IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE TWENTY FIRST DAY OF FEBRUARY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI & THE HON'BLE MS JUSTICE G.ROHINI WRIT PETITION NO : 3611 of 2008 Between: M/s.Victory Minerals, Dhone. Kurnool Dist., Rep by its Managing Partner, Mr.K.Lakshmikantha Reddy. ..... PETITIONER AND 1 The Assistant Commissioner (CT) (INT) Wing, Kurnool. 2 The Appellate Deputy Commissioner(CT) (FAC), kurnool 3 Commercial Tax Officer-III, Kurnol 4 The Manager, ICICI Bank Limited, Kurnol, Kurnool Branch. .....RESPONDENTS 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 Writ of Mandamus or any other appropriate writ or order or direction, declaring the action of the 3rd respondent in issuing garnishee notice without even before receiving the stay rejection proceedings of the 2nd respondent as arbitrary, contrary to the provisions of the Act and against the weight of evidence and probabilities of the petitioner's case and in violation of principles of natural justice and consequently grant stay of collection of disputed demand of Rs.3,12,325/- for the period December 2005 to October 2006, pending disposal of the appeal before the 2nd respondent and pass such other order or order as the Hon'ble Court may deem fit and proper in the circumstances of the case. Counsel for the Petitioner: SRI SHAIK JEELANI BASHA Counsel for the Respondents.: SPECIAL STANDING COUNSEL FOR COMMERCIAL TAX The Court made the following : HONOURABLE MRS. JUSTICE T.MEENA KUMARI & HONOURABLE MS JUSTICE G. ROHINI WRIT PETITION No:3611 OF 2008 ORDER: (Per Hon’ble Smt. Justice T. Meena Kumari) The present writ petition is filed by the petitioner seeking to declare the action of the 3rd respondent in issuing garnishee notice without even before receiving the stay rejection proceedings of the 2nd respondent as arbitrary and in violation of principles of natural justice and consequently, to grant stay of collection of the disputed demand of Rs.3,12,325/- for the period from December 2005 to October 2006, pending disposal of the appeal before the 2nd respondent The main grievance of the petitioner is that challenging the assessment order passed by the 1st respondent, the petitioner has preferred appeal before the 2nd respondent. Along with the appeal, the petitioner also filed stay application. But the 2nd respondent rejected the stay application. Meanwhile, the 3rd respondent has issued the garnishee notice to the 4th respondent. Having aggrieved by the same, the present writ petition has been preferred. Heard the learned Counsel appearing for the petitioner and the learned Special Standing Counsel for Commercial Tax and perused the material available on record. It is the contention of the learned Counsel for the petitioner that an appeal has been preferred before the 2nd respondent and the petitioner has already paid 12.5% of the disputed tax and at this juncture, the 2nd respondent is not justified in rejecting the stay application. It is further contended that taking advantage of the rejection of stay, the issuance of the garnishee notice is contrary to law and therefore, the impugned garnishee notice is liable to be set aside. In the facts and circumstances of the case and in view of the pendency of the appeal before the 2nd respondent, without expressing any opinion on the merits of the case, We feel it a fit case wherein stay can be granted, but subject to imposition of certain conditions. At this stage, it is the contention of the learned Counsel for the petitioner that if the garnishee notice is not revoked, it is much difficult to operate the account to meet the regular transactions and also to comply with the order of this Court. In view of the above submission, We deem it appropriate to revoke the garnishee notice so as to enable the petitioner to continue the operation of the account and comply with the conditions that would be imposed while granting stay by this Court. Accordingly, the impugned garnishee notice be revoked. There shall be interim stay of recovery of the disputed tax till the disposal of the appeal pending before the 2nd respondent subject to the condition of the petitioner depositing 50% of the disputed demand on or before 31st March, 2008. However, it is made clear that the amount paid if any, shall be given credit to the above stipulated sum. It is further made clear that in case of non- compliance of the above order, the garnishee notice becomes operative. Subject to the above direction, the writ petition is disposed of. No order as to costs. ________________________ Justice T. Meena Kumari _________________ Justice G. Rohini Date: 21st February, 2008 Nn/Gurc. HONOURABLE MRS. JUSTICE T.MEENA KUMARI & HONOURABLE MS JUSTICE G. ROHINI WRIT PETITION No:3611 OF 2008 (Order delivered by the Hon’ble Smt. Justice T. Meena Kumari) 21/02/2008