IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE THIRTIETH DAY OF APRIL TWO THOUSAND AND NINE PRESENT THE HON'BLE THE CHIEF JUSTICE AND THE HON'BLE MR JUSTICE RAMESH RANGANATHAN Writ Petition No. 2577 of 2009 Between: K.Linga Reddy S/o.K.Raja Reddy Door No.2-2-105/13, Tilak Nagar, Amberpet, Hyderabad. ... PETITIONER AND 1) The Commercial Tax Officer, Vidyanagar Circle, Hyderabad. 2) The Appellate Deputy Commissioner (CT) Secunderabad Division, Hyderabad. 3) The Joint Commissioner (CT) Legal, Office of the Commissioner of Commercial Taxes, Government of Andhra Pradesh, Hyderabad. 4) The Deputy Commercial Tax Officer, Vidyanagar Circle, Hyderabad. ...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 an appropriate writ, order or direction more particularly one in the nature of Writ of Mandamus declaring the action of the 1st respondent in insisting for payment of the disputed tax of Rs.3,60,424/- for the assessment year 2001-2002 and penalty of Rs.29,11,842/- for the assessment year 2002-2003, Rs.47,61,501/- for the assessment year 2003-2004 and Rs.73,39,788/- for the assessment year 2004-2005 even during pendency of appeals before the 2nd respondent in pursuance of the impugned orders of the 3rd respondent dated 18.11.2008 as illegal, arbitrary, high handed and consequently set aside the impugned notice in Form No.4 issued by the 4th respondent dated 23.01.2009 invoking power under Section 25 of A.P. Revenue Recovery Act and the orders of the 3rd respondent dated 18.11.2008 and restrain the 1st and 4th respondents from taking any coercive steps for recovery of the disputed tax for the assessment year 2001-2002 and penalty for the assessment years 2002-2003, 2003-2004 and 2004-2005 pending disposal of the appeals by the 2nd respondent. Counsel for the Petitioner: MR.BHASKAR REDDY VEMIREDDY Counsel for the Respondents: GP FOR COMMERCIAL TAX The Court made the following: ORDER: (per Hon’ble the Chief Justice) 1. The petitioner has been aggrieved by the notice of demand prior to attachment of land dated 23.1.2009 issued by respondent No.4 whereby the petitioner has been asked to pay the amount due to the Commercial Tax Department within 15 days from the date of service of notice. 2. The facts leading to the filing of the petition, in a nutshell, are as follows: The petitioner is a proprietary concern carrying on business of executing works contract. During the assessment years 2001-02 to 2004-05, the petitioner had executed a work of conversion of Metre Gauge Railway Track into Broad Gauge. At the time of payment of the contractual amount, the contractee had deducted tax @ 4% at source and remitted the same to the Commercial Tax Department. 3. It is the case of the petitioner that though he had submitted that there were works contract, respondent No.1 had passed the assessment orders treating the transactions as sale of Stone Ballast. It is also the case of the petitioner that he had filed appeals for the assessment years 2002-03 to 2004-05 before the Sales Tax Appellate Tribunal and appeal for the assessment year 2001-02 before respondent No.2 and the same are pending. When respondent No.1 had insisted for payment of the disputed tax during the pendency of the appeals, he had filed writ petitions before this Court and this Court granted conditional stay and the petitioner had deposited 50% of the disputed tax in compliance of the interim orders of this Court. However, respondent No.1 had passed orders imposing penalty for non-payment of the tax for the assessment years 2002-03 to 2004-05. The said orders imposing penalty had been challenged by the petitioner and the petitioner had also filed stay petitions before respondent No.2 and respondent No.2 had rejected the stay petitions. It is the case of the petitioner that he had challenged the orders of respondent No.2 before respondent No.3, who, by his proceedings dated 18.11.2008, has directed the petitioner to deposit 50% of the balance disputed tax and penalty and as the petitioner had failed to comply with the order of respondent No.3, respondent No.4 has issued the impugned notice of demand prior to attachment of land. 4. The main grievance of the petitioner is that though the petitioner had deposited 50% of the disputed tax during the pendency of the appeals before the Tribunal, the respondent authorities have imposed penalty for non-payment of the balance tax and when the petitioner failed to pay the disputed tax and the penalty, respondent No.4 has issued the notice for recovering the tax and penalty by putting his property to attachment. According to him, if the relief of stay of recovery of tax is not granted and the entire disputed tax is recovered, the very purpose of filing the appeals before the Tribunal would be defeated. 5. We have heard the learned advocate for the petitioner and the learned Special Government Pleader for Commercial Tax. 6. Upon hearing the learned advocates and in view of an undisputed fact that the tax levied upon the petitioner by virtue of the assessment orders has been challenged in appeal and this Court has granted protection to certain extent in relation to payment of disputed tax, in our opinion, some relief is required to be granted to the petitioner. 7. The petitioner has been asked to deposit 50% of the disputed amount on tax. In our opinion, the petitioner has a prima facie case in his favour and in view of the said fact, we are of the view that at this juncture, the petitioner need not pay more than 50% of the disputed amount of tax. 8. If the petitioner has already paid, in all, 50% of the disputed tax, the petitioner need not pay any further amount at this stage. If 50% of the disputed tax has not been paid so far, the same shall be paid within four weeks from today. 9. So far as the question of penalty is concerned, looking to the facts of the case, it is directed that 25% of the penalty imposed upon the petitioner shall be paid within four weeks from today. If any amount of penalty has been paid so far, the amount so paid shall be given credit to. 10. In view of the above order, upon payment of 50% of the tax, which according to the petitioner has already been paid, and upon payment of 25% of the amount of penalty, which should be paid within four weeks from today, no recovery of tax or penalty shall be effected. 11. Looking to the facts of the case, the learned advocates have also submitted that it would be in the interest of justice if the appeals pending before the concerned authority in relation to assessment of tax are disposed of at an early date. 12. In view of the above fact, it is directed that the appeals pending before the appellate authorities shall be disposed of as soon as possible and preferably within three months from today. 13. The learned advocate appearing for the petitioner has assured this Court that the advocate appearing for the petitioner before the appellate authorities shall extend his cooperation to the appellate authorities so that the appeals can be decided as soon as possible, as directed by this Court. 14. In view of the above directions, implementation of the impugned order dated 23.1.2009 is stayed till the appeals are decided by the appellate authorities. 15. The petition stands disposed of as allowed to the above extent with no order as to costs. ANIL R. DAVE, CJ April , 2009 RAMESH RANGANATHAN, J svs ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1) 2 CD copies Form-NIC-OGS/WP{KURR}