Andhra HC (Pre-Telangana)
P.C. Srinivasulu Chetty And Sons Co. vs State Of Andhra Pradesh And Ors. on 11 February, 1988
Equivalent citations: [1989]75STC366(AP)
Bench: B.P. Jeevan Reddy, M. Jagannadha Rao
JUDGMENT Jagannadha Rao, J.
1. This is an application for the issue of writ of mandamus commanding the respondents to refrain from demanding additional security from the petitioner under the Andhra Pradesh General Sales Tax Act.
2. The notice that is questioned in the writ petition is the one dated 21st May, 1984. It is issued under section 12(2) of the Act and it is proposed to demand under section 12(2)(e)(ii) a sum of Rs. 4,36,000, as security from the petitioner-firm for the following reasons :
"(1) There is a prima facie case of evasion of tax by you in the years 1979-80 and 1980-81.
(2) You have indulged in filing of false declaration in form I in support of the exemption claimed by you during the abovesaid years, with a view to evade payment of taxes under the A.P. General Sales Tax Act.
(3) The declarations in form I filed by you for the said years are from non-existing firms in some cases.
(4) You are continuing to file such declarations, from non-existing firms to fraudulently evade payment of taxes legally due to the Government, and (5) Also to ensure proper payment of taxes legally due from you."
3. It is further stated therein that the tax and surcharge payable on such tax totally payable by the petitioner for the years commencing from 1st April, 1979 and ending by 31st March, 1981, is estimated at Rs. 8,72,115. The said figure is arrived at by estimating a tax of Rs. 1,85,190 for 1979-80 and Rs. 6,86,925 for the year 1980-81. The petitioner was called upon to file his objections. The petitioner filed his explanation on 6th June, 1984, stating that the net turnover determined by the assessing officer for the years 1979-80 and 1980-81 and the demands raised and taxes paid by the petitioner are respectively in sums of Rs. 9,580, Rs. 68,208 (tax due) and Rs. 9,580, Rs. 77,315 (tax paid). It was further pointed out that for the years subsequent to 1980-81 the petitioner had paid tax in a sum of Rs. 7,961 for 1981-82, Rs. 19,241.70 for 1982-83 and Rs. 1,760 for 1983-84. The explanation shows that the turnover for the years commencing from 1979-80 to 1983-84 had been determined by the authorities.
4. It is not denied in the counter-affidavit filed by the respondents that the assessments for the years 1979-80 and 1980-81 mentioned in the abovesaid notice have been completed by the date of issue of the notice on 21st May, 1984. Though it has been mentioned in the demand notice that there is evasion of tax by the petitioner it is not stated that any proceedings for reopening of the assessments had been taken out by the competent authority, viz., the concerned Commercial Tax Officer. It is also not denied that the registration authority, viz., the Assistant Commercial Tax Officer who has given this notice is not the authority competent to make the reassessment, if any, in the present case.
5. We fail to see what purpose will be served by calling upon the petitioner to furnish additional security if the assessment for 1979-80 and 1980-81 had been completed and no proceedings for reassessment had been initiated. Further the authority which has issued the notice is not the authority which is competent to initiate reassessment proceedings. In the circumstances, we are of the view that the abovesaid demand notice ought not to have been issued on the facts of the present case.
6. The writ petition is accordingly allowed commanding the respondents not to take any further proceedings pursuant to the demand notice dated 21st May, 1984, impugned in this writ petition. There shall be no order as to costs. Advocate's fee Rs. 150.
7. Writ petition allowed.