THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON’BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION No.21588 of 2006 ORDER: (Per Hon’ble Sri Justice Ramesh Ranganathan) The relief sought for in this writ petition is to quash the order of the 3rd respondent dated 26.9.2006, and to consequently restrain the 1st respondent from taking coercive steps for recovery of the balance disputed tax of Rs.63,28,998/- for the year 2000-01 and Rs.72,29,671/- for the year 2001-02, pending disposal of the appeals before the Sales Tax Appellate Tribunal, Visakhapatnam (STAT). The petitioner is a company with its registered office in Perth in Australia. They entered into an agreement with M/s Cairn Energy India Pvt. Limited whereby they were assigned works connected with the development of Ravva Satellite Gas Field at S.Yanam. For the assessment years 2000-01 and 2001-02, the petitioner claimed exemption in respect of the equipment imported from outside the country for specific execution of the works contract. A turnover of Rs.2.34 crores and Rs.5.03 crores was claimed as exemption in terms of the third proviso to Section 5F of the Andhra Pradesh General Sales Tax Act, 1957 (APGST Act) read with Rule 38 of the Andhra Pradesh General Sales Tax Rules 1957 (APGST Rules). As a result, the assessment by the 1st respondent was nil for the year 2000-01 and Rs.9,80,243/- for the year 2001-02. The 2nd respondent revised the assessment by orders dated 27.5.2004 and 5.7.2005 for the years 2000-01 and 2001-02 respectively. The subject transactions were treated as ‘sale’. Aggrieved thereby the petitioner carried the matter in appeal to the STAT before whom the said appeal is said to be still pending as on date. They approached the 3rd respondent seeking stay of collection of the disputed tax pending disposal of the appeal by the STAT. The 3rd respondent, by order dated 26.9.2006, rejected the stay petition holding that the importer had handed over the goods to the contractor-dealer; later the goods were incorporated into the works contracts; there was transfer of property in favour of the assessee in the State of Andhra Pradesh only after the goods were imported from outside the country; and, as such, tax was leviable on those goods. Relying on an order of this Court, in W.P.No.3136 of 2006, he held that it is only in the rarest of rare cases should a petition for grant of interim stay be entertained. Aggrieved by the said order the petitioner invoked the jurisdiction of this Court under Article 226 of the Constitution of India. This Court, by order in W.P.M.P.No.27379 of 2006 dated 27.10.2006, granted interim stay as prayed for on condition that the petitioner furnishes bank guarantee for Rs.1.35 crores in favour of the 4th respondent within a period of three weeks; and they should also keep the bank guarantee alive during the pendency of the writ petition. Sri S.Dwarakanath, Learned Counsel for the petitioner, would submit that the petitioner has been renewing the bank guarantee periodically, and the latest bank guarantee No.060985 dated 20.5.2010 with HSBC Bank is valid till 31.5.2011. While several contentions are urged by him on merits, we see no reason to examine any of them in this proceedings since a substantive appeal is pending adjudication before the STAT. Suffice to hold that, since the petitioner has furnished a bank guarantee for Rs.1.35 Crores which has been renewed periodically pending disposal of the Writ Petition, the interim stay granted earlier shall continue till the appeals pending before the STAT are finally disposed of subject, however, to the condition that the petitioner keeps the bank guarantee alive, and renews it periodically. We request the STAT to hear and adjudicate the appeal on merits as expeditiously as possible, preferably within a period of three months from the date of receipt of a copy of this order. The Writ Petition stands disposed of accordingly. No costs. _____________ V.V.S.RAO, J ___________________________ RAMESH RANGANATHAN, J 15.03.2011 ASP