HIGH COURT OF JUDICATURE OF ANDHRA PRADESH THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE N.RAVI SHANKAR WRIT PETITION Nos. 9342 AND 9343 OF 2009 Tuesday, the Sixteenth day of August, Two Thousand and Eleven Between M/s. Santosh Builders, Rep.by its Managing Partner Smt. B.Bharathi Petitioner in both the W.Ps. AND The Deputy Commissioner of Commercial Tax (CT), Nellore and others Respondents in both the W.Ps. THE COURT MADE THE FOLLOWING: COMMON ORDER(per the Hon’ble Sri Justice Goda Raghuram) These two writ petitions are directed against the orders of the first respondent bearing R.V.No.6/04-05/A6 and RV No.7/04-05/A6, both dated 31.8.2006 and the consequent orders of assessment passed by the second respondent bearing GI No. 12537/1999-2000 and 12537/2000-2001, both dated 7.11.2006 proposing to recover the tax of Rs.38,37,571/- and Rs.31,20,369/- respectively, on principally two grounds (a) that the revisional orders passed by the first respondent on 31.8.2006 is inherently without jurisdiction and (b) that it is beyond the period of limitation prescribed under Sec.20(3) of the A.P.G.S.T. Act, 1957. Writ Petition No. 9342 of 2009 pertains to the assessment year 1999-2000 while Writ Petition No. 9343 of 2009 pertains to the assessment year 2000-2001. Having regard to the substantive similarity in the factual matrix of these two writ petitions, suffice it to record the facts in W.P. No. 9342 of 2009. The petitioner’s husband along with six others incorporated the petitioner firm in 1994 for the business of securing and executing P.W.D., R & B and other contract works and to execute the other contractor’s work as well, on sub-contracting basis. The petitioner a registered dealer on the rolls of the second respondent; for the assessment year 1999-2000 by order of the second respondent dated 23.10.2002, was assessed assessed to tax with total turnover of Rs.6,21,02,096/- and exempted turnover of Rs.4,96,17,258/- and net turnover of Rs.1,24,84,838/-, being liable to tax. The second respondent granted benefit of exemption on levy of tax under the Act and as per Rule 6(2) of the A.P.G.S.T. Rules, 1957 apparently on verification of records and documents maintained by the petitioner firm. The husband of the petitioner died on 18.4.2002 and consequently the firm was dissolved and a new partnership deed was entered into and the firm was reconstituted on 28.10.2003. The petitioner asserts that the reconstitution of the firm and the new place of business was informed to the second respondent vide letter dated 28.5.2005 which was acknowledged by the respondent; an assertion not disputed by the respondent. Against the assessment order dated 23.10.2002, the petitioner filed an appeal, aggrieved by certain disallowances under Rule 6(2) of the A.P.G.S.T. Rules, 1957. By order dated 5.9.2003, the Appellate Deputy Commissioner disposed of the appeal with a direction to the second respondent – assessing authority to undertake reassessment in accordance with the direction in the appellate order. Meanwhile, the first respondent took up revision against the original assessment order dated 23.10.2002 and issued show cause notice in this behalf on 17.5.2004. Pendency finalisation of the revision by the first respondent, the second respondent to effectuate the order of the Appellate Deputy Commissioner, dated 5.9.2003, issued the revised assessment order dated 4.5.2005. On learning about the revised assessment order passed by the second respondent on 4.5.2005, the first respondent intending to exercise the revisional power under Sec. 20 (2) of the Act, issued a fresh revision show cause notice dated 31.1.2006 proposing to deny the benefit of exemption allowed to the petitioner on the turnover of Rs.4,96,17,258/- by the second respondent under the Act under by initial assessment order 23.10.2002. It is the petitioner’s specific assertion that the revisional order dated 31.8.2006 was never communicated to it and only when the petitioner was making enquiry with the respondents 3 and 4 in respect of arrears due to the firm, it was informed that the second respondent issued proceedings for attaching pending bills due to the firm under Sec. 16-C and 17 of A.P.G.S.T. Act and Sec. 29 of the A.P. Value Added Tax Act, 2005 and that such proceedings were initiated pursuant to the orders in revision purportedly passed by the first respondent on 31.8.2006. It is the specific and pleaded case of the petitioner that the revision order dated 31.8.2006 was never