THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON'BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION Nos.20863 of 2009; 1832 of 2010 and 5706 of 2010 Dated:08.10.2010 Between: M/s.Arihant Polymers, And others. …Petitioners and The Government of Andhra Pradesh, Rep.by its Principal Secretary, Revenue (CT II) Department, Secretariat Buildings, Hyderabad, And others. …Respondents THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON'BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION Nos.20863 of 2009; 1832 of 2010 and 5706 of 2010 COMMON ORDER: (per Hon’ble Sri Justice V.V.S.Rao) The petitioners are industries, who availed the various incentives under the Government policy vide their orders in G.O.Ms.No.108, dated 20.05.1996. These incentives, inter alia, included tax exemption in so far as General Sales Tax was concerned. After the repeal of the Andhra Pradesh General Sales Tax Act, 1957, by the Andhra Pradesh Value Added Tax Act, 2005 (A.P.VAT Act), there is a change in the position. By reason of Section 69 of the A.P.VAT Act, the tax exemption statutorily stood modified as tax deferment. So as to get over certain difficulties, the Government of Andhra Pradesh amended the illustration under sub rule (3) of Rule 67 of the Andhra Pradesh Value Added Tax Rules, 2005 (A.P.VAT Rules). With this cause of action, number of dealers filed writ petitions assailing the amendment as well as sub rule (5) of Rule 67 of the A.P.VAT Rules, inter alia, on the ground that they are ultra vires and arbitrary. It is brought to our notice by the State’s Counsel that a Division Bench of this Court to which one of us (Ramesh Ranganathan, J) is a Member, in M/s.MAKS Casting Private Limited v Government of Andhra Pradesh (W.P.No.12804 of 2009 and batch, dated 16.09.2010), considered various questions that arise in the writ petitions, and dismissed them repelling the challenge to the impugned provisions. It was held therein as under. G.O.Ms. No.108 dated 20.5.1996 issued by the State Government is referable to its power of exemption under Section 9 of the APGST Act. As noted hereinabove the APGST Act was repealed in its entirety, and the A.P.VAT Act, 2005 came into force on 1.4.2005. The mere fact that G.O.Ms.108 dated 20.5.1996 has not been amended, or the final eligibility certificate issued thereunder was not cancelled or varied, would not enable the petitioners to either claim tax exemption or that the period for repayment of the deferred tax should be 14 years. Neither an executive order nor a statutory rule can fall foul of the provisions of the Statute and, since Section 69(1) of the Act requires tax holiday units to be treated as tax deferment units, the petitioners are not entitled to claim the benefit of tax exemption after the Act came into force from 1.4.2005 irrespective of the fact that G.O.Ms.No.108 dated 20.5.1996 has not been amended, and the final eligibility certificates issued thereunder have not been cancelled or varied. Viewed from any angle, the challenge to the validity of the illustration and sub-rule (5) of Rule 67 of the A.P VAT Rules, 2005, and the demand notices issued pursuant thereto, must fail. The Writ Petitions are, accordingly, dismissed. However, in the circumstances, without costs. Following the above judgment, we also dismiss these Writ Petitions without any order as to costs. __________________ (V.V.S.RAO, J) ______________________________ (RAMESH RANGANATHAN, J) 08.10.2010 vs