THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE G.V.SEETHAPATHY W.P.NO.27867 OF 2009 22-12-2009 BETWEEN; M/s G.S.Lamba & Sons, rep. By its karta GS Lamba ...Petitioner vs. The Deputy Commercial Tax officer CT Hyderbad and others ...Respondents THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE G.V.SEETHAPATHY W.P.NO.27867 OF 2009 ORAL ORDER: (Per GR,J) The notice dated 19-11-2009, issued under the provisions of the A.P. VAT Act, 2005 (for short “ the 2005 Act”) and the A.P.GST Act, 1957 calling upon the petitioner to pay the arrears of the tax as specified therein, is assailed in this writ petition. The petitioner is a firm engaged in the business of providing transportation solutions and operates a fleet of transit mixers used for transporting ready mix concrete to customers. During the course of its business, it entered into an agreement dated 01-10-2002 with M/s Grasim Industries Limited, a company engaged in the manufacturing of ready mix concretes agreeing to dedicate a fleet of five (5) vehicles to support the transportation needs of Grasim. The petitioner received a show cause notice dated 01-10-2008 proposing levy of tax of Rs.46,17,839/-, from the 2nd respondent who treated the transactions under the agreement between M/s.Grasim Industries Limited and the petitioner as constituting transfer of the right to use transit mixers and that the income received from the said transaction as liable to tax under Section 4(8) of the 2005 Act. The petitioner countered this proposal contending that what is received by the petitioner is transport charges and not lease rentals for leasing the transit mixers. However, the 2nd respondent by the order of assessment dated 30-12-2008 completed the assessment for 2005-06 and levied tax for the aforementioned amount. Aggrieved thereby, the petitioner preferred an appeal to the 3rd respondent on 31-01-2009. While so, the 1st respondent issued the impugned arrears notice calling upon the petitioner to pay the balance disputed tax of Rs.40,40,609/- for the year 2005-06, after giving credit for the amount of pre-deposit made by the petitioner while preferring the appeal to the 3rd respondent against the order of assessment dated 30-12-2008. The 1st respondent also issued a garnishee notice to the petitioner’s bank (HDFC, SD Road, Secunderabad) and eventually collected an amount of Rs.13,24,186/- pursuant to the garnishee notice. On the petitioner’s representation to the 1st respondent to release the bank attachment, the 1st respondent directed the petitioner to pay Rs.25 lakhs as a condition precedent for withdrawing the attachment. The petitioner states to have paid Rs.25 lakhs. The 3rd respondent- appellate authority is stated to have heard the petitioner at a personal hearing on 18-11-2009 on its petition for interim orders in the substantive appeal against the order of assessment, seeking stay of recovery of the disputed tax. However no order has been passed by the 3rd respondent on the interlocutory application of the petitioner. In the circumstances apprehending coercive process may be initiated by the Revenue pursuant to the impugned arrears demand notice dated 19-11-2009, the petitioner is before this Court. As the petitioner’s application for interim relief is pending consideration by the 3rd respondent and it is stated that the 3rd respondent had also granted and heard the petitioner in a personal hearing provided on 18-11-2009, we consider it appropriate to direct the respondents not to initiate any coercive process for recovery of the balance tax due for the assessment year 2005-06 under the 2005 Act, pursuant to the impugned arrears notice dated 19.11.2009 till the disposal by the 3rd respondent of the petitioner’s application for interim relief. The writ petition is disposed of as above at the stage of admission after hearing the learned counsel for the petitioner and Sri A.V.Krishna Koundinya, the learned Special Standing Counsel for Commercial Taxes for the respondents. No costs. ______________ GODA RAGHURAM,J ______________ G.V.SEETHAPATHY,J 22nd DECEMBER 2009 TSNR