THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON’BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION No.2547 of 2010 ORDER: (Per Hon’ble Sri Justice Ramesh Ranganathan) The order of assessment passed by the 1st respondent dated 20.01.2010 is under challenge in this Writ Petition on several grounds. The petitioner is a registered VAT dealer under the AP Value Added Tax Act, 2005 on the rolls of the Commercial Tax Officer, Kurupam Market Circle, Visakhapatnam carrying on business in the purchase and sale of silver articles. The 1st respondent after conducting audit passed the assessment order, under challenge in this Writ Petition, holding that sale of mixed metal silver articles was liable to be taxed at 12.5%. While this order is under challenge by Sri K. Raji Reddy, Learned Counsel for the petitioner, on several grounds it is wholly unnecessary for us to examine any of them except to observe that the Writ Petition must be allowed, and the impugned order set aside, on the short ground that the 1st respondent was merely authorized to conduct audit and not to assess the petitioner to tax under the Act. The Division Bench of this Court in Balaji Flour Mills v. the Commercial Tax Officer-II, Chittoor, Chittoor District[1] held: (a) In the result, in the analysis and for the reasons as above, we reject the relief to declare Rule 59(1)(4)(ii)(b) and (d) of the VAT Rules as ultra vires. We also declare that sub- sections (3) and (4) of Section 17 do not suffer from any constitutional infirmity and are valid. We also reject all other prayers for declaring the impugned rule and impugned assessment orders as ultra vires or invalid except to the extent indicated in (b) and (c) below; (b) In view of our holding that the authorisation to audit under Section 43 read with Rule 59(1)(7) by itself does not enable audit officer to undertake assessment, we set aside all the assessment orders and consequential orders, if any under Section 53 of the VAT Act, in all the writ petitions; (c) All the impugned assessment orders shall stand remitted to the respective audit officers who shall submit audit reports as contemplated under Chapter VII of the VAT Audit Manual for appropriate Post Audit Action. If the competent controlling and/or supervising authority like Deputy Commissioner issues separate orders authorizing assessment, it shall be open to such authorizing officer or authority prescribed, as the case may be, to undertake assessment in accordance with law. Following the said judgment, the impugned assessment order is quashed. The Writ Petition is allowed, and the matter is remanded to the jurisdictional/authorized Commercial Tax Officer who shall issue notice to the petitioner, and assess the petitioner to tax in accordance with law. However, in the circumstances, without costs. ______________ V.V.S.RAO, J ___________________________ RAMESH RANGANATHAN, J 09.06.2011 MRKR [1] 40 VST 150