IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE FIRST DAY OF MAY TWO THOUSAND AND NINE PRESENT THE HON'BLE THE CHIEF JUSTICE SRI ANIL R. DAVE AND THE HON'BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 9579 of 2009 Between: M/s. Ashoka Coffee Works Chilakaluripeta, Guntur District Represented by its Proprietor Munnaluri Hari Prasad, S/o. Apparao ..... PETITIONER AND 1. The Commercial Tax Officer, Chilakaluripeta, Guntur District 2. The Deputy Commercial Tax Officer Ganapavara, 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, direction particularly in the nature of writ of mandamus declaring the impugned common proceedings of penalty Dt.30.03.2009 in G.I. No.11199/2002-03 to 2004-05 issued by the Commercial Tax Officer, Chilakaluripeta levying penalty by a common order for three different assessment years after expiry of the 3 years of limitation set out for assessment, also as contrary to the expression used in subsection (2) of Section 5B namely Assessing Authority, for reasons/grounds not notified to the petitioner in the Show Cause Notice dt.25.06.2007 and contrary to the grant, subsistence and non-cancellation of G2 certificate Dt.17.02.1990 issued by the 2nd respondent herein as illegal, arbitrary, unjust, without authority of Law and without jurisdiction and also contrary to the judgment of the Hon’ble Supreme Court in 142 STC 96 and this Hon’ble Court fin 20 APSTJ 130 and grant such other relief or reliefs. Counsel for the Petitioner:MR.M.V.J.K.KUMAR Counsel for the Respondents: MR. K. RAJI REDDY, SPECIAL STANDING COUNSEL FOR COMMERCIAL TAX The Court made the following : THE HON’BLE THE CHIEF JUSTICE SRI ANIL R. DAVE AND THE HON’BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION NO.9579 OF 2009 ORDER: (per Sri Ramesh Ranganathan, J) Rule. Heard the learned Counsel for the petitioner and the learned Special Standing Counsel for Commercial Taxes and with their consent the Writ Petition is taken up for final disposal at the stage of admission. Aggrieved by the order passed by the assessing authority dt.30.3.2009 whereby penalty of Rs.1,88,958/- was levied for three assessment years i.e., 2002-2003, 2003-2004 and 2004-2005, the present Writ Petition is filed. Though several contentions are raised by Sri M.V.K. Moorthy, learned Counsel for the petitioner, the Writ Petition is required to be allowed on the short ground that the grounds, on which the penalty was proposed to be imposed, were not reflected in the show cause notice which formed the basis for passing the impugned order of penalty. In the show cause notice dt.28.6.2007 it is stated that, as per the returns filed for the assessment years 2002-2003, 2003-2004 and 2004-2005, the petitioner had purchased coffee seeds by issuing ‘G’ Forms from outside the State of Andhra Pradesh, that the out of State purchase of coffee seeds was sold to the petitioner on ‘G’ Form and the purchase of coffee seeds on ‘G’ Forms was sold as coffee powder and was exempted from levy of tax as second sales. Penalty was sought to be levied on the petitioner under Section 5B(2)(ii) of the A.P. General Sales Tax Act (for short, the Act). In the impugned order of penalty dt.30.3.2009, passed after the petitioner had submitted their objections to the show cause notice, the assessing authority observed that the petitioner had purchased raw coffee seeds against Form-G declarations from registered dealers within the State at the concessional rate of 4% tax, that they had effected sales on conversion of coffee seeds as pure coffee powder without blending or mixing with any other commodity like chicory or other ingredients and, at the time of assessment, they claimed exemption as secondary transactions. The assessing authority (first respondent herein), in the order impugned in this Writ Petition, held that the petitioner had misused the Form-G declarations during the aforesaid three years contrary to the provisions of Section 5B of the Act. The only ground on which the show cause notice dt.28.6.2007 was issued is that the petitioner had purchased coffee seeds from outside the State, whereas in the impugned order of penalty it is admitted that these purchases were intra-state purchases. The other grounds for levy of penalty, as stated in the impugned order, do not form part of the show cause notice dt.28.6.2007. Since the petitioner did not have an opportunity of submitting their objections to the grounds on which the penalty was levied in the impugned order, we are of the view that the impugned order of penalty is required to be and is, accordingly, quashed. We leave it open to the competent authority to issue a notice afresh for each assessment year separately informing the petitioner of the grounds on which penalty is proposed to be imposed and, after inviting objections from the petitioner and giving them an opportunity of being heard, to pass orders afresh in accordance with law. The Writ Petition is, accordingly, allowed. However, in the circumstances, without costs. ANIL R. DAVE, CJ RAMESH RANGANATHAN, J 01-05-2009 bnr