IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) SATURDAY, THE EIGHTEENTH DAY OF OCTOBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI AND THE HON'BLE MR JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 22448 of 2008 Between: M/s. Hindustan Coca Cola Beverages Private Limited Plot No. 44-69, Moulali, Hyderabad, rep. by its Regional Finance Manager Mr.K.Ravi. ..... PETITIONER AND 1 Assistant Commissioner (CT), LTU, Saroornagar Division, Hyderabad. 2 The Appellate Deputy Commissioner (CT), Hyderabad Rural Division, Hyderabad. 3 Citi Bank, Begumpet Branch, Hyderabad, rep. by its Manager. 4 ABN Amro Bank, Banjara Hills Branch, Hyderabad, rep. by its Manager. .....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 a Writ of Mandamus or any other appropriate or order or direction setting aside the Garnishee notice dated 1-10-2008 issued by the First Respondent to Respondent 3 and Respondent 4 in spite of being informed about the pendency of appeal and stay application before the Second Respondent as illegal, arbitrary, unjustiﬁed and contrary to the law laid down by this Court in M/s. Anab-E-Shahi case reported in 98 STC 386 and direct the 1st Respondent not to take any coercive steps for recovery of disputed tax pending disposal of appeal before the 2nd Respondent for assessment year 2007-08 (CST) and pass such other order or orders. Counsel for the Petitioner: MR.S.DWARAKANATH 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) Seeking a writ of mandamus to set aside the Garnishee Notice dated 1.10.2008 issued by the ﬁrst respondent to respondents 3 and 4, inspite of pendency of appeal and stay application before the second respondent, as illegal, arbitrary and contrary to the settled principles of law and consequently to direct the ﬁrst respondent not to take coercive steps for recovery of the disputed tax pending appeal before the second respondent for the assessment year 2007-2008, the petitioner ﬁled this writ petition. The petitioner is a Private Limited Company engaged in the manufacture and trading of soft drinks and aerated water and is an assessee on the rolls of the ﬁrst respondent herein. The petitioner eﬀected certain inter- State sales against ‘C’ forms and also stock transfers to branches in other States to which the petitioner is entitled to claim exemption under ‘F’ forms. The petitioner is dependant upon the buyers in other States and due to procedural diﬃculties, there is delay in issuing ‘C’ and obtaining ‘F’ from the buyers and Department. While so, a show case notice was issued on 4.9.2008 proposing to consider the entire net turnover of Rs.112.16 crores as liable to tax and exemption was granted to the extent of ﬁling ‘C’ and ‘F’ forms and levied tax at 12.5% on the balance turnover and raised a demand of Rs.3.43 crores by order dated 20.9.2008. Though the petitioner ﬁled W.P. No. 21828 of 2008, it was posted to 30.9.2008, on the ground of availability of alternate remedy of Appeal. In the meanwhile, the ﬁrst respondent has issued garnishee notice dated 1.10.2008 to the respondents 3 and 4 for recovery of the disputed tax. Thereafter, the petitioner preferred appeal before the second respondent, paying a sum of Rs.42,91,645/-. Along with the appeal the petitioner also ﬁled stay application and also wrote to the ﬁrst respondent by letter dated 3.10.2008 that in view of pendency of the appeal and stay application, the Garnishee Notice be not given eﬀect to. But since the ﬁrst respondent has not chosen to withdraw the Garnishee notice, the present writ petition is filed. It is submitted by the learned counsel for the petitioner that from out of the total demand of Rs.3.43 crores, the petitioner possess ‘C’ and ‘F’ forms covering an amount of Rs.3.1 crores and the balance of the disputed demand raised is only Rs.42.00 lakhs and submitted that the Garnishee notice be kept in abeyance pending ﬁnalisation of appeal by the appellate Authority and also in view of the fact that the disputed amount is only Rs.42.00 lakhs. He further submitted that though several contentions were raised before the second respondent, the second respondent has not granted stay and in view of the fact that the garnishee notice is eﬀective, the petitioner is not above to operate the accounts with the 3rd and 4th respondent. Heard the learned counsel for the petitioner and the learned Special Standing Counsel for Commercial Taxes. In the facts and circumstances of the case, we are of the opinion that the writ petition can be disposed of at the stage of admission with certain conditions. Accordingly, the Garnishee notice dated 1.10.2008 issued by the ﬁrst respondent to the respondents 3 and 4 is suspended subject to the condition of the petitioner depositing a sum of Rs.1.00 crore (Rupees one crore), within a period of two weeks from today, and the amounts paid, if any, shall be given credit to the above stipulated sum. On such deposit, the second respondent is directed to dispose of the appeal within a period of four weeks thereafter. It is made clear that the deposit of the said amount is without prejudice to rights of the petitioner to contest appeal before the second respondent. With these directions, the writ petition is disposed of. No order as to costs. ____________________ Justice T.Meena Kumari _______________________ Justice Ramesh Ranganathan October 18, 2008 Operative portion by wire at party’s costs //BO// MAS