M/s Hara Indusries Pvt.Ltd.,, Cherlapally v. The Additional Commissioner (CT), Legal

M/s Hara Indusries Pvt. Ltd.,, Cherlapally, rep. by its Director Dr. B.N.S.Rao. The Additional Commissioner (CT), Legal Nampally, Hyderabadand others. …Petitioner …Respondents Oral order: (Per RR, J) The petitioner, a dealer registered both under the AP VAT Act, 2005 and the CST Act, 1956, undertakes fabrication, supply and erection of S.S.Masts. For the assessment year 2005-06 it executed works contracts in the course of inter-state trade and commerce. The 3rd respondent, by the assessment order dated 31-3-2009 for the assessment year 2005-06 (CST), assessed the petitioner to tax for Rs.57,48,377-00 and, after adjusting the tax paid and the input tax credit which the petitioner was entitled to, issued a demand notice for payment of the balance tax due of Rs.22,66,625-00. Aggrieved thereby, the petitioner preferred an appeal to the 2nd respondent along with an application for stay. The 2nd respondent, by proceedings 19-6-2009, rejected the stay petition, against which the petitioner preferred a revision before the 1st respondent.

The said revision petition was rejected by the 1st respondent by order dated 21-8-2009. The petitioner claims to have paid 50 per cent of the disputed tax even during the pendency of the appeal before the 2nd respondent. In his order dated 23-10-2009, the 1st respondent rejected the petitioner’s application for stay holding that, in respect of the turnover not covered by C forms, the petitioner had filed copies of two C forms covering a turnover of Rs.1,04,62,225-00; that the petitioner had failed to furnish these C forms before the assessing authority; and that there was nothing on record to show that the assessing authority had granted time for the belated filing of the C forms. The Additional Commissioner held that filing of C forms before him did not help the petitioner’s case. Dr. S.R.R.Viswanath, learned counsel for the petitioner, would contend that it is open to the petitioner to file C forms even before the 2nd appellate authority i.e., the Sales Tax Appellate Tribunal and, since the power to grant stay is incidental to the power to hear and decide the appeal, the 1st respondent should have considered the C forms submitted by the petitioner for the limited purpose of granting stay in respect of the turnover covered by the said C forms.

With respect to the remaining turnover of Rs.1,54,79,572-00 Dr.S.R.R.Vishwanath, learned counsel for the petitioner, would draw attention of this Court to the definition of ‘sale price’ under the Central Sales Tax Act, 1956, whereunder, even in the case of sale, the price of the goods sold excludes the cost of freight or delivery or the cost of installation in cases where such cost is separately charged. Learned counsel would submit that, while the agreement is undoubtedly a composite agreement for erection and installation of telecommunication towers, the petitioner has shown the cost of the goods and the installation charges separately in the invoice and as such these items ought to have been deducted from the petitioner’s turnover. The submission of Dr.S.R.R.Vishwanath, learned counsel for the petitioner, cannot be said to be without merits. We do not, however, propose to examine these contentions on merits, as the substantive appeal is pending adjudication before the Sales Tax Appellate Tribunal.

Ends of justice would be met if the respondents are directed not to take any coercive steps for recovery of the disputed tax pending disposal of the appeal by the Sales Tax Appellate Tribunal, subject to the condition that the petitioner pays 50 per cent of the disputed tax within a period of four weeks from today. Amount, if any, already paid, shall be given credit. The writ petition is, accordingly, disposed of, after hearing Dr. S.R.,R.Vishwanath, learned counsel for the petitioner and Sri P.Balaji Varma, learned special standing counsel for commercial taxes. However, in the circumstances, without costs. _________________________ GODA RAGHURAM, J ______________________________ RAMESH RANGANATHAN, J 13th November, 2009 GRR