Rep by its Managing Partner, Mr. K. Surapunaidu v. Hyderabad

{ Per the Hon’ble Mrs. Justice T. Meena Kumari } Seeking a writ of mandamus declaring order dated 30-4- 1997 passed by the first respondent rejecting to stay the collection of disputed tax of Rs.90,720/- as illegal, arbitrary and contrary to the provisions of the APGST Act, 1957 and consequently to direct the first respondent not to collect the disputed tax for the year 1995-96, pending appeal before the Sales Tax Appellate Tribunal, Hyderabad, the petitioner filed this writ petition.

The petitioner is a partnership firm and a registered dealer on the rolls of the first respondent under the provisions of Andhra Pradesh General Sales Tax Act, 1957 and the Central Sales Tax Act, 1956 (hereinafter referred to as the ‘APGST’ and ‘CST’ Acts). It is stated that the petitioner is carrying on business in manufacturing and sale of AAA conductor and AB cables. Aluminum wire is one of the raw material required for production of the said conductors. It is also stated that during the year 1995-96 due to non-availability of raw material, the petitioner requested M/s. Gowri Shanker Cable Industries to send the material on loan basis and they have supplied the raw-material on loan basis. However, for the purpose of Central Excise formalities, M/s. Gowrishanker Cable Industries and the petitioner have raised the Central Excise Invoice for dispatch of goods as it requires removal from the factory. For the said purpose, the petitioner had taken approval from the Asst. Commissioner (Central Excise) who had given consent through letter dated 12-7-1995. The dispatch of goods by the petitioner was accompanied by Central Excise Invoice showing the value of the goods as Rs.9,97,940/- but there was no sale between the petitioner and M/s. Gowrishanker Cable Industries. It is further stated that the first respondent levied tax at 10% based on the Central Excise document by an order dated 30- 4-1997. Aggrieved by the order passed by the first respondent, the petitioner filed an appeal before the second respondent, who by his order dated 05-8-1998 remanded the matter to the first respondent.

Sri S. Dwarkanath, the learned counsel for the petitioner contended that in the order of the second respondent, he has directed the assessing authority to enquire about the genuineness of the letter issued by the Asst. Commissioner (Central Excise) dated 12-7-1995 and also to ascertain whether the transaction is involved passage of any money consideration to attract the provisions of the definition of sale under section 2 (n) of the Act. Further the first respondent gave relief on examination of the documents and facts of the case, pursuant to the remand direction of the second respondent, by an order dated 31-3-2000. Now the third respondent through an order dated 10-5-2002 has revised the orders of the second respondent and the consequential order thereto passed by the first respondent under section 20 (2) of the Act. Against the revision order of the third respondent, the petitioner preferred an appeal before the Sales Tax Appellate Tribunal, in TA. No. 809 of 2004 and also an application seeking stay of collection of disputed tax. Since the Tribunal at Viskhapatnam is not functioning, presently due to lack of members, the stay application filed by the petitioner could not be taken up for hearing. In the meantime, the first respondent is insisting for payment of the disputed tax and is contemplating to take coercive steps against the petitioner.

Heard the learned counsel for the petitioner and the learned Special Standing Counsel for Commercial Taxes.

In the facts and circumstances of the case, we are of the opinion that the writ petition can be disposed of at the stage of admission directing the petitioner to deposit 50% of the disputed tax amount, as per the impugned order, within a period of six weeks from the date of this order and the respondents are directed not to take coercive steps for recovery of the disputed tax, pending finalization of TA.No.809 of 2004 by the Sales Tax Appellate Tribunal, Viskhapatnam. It is also made clear that the amount paid, if any, shall be given credit to the above stipulated sum.