WP/27960/2007 of M/s. Supraja Modern Par Boiled Rice Mill, Venkatagiri Vs The Additional Commissioner (CT) (Legal) on 27 December 2007

THE HON’BLE Smt. JUSTICE T.MEENA KUMARIANDTHE HON’BLE Ms. JUSTICE G.ROHINI

WRIT PETITION No.27960 OF 2007

O R D E R:(Per THE HON’BLE Smt. JUSTICE T.MEENA KUMARI)

This writ petition is filed seeking to declare theimpugned order dated 20.11.2007 passed by the 1[st]respondent in CCT’s Ref.LIII (1)/744/07 for the taxperiod May, 2005 as illegal and arbitrary.

The case of the petitioner is that thepetitioner is a registered VAT dealer on the rolls of 3[rd]respondent and engaged in the business of Milling ofRice. The petitioner purchased rice from VATregistered dealers during the period May, 2007 andclaimed input tax credit on the ground that underSection 13 of the AP VAT Act, 2005 the dealer isentitled for input tax credit in respect of the goodspurchased from local VAT registered dealers.However, the 3[rd] respondent issued show-causenotice proposing to disallow the input tax creditclaimed by the petitioner on the ground that theselling VAT dealer is fictitious dealer and though thepetitioner stated that the consignments areaccompanied by tax invoices and the selling dealer isa VAT registered dealer, the 3[rd] respondent passed an order dated 28.9.2005 disallowing the input taxcredit claimed by the petitioner and also penalty ofRs.1,61,026-00. Aggrieved by the said order, thepetitioner preferred an appeal before the 2[nd]respondent, but the 2[nd] respondent vide order dated8.6.2007 confirmed the order dated 28.9.2005passed by the 3[rd] respondent. Aggrieved by thesame, the petitioner preferred an appeal before theTribunal and as the Tribunal has no power to grantstay, the petitioner filed a stay petition before the 1[st]respondent for stay of collection of disputed taxpending disposal of the appeal by the Tribunal. Thegrievance of the petitioner is that the 1[st] respondentwithout appreciating the detailed grounds raised bythe petitioner in support of the contention that theinput tax credit was rightly taken in respect of thegoods purchased from local VAT registered dealersbasing on the tax invoices issued by the said dealers,passed the order dated 20.11.2007 rejecting the staypetition filed by the petitioner for stay of collection ofthe disputed tax pending disposal of the appeal bythe Tribunal. Hence, this writ petition.

Heard the learned counsel for thepetitioner and the learned Special Standing Counselfor the respondents.

The controversy is that pending an appeal,application for stay was dismissed by the CompetentAuthority. We have gone through the record. We feelthat the interest of justice would have been met if staywas granted pending appeal, subject to deposit of1/4[th] of the liability. Therefore, we set aside theimpugned order and direct that 1/4[th] of the penaltyand interest shall be paid by the petitioner within aperiod of eight weeks from the date of receipt of acopy of this order. For such period, there shall be anunconditional stay and stay shall continue till disposalof the appeal, provided the amount is depositedwithin the stipulated time. The deposit of amount shallbe without prejudice to the rights of the petitioner inappeal. If any amount has already been paid by thepetitioner, the same shall be given credit.

The writ petition is accordingly disposed of. Nocosts.

December 27, 2007

T.MEENA KUMARI, J.G.ROHINI, J.

Note:C.C. in four days.(BO) MVB