IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE NINETEENTH DAY OF FEBRUARY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI and THE HON'BLE MS JUSTICE G.ROHINI WRIT PETITION NO : 21276 of 2007 Between: Cyber Automobiles Pvt.Ltd., D.No.22-235, Aruna Co.operative Society, Bhagyanagar Colony, Opp:KPHB, Kukatpally, Hyderabad-72, represented by its Director Sri U.Parthasarathi. ..... PETITIONER AND Assistant Commissioner (CT) Audit, VAT Management Unit-II, Hyderabad (Rural) Division, Hyderabad. .....RESPONDENT 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, order or direction, more particularly in thenature of writ of certiorari and quash the order of assessment dt.25-7-2007 passed by the Asst.Commissioner (CT) Audit, VAT Management Unit-II, Hyderabad (Rural) Division, Hyderabad and pass suchother order or orders as this Hon'ble Court may deem fit and proper in the circumstances of the case. Counsel for the Petitioner:MR.S.CHAKRAPANI Counsel for the Respondent No.: GP FOR COMMERCIAL TAX The Court made the following : THE HON'BLE MRS JUSTICE T.MEENA KUMARI and THE HON'BLE MS JUSTICE G.ROHINI WRIT PETITION NO : 21276 of 2007 ORDER : (Per Hon’ble Smt. Justice T. Meena Kumari) In this writ petition, the petitioner seeks for a Writ of Certiorari to quash the order of assessment dated 25.7.2007 passed by the Assistant Commissioner(CT), Audit, VAT Management Unit-II, Hyderabad (Rural Division), Hyderabad, the respondent herein and to pass such other orders. The petitioner, which is a company engaged in the business of purchase and sale of automobile parts at Kukatpally, is a registered dealer on the rolls of the respondent. For the assessment year 2005-06, the petitioner filed the returns under A.P.VAT Act declaring turnover in a sum of Rs.7.44 crores and paid tax thereon. According to the petitioner, around 90% of the purchases of the petitioner were from dealers within the State while the remaining 10% was from the dealers outside the State. Thus, the tax on the first sale point had already been paid by the first seller within the State and it is only in respect of value addition that the petitioner is exigible to tax. While so, the respondent on verification of the records found that the petitioner has not disclosed the correct turnover and input and output taxes to the department and not paid the taxes which are legitimately due to the department. The respondent, therefore, issued a notice dated 23.9.2006 to the petitioner calling upon it to file its objections along with documentary evidence, if any, within seven days from the date of receipt of the notice, failing which, he informed that necessary orders would be passed without any further notice in the matter. While denying the allegations, the petitioner submitted its explanation to the said show cause notice. In the said explanation, the petitioner submitted that except U. Parthasarathi, Cyber Automobiles and Venkateshwarlu, rest of the people mentioned in page-2 of the show cause notice are in no way connected with the petitioner-company and its directors. Even the remittances and withdrawals found in the accounts of U. Parthasarathi and Venkateshwarlu, have nothing to do with the business of Cyber Automobiles and on the contrary they are traceable to online remittances made by the constituents of Venkateshwarlu and U. Parthasarathi, either on account of land deals or otherwise. Petitioner states that it is not involved in any clandestine business and on the basis of the purported remittances and withdrawals, the respondent passed the impugned assessment order. Further, there was no material on record to show that the petitioner indulged in clandestine business. Petitioner further alleged that the show cause notice did not contain any material with regard to remittances to any automobile dealer for purchase of the goods outside the books of accounts, but for the first time, the same was mentioned in the assessment order, as a result, the petitioner could not file any material to rebut the said charge and the same is violative of principles of natural justice. Hence, he filed the present writ petition seeking appropriate directions. Learned counsel for the petitioner submitted that the petitioner did not indulge itself in any kind of clandestine business and the remittances and withdrawals in the accounts of U. Parthasarathi and Venkateshwarlu relate to real estate business being carried on by U. Parthasarathi and Venkateswarlu and the same has nothing to do with the petitioner. He further submitted that since the account runs on online basis, some of the friends used to request the petitioner to arrange outside remittances through the said account and the petitioner also used to oblige them out of their friendship and stated that the none of the remittances or withdrawals are referable to purchase of any material. He further contended that the respondent while passing the assessment order has relied on some new material, the details of which have not been furnished to the petitioner, as a result, the petitioner was deprived of submitting a proper explanation to rebut the said charge. Admittedly, in the show cause notice the respondent did not furnish the details of remittances or withdrawals. However, only in the impugned assessment order, the respondent furnished the details of such remittances. In view of the fact that the show cause notice did not contain the details of the remittances or withdrawals and in view of the fact that the respondent passed the impugned order without affording any opportunity to the petitioner to file necessary additional evidence to rebut the allegations levelled against it, in the interest of justice, we feel it appropriate to remit the matter back to the respondent-assessing authority for passing appropriate orders afresh subject to the condition of the petitioner depositing certain amount. In the circumstances, the writ petition is allowed and the matter is remanded back to the respondent-authority for fresh consideration on condition of the petitioner depositing an amount of Rs. 25.00 lakhs (Rupees Twenty Five Lakhs Only) with the respondent on or before 31.3.2008. On such deposit being made, the respondent shall hear and decide the matter afresh after affording opportunity to the petitioner to adduce necessary additional evidence. ___________________ T. MEENA KUMARI,J DATE: 19th February, 2008 ______________ G. ROHINI, ,J Note: Furnish c.c. in one week. B/o Pnb To 1.The Assistant Commissioner (CT) Audit, VAT Management Unit-II, Hyderabad (Rural) Division, Hyderabad. 2.2CD copies // TRUE COPY // SECTION OFFICER