), )4, a reading of the aibresaid Certiflca e. Lssued by the Prin: p r Secretary to Govemment, youth A.dvanct.ment, Tourism lirr i r 'ulture Department, clearly indicates tl-rrLt the petitioner'r r o I ;truction i.e. Multiplex-cum-Shopping lr4all has been rec'lgrizt. as'fourism Unit under the A.p. Tourisnr Ir olic1,, l I l l i 20 1998 and is entitled for'any incentives, concessions, as are in vogue subject to obtaining necessary approvals from the concerned local bodies and other agencies. The contents of the above certificate would go to show that the petitioner is required to approach the concemed authorities to claim/avail the incentives/concessions as are available to a Tourism Unit by enclosing the said certificate. The said fact would be further. clear from the letter dated 20-10-20024 filed by the petitioner (filed partly i.e. only first page) detailing the incenrives and concessions available under the A.P. Tourism policy, 199g which a Tourism Unit can avail.

47. Though, it is contended by the petitioner that rhe Certificate dated.29-05-2004 as issued by the Youth Advancement, Tourism and Culture Department, Government of Andhra pradesh would entitle it to 100% sales tax exemption for a period ol. 5 years, inasmuch as no eligibility certificate as issued by the Government of Commissioner of Commercial Taxes has been placed before this Court or for that matter before the First Appellate Authority or the Assessing Authority at the time ol assessment, the claim of the petitioner of it having been granted I

21. exelnptic,ll 1i r r payment of sales tax lor a period o1'-5 )'tra. s can only be a s3il-: ::r'ing statement and cannot be acceoted

48. Furt.lrr:r. i .s also to be noted that even if th,: peti iorrer is granted (:x(l r p I :)n by recognizing it as a Tourism Llni:, th r said exemption rv:,r r 1 only be applicable in respect of ,rutpu tl'x i.e sales tax oa1'.: I ' .r on its sale and lrorn the date as mel)t orred in the eligiritir, ..utificate and cannot be applied in rer;pect of works it hac rrr rlr:ftaken as works contractor for the t ear' 20 )3-0,1 or 2004-[t5. \\ 'i)11 no such certificate of exemption h td been sranted in rts li ' ,rur

49. Fur1l..cr, tl r 3'd lespondent in W.P.No.22615 of 2OO i t,y the counter-a lTir rr having made a categorical state .nrert of petitionel' n,)r ,:iug registeled as a recognized 'Tourisnr Unit' and as srrr:..r r , ,t entitled for exemption under A.P T ou risim Policy, 199E, 1j rther belies the claim of the petitioner.

50. 'Iho,-rgl . c . r'ing the course of hearing of the Srrit l,el Ltion, petitioner h rr I I Icd additional documents enclosing ther,:rvith copy of the'7'r' ,\nnual reporl for the year 2003-04. a [re:usal of the said b,alarLr , sheet would also show that dur.ilig t te ) ear 2003-04 in !,c h ' :ule -V attached to the balance sheet _urdcr the -'t. \ a 22 heading 'Fixed Asset', there is no mention of the land which the petitioner claims to have purchased under agreement of sale dated 23-09-2004 for it to claim the purchase of goods used in construction is lor self. Further, as noted herein above, by Clause-5 of the Agreement of Sale and lrrevocable Power of Attomey, the owners having specihcally mentioned to execute 'sale deed' at later point of time, all the purchases made by the petitioner would have to be construed as in relation to for being incorporated into the execution of works contract only.

51. Thus, this Court is of the considered view that the order of the 2nd respondent authority in subjecting the value of purchase of goods incorporated in execution of works contract by the petitioner during the year 2003-04 or 2004-05 by adding a profit margin of l5o/o and subjecting the same to tax under the provisions of Section 5-F of the Act cannot be held as either illegal or contrary or without authority of law.

52. Further, on the 2nd respondent authority having passed the order ofassessment on 06-02-2006, the petitioner having availed the remedy of appeal provided under the Act on 04-03-2006, is required to make payment of 12.5%o of the disputed tax assessed // / 23 by the Assesstr : A.uthority in order to maintain the a frrre said appeal.

53. Despite th' petitioner being issued with check memo a' the firstinstan*'o'21-03-2006sentby'CertificateoiPostrnlr''on 23-03-2006 an lthe petitioner in response to the same hrvinEl claimed oi'it approaching the Government for issrrinE of exemption :r:r i'icate, and not fumishing any such ex':trption certificate obte red tiom the Government' and the l!'d r':spo edent thereafter ii:,u r,g another notice calling upon the pel-ilioller to produce prrll of payment of mandatory tax of l2':;9t' ')f the i ithin 7 daYs' and even in response t,r th,: said notice, petitic - t:r having failed either to produce th': prrrof of payment <1" :; i'lnption certificate obtained from the Gor er rment' even aftet l: r' ng afforded with the opportunity of pt':rsonal hearing, the retitioner cannot claim that the ortler of the 3'd responde't I in rejecting the appeal as 'not mainlarnabie' as contrar) t,l t[; Act' disputed tax

54.I{orI.,}.eclaimofthepetitionerofithavirrgbecngranted exemptio I ll .'rn payment of sales tax' the Assessing {utl ority at 7 ..,] 24 the first instance would not have assessed it to tax at all forcing the petitioner to avail the remedy ofappeal.

55. Since, even after filing of the appeal, as the petitioner had failed to produce the exemption certificate granted by the concemed Commercial Tax authorities or Government specifuing the period of 5 years during which the exemption certificate would be in vogue or even before this Court now, this Court is of the view that the said claim of the petitioner is only intended to avoid payment o[tax assessed on it.

56. For the aforesaid reasons, this Court is of the considered view that the present Writ petitions as frled are devoid of merit and are accordingly dismissed. No order as to costs.

57. As a sequel, miscellaneous petitions pending if any shall stand closed. //TRUE COPY// SD/.T. TIRUMALA DEVI PUTY REGISTRAR SECTION OFFICER '1. Two CCs to G.P FOR TOURTSM AND CULTURE Telangana at Hyderabad. [OUrl One CC to SRI DANTU SRINI VAS (SPL SC FOR CT) Advocate loPUcl One CC to SRI VENKAT P RASAD UKKALAM, Advocate [OPU cI Two CD Copies igh Court for the State of To 2 J 4 SA BS ry- HIGH COUtt'f DATED:28ltlt'i12025 COMMON OTIDER WP.Nos.2zli' 0 AND 22615 of 2006 \/AIJ,{'f tON COURT .Z' * ' lto' ' i.t AI€: q !,_ 'l ) iL\N ?S6 l .lr \: l- l: c o ',i =1:t' 7 i DISMISSING HE BOTH WRIT PETITIONS WITHOUT C:0STS. a /11 1 ) ),; I(,