Writ Petition No. 23071 of 2014. Case: Ideal Detonators Private Limited Vs The Government of Telangana. High Court of Andhra Pradesh (India)
| Case Number | Writ Petition No. 23071 of 2014 |
| Counsel | For Appellant: M.V.J.K. Kumar, Adv. and For Respondents: J. Anil Kumar, Spl. Standing Counsel |
| Judges | Ramesh Ranganathan and M. Satyanarayana Murthy, JJ. |
| Issue | Andhra Pradesh Value Added Tax Act, 2005 - Sections 19(1), 21(5), 31, 31(1); Central Sales Tax Act, 1956 - Section 9(2); Code of Civil Procedure, 1908 (CPC) - Order XXI Rules 89, 92; Constitution of India - Articles 136, 142, 142(1), 226; Tamil Nadu Value Added Tax Act 2006 - Section 51 |
| Judgement Date | September 05, 2014 |
| Court | High Court of Andhra Pradesh (India) |
Order:
Ramesh Ranganathan, J.
1. The relief sought for in this Writ Petition is to declare the assessment order dated 28.02.2009 passed by the 3rd respondent, without considering the statutory declaration C Forms, as contrary to Section 9(2) of the Central Sales Tax Act (CST Act for short) read with Rule 2(c)(i) of the CST (A.P). Rules and Section 21(5) and Rule 59 of the A.P. VAT Act and Rules, 2005 respectively as arbitrary and illegal. The proceedings of the 2nd respondent dated 19.06.2014 rejecting the petitioners appeal, on the ground of belated payment of 12.5% of the disputed tax beyond the prescribed period for filing the appeal under Section 31 of the A.P. VAT Act, is also questioned as illegal and without authority of law.
2. The petitioner, a limited company, is an assessee on the rolls of the 4th respondent and is a registered dealer both under the A.P. VAT Act and the CST Act. Pursuant to an audit of the petitioner undertaking on 18.02.2008, the 3rd respondent issued show cause notice dated 30.12.2008 proposing to levy a higher rate of tax on a turnover of Rs.10.78 crores on the ground that concessional rate of tax could not be allowed as the petitioner had not filed the C declaration forms. An assessment order came to be passed on 28.02.2009. Aggrieved thereby, the petitioner preferred an appeal on 03.04.2009 which was rejected by the 2nd respondent, by his order dated 19.06.2014, on the ground that he, as the first appellate authority, could not consider admission of an appeal if the appellant failed to produce proof of payment of the admitted tax, and 12.5% of the disputed tax, within sixty days from the date of receipt of the assessment order including the condonable delay period of thirty days; as the petitioner had paid the amount, 478 days after receipt of the order of assessment, the delay could not be condoned and the appeal could not be admitted; as held in M/s. Zuari Cements Limited v. State of A.P., a statutory authority could not deviate from the prescribed statutory requirement; a Division Bench of the High Court, in Ankamma Trading Company v. The Appellate Deputy Commissioner, had held that admission of an appeal, filed before the Appellate Deputy Commissioner, was liable for rejection if payment of the admitted tax/12.5% of the disputed tax was made beyond the period of sixty days from the date of receipt of a copy of the assessment order; and as the petitioner had failed to comply with the prescribed statutory requirement, while filing a statutory appeal under Section 31 of the A.P. VAT Act, the appeal preferred by them could not be admitted. Accordingly, admission of the appeal was rejected.
