THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE T.MALLIKARJUNA RAO

WRIT PETITION Nos.20843, 20868, 20876, 20896, 21397, 21629, 21631, 21633 & 22101 of 2022

COMMON ORDER:- (Per Hon'ble Sri Justice C.Praveen Kumar)

Heard Ms. Sushma Yaganti, learned counsel for the petitioners, and Ms. Dasari Nagaraja Kumari, learned Assistant Government Pleader for Commercial Tax appearing for the respondents.

2. As the issue involved in all the writ petitions is one and the same, they are disposed of at the stage of admission with the consent of all counsel.

3. W.P.No.20843 of 2022 is taken as a lead petition.

4. W.P.No.20843 of 2022 is filed under Article 226 of the Constitution of India seeking the following relief:-

"….. to issue an appropriate Writ, Order or Direction more particularly one in the nature of Writ of Mandamus to declare the action of the 4th respondent in issuing Assessment of Value Added Tax Order dated 08.04.2022 demanding the petitioner to pay an amount of Rs.4,81,798/- towards revised tax from 1% to 14.5% for the assessment year 2016-2017 on the hire charges received from the APSRTC for the buses bearing No.AP 35 U 9589, AP 35 U 9689 and AP 35 Y 4789 as illegal, arbitrary, improper, colourable exercise of power and jurisdiction, in violation of principles of Natural Justice and violative of Articles 14 and 21 of Constitution of India, barred by limitation and opposed to provisions of AP VAT Act, 2005 and Rules there under and consequently set aside the impugned Assessment Order dated 08.04.2022 issued by the 4th respondent and pass….."

5. The averments in the affidavit filed in support of the writ petition show that the petitioner herein entered into an agreement with Andhra Pradesh State Road Transport Corporation (A.P.S.R.T.C.) on 26.11.2016 for running five buses on hire basis. Clause (v) of condition No.6 of the said agreement postulates that the Corporation shall pay fines, compounding fees etc., imposed by a Court, R.T.A. or S.T.A. against the permit holder under Section 86 of the Motor Vehicles Act, 1988 for contravention of any provision of law provided that such contravention or violation has occurred when the vehicle plies for the Corporation.

It is stated that initially, respondent No.4 assessed and collected VAT @ 1% on total hire charges received from A.P.S.R.T.C. on the above said buses. Subsequently, A.P.S.R.T.C. issued a circular, dated 19.07.2008, to reimburse 1% tax paid by the bus owners. Accordingly, petitioner paid 1% VAT to respondent No.4 for plying the buses, for the financial year 24.11.2016 to 31.03.2017.

While things stood thus, the Vigilance & Enforcement of General Administration Department issued proceedings, dated 08.02.2018, which led to initiation of action by respondent No.4 for realization of evaded VAT of Rs.34,32,849/-. Respondent No.4 is said to have issued a show cause notice on 25.09.2021 basing on the Vigilance Report. A reply to the said show cause notice was given by the petitioner but however, a final order came to be passed on 08.04.2022, imposing liability at the rate of 14.5%. This order of assessment imposing 14.5% is challenged in this writ petition.

6. Ms. Sushma Yaganti, learned counsel for the petitioners, mainly submits the revised show cause notices imposing tax at 14.5% cannot be accepted as the same are bereft of any reasons. It is stated that though the petitioners have submitted their explanation to the revised show cause notices, but passing of assessment orders basing on the said show cause notices is improbable and incorrect. Learned counsel took us through the revised show cause notice, filed in one of the writ petitions, in support of her plea. In other words, the argument of the learned counsel for the petitioners is that the revised show cause notices enhancing the tax from 1% to 14.5% is without any basis.

7. On the other hand, Ms. Dasari Nagaraja Kumari, learned Assistant Government Pleader for Commercial Tax appearing for the respondents, would contend that the petitioners, having subjected themselves to the show cause notices by submitting the explanation, which led to passing of assessment orders, cannot now question the show cause notices. In any event, learned Assistant Government Pleader would contend that the petitioners are having a remedy of appeal, which they can avail, as many disputed questions of fact are involved.

8. The point that arises for consideration in these writ petitions is:-

"Whether the relief sought for by the petitioners in these writ petitions mainly with regard to passing of the assessment orders can be interfered with?"

9. POINT:-

It is to be noted here that the main argument of the learned counsel for the petitioners is that the revised show cause notice

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issued by the respondents enhancing the tax from 1% to 14.5% is without any basis. At the same time, it is to be noted here that the petitioners herein have submitted their explanation to the show cause notices and thereafter, the assessing authority passed the assessment orders levying tax at the rate of 14.5%. Therefore, we feel that it may not be proper for the petitioners either to question the revision show cause notices at this length of time or to question the correctness or otherwise of the revised show cause notices at this stage, more so when assessment orders are passed and appeals lie against the said orders.

10. Insofar as the second prayer i.e., the assessment orders, which are based on the revised show cause notices, are bad in law, it is to be noted that as against the said orders, appeal lies before the Appellate Deputy Commissioner, which fact was indicated in the order impugned in the writ petitions. Further, learned Assistant Government Pleader submits that the petitioners have not registered themselves as Turnover Tax (T.O.T.) dealers, which fact is disputed by the petitioners, but no material to that effect is placed on record. As the issue involves disputed questions of fact as well, we feel that these disputed factual aspects can be better adjudicated by appreciating the evidence in the appeals and definitely, not in the writ petitions filed under Article 226 of the Constitution of India.

11. Further, the issue as to whether notices were issued after the period of limitation can also be decided only after going through the material facts of the case as the limitation aspect is also a mixed question of fact and law. Hence, we dispose of these

writ petitions directing the petitioners to prefer an appeal before the authority concerned. Taking into consideration the statement made by the learned Government Pleader, we direct the respondents herein not to take any coercive steps for realization of the VAT for a period of six (6) weeks from today. Meanwhile, learned counsel for the petitioners shall take steps for filing interlocutory applications along with the appeals seeking interim order in which event, the same shall be dealt with in accordance with law. There shall be no order as to costs.

Miscellaneous petitions pending, if any, in these Writ Petitions shall stand closed.

_______________________________ JUSTICE C.PRAVEEN KUMAR

__________________________________ JUSTICE T.MALLIKARJUNA RAO

Date : 18.8.2022 Note:- Furnish C.C. on 24.8.2022. B/O AMD

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THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE T.MALLIKARJUNA RAO

WRIT PETITION Nos.20843, 20868, 20876, 20896, 21397, 21629, 21631, 21633 & 22101 of 2022

Date : 18.8.2022

AMD