Asian Paints Limited vs The State Of Andhra Pradesh
2022 Latest Caselaw 8589 AP

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            HIGH COURT OF ANDHRA PRADESH
      MAIN CASE No: W.P.No.36251 OF 2022

                            PROCEEDING SHEET

Sl.     DATE                          ORDER                               OFFICE
No.                                                                        NOTE
1     09.11.2022 TRR, J
                      The       Assessment          Order,         vide
                Rc.No.A/995/2017 dated 04.10.2022, was issued
                by the 2nd respondent herein, directing the writ

petitioner to pay the amount of balance Cess of Rs.8,73,00,000/- within 30 days of receipt of the notice. The said order came to be challenged before this Court in the present Writ Petition on the ground that the 2nd respondent has issued the impugned notice contrary to Section 3 of the Andhra Pradesh Building and Other Construction Workers' Welfare Cess Act, 1996. Section 3 of the said Act is hereby extracted hereunder:

"3. Levy and collection of cess.--

(1) There shall be levied and collected a cess for the purpose of the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, at such rate not exceeding two per cent, but not less than one per cent, of the cost of construction incurred by an employer, as the Central Government may, by notification in the Official

Sl. DATE ORDER OFFICE No. NOTE Gazette, from time to time specify. (2) The cess levied under sub-section (1) shall be collected from every employer in such manner and at such time, including deduction at source in relation to a building or other construction work of a Government or of a public sector undertaking or advance collection through a local authority where an approval of such building or other construction work by such local authority is required, as may be prescribed."

The case of the petitioner is that the respondent-authorities have no authority to impose/levy Cess on the plant and machinery and therefore, sought a direction to set aside the impugned assessment order.

Learned counsel for the petitioner has relied on the judgment of the Hon'ble Supreme Court in Uttar Pradesh Power Transmission Corporation Limited and another v. CG Power and Industrial Solutions Limited and another [(2021) 6 Supreme Court Cases 15], wherein it indicates that availability of an alternative remedy does not prohibit the High Court from entertaining a Writ Petition in an appropriate case and the High Court may entertain a writ petition, notwithstanding the

Sl. DATE ORDER OFFICE No. NOTE availability of an alternative remedy, particularly, (1) where the writ petition seeks enforcement of a fundamental right, (2) where there is failure of principles of natural justice or (3) where the impugned orders or proceedings are wholly without jurisdiction or (4) the vires of an Act is under challenge. The learned counsel for the petitioner would submit that the impugned order in the present Writ Petition is beyond the jurisdiction under Section 3 of the Act, where a writ is maintainable.

Learned counsel for the respondent- authorities would submit that an appeal is maintainable before the appellate authority under Section 11 of the Andhra Pradesh Building and Other Construction Workers' Welfare Cess Act, 1996, read with Rule 14 of the Andhra Pradesh Building and Other Construction Workers' Welfare Cess Rules, 1998, and as per the said Rule, this Court cannot exercise jurisdiction of this Court under Article 226 of the Constitution of India, as there is an alternative remedy of appeal under the aforesaid Rule.

Learned counsel for the respondent- authorities has relied on Rule 3 of the Andhra Pradesh Building and Other Construction Workers' Welfare Cess Rules, 1998, which is extracted hereunder:

Sl.   DATE                                ORDER                                OFFICE
No.                                                                             NOTE

"3. Levy of cess.-- For the purpose of levy of cess under sub-section (1) of section 3 of the Act, cost of construction shall include all expenditure incurred by an employer in connection with the building or other construction work but shall not include--

                -    cost of land;
                -    any compensation paid or payable to a

worker or his kin under the Workmen's Compensation Act, 1923."

As per the said Rule, the construction shall include all expenditure incurred by an employer in connection with the building or other construction work but shall not include any compensation paid or payable to a worker or his kin under the Workmen's Compensation Act, 1923.

Learned counsel for the respondent would submit that the expenditure includes the plant and machinery and, therefore, the petitioner invariably has to pay cess as per the above Rule.

To resolve the above contended issues, counter is required.

To protect the interest of the writ petitioner, there shall be an interim direction to the respondent-authorities not to take any coercive steps pursuant to the impugned assessment order, dated 04.10.2022, on condition of the petitioner depositing Rs.1,00,00,000/- (Rupees one crore

Sl. DATE ORDER OFFICE No. NOTE only), i.e., an amount of Rs.50,00,000/- (Rupees fifty lakhs only) by way of cash and Rs.50,00,000/- (Rupees fifty lakhs only) by way of bank guarantee, within a period of two (2) months from today, failing which, the respondent-authorities shall proceed in accordance with law in pursuant to the impugned assessment order issued by the 2nd respondent.

Post the Writ Petition after eight (8) weeks for filing counter.

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                                                            TRR,J
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