3. Oral submissions were made, and written arguments filed, by Sri M.V.J.K. Kumar, Learned Counsel for the petitioner. Learned counsel would submit that the petitioner was being extended the benefit of tax deferment, vide G.O. Ms. No. 108 dated 20.05.1996, for a period of fourteen years from 30.03.2002 to 29.03.2016; they were permitted to collect tax, for the development of their industry, and remit the amount after completion of fourteen years; they had requested the 4th respondent to adjust the pre-deposit, of 12.5% of the disputed tax which worked out to Rs.24,29,036/-, from their deferment amount balance of Rs.30,98,688/-; thereafter, on legal advice, they had belatedly made payment of the pre-deposit of Rs.24,29,036/- on 29.06.2010; the appellate authority ought to have condoned the delay, admitted the appeal and passed orders on merits, instead of rejecting the appeal on the ground that the amount was not paid within the prescribed time; and the order of the 2nd respondent, refusing to entertain their appeal, is illegal. Learned Counsel would submit that the petitioner herein was also one of the petitioners in Ankamma Trading Company2 (i.e., the petitioner in W.P. No. 27885/2010); questioning the judgment, in Ankamma Trading Company2, the petitioner had carried the matter in appeal to the Supreme Court by way of SLP No. 32221/2011; after hearing both the parties, the SLP was disposed of on 17.09.2012 with a direction to the Appellate Deputy Commissioner (CT) to take the appeals on file, and dispose them of on merits after due notice, though the pre-deposit had not been made within time; in S. Pitchi Reddy v. Appellate Deputy Commissioner (CT), Guntur, this Court had, on request, granted the petitioners therein two weeks time, from the date of receipt of the order, to pay the pre-deposit amount, as they were disputing their liability to make payment of such pre-deposit; M/s. S.E. Graphites Pvt. Ltd., filed W.P. No. 15384 of 2013 challenging the order of the appellate authority rejecting the appeal for non payment of 12.5% of the disputed tax within the prescribed time; in its order, in W.P. No.15384 of 2013 dated 17.09.2013, this Court held that the judgment in S. Pitchi Reddy3 was distinguishable; the order of the Supreme Court, in S.L.P. No. 32221 of 2011, could not be treated as a precedent; and, following the judgment in Ankamma Trading Company2, had dismissed the Writ Petition; against the judgment of this Court in M/s. S.E. Graphites Pvt. Ltd. v. State of Andhra Pradesh, SLP No. 3217 of 2014 was filed; upon hearing both the parties on 19.02.2014, the Supreme Court had ordered notice and directed that there should be no coercive recovery of the amount in question; and when the matter was listed on 30.07.2014, and upon hearing both the sides and considering it necessary to hear the issues involved at length, the Supreme Court had granted leave (meaning thereby that the appeal was admitted), and had ordered continuation of the interim relief granted on 19.02.2014; in State of A.P. v. M/s. Pearl City Containers this Court, following the judgment in M/s. Swastik Oleachems Ltd. Hyderabad v. State of Andhra Pradesh and Ankamma Trading Company2, held that the assessee was liable to pay the condition precedent amount in order to entertain the appeal, and had granted four weeks time to make payment thereof; in similar circumstances, the petitioners sister concern M/s. Ideal Industrial Explosives Ltd. filed W.P. No. 13617/2014 wherein the interim order passed by the Supreme Court, in SLP No. 3217/2014 dated 19.02.2014, was brought to the notice of this Court; and taking note of the submission, that the judgment in Ankamma Trading Company2 was subjudice before the Supreme Court, this Court had, by order in W.P.M.P. No. 17000 of 2014 in W.P. No. 13617 of 2014 dated 28.04.2014, granted stay.
4. According to the Learned Counsel the judgments of this Court, in Ankamma Trading Company2, and M/s. S.E. Graphites Pvt. Ltd.,4 are now subjudice before the Supreme Court; when an SLP is filed, challenging the orders passed by any Court or Tribunal, the said judgment of the Court/Tribunal ceases to operate, whether or not leave is granted, and whether or not operation of the judgment of the Court/Tribunal is stayed; as the Supreme Court has granted leave, admitted the appeal and stayed recovery in M/s. S.E. Graphite Pvt. Ltd4, the correctness or otherwise of both the aforesaid judgments of this Court is wide open; the Supreme Court is entitled to examine both questions of fact and law; in such circumstances, the correctness of the judgment, in Ankamma Trading Company2, is also in jeopardy; and as the judgments in Ankamma Trading Company2 followed in M/s. S.E. Graphites Pvt. Ltd.,4 are both subjudice before the Supreme Court, and interim relief has been granted therein directing the respondent officials not to take coercive action for recovery of the amounts, this writ petition should also be admitted, and collection of the disputed tax stayed, pending disposal of the Civil Appeal filed by M/s. S.E. Graphites Pvt. Ltd. Learned Counsel would rely on Union of India v. West Coast Paper Mills Ltd.; and Ranjith Impex v. Appellate Deputy Commissioner (CT).
5. In Swastic Oleachems Ltd. Hyderabad6, it was contended that the petitioner therein could not be said to have committed default in making payment of the admitted tax and 12.5% of the disputed tax, for preferring an appeal under Section 19(1) of the A.P.G.S.T. Act, as they were sanctioned sales-tax deferment by the Commissionerate of Industries; and such incentive must be deemed as payment of the entire tax. Following the earlier judgment in...
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