communicated to the firm and after procuring the copy of the order, it has filed this writ petition challenging the said order and the consequent order purportedly passed by the second respondent on 7.11.2006 attaching the bills due to the petitioner firm from the respondents 3 and 4, on the grounds already adverted to. A perusal of the order impugned in this writ petition (W.P. No.9342 of 2009) reveals that the first respondent has set aside both the initial order of assessment passed by the second respondent dated 23.10.2002 as well as the order of assessment dated 4.5.2005 passed consequent on the Appellate Deputy Commissioner’s order dated 5.9.2003. Sri R.Raghunandan, learned counsel for the petitioner contends that the revisional order is unsustainable on account of having been passed beyond the period of limitation specific in Sec. 20(3) of the Act, since it seeks to revise the order dated 23.10.2002 and in view of the fact that the order, as admitted in the counter affidavit was put in the process of communication to the petitioner only on 20.7.2007 by Registered Post Acknowledgement Due. It is also contended that the first respondent was incompetent to exercise the revision power in view of Sec. 20(2) of the Act. Sec. 20(2) of the Act reads: “..(2) Powers of the nature referred to sub-Section (1) may also be exercised by Additional Commissioner or the Joint Commissioner, Deputy Commissioner and the Commercial Tax Officer in the case of orders passed or proceedings recorded by authorities, officers or persons subordinate to them..” Section 20 confers revisional powers on the Commissioner or Commercial Taxes and other prescribed authorities who may suo motu call for and examine the records of any order passed or proceeding recorded by any authority, officer or person subordinate to it under the provisions of the Act including sub-section (2) of this section, if such order or proceeding recorded is prejudicial to the interests of revenue may make such enquiry and on such enquiry as to such prejudice to the interest of revenue, authorize initiation of proceedings to revise, modify or set aside such and such other proceedings and may pass such other order in reference thereto as it thinks fit and proper. Sub-Section (2) confers the powers of revision on the Additional Commissioner, the Joint Commissioner, Deputy Commissioner and the Commercial Tax Officer, subject to the condition that the orders passed or proceedings recorded are by authorities, officers or persons subordinate to the authority or officer exercising the power of revision. Rule 44-A of the A.P. G.S.T. Rules, 1957 enumerates )for the purpose of exercising powers of the nature referred to in Sec. 20(1) of the Act) Officers or authorities who are deemed to be subordinate to the authorities specified in the table following Rule 44-A. It is specified that the Deputy Commissioner including Appellate Deputy Commissioners, Assistant Commissioners, Commercial Tax Officers, Deputy Commercial Tax Officers and Assistant Commercial Tax Officers are subordinate to the Additional Commissioner of Commercial Taxes (Legal) or Joint Commissioner Commercial Taxes (Legal). Rule 44-A, therefore, treats that all Deputy Commissioners including Appellate Deputy Commissioners as being subordinate to the Additional Commissioner and Joint Commissioners specified in the corresponding entry column No.2. Since the first respondent is a Deputy Commissioner, who has set aside the consequent order passed by the second respondent dated 4.5.2005, an order passed in consequence of the order of the Appellate Deputy Commissioner on 5.9.2003, the first respondent is not competent to exercise the power of revision and the revisional order is thus unsustainable. Since on the analysis above, the revisional order dated 31.8.2006 is unsustainable on the point of jurisdiction, it is not necessary for us to go in to the question whether the order is unsustainable for having been passed beyond the period of limitation specified in Sec. 20(3) of the Act, as well. Accordingly, the two revision orders passed by the first respondent on 31.8.2006 for the assessment years 1999-2000 and 2000-2001 respectively are set aside and the consequent orders passed by the second respondent dated 7.11.2006 are also declared invalid. The writ petitions are allowed as above, but in the circumstances without costs. ______________________ Justice Goda Raghuram _______________________ Justice N.Ravi Shankar August 16, 2011 MAS