HONOURABLE SRI JUSTICE GODA RAGHURAM AND HONOURABLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION No. 19753 OF 2009 DATED 23rd SEPTEMBER, 2009 Between M/s. Kandukuri Silks & Readymades Nellore, rep. By its Proprietor Sri IV Vijaya Bhaskara Rao …Petitioner and The Commercial Tax Officer, No.II Circle Nellore, and, others. …Respondents. HONOURABLE SRI JUSTICE GODA RAGHURAM AND HONOURABLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION No. 19753 OF 2009 ORDER: (Per Hon’ble Sri Justice Goda Raghuram) By the impugned order, dated 21/7/2009, the third respondent rejected the revision preferred by the petitioner. The petitioner is a dealer in readymades etc and an assessee on the rolls of the first respondent, under the AP VAT Act,2005 (for short ‘the Act’). The first respondent by assessment proceedings dated 10- 07-2008 determined the tax payable at Rs.4,99,080/- while disallowing Input Tax Credit to the extent of Rs.4,30,060/- for the period from 1-09- 2006 to 31-3-2008, under the Act. The petitioner preferred an appeal to the second respondent, which authority by an order dated 28-05- 2009 dismissed the appeal. The petitioner has preferred a further appeal to the Sales Tax Appellate Tribunal, which is pending. The first respondent by the order dated 19-12-2008 levied penalty of Rs.1,33,264/- and interest of Rs.64,693/-, altogether amounting to Rs.1,97,957/-. Against this order, the petitioner preferred an appeal before the second respondent which was dismissed by the said respondent by the order dated 30-5-2009. The petitioner preferred an appeal there against to the Sales Tax Appellate Tribunal. During the pendency of the appeal before the second respondent, the petitioner applied and was granted stay of collection of the disputed tax by the third respondent on condition that the petitioner deposits 50% of the balance disputed tax, a condition complied with by the petitioner (Para 6). After filing an appeal to the STAT, the petitioner petitioned the third respondent seeking stay. The third respondent has now rejected the petition seeking stay of collection of the disputed penalty and interest pending disposal of the appeal by the Sales Tax Appellate Tribunal and that is the order impugned in this Writ Petition, as already stated. Provisions of Section 31(3) of the AP VAT Act, 2005 are relevant and read as under: 31(3)(a): Where an appeal is admitted under sub-Section (1), the appellate authority may, on an application filed by the appellant and subject to furnishing of such security or on payment of such part of the disputed tax within such time as may be specified, order stay of collection of balance of the tax under dispute pending disposal of the appeal: (b) Against an order passed by the appellate authority refusing to order stay under clause (a), the appellant may prefer a revision petition within thirty days from the date of the order of such refusal to the Additional Commissioner or the Joint Commissioner who may subject to such terms and conditions as he may think fit, order stay of collection of balance of the tax under dispute pending disposal of the appeal by the appellate authority; (c) Notwithstanding anything in clause (a) or (b), where a VAT dealer or TOT dealer or any other dealer has preferred an appeal to the Appellate Tribunal under Section 33, the stay, if any, ordered under Clause (b) shall be operative till the disposal of the appeal by such Tribunal, and, the stay, if any ordered under Clause (a) shall be operative till the disposal of the appeal by such Tribunal, only in case where the Additional Commissioner or the Joint Commissioner on an application made to him by the dealer in the prescribed manner, makes specific order to that effect.” In view of the provision of Section 31(3)(c) of the Act, and as the third respondent had earlier granted stay pending the petitioner’s appeal before the second respondent, such stay enures till the disposal of the appeal pending before the STAT. Therefore, the rejection of stay by the order impugned cannot be sustained. The Writ Petition is accordingly allowed, the order dated 21-07- 2009 passed by the third respondent is set aside and it is declared that the collection of the disputed penalty and interest, in all amounting to Rs.1,97,957/- for the period 1-09-2006 to 31-3-2008 under the provisions of the AP VAT Act,2005 is stayed pending disposal of the further appeal preferred by the petitioner to the STAT. There shall be no order as to costs. ----------------------------- JUSTICE GODA RAGHURAM ------------------------------------ JUSTICE RAMESH RANGANATHAN Dated 23rd September, 2009 Msnr.