IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE ELEVENTH DAY OF AUGUST TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI AND THE HON'BLE SRI JUSTICE P.V.SANJAY KUMAR WRIT PETITION NO : 17398 of 2008 Between: C. Krishna Murthy S/o. Veeraraghavaiah Special Class Contractor, Flat No.42, Mouli Towers, Chandramoulipuram, Vijayawada-520 101, Krishna District. ..... PETITIONER AND 1 The Government of Andhra Pradesh, Rep. by its Principal Secretary, Finance (Works & Projects) Department, Secretariat Buildings, Hyderabad. 2 The Engineer-in-Chief, Administration & NH, Erramanzil, Hyderabad. 3 The Engineer-in-Chief, Roads, Erramanzil, Hyderabad. 4 The Chief Engineer-HUDCO & 12th Finance, Erramanzil, Hyderabad. 5 The Chief Engineer-NABARD, Erramanzil, Hyderabad. 6 The Chief Engineer-Panchayat Raj Department, NABARD, Erramanzil, Hyderabad. 7 The Superintendent Engineer, Rural Circle, Balakampet, Hyderabad. 8 The Superintendent Engineer (R&B) Circle, Vijayawada, Krishna District. 9 The Superintendent Engineer, P.R., PRED, Eluru. 10 The Executive Engineer, Roads Division, Hyderabad. 11 The Executive Engineer, City Roads Division, Hyderabad. 12 The Executive Engineer (R&B) Division, Vijayawada. 13 The Executive Engineer (R&B) Division, Machilipatnam. 14 The Executive Engineer (R&B) Division, Mylavaram. 15 The Executive Engineer (R&B) Division, Khammam. 16 The Executive Engineer, P.R., Machilipatnam. 17 The Executive Engineer (R&B) Division, P.R., Kavali. 18 The Pay and Accounts Officer, (W&P), P.R. District, Hyderabad. 19 The Pay and Accounts Officer, (W&P), Vijayawada. 20 The Assistant Pay and Accounts Officer, (W&P), Tekulapali. 21 The Assistant Pay and Accounts Officer, (W&P), Somasila, Nellore. 22 The Assistant Commissioner (C.T.), (L.T.U.) Division-II, Vijayawada. .....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, order or direction more particularly one in the nature of writ of mandamus declaring that (1) the Memo No.602/F8(1)/2006, dated 14.03.2007 issued by the 1st Respondent is arbitrary, illegal, invalid, contrary to the provisions of the A.P. Value added Tax act, Rules made there under, G.O.Ms.Nos.11 dt. 29.07.2005 and 141 dt. 27.07.2006, and unsustainable. (2) The petitioner is entitled for addition of VAT component of 4% on the entire value of work done at the time of payment of each bill in terms of the provisions of the G.O.Ms.Nos.11 dt. 29.07.2005 and 141 dt. 27.07.2006, and Section 22(3) of the A.P. VAT Act, (3) Declaring the action of the respondents in adding only 1.4% at the time of payment of each bill i.e., lesser than 4% as arbitrary, illegal and contrary to the provisions of the A.P. Value Added Tax and the Government orders in force as well as the terms of the Agreement and (4) Consequently direct the respondents to pay the difference 2.6% amount on the total value of the work relating to the Agreement Nos. 165, 4, 9, 32, 26, 25, 31, XII and 27 to the petitioner; and (5) to pass such other order or orders Counsel for the Petitioner: MR.P.GIRISH KUMAR 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) The writ petition is filed seeking writ of Mandamus declaring that the Memo No.602/F8(1)/2006, dated 14-3-2007 issued by the 1st respondent has no application to the petitioner, who opted for payment of tax under composition scheme as per Section 4 (7)(b) of the A.P. Value Added Tax Act, that the petitioner is entitled for addition of VAT component of 4% on the entire work done and deduction at the time of payment of each bill in terms of the provisions of agreement read with G.O. 141, dated 27-7-2006 and Section 22(3) of the A.P. VAT Act and to declare the action of the respondents in adding and/or deducting different amounts lesser than 4% and issuing TCS Certificate to the said amount as illegal and contrary to the provisions of A.P. Value Added Tax and Government orders in force as well as the terms of the agreement and consequently to direct the respondents to pay the difference amount between 2.6% amount on the total value of the works relating to agreement Nos. 165, 4, 9, 32, 26, 25, 31 XII and 27. The petitioner company is a firm registered under the APGST Act - now under A.P. Value Added Tax Act, 2005 and the petitioner is an assessee on the rolls of the 22nd respondent. The petitioner is carrying on the business in execution of ‘Work Contracts’. It is submitted by the learned counsel for the petitioner that the petitioner has already paid 1.4% on total value to the 22nd respondent and hence, the petitioner is entitled for refund of 4% on total value from the respondents. But, however, the learned Government Pleader and also the learned counsel for the petitioner further submits that the balance of 1.4% has already paid and he is entitled for refund from the respondent. The learned Government Pleader submits that the petitioner has paid 4% in total. Heard the learned counsel for the petitioner, the learned Government Pleader for Finance and Planning, Special Standing Counsel for Commercial Taxes, the learned Government Pleader for Roads and Buildings and learned Government Pleader for Panchayath Raj and Rural Development. In view of the facts and circumstances of the case and also recording the submissions made by the learned counsel for the petitioner and the learned Government Pleader, the Writ Petition is allowed. However, there shall be a direction to the respondents not to remit any further amount to the 22nd respondent in respect of the deductions already made pursuant to the Memo dated 14-3-2007 of the 1st respondent, while processing the final bill. The Writ Petition is disposed of accordingly. No costs. ____________________ Justice T.Meena Kumari ______________________ Justice P.V. Sanjay Kumar August 11, 2008 MAS ..... 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