Andhra Pradesh High Court - Amravati
M/S. Sri Venkateswara Constructions vs The Assistant Commissioner Of State Tax on 18 March, 2026
Author: R. Raghunandan Rao
Bench: R Raghunandan Rao
APHC010330282025
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3529]
(Special Original Jurisdiction)
WEDNESDAY, THE EIGHTEENTH DAY OF MARCH
TWO THOUSAND AND TWENTY SIX
PRESENT
THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO
THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR
WRIT PETITION Nos.16833, 21869 & 22017 of 2025
WRIT PETITION NO: 16833/2025
Between:
1. M/S. SRI VENKATESWARA CONSTRUCTIONS,, 4/539/2,
RAMALAYAM STREET, ARAVINDA NAGAR, CHINNA CHOWK,
KADAPA, YSR KADAPA DISTRICT, ANDHRA PRADESH, REP. BY
ITS MANAGING PARTNER, V. VISWANADHA REDDY
...PETITIONER
AND
1. THE ASSISTANT COMMISSIONER OF STATE TAX, KADAPA-I
CIRCLE, I FLOOR, OPP YSR GUEST HOUSE, SMITH ROAD, NEAR
ZILLA PARISHAD, KADAPA- 516001, YSR KADAPA DISTRICT,
ANDHRA PRADESH.
2. THE ASSISTANT COMMISSIONER OF STATE TAX, O/O.
ADDITIONAL COMMISSIONER (ST), REGIONAL GST AUDIT AND
ENFORCEMENT OFFICE, TIRUPATI, 7TH FLOOR, DISTRICT
COLLECTOR OFFICE BUILDING, TIRUPATI, TIRUPATI DISTRICT,
ANDHRA PRADESH - 517504.
3. THE STATE OF ANDHRA PRADESH, REP. BY THE PRINCIPAL
SECRETARY TO THE GOVERNMENT, REVENUE (ST)
DEPARTMENT, A.P. SECRETARIAT BUILDINGS,
VELAGAPUDI,GUNTUR DISTRICT, ANDHRA PRADESH.
4. THE ANDHRA PRADESH INDUSTRIAL INFRASTRUCTURE
CORPORATION LIMITED, (GOVT, OF A.P. UNDERTAKING), PLOT
NO. 1, I.T. PARK, MANGALAGIRI, GUNTUR DISTRICT, ANDHRA
PRADESH, REP. BY ITS MANAGING DIRECTOR.
5. THE UNION OF INDIA, REP. BY ITS SECRETARY (FINANCE),
MINISTRY OF FINANCE, NORTH BLOCK, NEW DELHI - 110001.
6. THE BRANCH MANAGER, INDIAN BANK, AMEEN COMPLEX, NEAR
2
OLD BUS STAND, CUDDAPAH- 516001, ANDHRA PRADESH.
