IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE ELEVENTH DAY OF AUGUST TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI AND THE HON'BLE MR JUSTICE P.V.SANJAY KUMAR WRIT PETITION NO : 7576 of 2008 Between: Sri Venkateshwara Commercial Corporation, Ponnur, Guntur District, Rep by its Partner, Mr. K. Venkata Srinivasa Rao ..... PETITIONER AND 1 The Commercial Tax Officer, Bapatla, Guntur District. 2 The Dy. Commercial Tax Officer, Mangalagiri, Guntur District. .....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 an appropriate writ, order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the 1st respondent in passing the impugned assessment order dated 14-12-2007 in Form VAT 305 in levying tax under AP VAT Act, tax under the CST and Penalty by a common order as illegal, arbitrary, without authority of law and jurisdiction, violation of principles of natural justice and set aside the same and also declare that no tax can be levied on the turnover of consignment sales covered by Sale Patties and F-Forms as the same is exempt under Section 6A of the CST Act and also declare that no tax can be levied on the turnover of closing stocks and pass Counsel for the Petitioner: MR.BHASKAR REDDY VEMIREDDY Counsel for the Respondent No.: GP FOR COMMERCIAL TAX The Court made the following : ORAL ORDER: (per THE HON’BLE MRS. JUSTICE T.MEENA KUMARI) Seeking a writ of mandamus declaring action of the respondent in passing a composite Assessment Order dated 14.12.2007 in Form VAT 305 levying tax under the AP VAT Act and C.S.T. Act as illegal and arbitrary and consequently to set aside the same, the present writ petition is filed. The petitioner is a partnership firm carrying on business in purchase and sale of pulses and is a registered dealer under the provisions of A.P. VAT Act and C.S.T. Act and an assessee on the rolls of the first respondent. The petitioner herein has reported the turnover of consignment sales on receipt of confirmation that the goods were sold and the sale patties and F-Forms were filed before the first respondent on 6.9.2007. While so, the second respondent has inspected the business premises of the petitioner on 11.9.2007 and issued show cause notice in Form VAT 305A dated 5.11.2007, proposing to assess the petitioner for the period from 1.4.2005 to August, 2007 and also proposed to levy tax on the ground that there were no physical stocks towards closing stock as on 31.8.2007. Though the petitioner submitted detailed objections to the show cause notice on 5.11.2007 with relevant records, the second respondent has confirmed the levy through order dated 14.12.2007 raising a demand of Rs.2,27,487/- for the tax period from 2005-06 to 2007-2008 apart from penalty of Rs.22,748/-. It is contended by the learned counsel for the petitioner that the respondents have no power to pass a composite Assessment Order for three years under both the A.P.G.S.T. Act and the Central Sales Tax Act and, hence, the impugned order is liable to be set aside and drew attention of this court to Sec.2(36) of the A.P. V.A.T. Act, which defines Tax Period. The learned Special Standing Counsel for the Commercial Taxes contends that Section 21 of the A.P. Value Added Tax Act, 2005 empowers the Authority to assess the defaulting dealer for the said period for such default. Learned Special Standing Counsel further placed reliance on Rule 25 in support of his contention that the authority is empowered to assess the dealer unilaterally for the tax payable by the assessee. Reliance is further placed on Rule 25(5) to contend that when an assessee suppresses turnover and files incorrect returns, the Authority shall assess the tax payable to the best of his judgment in Form VAT 305 after affording an opportunity to the dealer for the defaulting period. Section 2(36) of the AP VAT Act defines Tax Period to mean a calendar month or any other period, as may be prescribed. In view of the fact that the Act itself prescribes the tax period as a calendar month, without adverting to merits or otherwise of the contentions raised, we are of the opinion that the writ petition can be disposed of directing the authority to resolve the issue after affording an opportunity of hearing to the petitioner by passing three separate orders for the disputed Assessment years. Accordingly, the impugned order dated 14.12.2007 is set aside and the matter is remanded back to the first respondent for passing orders afresh, in accordance with law and the petitioner is given liberty to raise all the objections and pleas which are raised in this writ petition and the respondents are directed to complete the entire exercise as early as possible preferably within a period of six moths from the date of receipt of a copy of this order. With this direction, the writ petition is allowed. No order as to costs. ____________________ Justice T.Meena Kumari ______________________ Justice P.V. Sanjay Kumar August 11, 2008 MAS ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1.2CCs to 2.2CD copies Form-NIC-OGS/WP{RLD}