IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE TWENTY FIRST DAY OF JULY TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI and THE HON'BLE MR JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 15562 of 2008 Between: M/s. K.V.S.Enterprises, Rep. by its Managing Partner Mr. S.J.Kreepanand, Ground Floor, United Building, Masab Tank, Hyderabad. ..... PETITIONER AND 1 Govt. of A.P., rep. by its Principal Secretary, Revenue (Commercial Tax) Department, Secretariat, Hyderabad. 2 Additional Commissioner of Commercial Taxes (Legal) Govt. of A.P., Gruha Kalpa Buildings, Nampally, Hyderabad. 3 Deputy Commissioner of Commercial Taxes (Appeals) Panjagutta, Hyderabad. 4 Commercial Tax Officer, Begumpet, 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 a writ, order or direction, one more particularly in the nature of Writ of Mandamus declaring the action of the 4th respondent in demanding Sales tax of Rs.63,06,362/- for the assessment year 2004-2005 on the basis of the orders made in proceedings RC No. 3900/2004-05 APGST dated 31-3- 2008 from the petitioner under the A.P.General Sales Tax Act, 1957 or A.P.Value Added Tax, 2005 on the Airtel Prepaid Cards and recharge coupons of M/s. Bharti Tele-Ventures Ltd., Distributed by the petitioner on commission basis as illegal, arbitrary and unconstitutional apart from being contrary to the orders of the Hon'ble Supreme Court of India in reported in (2006) 3 SCCI ( BSNL VS UOI) and consequently, direct the respondents not to revise any demand of Sales tax from the petitioner for the assessment year 2004-2005 for the sale of SIM cards. Counsel for the Petitioner: MR.S.NIRANJAN REDDY Counsel for the Respondents.: SPL. STANDING COUNSEL FOR COMMERCIAL TAX The Court made the following : THE HON'BLE MRS JUSTICE T.MEENA KUMARI and THE HON'BLE MR JUSTICE RAMESH RANGANATHAN WRIT PETITION NO : 15562 of 2008 ORDER: (Per Hon’ble Smt. Justice T. Meena Kumari) This writ petition is filed by the petitioner seeking to declare the action of the 4th respondent in demanding Sales tax of Rs.63,06,362/- for the assessment year 2004-2005 on the Airtel Prepaid Cards and recharge coupons of M/s. Bharti Tele-Ventures Ltd., Distributed by the petitioner on commission basis as illegal and arbitrary and consequently, to direct the respondents not to raise any demand of Sales tax for the assessment year 2004-2005 for the sale of SIM cards. It is the case of the petitioner that against the assessment order passed by the 4th respondent, an appeal has been preferred before the 3rd respondent. Along with the appeal, an application seeking stay of demand of tax was filed. But the said application was rejected. Taking advantage of the same, a notice was issued demanding payment of tax. The petitioner preferred revision against the stay rejection order, before the 2nd respondent and submitted a representation to the 4th respondent to keep the said demand notice in abeyance till the disposal of the revision. But the 4th respondent passed garnishee order and the 3rd respondent is resorting to take coercive steps by attaching the bank accounts of the petitioner. Hence, the present writ petition has been filed. Heard the learned Counsel for the petitioner and the learned Special Standing Counsel for Commercial Tax and perused the material available on record. The learned Counsel for the petitioner contended that an appeal has been preferred against the assessment order passed by the 4th respondent, before the 3rd respondent and the same is pending and against the stay rejection order of the 3rd respondent, a revision has been filed and the same is also pending before the 2nd respondent and at this juncture, the initiation of recovery proceedings by way of attaching the bank accounts is unjustified and in these circumstances, if the relief as to the stay of demand of Sales Tax is not entertained and if the recovery of Sales Tax in question is effected during the pendency of the appeal, the very purpose of filing the said appeal, which is a statutory remedy that is available to the aggrieved party, would be defeated. In the facts and circumstances of the case and in view of the pendency of the appeal before the 3rd respondent as well as the revision, without expressing any opinion on the merits of the case, We feel it a fit case wherein stay can be granted, but subject to imposition of certain conditions. Accordingly, there shall be stay of demand of Sales Tax in question for the assessment year 2004-2005, till the disposal of the appeal pending before the 3rd respondent, subject to the condition of the petitioner depositing 1/3rd of the demanded Sales Tax, within a period of eight (8) weeks from today. However, it is made clear that the amount, if any already paid, shall be given credit to the above stipulated sum. Subject to the above direction, this writ petition is disposed of. No costs. _____________________ Justice T. Meena Kumari _________________________ Justice Ramesh Ranganathan Date: 21st July, 2008 Nn. THE HON'BLE MRS JUSTICE T.MEENA KUMARI and THE HON'BLE MR JUSTICE RAMESH RANGANATHAN WRIT PETITION No:15562 OF 2008 (Order delivered by the Hon’ble Smt. Justice T. Meena Kumari) 21/07/2008