...RESPONDENT(S):
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased tobe pleased to issue an appropriate Writ, Order or Direction, more particularly in the nature of MANDAMUS declaring the action of the First Respondent in recovering Rs. 75,32,139/- from the Cash and Credit Ledgers of the Petitioner and further issuing the impugned Notice to third person under section 79(1 )(c) of the GST Acts, 2017, vide Rc.No.DRC13/Recovery/Kadapa-l Circle, dated 24-03-2025 (signed on 23- 05-2025), to the Sixth Respondent Bank where the Petitioner is having Current Account No 855379482, for recovery of the balance amount of Rs. 1,35,12,360-00 from the Petitioners Account in the Sixth Respondent Bank, towards the dues towards differential tax and interest arising out of the Assessment Order passed by the Second Respondent vide Ref. No. AD3711220069648, dated 04-08-2023, as being contrary to and violative of the directions contained in the Order of this Honble High Court, dated 24-07- 2024, in W.P. No. 22663 of 2023, directing that the same are payable by the Fourth Respondent, amounts to contempt of court, unjustified and illegal and consequently set aside the impugned Notice to third person u/S. 79(1 )(c) and direct the First Respondent to refund the amount of Rs. 75,32,179/- recovered by the First Respondent from the Petitioner's Cash and Credit Ledgers with interest and direct the First Respondent to recover the due amounts from the Fourth Respondent and pass such IA NO: 1 OF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased IA NO: 1 OF 2026 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased May be pleased to receive the counter copies on record by allowing the leave petition in the above writ petition and pass Counsel for the Petitioner:
1. G NARENDRA CHETTY Counsel for the Respondent(S):
1. SANTHI CHANDRA
2. GP FOR COMMERCIAL TAX
3. GP FOR COMMERCIAL TAX 3 The Court made the following Order: (per Hon'ble Sri Justice R. Raghunandan Rao) The petitioner herein is a contractor who executes work contracts for other contractors as well as for the Government institutions. One M/s. Sri Venkateswara Constructions had obtained certain road work and other construction contracts from M/s. Andhra Pradesh Industrial Infrastructure Corporation (herein referred to as "M/s. APIIC") and had subcontracted these contracts to the petitioner herein. In the years 2021-22 & 2022-23, the petitioner had executed these contracts and had received consideration for the execution of such contracts along with GST @12%. Subsequently, demands were raised against the petitioner, by the GST authorities, on the ground that the appropriate rate of GST is 18% and not 12% for these years.
Aggrieved by the said order of assessment passed against the petitioner on 30.05.2025 for the period 2022-23 and the order of assessment, dated 30.05.2025, for the period 2021-22, the petitioner has filed the present Writ Petitions.
2. The case of the petitioner is that the rate of tax payable, on the contracts executed by the petitioner, would be @12% and not @18%, for the relevant period. The petitioner also contends, in the alternative, that even if the rate of tax is to be treated as @18% on these contracts, the petitioner requires to be reimbursed by the main contractor M/s. Sri Venkateswara Constructions and the petitioner would thereupon remit the differential amount of tax to the department.
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3. The main contractor M/s. Sri Venkateswara Constructions has also approached this Court by way of W.P.No.22663 of 2023 contending that the action of the tax authorities seeking to recover Rs.75,32,139/- from M/s. Sri Venkateswara Constructions was impermissible inasmuch as M/s. Sri Venkateswara Constructions had already discharged it's tax liability @12% and M/s. Sri Venkateswara Constructions cannot be called upon to pay the tax @18%. M/s. Sri Venkateswara Constructions also contended that even if such payment had to be made, the same would have to be reimbursed by M/s. APIIC. This Court by an Order, dated 24.07.2024 had disposed of the W.P.No.22663 of 2023 holding that the rate of tax on this contract would be @18%. However, this Court also directed M/s. APIIC to reimburse the differential rate of tax, along with the interest, to M/s. Sri Venkateswara Constructions. M/s. APIIC had reimbursed an amount of Rs.1,54,72,958/- as the differential rate of tax against the claim of M/s. Sri Venkateswara Constructions for a sum of Rs.1,82,56,578/-. The difference between these two figures is in dispute.
4. M/s. Sri Venkateswara Constructions, has again approached this Court by way of the W.P.No.16833 of 2025 contending that it was entitled to reimbursement of the differential amount and also for a direction to set aside the attachment of the bank accounts of M/s. Sri Venkateswara Constructions and for a further direction to the 1st respondent therein to refund a sum of Rs.75,32,179/-.
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5. Heard Sri L. Chandra Obul Reddy, learned counsel for the petitioner in W.P.Nos.21869 & 22017 of 2025, Sri G. Narendra Chetty, learned counsel for the petitioner in W.P.No.16833 of 2025 and also appearing for the 6th respondent in W.P.Nos.21869 & 22017 of 2025 and Smt. Santhi Chandra, the Learned Standing Counsel appearing for APIIC and the Learned Government Pleader for Commercial Tax appearing for the respondents.
6. The question of the rate of tax had already been decided by this Court in W.P.No.22663 of 2023. In that view of the matter, the rate of tax payable on the consideration received in these contracts is 18%.
