THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE G.V.SEETHAPATHY W.P.NO.27643 OF 2009 21-12-2009 BETWEEN; M/s Hindustan Petroleum Corporation Limited, Secunderabad, rep. By its Senior Manager-Finance ...Petitioner vs. The Assistant Commissioner, CT LTU, Hyderabad and three others. ...Respondents THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE G.V.SEETHAPATHY W.P.NO.27643 OF 2009 ORAL ORDER: (Per GR,J) The petitioner is aggrieved by the garnishee notice dated 09.12.200 issued under Section 29 of the A.P. VAT Act, 2005 ( for short “ 2005 Act by the 1st respondent to the 4th respondent with whom the petitioner has bank account, calling upon the 4th respondent to pay, inter alia an amount of Rs.1,49,38,609/- towards the tax liability of the petitioner fo the period 2005-06 . The petitioner a registered dealer on the rolls of the 1s respondent under the provisions of the 2005 Act as well as the CST Ac 1956 is an oil company having a refinery at Visakhapatnam. It is engage in the business of refining of crude and marketing of various petroleum products. The petitioner filed its returns for the period 2005-06 and 2006 07. An inspection was conducted by the Additional Commissioner alon with the territorial Deputy Commissioner and the 1st respondent an thereafter a notice dated 14-11-2007 issued by the 1st responden pursuant to the inspection proposing assessment on a best judgmen basis. The petitioner filed its response on 14-01-2008 objecting to th several proposals set out in the show cause notice. However, an order o assessment in Form 305 was passed on 07-02-2008. Levy of licence fee on delivery assistance charges; disallowance of input tax credit for belate claim and input tax credit disallowance under Rule 20 led to a demand o tax. Against the order of assessment, the petitioner preferred an appea before the 2nd respondent and for doing so paid 12.5% of the disputed tax The petitioner also preferred an application for grant of stay. Stay wa declined by the 2nd respondent by the order dated 16-04-2008. A revisio thereagainst preferred to the 3rd respondent was also rejected, by th order dated 23-06-2008. Thereupon, the 3rd respondent issued garnishee notice dated 26-06-2008 to the APSRTC demanding paymen of the tax due and payable by the petitioner. Aggrieved by the garnishee notice, the petitioner preferre W.P.No.14121 of 2008. This Court by the order dated 03-07-200 disposed of the writ petition granting stay of collection of the disputed ta pending disposal of the appeal before the 2nd respondent, o condition that the petitioner pays 50% of the disputed tax after taking cred for the pre-deposits or other payments made if any. The petitioner plead to have complied with the conditional order. The 2nd respondent by the order dated 22-07-2009 dismissed th appeal. Aggrieved thereby, the petitioner preferred a further appeal befor the Sales Tax Appellate Tribunal (STAT). As the 3rd respondent ha earlier rejected grant of stay the petitioner is again before this Cou seeking stay pending its further appeal before the STAT. As the petitioner’s substantive appeal is pending before the STAT, would be inappropriate for this Court to record a pronouncement on th several contentions of the petitioner with regard to the validity of the orde of the 2nd respondent rejecting the appeal or in the order of the 1s respondent rejecting the claims including the claims to the benefits of inpu tax credit, asserted by the petitioner. Suffice it to record that the petitione has an arguable case to present in the further appeal before the STAT an the petitioner has already paid 50% of the disputed tax pursuant to th order of this Court dated 03-07-2008 in W.P.No.14121 of 2008. Th petitioner is also an instrumentality of the Union and the learned Specia Standing Counsel for Commercial Taxes for the respondents does no assert that the petitioner’s liquidity is doubtful. In the circumstances, interests of justice warrant that the respondent are directed not to initiate any coercive steps against the petitioner fo recovery of the balance tax due for 2005-06, 2006-07 pending th petitioner’s appeal before the STAT. The eventual liability of the petitione will depend upon the outcome of the appeal in the decision of the STAT The garnishee notice dated 09-12-2009 issued under Section 29 of th 2005 Act insofar as it pertains to the demand for payment o Rs.1,49,38,609/- to the tax period 2005-06, 2006-07, is quashed. Ther shall however be no stay or interdiction with regard to the garnishee notic for the other periods as enumerated in the notice dated 09-12-2009 issue by the 1st respondent to the 4th respondent. The writ petition is accordingly disposed of at the stage of admissio after hearing Sri S.R. Ashok, the learned Senior Counsel instructed by S S.Dwarakanath, the learned counsel for the petitioner and Sri P.Bala Varma, the learned Special Standing Counsel for Commercial Taxes fo respondents. No costs. ______________ GODA RAGHURAM,J ______________ G.V.SEETHAPATHY,J 21st DECEMBER 2009 Note. Issue CC As soon as possible (B/O) TSNR