HON'BLE SRI JUSTICE R. SUBHASH REDDY WRIT PETITION No.2375 of 2011 Date : 09.02.2011 Between : M/s.Sesha Sai Ispat Pvt. Ltd., Madgumpally village, Nalgonda District, rep. by its Director. …..Petitioner And The Government of Andhra Pradesh, rep. by its Secretary, Industries and Commerce Department & others. …..Respondents HON'BLE SRI JUSTICE R. SUBHASH REDDY WRIT PETITION No.2375 of 2011 ORDER : This writ petition is filed, questioning the demand notice, dated 19.05.2010, issued by the 3rd respondent in Notice No.2885/V&E/ S.I.U/2/1/2009, to recover an amount of Rs.21,65,649/-, on the allegation that the petitioner-Unit has evaded royalty on the mineral procured by it. The petitioner-Unit is engaged in the business of manufacturing sponge iron, mild steel ingots and TMT bars. It appears that the Regional Vigilance and Enforcement Officer, Hyderabad Rural Unit, has conducted an inquiry and found illegal transportation of iron ore from border areas of Andhra Pradesh and Karnataka to various sponge iron plants and cement industries. Further, on the ground that the petitioner did not produce any material in proof of payment of royalty on the bills for the period from July 2006 to August 2008, respondents have tentatively come to the conclusion that the petitioner evaded royalty to the tune of Rs.21,65,649/- . Based on the communication sent by the Assistant Director of Mines and Geology, a show cause notice, dated 17.06.2009, was issued to the petitioner in Proceedings No.2885/V&E/S.I.U/II(1)/2009. On receipt of the same, the petitioner herein has made a representation, dated 20.07.2009, requesting to furnish the detailed information for which royalty bills were not submitted to the Regional Vigilance and Enforcement Officer. Without any further communication, on the ground that the reply submitted by the petitioner is not satisfactory, the impugned notice is issued, demanding an amount of Rs.21,65,649/-. In this writ petition, it is the case of the petitioner-Unit that as it is engaged in the business of manufacturing, it is not responsible if there is any evasion of royalty on the ore, which is purchased by it. In support of his case, the learned counsel for petitioner relies on the judgment of this Court in W.P.No.5871 of 2001 and batch, dated 31.10.2008. On the other hand, it is submitted by the learned Government Pleader appearing for respondents that all the information is forming part of the show cause notice, and in that view of the matter, no further information is needed to be given to the petitioner. I have perused the show cause notice and also the representation filed by the petitioner. The petitioner, in response to the show cause notice, dated 17.06.2009, did not file any reply, but he made a representation, requesting to furnish the detailed information for which royalty bills were not submitted to the Regional Vigilance and Enforcement Officer. In that view of the matter, this Court is of the view that the representation filed by the petitioner cannot be construed as a reply to the show cause notice. As much as the petitioner is denying the liability itself, and as he has not submitted any reply to the show cause notice on the allegations made against him, I deem it appropriate to set aside the demand notice, dated 19.05.2010, issued in notice No.2885/V&E/ S.I.U/2/1/2009, by permitting the petitioner to file a detailed reply to the show cause notice, dated 17.06.2009, within a period of four weeks from today. If such an explanation is filed, respondents shall consider the same and pass appropriate orders. It is needless to observe that the respondents shall consider the findings recorded by this court in the judgment in W.P.No.5871 of 2001 and batch, dated 31.10.2008, while passing appropriate final orders. Subject to the above directions, the writ petition is allowed. No costs. ______________________ R. SUBHASH REDDY, J 9th February 2011 ajr