IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD THIS THE 27th DAY OF AUGUST, TWO THOUSAND AND ELEVEN PRESENT HON’BLE SRI JUSTICE A.GOPAL REDDY AND HON’BLE SRI JUSTICE RAJA ELANGO T.R.E.V.C.No.10 of 2011 Between: M/s.A.L.Sudershan Construction Co. Limited, rep. by its Company Secretary, L.Kaladhar Reddy … Petitioner And State of Andhra Pradesh, rep. by its State representative. … Respondent This Court made the following: HON’BLE SRI JUSTICE A.GOPAL REDDY AND HON’BLE SRI JUSTICE RAJA ELANGO T.R.E.V.C.No.10 of 2011 ORDER: - (Per Hon’ble Sri Justice A.GOPAL REDDY) This revision petition under Section 22(1) of the Andhra Pradesh General Sales Tax Act, 1957 (for brevity, “the Act”), by a dealer registered under the provisions of the Act, are directed against the orders of the Sales Tax Appellate Tribunal, Hyderabad, dated 16.02.2010, in T.A.Nos.650 and 651 of 2007. 2. The brief facts leading to the disposal of this revision case is stated as follows:- The petitioner was a dealer engaged in works contract and registered under the provisions of the Act and is an assessee under the rolls of Commercial Tax Officer, Hissamgunj Circle, Secunderabad. In the course of its business activities, it undertakes various civil construction works as a competitive price quoted by it for the execution of the entire work, which in the sales tax parlance is termed as a works contract, and the consequence insofar as the Act is concerned, is when the dealer like the petitioner executes a works contract, the value of the taxable goods involved in the execution of the works contract attracts tax liability under the provisions of the Act and the machinery for determination of the tax liability is set in motion and quantified, and the dealer called upon to pay the corresponding tax. The petitioner dealer, who was assessed by the Commercial Tax Officer for the years 1995-96 and 1996-97 by proceedings, dated 21.12.1998 and 30.03.2000, was granted exemption on the turn overs of Rs.4,12,75,761/- and Rs.4,97,01,853/- respectively on the turnovers pertaining to salaries paid to staff, amounts spent on consumables like petrol, diesel and other oils and also the amount representing royalty and seigniorage and transportation charges. The Deputy Commissioner (CT), Secunderabad Division, Hyderabad by proceedings, dated 25.03.2002 revised the order of the Commercial Tax Officer exercising the power under Section 20(2) of the A.P.G.S.T.Act. The petitioner challenged the same before the Sales Tax Appellate Tribunal in T.A.Nos.440 of 2004 and 1151 of 2003 respectively. The said appeals were allowed and the matters were remanded to the Deputy Commissioner for passing fresh orders through proceedings, dated 25.11.2004. On such remand, the Deputy Commissioner by separate proceedings, while rejecting the objections filed by the petitioner, confirmed the levy by separate proceedings, dated 16.05.2005, holding that the assessee is not eligible for exemption under Rule 6(2) of the A.P.General Sales Tax Rules, 1957 (for brevity, “the Rules”) and liable to tax under Section 5(f) of the Act including the amounts which were given exemption by the Commercial Tax Officer viz., the salaries paid to staff, amounts spent on consumables like petrol, diesel and other oils and also the amount representing royalty, seigniorage and transportation charges. On appeals being filed by the petitioner viz., T.A.Nos.650 and 651 of 2007, the Sales Tax Appellate Tribunal by the impugned order dismissed the appeals confirming the order of the Deputy Commissioner. Hence, the present revision. Sri S.Dwarakanath, learned counsel for the petitioner, contends that Rule 6(2) of the Rules is not exhaustive but only illustrative. The salary paid to supervisory staff falls under the cost of establishment under Rule 6(2)(f). Therefore, the turn over relating to the salaries of the supervisory staff should be allowed as a deduction under Rule 6(2)(f). The inclusion of turnover relating to royalty, seignorage and transportation charges is taxable turnover as per the ratio laid down by the High Court in B.Seenaiah and Company in 124 STC 248, which is distinguishable to the facts of the case. He further contends that the judgment of the Tribunal in Stanes Tyres & Rubber Products Limited reported at 18 APSTJ 216, wherein petrol, diesel and other oils are used for processing of bitumen and in maintenance of machinery as lubricants, is not applicable to the facts of the case. On the other hand, Sri A.V.Krishna Koundinya, learned counsel for the respondents contends that Rule 6(2)(f) is applicable to the extent it is related to the supply of labour and services. Therefore, the said Rule cannot be expanded to cover the turnover relating to the salaries paid to the supervisory staff. The appellate Tribunal rightly rejected the appeals as the petitioner failed to submit any documentary evidence to show that the turn over relates only to the salaries paid to the supervisory staff, which does not give rise to a question of law. The T.R.E.V.C. can be entertained under Section 22(1) of the Act, where the appellate Tribunal decided the appeal erroneously or failed to decide any question of law. Hence, the present T.R.E.V.C. is not maintainable and is liable to be dismissed. Then remains the only question as to whether the petitioner is entitled to deduction under Rule 6(2)(f) of the Rules viz., the cost of establishment of the contractor to the extent it is relatable to supply of labour and services, which includes salaries paid to supervisory staff, or not? The Tribunal found that the petitioner failed to produce any documentary evidence to show that the said supervisory staff were engaged to supervise the execution of the works contract only. In the absence of any such evidence adduced by the petitioner, the Tribunal rightly disallowed exemption of the turnover relating to the salaries paid to the supervisory staff, as the same does not fall under Rule 6(2)(f) of the Rules. Since there is no question of law involved, the revision is not maintainable. The T.R.E.V.C. is, accordingly, dismissed. There shall be no order as to costs. _____________________ A. GOPAL REDDY, J ___________________ RAJA ELANGO, J 27 - 08 - 2011 lmv HON’BLE SRI JUSTICE A.GOPAL REDDY AND HON’BLE SRI JUSTICE RAJA ELANGO T.R.E.V.C.Nos.10 of 2011 - 08 - 2011 lmv