IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE TWENTY FIFTH DAY OF SEPTEMBER TWO THOUSAND AND NINE PRESENT THE HON'BLE SRI JUSTICE GODA RAGHURAM and THE HON'BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 19745 of 2009 Between: M/s R 9000 Textiles and Garments Koti Hyderabad Rep.by its Partner Sri T.Prasada Rao ..... PETITIONER AND 1 The Commerical Tax Officer Sultan Bazar Circle,Hyderabad 2 The Appellate Deputy Commissioner(CT) Secunderbad Divsion Hyderabad 3 The Joint Commissioner (CT) Legal Office of the Commissioner of Commercial Taxes Government of Andhra Pradesh,Hyderabad .....RESPONDENT(S) 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 Counsel for the Petitioner:MR.BHASKAR REDDY VEMIREDDY Counsel for the Respondent No.: GP FOR COMMERCIAL TAX The Court made the following : Form-NIC-OGS/WP{BMR} THE HON'BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE RAMESH RANGANATHAN WRIT PETITION No. 19745 OF 2009 ORDER: (Per The Hon’ble Sri Justice Goda Raghuram) The petitioner is a partnership firm carrying on business in Garments and Readymades and an assessee on the rolls of the first respondent under the provisions of the A.P. VAT Act, 2005 and the CST Act, 1956. The petitioner applied to the Authority for clarification and advance ruling under Section 67of the A.P. VAT Act, 2005 (the A.P. VAT Act) on whether it was entitled to claim input tax credit on plant and machinery locally purchased from registered VAT dealers including air condition units etc., and electrical items such as bulbs, tubes, UPS etc., By the order dated 02.02.2008, the Authority while accepting the petitioner’s contention of entitlement to claim input tax credit on UPS and electrical items rejected the contention in so far as the claim of input tax on air condition units etc is concerned. Aggrieved thereby, the petitioner T.A. No.466 of 2008 before the STAT, against the order of the Advance Ruling Authority. The first respondent passed an order dated 24.04.2008 for the tax period April, 2006 to March, 2007 and April, 2007 to October, 2007 rejecting the claim of the input tax credit on air condition units as well as electrical items though the Advance Ruling Authority acceded to the petitioner’s contention of input tax credit in so far as UPS and electrical items are concerned. Against the order of assessment by the first respondent, the petitioner preferred appeals and preferred applications for stay before the second respondent. The said applications were however rejected by the second respondent. The petitioner thereupon filed revisions before the third respondent on 31.01.2009 which were dismissed by the order dated 12.02.2009. Thereupon the petitioner approached this Court by way of writ petition W.P. No.4098 and 4105 of 2009 wherein he obtained stay of recovery of the disputed demands for the aforesaid periods. While so, the second respondent by orders dated 09.04.2009 disposed of the appeals partly remanding and partly dismissing the appeals. The second respondent rejected the claim of input tax credit, both on air condition units as well as UPS, computers and printers; as well as on packing material which is a separate grievance of the petitioner. To the extent the appellate order of the second respondent was against it, the petitioner preferred further appeals in T.A. Nos. 441 and 442 of 2009 before the STAT, for the tax periods 01.04.2006 to 31.03.2007and 01.04.2007 to 30.10.2007 as already stated. These are pending. The grievance herein is that the first respondent again passed orders on 20.06.2009 for the tax period April, 2007 to March, 2008. By this order the first respondent rejected the input tax credit for both A.C. machines and electrical items including UPS and on packing material as well. Against this order of assessment, the petitioner filed an appeal along with the stay application before the second respondent, which application was rejected by the impugned proceedings dated 07.08.2009. The reasons recorded by the second respondent for rejecting the application for stay reads as under: I have heard the arguments of the authorized representative and perused the grounds of stay application and gone through the impugned assessment order carefully. In the absence of recorded evidence in support of the contentions raised therein prima facie, I find no case to grant stay of collection of disputed tax of Rs.17,12,662/- (denial of ITC). I, therefore, refuse to order of stay of collection of disputed tax of Rs. 17,12,662/-. Accordingly, the stay application is rejected. As the order of the Advance Ruling Authority dated 02.02.2008 is the subject matter of an appeal before the STAT in T.A. No.466 of 2008, in view of the proviso to Section 67(4) of the A.P. VAT Act, the authorities under the Act other than the Commissioner are not bound by the order of the Advance Ruling Authority. In any event, the second respondent failed to record any reasons except an ipsi dixit that it finds “no case to grant stay of collection of the disputed tax”, in the order dated 07.08.2009. In the circumstances, the order dated 07.08.2009 of the second respondent is quashed and the matter remanded to the second respondent-appellate authority for passing an order de novo on the application of the petitioner for grant of stay. The second respondent while considering the said application for grant of stay shall keep in view the provisions of Section 67(4) of the A.P. VAT Act, 2005. The respondent shall also not take any coercive steps till a fresh order is passed by the second respondent and communicated to the petitioner on its application for stay, which is now being remanded to the second respondent for consideration de novo. The writ petition is, accordingly, disposed of at the admission stage after hearing the learned Counsel for the petitioner and the learned Government Pleader for Commercial Taxes. ______________________ GODA RAGHURAM, J 25-09-2009 _____________________________ RAMESH RANGANATHAN, J ASP/MRKR