IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE THIRTEENTH DAY OF MARCH TWO THOUSAND AND NINE PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI and THE HON'BLE MR JUSTICE C.V.NAGARJUNA REDDY WRIT PETITION NO : 5110 of 2009 Between: Nikhil Refineries Private Limited, a company incorporated under the Companies Act,1956,having its registered office at 1-8-663, Azamabad Industrial Area,Hyderabad-500020 Andhra Pradesh, rep.by its Director Sri Kailash Chandra Agarwal, S/o.Sri Banwarilal Agarwal, aged around 45 years Resident of Hyderabad. ..... PETITIONER AND 1 The Assistant Commissioner of Commercial Taxes, Large Tax Payers Unit, Kakinada. 2 The Appellate Deputy Commissioner, Commercial Taxes, Visakhapatnam. 3 The Joint Commissioner (CT) Legal, Hyderabad. 4 State Bank of Hyderabad,Industrial Finance Branch Ameerpet, Hyderabad, Andhra Pradesh. 5 State Bank of Indore, 4-1-971,Triveni Complex Abids,Roads, Hyderabad, GPO,Hyderabad-500001. 6 State Bank of Mysore, 1-7-265-274,SD Road Secunderabad, Andhra Pradesh-500003 7 State Bank of Hyderabad, 6-3-448,Panjagutta, Hyderabad. 8 State Bank of Mysore, 21-50/1,Hosipital Complex Bahanugudi Centre, Kakinada .....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 to issue an appropriate writ direction or order especially in the nature of writ of mandamus directing the 3rd respondent to dispose of the stay petition filed by the petitioner dated 9.3.2009 and pass such other orders. Counsel for the Petitioner:MR.S.RAVI Counsel for the Respondent Nos.1 to 3: GP FOR COMMERCIAL TAX The Court made the following : THE HON'BLE SMT. JUSTICE T.MEENA KUMARI and THE HON'BLE SRI JUSTICE C.V.NAGARJUNA REDDY WRIT PETITION NO. 5110 OF 2009 ORDER : (Per Hon’ble Smt. Justice T. Meena Kumari) Heard the learned counsel appearing for the petitioner and the learned Government Pleader for Commercial Taxes. In this writ petition, the petitioner-company seeks a direction to the 3rd respondent to dispose of the stay petition filed by the petitioner dated 9.3.2009. The facts in brief are that the petitioner is engaged in the business of importing crude edible oil. According to the petitioner, it refines the crude edible oil in its factory at Kakinada and sells the same in bulk. Petitioner states that for the purpose of payment of Customs Duty, it utilizes licences known as Duty Entitlement Pass Book(DEPB) licences, which are commercially available in the market. According to the petitioner, exporters of goods from India are given DEPB licences as a benefit under the Import Export Policy of the Government of India; that such exporters of goods who have no use in so far as the DEPBs are concerned for import of goods, offer them for sale in the market. When the DEPB is sold, they are liable to Sales Tax. Petitioner states that it is also a purchaser of such DEPB licences. According to the petitioner, on the refined edible oil sold by the petitioner, tax is payable under the VAT Act and in respect of VAT payable by the petitioner, there is input tax credit available to the petitioner and that such input tax credit paid on the DEPB licences purchased by the petitioner in the State of Andhra Pradesh is claimed by the petitioner as a mode of payment of tax under the VAT Act. While so, the 1st respondent issued a notice to the petitioner seeking to deny the benefit of input tax credit. The petitioner submitted a detailed reply to the said on 11.11.2008. However, the 1st respondent while rejecting the claim of input tax on the relevant DEPB purchases, passed reassessment orders directing the petitioner to pay an amount of Rs. 75,22,093/- within 30 days from the date of receipt of the said order. Aggrieved, the petitioner filed an appeal before the 2nd respondent on 22.1.2009. Along with the appeal, it also filed a stay application and paid 12.5% of the disputed tax. The 2nd respondent through order dated 25.2.2009 has rejected the stay application. Petitioner alleges that even before the order of rejection of stay was communicated to the petitioner, the 1st respondent has initiated the process of recovery of the disputed tax amount by giving three days time for payment of the same. The petitioner, thereafter filed an application before the 3rd respondent seeking stay of the order of the 2nd respondent. The grievance of the petitioner is that the 3rd respondent has not passed any orders on the stay application and the same is pending. In the meantime, it appears, the 1st respondent has issued notice of attachment under Section 29 of the VAT Act on 10.3.2009 to the respondents 4 to 8 to pay the balance disputed tax. Hence, the present writ petition. Leaned counsel for the petitioner contends that even when the stay application filed against the order of the 2nd respondent is pending before the third respondent, the 1st respondent issued the impugned garnishee notices contemplating to take coercive steps for recovery of the disputed tax. We have gone through the record. We feel that ends of justice would have been met if stay was granted pending appeal subject to deposit of certain amount. Therefore, we quash the impugned garnishee notices dated 10.3.2009 and direct the petitioner to pay 50% of the disputed tax liability within a period of eight weeks from today. The deposit of the amount shall be without prejudice to the rights of the petitioner in the appeal. If any amount has already been paid by the petitioner, the same shall be given credit to. The Writ Petition is accordingly disposed of. No costs. ___________________ T. MEENA KUMARI,J DATE: 13th March, 2009 _________________________ C.V. NAGARJUNA REDDY,J Note: Furnish c.c. in three days B/o pnb