IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE FIFTEENTH DAY OF JULY TWO THOUSAND AND NINE PRESENT HON'BLE SRI ANIL R. DAVE, THE CHIEF JUSTICE and HON'BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 13543 of 2009 Between: M/s. Shalaini Steels Private Ltd., IDA Bollaram, Medak District, Rep. by its Managing Director, Suresh Kumar Singhal S/o. K.C. Singhal 52 yrs, Medak District. ..... PETITIONER AND 1 The Joint Commissioner of Commercial Taxes (Legal) Andhra Pradesh, Office of Commissioner of Commercial Taxes, Commercial Taxes Complex, M.J. Road, Nampally, Hyderabad. 2 The Appellate Deputy Commissioner (CT) Secunderabad Division, Commercial Taxes Complex, M.J. Road, Nampally, Hyderabad. 3 The Commercial Tax Officer, Medak Circle, Medak. .....RESPONDENT(S) Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed herein the High Court will be pleased to issue an appropriate writ, order or direction particularly in the nature of Writ of Certiorari by calling for the entire records relating to the impugned Proceedings of the Joint Commissioner (CT) (Legal) Hyderabad dt. 16-6-2009 in CCT'S Ref No.LV (1)/319/2009 served on the petitioner on 1-7-2009 rejecting the stay for collection of the disputed penalty of Rs. 22,59,100/- for the assessment year 2003-04 pending disposal of the appeal on the file of the Appellate Deputy Commissioner (CT) in Appeal No. N/134/2008-09 by holding the same as illegal, improper, unjust, arbitrary, and opposed to the principles of natural justice as the levy of sales tax and penalty indisputably linked to the levy of the disputed Deputy of Central Excise, interest and penalty by the Commissioner of Central Excise and Customs Commissionarate, Hyderabad-I being the subject matter of the appeals on the file of the Central Excise Gold Appellate Tribunal, Bangalore in Appeal Nos. Excise/1037 to 1042/2005 covered by orders of stay dt. 27-2-2006 and dt. 8-1-2007 and consequently direct the 3rd respondent not to take any coercive action for recovery of the disputed penalty in view of the Collection of the entire amount of tax in dispute pending disposal of the appeal on the file of the appellate authorities under the State Sales Tax Law and grant such other relief o reliefs Counsel for the Petitioner: Sri M.V.J.K.Kumar Counsel for the Respondents: Sri A.V. Krishna Kaundinya, Special Standing Counsel for Commercial Taxes The Court made the following : ORAL ORDER: (Per Sri Anil R. Dave, CJ) Rule. Service of Rule is waived by the learned standing counsel, Sri A.V. Krishna Kaundinya, appearing for the respondents. At the request of the learned advocates, the petition is finally heard today. 2. The petitioner has been aggrieved by an order dated 16-06-2009 passed by the Joint Commissioner (CT) (Legal), Hyderabad – respondent No.1. By virtue of the impugned order, an application made by the petitioner for stay of recovery of penalty during the pendency of the appeal has been rejected. 3. The learned advocate appearing for the petitioner has submitted that the order of penalty is very harsh and as the petitioner is hopeful of succeeding in the appeal, at this juncture, the amount of penalty should not be recovered from it. It has been further submitted by him that the assessment order was passed on the basis of a report given by Anti-evasion Team of Central Excise, Hyderabad I Commisionerate. The said Anti-evasion Team had come to conclusion that the petitioner had cleared certain CTD Bars in a clandestine manner and thereby had evaded payment of taxes and on the basis of the said report, the Assessing Officer had also made assessment under the provisions of the Andhra Pradesh General Sales Tax Act, 1957. 4. It has been also further submitted by him that recovery of the amount of penalty imposed under the Central Excise Act, 1944 has been stayed by virtue of an order dated 27-02-2006 passed by Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench at Bangalore. It has been, therefore, submitted that the petitioner be protected by passing an appropriate order so that it may not have to pay the amount of penalty during the pendency of the appeal, which is pending before respondent No.2. 5. On the other hand, the learned standing counsel appearing for the respondents has submitted that the petitioner had removed CTD Bars in a clandestine manner but Anti-evasion Team of Central Excise Hyderabad-I Commissionerate had detected the said fact. Upon knowing the said fact, the assessment order was revised and a reassessment order under Section 14(4) of the Andhra Pradesh General Sales Tax Act, 1957 had been passed on 22-10-2008. It has been submitted that the said order reveals the way in which the petitioner had made an effort to evade payment of tax. It has also been submitted that the said order had been challenged before respondent No.2 and during the pendency of the said appeal, the petitioner had filed an application for stay, which has been rejected by the impugned order. It has also been submitted by the learned standing counsel appearing for the respondents that even the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench at Bangalore, which has granted some protection to the petitioner during the pendency of the appeal filed under the Central Excise Act, 1944 has not assigned any reason for which the recovery of the amount of penalty had been stayed. He has therefore, submitted that the impugned reasoned order passed by respondent No.1 need not be disturbed as it is a just and proper order. 6. We have heard the learned advocates and have perused the impunged order as well as the order passed on reassessment by the Commercial Tax Officer, Medak. We have also perused the order dated 27-02-2006 passed by Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench at Bangalore, by virtue of which recovery of penalty has been stayed during the pendency of an appeal filed before the said Tribunal. 7. Upon perusal of the impugned order as well as the order passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench at Bangalore, prima facie, we find that there was an attempt on the part of the petitioner to evade excise duty and sales tax. Only upon detection of the said fact by Anti-evasion Team of Central Excise, Hyderabad-I Commissionerate, the order of reassessment dated 22-10-2008 had been passed by the Commercial Tax Officer, Medak. 8. For the aforestated reasons, in our opinion, the order of penalty prima facie appears to be just. Further, in view of the fact that Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench at Bangalore has afforded some protection to the petitioner on payment of some penalty under the provisions of the Central Excise Act, 1944, we take lenient view and direct the petitioner to pay 75% of the disputed penalty within six weeks from today. Upon payment of the said amount, no coercive action shall be taken against the petitioner for recovery of the balance amount of penalty till the appeal is finally disposed of. If any amount of penalty has already been paid by the petitioner, the said amount shall be given credit to. 8. In view of the above order, the petition stands disposed of as allowed to the above extent with no order as to costs. ANIL R. DAVE, CJ RAMESH RANGANATHAN, J 15th July, 2009 ks Note: Furnish copy in two days. B/O ks