THE HONOURABLE SRI JUSTICE L.NARASIMHA REDDY A N D THE HONOURABLE SRI JUSTICE RAMESH RANGANATHAN W.P.No. 11648 OF 2008 O R D E R: (Per Hon’ble Sri Justice L. Narasimha Reddy) The petitioner is a telecom service provider. It is assessed to Sales Tax, under the A.P. General Sales Tax Act. For the year 2000-01, the Assessing Authority, the second Respondent herein, passed an order dated 3-7-2003, determining a sum of Rs.4,74,57,297/-, towards Commercial Tax under various heads. The petitioner approached this Court, by filing W.P.No.23909 of 2003, assailing the notice. The writ petition was allowed and the matter was remanded to the second respondent for fresh consideration. Thereafter, a final order, dated 1-3-2008, was passed by the second respondent, holding that the petitioner is liable to pay a sum of Rs.7,11,45,377/- towards tax due. The petitioner filed an appeal before the 1st respondent against the order dated 1-3-2008. It has also filed an application for stay, pending disposal of the appeal. The first respondent passed an order dated 23-5-2008, dismissing the application for stay. This was followed by a notice, dated 2-6-2008, issued by the 2nd respondent, whereunder the petitioner was required to clear the arrears of tax, within three days. Hence, the petitioner has moved this Court, by way of House Motion. Sri Lakshmi Kumaran, learned counsel for the petitioner, has urged several contentions and placed reliance upon an order dated 6- 2-2008 passed by the Sales Tax Appellate Tribunal, in Appeal NO.881 of 2007. He contends that the Tribunal held in clear terms that the SIM Cards and Recharge Coupons cannot be treated as tangible properties, and thereby not liable to be levied tax, and the 1st respondent dismissed the application for stay, though the facts of the present case are similar. He submits that there was no basis, either for the second respondent in passing an order of final assessment, or the first respondent, in rejecting the stay. He has also drawn the attention of this Court for the interim orders passed in different writ petitions, filed by the telecom service providers. Sri Krishna Koundinya, learned Special Government Pleader for Commercial Tax, on the other hand, submits that the order passed by the Sales Tax Appellate Tribunal cannot be treated as final, much less, relied upon as a precedent before this Court. He contends that when the petitioner has availed the remedy of appeal, as provided under the statute, it is not advisable to plead to this Court to take any final view in the matter. He contends that the normal rule and practice of requiring the assessee to deposit 50% of the amount, pending disposal of the appeal, needs consideration of this Court. Both the counsel agreed that the writ petition can be disposed of finally, at the stage of admission. The petitioner has already availed remedy of appeal and it can urge all the contentions on merits, before the appellate authority. It is true that the Sales Tax Appellate Tribunal of Andhra Pradesh had taken a view that SIM Cards and Recharge Coupons cannot be treated as tangible properties, and on that basis, had set aside the order of assessment. It is true that similar question arises in this matter also. However, at this stage, it is too difficult to assume that the controversy has been resolved finally. It is not known as to whether the Revenue had assailed the order of the Tribunal. Be that as it may, once the appeal preferred by the petitioner is pending, it cannot be required to pay the entire amount involved. In the matter of this nature, this Court normally grants stay of operation of the order of Assessing Authority, on condition that the assessee deposits half of the disputed amount. In this case also, we would have adopted the same course of action. One significant feature, we have noticed in this case is that the assessment against the petitioner commenced with service of a notice proposing to levy tax, at the rate of 8%. In fact an order of assessment was passed on that basis. However, the tax was levied at 12%, after remand by this Court. The difference works out to 1/3rd. Though this is not the stage to examine the matter in detail, we have gone through the order of assessment, to know as to what prompted the Assessing Authority to deviate from the initial figures. Prima facie, we do not find any valid reason for it. At any rate, this has to be taken into account by the appellate authority. Having regard to the facts and circumstances of the case, we are of the view that ends of justice would be met, if the stay of final order dated 1-3-2008 is granted, on condition that the petitioner deposits 1/3rd of the demanded amount, which, roughly works out to half of the initial assessment, duly giving credit to the amount, which was already paid, either as pre-deposit while preferring the appeal, or otherwise. Hence, the writ petition is disposed of, directing that there shall be stay of all further proceedings, in pursuance of the order dated 1-3- 2008, passed by the second respondent, as well as the consequential demand notice dated 2-6-2008, on condition that the petitioner deposits 1/3rd of the amount covered by the said order, within a period of four weeks from today. The amount deposited by the petitioner, either as a condition precedent for preferring the appeal, or otherwise, shall be taken into account for this purpose. There shall be no order as to costs. _________________________________ JUSTICE L.NARASIMHA REDDY ____________________________________ JUSTICE RAMESH RANGANATHAN 6TH JUNE, 2008. KM