IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE THIRTIETH DAY OF MARCH TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE V.ESWARAIAH and THE HON'BLE MR JUSTICE SANJAY KUMAR WRIT PETITION No.6319 of 2009 Between: M/s. Laqshya Hyderabad Airport (Media) Private Limited, 3-D, LTOB Office Complex, GHIAL, Rajiv Gandhi International Airport, Ranga Reddy District, Shamshabad, Hyderabad. ..... PETITIONER AND 1 Assistant Commercial Tax Officer, Hyderguda Circle, Hyderabad. 2 Assistant Commissioner (CT), Audit, Abids Division, Hyderabad. 3 Appellate Deputy Commissioner (CT) Secunderabad Division, Hyderabad. 4 Commissioner of Commercial Taxes, Hyderabad, Andhra Pradesh. 5 Government of Andhra Pradesh, Through Principal Secretary to Government, Revenue Department, Hyderabad. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court may be pleased to issue a Writ, Order or direction particularly one in the nature of a Writ of Certiorari quashing Rule 25(8) of the APVAT Rules, 2005 as ultra vires the provisions of the APVAT Act, 2005 alternatively read down the Rule 25(8) of the APVAT Rules, 2005 to mean Rule 25(8) is not applicable where Input Tax Credit is not utilised and to quash the Notice of demand dated 21- 03-2009 issued by the Respondent No.1 and quash the order in Appeal No. A/104/08-09/V dated 19-03-2009 passed by learned Appellant Deputy Commissioner (CT), Hyderabad, rejecting stay as illegal, arbitrary, violative of principles of natural justice and violative of Article 14 of the Constitutino of India and consequenty restrain the respondents from recovering from the petitioner as su of Rs. 42,46,867/- towards penalty consequent to the proceedings on alleged under declared input tax credit under Sec 53(3) read with Rule 25 (8)(a) of APVAT Act, 2005 for the tax perido February, 2008 to July, 2008. Counsel for the Petitioner:LAKSHMI KUMARAN & SRIDHARAN Counsel for the Respondent No.: GP FOR COMMERCIAL TAX The Court made the following : THE HON'BLE MR JUSTICE V.ESWARAIAH and THE HON'BLE MR JUSTICE SANJAY KUMAR WRIT PETITION No.6319 of 2009 ORDER: (per the Hon’ble Sri Justice Sanjay Kumar) The petitioner challenges the constitutional validity of Rule 25(8) of the APVAT Rules, 2005, on the ground that the same is ultra vires the provisions of the APVAT Act, 2005. Alternatively, it seeks a direction to read down the said rule to mean that it is not applicable where Input Tax Credit is not utilized and a consequent direction to quash the notice of demand dated 21-03-2009 issued by the Assistant Commercial Tax Officer, Hyderabad-R-1 and to quash the order dated 19-03-2009 in Appeal No.A/104/08-09/V, passed by the learned Appellate Deputy Commissioner (CT), Hyderabad. The petitioner suffered an order dated 19-12-2008 before the Deputy Commissioner (CT), Hyderabad, whereby he was directed to pay penalty of Rs.42,46,867/- under the provisions of Section 53(3) of the APVAT Act read with Rule 25(8)(a) of the A.P.VAT Rules. Aggrieved thereby, the petitioner filed an appeal before the Appellate Deputy Commissioner (CT), Hyderabad and sought stay of the order under appeal. By the impugned order, dated 19- 03-2009, the Appellate Deputy Commissioner rejected the stay application. At the time of hearing of the case, the learned counsel for the petitioner conceded that the petitioner is not keen on pressing the case insofar as the validity of the impugned rule is concerned as its appeal is still pending. Taking note of the aforesaid submission, the writ petition is disposed of granting stay, pending disposal of the appeal, subject to the condition that the petitioner deposits 25% of the penalty due under the order dated 19-12- 2008 passed by the Deputy Commissioner (CT), Hyderabad, within a period of six weeks from today. There shall be no order as to costs. ________________ V.ESWARAIAH, J __________________ SANJAY KUMAR, J Date: 30-03-2009 Prv ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1) 2 CD copies Form-NIC-OGS/WP{SPJS}