IN THE HIGH COURT OF JUDICATURE ANDHRA PRADESH AT HYDERABAD. THURSDAY, THE TWENTYFIFTH DAY OF MARCH TWO THOUSAND AND TEN P R E S E N T: THE HONOURABLE SMT. JUSTICE T. MEENA KUMARI AND THE HONOURABLE SRI JUSTICE SANJAY KUMAR WRIT PETITION No. 6 4 8 1 OF 2010 Between : M/s. Ashoka Industries, Industrial Area, Maheshwaram, Narsampet Mandal, Warangal District-506 132 Represented by its Partner, Sri S. Ramanjaneyulu. … Petitioner V/ s. The Assistant Commissioner (CT) (Intelligence) Warangal Division, Warangal district & Anr. … Respondents Counsel for the Petitioner: Sri Shaik Jeelani Basha & Sri M.V.Pavan Kumar Counsel for the Respondents: GOVT.PLEADER FOR COMMERCIAL TAX THE HONOURABLE SMT. JUSTICE T. MEENA KUMARI AND THE HONOURABLE SRI JUSTICE NOOTY RAMA MOHAN RAO WRIT PETITION No. 6 4 8 1 OF 2010 O R D E R : (Per the Hon’ble Smt.Justice T.Meenakumari) This writ petition is filed seeking mandamus to grant stay of collection of disputed penalty of Rs.11,10,552-00 for the period from 01-4-2005 to 30-6-2005 pending disposal of the appeal before the Sales Tax Appellate Tribunal, pursuant to the orders dated 03-8- 2009 passed by this Court in WP.No.18275 of 2008 and to pass such other suitable orders as this Court may deems fit and proper in the circumstances of the case. 2. The facts of the case are that the petitioner is a partnership concern carrying on business in paddy and it is having a Rice Mill. The petitioner is a registered dealer on the rolls of the Assistant Commissioner (CT) (Intelligence) and LTU, Warangal Division, Warangal under A.P. Value Added Tax Act. The assessing authority had inspected the business premises of the petitioner on 14-11-2005 in connection with VAT audit and at the time of the said audit the petitioner had filed purchase details corresponding to input tax of Rs.5,55,276-00 claimed in VAT returns for the tax period from 01-04-2005 to 30-06-2005 and as the purchases were found to be suspicious consequent on brief check of the genuineness of the TIN numbers of the selling dealers using computer data base available in the office and accordingly issued notice dated 22-11-2005 proposing to reject the input tax credit claim of the petitioner. Pursuant to the said notice, the petitioner filed its detailed objections on 14-11-2007 against the show cause notice dated 20-8-2008 and initially against the rejection of input tax credit the petitioner had also filed its objections by way of representation on 09-1-2006 against the earlier notice dated 22-11-2005. It is stated that against the said show cause notice issued by the first respondent in levying of penalty under section 55 (2) of the AP VAT Act holding that the claim of input tax credit on false transactions knowing to be false and relying upon those documents in support of the claim of the petitioner and thereafter it was proposed to levy penalty of Rs.11,10,552-00 i.e., equivalent to 200% of the input tax credit claimed by the petitioner. But however, the first respondent without considering the detailed objections of the petitioner dated 14-11-2007 had confirmed the proposed penalty by proceedings dated 06-6-2008. 3. Aggrieved by the orders of the first respondent in levying penalty, the petitioner filed appeal and stay application before the second respondent and the second respondent rejected the stay application through proceedings dated 30-7-2008. Assailing the same, the petitioner filed WP.No. 18275 of 2008 and this court on 22-08-2008 while disposing of the above writ petition was pleased to grant stay of collection of the disputed penalty on condition of payment of 25% of the disputed penalty and accordingly, the petitioner complied with the orders of this court and however in the meanwhile the second respondent dismissed the appeal by proceedings dated 14-11-2008 without considering all the contentions raised by the petitioner. 4. Aggrieved by the orders of the second respondent, the petitioner preferred an appeal before the Sales Tax Appellate Tribunal on 18-5-2009 and the same is pending adjudication before the Sales Tax Appellate Tribunal and in the meanwhile, the first respondent is threatening to take coercive steps to recover the disputed penalty in view of the dismissal of the orders of the second respondent. Hence, the petitioner craves leave of this court to extend the stay granted by this court till the appeal is pending disposal by the Sales Tax Appellate Tribunal. Hence, the writ petition. 5. It is submitted by the learned counsel for the petitioner that though several contentions were raised before the second respondent, the second respondent without considering the fact has dismissed the appeal through proceedings dated 14-11-2008 without considering the contentions raised by the petitioner. It is submitted that pursuant to the dismissing of appeal by the second respondent, the first respondent is contemplating to take coercive steps for recovery of the disputed penalty of Rs.11,10,552-00. 6. Heard the learned counsel for the petitioner and the learned Special Standing Counsel for Commercial Taxes. 7. In the facts and circumstances of the case, we are of the opinion that the writ petition can be disposed of at the stage of admission directing the petitioner to deposit 25% of the disputed penalty within a period of six weeks from the date of receipt of a copy of the order, and the first respondent is directed not to take coercive step for collection/recovery of the disputed penalty of Rs.11,10,552-00, pending finalisation of the appeal by the Sales Tax Appellate Tribunal. However, the deposit of amount shall be without prejudice to the rights of the petitioner in appeal. If any amount has already been paid by the petitioner, the same shall be given credit. 8. With these directions, the writ petition is disposed of. No order as to costs. _____________________ JUSTICE T. MEENA KUMARI ____________________________ JUSTICE NOOTY RAMA MOHAN RAO 25-III-2009. I s L THE HONOURABLE SMT. JUSTICE T. MEENA KUMARI AND THE HONOURABLE SRI JUSTICE NOOTY RAMA MOHAN RAO WRIT PETITION No. 6 4 8 1 OF 2010 ORDER of the Division Bench delivered by the Hon’ble Smt.Justice T.Meenakumari Circulation Entry No. 5 3 Computer No.43 Court Master: I s L Date: 25-III-2010