Andhra Pradesh High Court - Amravati
Krishna Cold Storage Pvt. ... vs The State Of Andhra Pradesh on 26 August, 2021
THE HON'BLE SRI JUSTICE JOYMALYA BAGCHI
AND
THE HON'BLE SRI JUSTICE D.RAMESH
WRIT PETITION NO.3625 of 2021
(Taken up through video conferencing)
ORDER: (per Hon'ble Sri Justice Joymalya Bagchi)
The petitioner assailed the demand Notice ID.No.10400324154
dated 02.03.2020 issued by the 3rd respondent for collection of alleged
arrears arising out of Assessment Orders No.5236/2002-2003 dated
31.12.2008 and 5236/2004-2005 dated 31.10.2008 and the
consequential action of freezing the bank accounts of the petitioner
company on the instruction of the 3rd respondent vide order dated
20.03.2020.
2. Factual matrix giving rise to the writ petition is to the effect that
the writ petitioner provides cold storage facilities for storage of
perishable vegetables and fruits. It is an assessee on the rolls of
Commercial Tax Officer, Madanapalle, and has been registered under
Andhra Pradesh General Sales Tax Act, 1957 ('Act of 1957', for short).
Pursuant to the inspection conducted by the Vigilance and Enforcement
Officer, Tirupati, in the cold storage of the petitioner company,
assessment proceedings were instituted by 4th respondent for the
Assessment Year 2002-2003 and a provisional assessment order, dated
27.07.2004 was passed. Subsequently a final order was passed on
31.03.2006 for the said assessment year, which was appealed before
the appellate authority under section 19 of the Act of 1957. The
appellate authority remanded the matter for fresh consideration before
the Assessing Officer. Pursuant thereto, Assessing Officer passed order
dated 31.12.2008, recording there is no tax liability of the petitioner
for the Assessment Year 2002-2003. In the meantime, the assessment
had also been undertaken with respect to the Assessment Year 2004-
2005, and by order dated 08.10.2007 a tax liability of Rs.8,48,000/- on
best judgment basis was arrived at for the said Assessment Year. This
order was challenged before this Court in W.P.No.13237 of 2008 and
this Court remanded the matter for fresh consideration after giving an
opportunity of hearing to the petitioner. Thereupon, by order dated
31.10.2008, the tax liability was reduced to Rs.2,95,374/- for the
Assessment Year 2004-05.
3. It is contended on behalf of the petitioner, though the aforesaid
assessment order dated 31.10.2008 was not served upon it as per law,
the petitioner was surprised to receive impugned demand notice dated
02.03.2020 making a claim as follows:-
S.NO. YEAR ACT DEMAND
(Rs.)
1. 2002-03 APGST Act 7,41,840-00
2. 2004-05 APGST Act 8,48,000-00
TOTAL 15,89,840-00
4. Consequent to the demand notice an attachment order was also
issued by the 3rd respondent dated 20.03.2020 attaching the bank
accounts of the petitioner company maintained with the 5th respondent
Bank.
5. Learned counsel appearing for the petitioner submits that the
impugned demand notice was issued without application of mind as
there was no tax liability with regard to the assessment year 2002-2003
and the liability with regard to the Assessment Year 2004-2005 had
been altered due at Rs.2,95,374/- as per the purported order dated
31.10.2008, which had not been served upon the petitioner.
6. He further submits that the assessment order dated 31.10.2008
with regard to the Assessment Year 2003-2004 is an ante-dated one as it
was not even referred to in the response dated 20.05.2015 given by the
department to the reply of the petitioner to the urgent notice dated
28.06.2014 calling upon the latter to pay alleged tax arrears.
7. Mr.Y.N.Vivekananda, learned counsel appearing for the
respondent department candidly submits that the demand upon the
petitioner is to the tune of Rs.2,95,374/- as per the assessment order,
dated 31.10.2008. He, however, contends that the said assessment
order was passed after giving an opportunity of hearing to the
petitioner and was duly served upon it. Such order had not been
appealed and had become final.
8. In rebuttal, learned counsel for the petitioner submits that the
said order had not been served as per Rule 58 of Andhra Pradesh
General Sales Tax Rules and was not even referred to in the
communication dated 20.05.2015, as aforesaid. His client has been
advised to assail the said order in accordance with law.
9. Having considered the rival submissions of the parties, we note
that the impugned demand notice dated 02.03.2020 is incorrect with
regard to the demand of Rs.15,89,840/- for the Assessment Years 2002-
2003 and 2004-2005 respectively. Admittedly there is no tax liability
with regard to the Assessment Year 2002-2003 whereas the tax liability
was reduced to Rs.2,95,374/- with regard to the Assessment Year 2004-
2005. Hence, there is much force in the submission of the petitioner
that the demand notice was issued without proper application of mind
and is an incorrect one.
10. For the aforesaid reasons we are of the opinion that the
impugned demand notice dated 02.03.2020 and the consequential
attachment order being illegal and without authority of law, are liable
to be set aside.
11. We, however, give liberty to the department to issue fresh
demand notice in accordance with law, if so advised. We express no
opinion with regard to the issue whether the assessment order dated
31.10.2008 was served upon the petitioner as per Rules and keep such
issue open to be adjudicated in accordance with law, if occasion arises.
12. With these observations, the Writ Petition is disposed of.
There shall be no order as to costs.
As a sequel, Miscellaneous Petitions, if any, pending in the Writ
Petition shall stand closed.
______________________
JUSTICE JOYMALYA BAGCHI
_______________
JUSTICE D.RAMESH
Date: 26.8.2021
Pnr
THE HON'BLE SRI JUSTICE JOYMALYA BAGCHI
AND
THE HON'BLE SRI JUSTICE D.RAMESH
WRIT PETITION NO.3625 of 2021
Dated: 26.8.2021
Pnr
