THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE G.V.SEETHAPATHY WRIT PETITION Nos. 27294, 27297 and 27308 of 2009 Between: M/s Aquamall Water Solutions Limited, rep. by its Chief Financial Officer Mr. S.Ramesh …Petitioner and The Commercial Tax Officer, Sanathnagar Circle, Hyderabad and others …Respondents Common Order: (Per GR, J) These writ petitions involve common issues and are thus considered and disposed of by this common order. The facts in W.P.No. 27294 of 2009 are recorded as representative of the issues arising in these three writ petitions. W.P.No.27294 of 2009: The 2nd respondent by the order impugned dated 30-11-2009 declined grant of stay. The petitioner is a registered dealers under the provisions of the APGST Act, 1957 and the CST Act, 1956 and registered as such on the rolls of the 1st respondent. The petitioner manufactures Water Filters/Purifiers. It has three manufacturing units in Hyderabad (AP), Bhimtal (Uttarakhand) and Bangalore (Karnataka). The goods are claimed to be manufactured on “Stock and Sale” basis and not on “Made to Order” basis. The petitioner asserts that the goods manufactured by it are stock transferred to its various branches in several States from where the goods are being sold. For 2004-05 the 1st respondent issued a show-cause notice dated 13-10-2007 inviting objections from the petitioners against a proposal to bring the turnover to Rs. Rs.40,09,39,657-00 to tax. The petitioners claims to have filed C Forms in original covering the turnover of Rs.2,39,84,938- 00 including CST and claimed a concessional rate of tax at 4%. The petitioner also filed Form F in original covering the turnover of Rs.99,08,957-00 and exemption was sought on this turnover towards Branch Transfers. The 1st respondent verified the Forms C and F filed by the petitioners, allowed exemption on certain portions of the turnover and completed the revised assessment, levying a tax of Rs. 17,29,385-00, by the order of assessment dated 16-2-2008. After this order of assessment, the petitioner by a representation dated 16-2-2008 filed Form C in original covering the turnover of Rs.38,31,832-00 including CST and prayed for a concessional rate of tax of 4% on this turnover as well. It also filed Form H in original covering the turnover of Rs.25,74,028-00 and sought concessional rate of tax and exemption of these turnovers claimed to be Branch Transfers. The 1st respondent completed the revised assessment by levying tax of Rs.17,29,385-00, by the order dated 1-4-2008. The 3rd respondent-revisional authority however set aside the orders of assessment exercising revisional power under Section 20 (2) of the APGST Act, 1957. After a due process that included a show-cause notice dated 10-12-2008, receipt of objections from the petitioners and considering the same, the 3rd respondent by the order dated 29-7-2009 rejected the petitioners claim for exemption on the ground of Branch Transfers and brought the turnover relatable to the claim of Branch Transfers to tax treating these as Inter-State sales. Aggrieved by the order dated 29-7-2009 passed by the 2nd respondent, the petitioners filed an appeal before the Sales Tax Appellate Tribunal on 9-10-2009. The petitioner also applied to the 2nd respondent for grant of stay of collection of the disputed tax. This application was rejected by the impugned order dated 13-11-2009. W.P.No. 27297 of 2009 pertains to theassessment year 2002-03 andW.P.No. 27308 of 2009 to the assessment year 2003-04. These writ petitions involve substantially similar issues and present a similar chronology of facts. Whether the turnover representing the goods transferred to other States, claimed by the petitioners to be Branch Transfers and by the Revenue to be Inter-State sales, fall within one domain or the other, is a matter not exclusively dependent on elucidation of principles of law or the relevant provisions of the Statute, namely, Sections 3,4 and 6A of the CST Act, 1956, but involves analysis of the nature of the transaction, the agreement between the petitioner-manufacturer and M/s Eureka Forbes Limited to whom a predominant component of goods manufactured are meant to be sold and a critical analysis of the relevant facts as to whether the movement of the goods constitutes Inter-State sales or Branch Transfer. It also requires to be noticed that despite the requisition by the revisional authority, the petitioner failed to produce the relevant distribution agreement between itself and M/s Eureka Forbes Limited for which demonstrably 94 per cent of the goods are manufactured by the petitioner. In any event, the petitioner and the Revenue are seen to have eminently an arguable positions to assert before the Sales Tax Appellate Tribunal, before whom the petitioners’ appeals against the several revisional orders are pending. In the circumstances, this Court considers it appropriate in the interest of justice, to direct that on the petitioner depositing 50 per cent of the total amount due as per the orders of the revisional authority (after taking credit for the amount already deposited including by way of pre- deposits while preferring appeals before the Sales Tax Appellate Tribunal), within a period of eight (8) weeks from today, the respondents shall forbear from taking any coercive steps to recover the balance tax due, pending the disposal of the appeal by the Sales Tax Appellate Tribunal. In default by the petitioner in the matter of deposit and within the time stipulated herein, the stay granted herein shall be considered as dissolved and the Revenue would be at liberty to recover the entire tax liability. The writ petitions are disposed of as above, after hearing the learned counsel for the petitioners and Sri A.V.Krishna Koundinya, the learned special standing counsel for Commercial Taxes. There shall be no order as to costs. _________________________ GODA RAGHURAM, J ____________________________ G.V.SEETHAPATHY, J 15th December, 2009. Note: Issue copy in two days. /B.O/ GRR