7. This Court in W.P.No.22663 of 2023, had also held that M/s. APIIC would be liable to reimburse M/s. Sri Venkateswara Constructions, for the tax paid by M/s. Sri Venkateswara Constructions in relation to the consideration received against the work done for the work contracts given by M/s. APIIC. According to M/s. APIIC the differential amount of Rs.1,54,72,959/- had been paid in full. M/s. Sri Venkateswara Constructions disputes these figures and contends that the differential tax is Rs.1,82,56,578/-.
8. Be that as it may, M/s. Sri Venkateswara Constructions, which had awarded a sub-contract, in relation to these contracts, to the petitioner in W.P.Nos.21869 & 22017 of 2025, had also reimbursed this petitioner, to the extent of 12% of the consideration received by the petitioner from M/s. Sri Venkateswara Constructions. However, M/s. Sri Venkateswara Constructions 6 has not reimbursed the differential amount of 6% despite receipt of amounts from M/s. APIIC. It is contended by Sri G. Narendra Chetty, learned counsel for the petitioner that M/s. Sri Venkateswara Constructions had remitted the entire amount received from M/s. APIIC to discharge its tax liability. To the mind of this Court, the petitioner in W.P.Nos.21869 & 22017 of 2025 is entitled to the same benefit and consideration as M/s. Sri Venkateswara Constructions, in W.P.No.22663 of 2023. This would require M/s. Sri Venkateswara Constructions to reimburse the differential amount of Rs.63,88,598/- claimed by the petitioner in W.P.Nos.21869 & 22017 of 2025.
9. In the circumstances, M/s. Sri Venkateswara Constructions would have to reimburse the petitioner in W.P.Nos.21869 & 22017 of 2025. Upon such reimbursement, it would be open to the petitioner to raise debit notes which can be passed on to M/s. Sri Venkateswara Constructions. In view of the Circular No.160/16/2021-GST, dated 20.09.2021, the debit notes issued after 01.01.2021 would be taken into account in the assessment year in which such debit notes are issued. This benefit would be available to M/s. Sri Venkateswara Constructions.
10. In view of the aforesaid situation, W.P.Nos.21869 & 22017 of 2025 are disposed of with a direction to M/s. Sri Venkateswara Constructions- respondent No.6 herein, to remit the differential rate of tax to the petitioner in W.P.Nos.21869 & 22017 of 2025. The said payment is to be made in six weeks. The petitioner in these Writ Petitions would however not be absolved of the liability to pay the said tax to the GST authorities. 7
11. As far as W.P.No.16833 of 2025 is concerned, the dispute between M/s. APIIC and the petitioner, regarding the liability of M/s. APIIC to reimburse the sum of Rs.28,00,000/-, approximately, is left open for resolution before the appropriate forum. It is disposed of accordingly.
12. M/s. Sri Venkateswara Constructions had also contended that it was entitled to a refund of Rs.75,32,170/- on the ground that this amount had been recovered from the cash and credit ledgers despite payment of entire tax along with the interest by M/s. Sri Venkateswara Constructions. This issue, cannot be decided by this Court in the present Writ Petition. Accordingly, M/s. Sri Venkateswara Constructions is permitted to raise the question of payment of tax, twice over, as claimed by M/s. Sri Venkateswara Constructions and upon such claim being made, the account of M/s. Sri Venkateswara Constructions, with the department, shall be reconciled and any excess payment found shall be refunded, in accordance with the provisions of Section 54 of the GST Act. The said reconciliation is to be completed within a period of two months from the date of receipt of this Order. There shall be no order as to costs.
As a sequel, pending miscellaneous applications, if any, shall stand closed.
________________________ R. RAGHUNANDAN RAO, J _________________ T.C.D. SEKHAR, J Date:- 18.03.2026 BSM 8 THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO AND THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR WRIT PETITION Nos.16833, 21869 & 22017 of 2025 Date:-18.03.2026 BSM