Andhra HC (Pre-Telangana)
Bhagyanagar Traders vs Commercial Tax Officer, Charminar ... on 11 February, 1991
Equivalent citations: [1992]85STC558(AP)
Author: Chief Justice
Bench: Chief Justice
JUDGMENT Yogeshwar Dayal, C.J. and Lakshmana Rao, J.
1. Heard the learned counsel for the petitioner as well as the learned Government Pleader for Commercial Taxes.
2. The petitioner is a trading firm carrying on business in the sale of seeds and foodgrains. It was registered under the A.P. General Sales Tax Act, 1957, and the Central Sales Tax Act, 1956, with the Commercial Tax Officer, Charminar Circle, Hyderabad.
3. For the assessment year 1985-86, the petitioner herein purchased maize and til-seeds for Rs. 38,342 and Rs. 5,38,515, respectively, from registered dealers in the State of Andhra Pradesh.
4. Til-seeds and maize are both liable to sales tax at the point of first purchase within the State of Andhra Pradesh under entries 3 and 18 of the Third Schedule to the A.P. General Sales Tax Act. These are declared goods. It was submitted on behalf of the petitioner that it is a case of second purchase in the hands of the petitioner and that they filed declarations to that effect before the assessing authority that both these sets of goods had suffered tax in the hands of the registered dealers from whom the petitioner had purchased them.
5. After purchasing the til-seeds and maize from the registered dealers in the State of Andhra Pradesh, the petitioner sold them by way of inter-State sales for Rs. 5,48,505 and Rs. 42,677, respectively, and filed returns under the Central Sales Tax Act in the months of September, 1985 and October, 1985 and paid Central Sales Tax under the Central Sales Tax Act.
6. After submitting monthly returns under the Andhra Pradesh General Sales Tax Act and the Central Sales Tax Act, the petitioner filed form F under rule 27-A of the Andhra Pradesh General Sales Tax Rules on October 16, 1985 and November 3, 1985, requesting them to issue orders refunding the sales tax paid within the State on the above goods.
7. The respondent after verifying the purchase bills and the declarations issued by the selling registered dealers to the effect that they had paid sales tax on the til-seeds and maize, granted exemption on the purchase turnover of til-seeds and maize under orders dated July 19, 1986, and taxed the inter-State sales turnover of both the goods by an order dated October 15, 1987.
8. It is clear from the assessment order dated July 19, 1986, that in relation to the purchase of maize within the State by the petitioner, exemption was allowed on a turnover of Rs. 38,342 and similarly exemption was allowed on a turnover of Rs. 5,38,515 for til-seeds. These exemptions were allowed on the ground that the two items were second purchases and were not subject to local sales tax is leviable only at the stage of first purchase. It is also clear from the Central sales tax assessment order dated October 15, 1987, that the petitioner had paid Central Sales Tax in relation to the turnover of the aforesaid two items.
9. The petitioner had applied for refund of tax as contemplated by rule 27-A of the Andhra Pradesh General Sales Tax Rules. Rule 27-A reads as follows :
"(1) Where any tax and the surcharge have been levied and collected under section 6 and section 6-B in respect of the sale or purchase inside the State of any declared goods and such goods are subsequently sold in the course of inter-State trade or commerce, the tax and surcharge so levied and collected shall be reimbursed to the person in the manner and subject to the conditions specified in sub-rules (2) to (4) :
Provided that the refund shall not be made unless the tax payable under the Central Sales Tax Act is paid.
(2) The refund of tax and the surcharge referred to in sub-rule (1) shall be made to the dealer who effected the first sale in the course of the inter-State trade or commerce.
(3) Every application for refund under this rule shall be filed by the dealer claiming refund before the assessing authority having jurisdiction over his place of business within a period of three months from the date of payment of the tax due under the Central Sales Tax Act, 1956, in respect of the goods specified under sub-rule (1) in form 'F'.
Provided that the assessing authority may condone for reasons to be recorded in writing, any delay in the filing of such application.
(4) The burden of proving that a dealer is entitled to a refund under this rule shall be with the dealer claiming such refund.
(5) The assessing authority shall after making such enquiry as he considers necessary refund without interest the tax and surcharge levied and collected under section 6 and section 6-B not later than three months from the date of receipt of the application specified under sub-rule (3) :
Provided that the assessing authority shall first adjust the amount of refund towards tax and surcharge, if any, due from the dealer for any year and then refund the balance, if any."
10. It is clear that the applications for refund were filed within time and were required to be disposed of within three months from the date of receipt of those applications by the assessing authority.
11. The aforesaid facts are admittedly in the counter-affidavit filed on behalf of the respondent and it is also pointed out that cross-verification slips had been sent to the Commercial Tax Officers, Siddipet, Nalgonda and Nizamabad and the Deputy Commercial Tax Officer, Jangaon, on July 28, 1986, August 18, 1988, January 27, 1989 and July 6, 1990 requesting them to verify the accounts of the dealers and find out whether the actual sales tax is paid by the dealers for that period for considering the claim for refund of the tax.
12. It may be noticed that in the assessment order itself exemption was allowed on the ground that it was a case of second purchase and no further check is required. In any case the cross-check should have been completed within three months as contemplated by sub-rule (5) of rule 27-A of the Andhra Pradesh General Sales Tax Rules. In the above circumstances, we find no reason for withholding the refund for all these years. A writ of mandamus is accordingly issued directing the respondent to refund the local sales tax collected from the petitioner for the aforesaid two sets of goods for the aforesaid turnover, within a period of one month from the date of receipt of this order, together with interest calculated at the rate of 12 per cent per annum with effect from November 1, 1986, since the order of assessment was made on July 19, 1986. No costs.
13. Writ petition allowed.