M/s.RKS Motors Pvt Ltd v. Commercial Taxes, SEcretariat Buildings, Hyderabad

Counsel for the Respondents: Sri Krishna Kaundinya, SC for Commercial Taxes The Court made the following : ORAL ORDER: (Per Sri Anil R. Dave, CJ) Rule. Service of Rule is waived by Sri Krishna Kaundinya, learned Special Standing Counsel appearing for the respondents. At the request of the learned advocates, the petition is finally heard today.

In this petition, order dated 13-02-2009 passed by the Additional Commissioner (CT) Legal has been challenged.

The facts giving rise to the present litigation, in a nutshell, are as under: The petitioner had challenged the validity of assessment order dated 26-08-2008 before the appellate authority. At the time of filing the appeal, an application had also been submitted for stay of recovery of tax, during the pendency of the appeal. The stay application had been rejected and, therefore, a revision application had been filed against the order of rejection. The said revision application has also been rejected by virtue of the impugned order dated 13-02-2009.

The case of the petitioner is that he is hopeful of succeeding in the appeal and, therefore, during the pendency of the appeal, the amount of tax sought to be recovered should not be recovered. He has a prima facie case in his favour and, therefore, it has been submitted that stay pending appeal with regard to the recovery of tax should have been granted.

It has been submitted by the learned advocate appearing for the petitioner that certain amount which could not have been considered as consideration for sale has been included in the sale by the assessing officer. He has given certain instances whereby he has made out a case to show that amount recovered from the customers for rendering certain services has also been included in sales.

On the other hand, the learned Special Standing Counsel relying upon the definition of ‘sale’ has submitted that the assessing officer has passed just and proper order and, therefore, the petitioner has no chance of succeeding before the appellate authority.

Both the learned advocates have submitted that we may not give final pronouncement on the merits of the case because the appeal has not yet been heard.

After hearing the learned advocates, prima facie, we feel that the petitioner has made out a case for getting some relief. Certain items, in our opinion, could not have been included in sales.

Upon perusal of the papers, we prima facie, believe that some relief should have been given by the revisional authority while entertaining the stay application.

In the circumstances, we direct stay of recovery on condition that one-third of the amount sought to be recovered be paid by the petitioner within three weeks from today and on that condition, implementation of the impugned recovery proceedings is stayed. The amount paid so far shall be given credit to while calculating one-third amount of tax. We further clarify that the observations made hereinabove are prima facie observations which need not be looked into by the appellate authority while deciding the appeal finally.