BharatTaxGST

M/S. Venkateswara Boiled And Raw Rice Mill vs. The Commercial Tax, Officer, Markapur.

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WP/25097/2006HC Andhra PradeshGSTCNR APHC01012063200617 March 2024Bench: U.DURGA PRASAD RAO,A V RAVINDRA BABU12 pages
For Petitioner: SRI M.S.HARISHITHA FOR SRI GUDURI, VENKATESWARA RAOFor Respondent: GP FOR COMMERCIAL TAX (AP)

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Cause title — parties, addresses and appearances
IN THE HIGH COURT OF ANDHRA PRADESH::AMARAVATI (Special Original Jurisdiction) MONDAY, THE EIGHTEENTH DAY OF MARCH TWO THOUSAND AND TWENTY FOUR | PRESENT ' , THE HONOURABLE SRI JUSTICE U.DURGA PRASAD RAO AND THE HONOURABLE SRI JUSTICE A.V.RAVINDRA BABU WRIT PETITION NO: 25097 OF 2006 c> Oil o: f« Si lO' Between: M/s. Venkateswara Boiled & Raw Rice Mill, Pothavaram Ravi Venkateshwarlu rep by Proprietor Mr. ...Petitioner AND 1. The Commercial Tax, Officer, Markapur. 2. The Deputy Commercial Tax Officer, Markapur. ...Respondents Petition under Article 226 of the Constitution of India the circumstances stated in the affidavit filed therewith praying that in the High Court may be pleased to issue an appropriate Writ, order or direction more particularly in the nature of writ of Mandamus declaring the respondents in not extending the benefit of waiver of demand of Rural Development Cess for the assessment one action of the year 2002-03 pursuant to GO.Ms. and 683 dt.03-09-2004, G.O.Ms.No.290 dt.07-09-2005 consequently set aside the demand notice dt 07-11-2006 issued in form-4 under Revenue Recovery Act as far as Rural Development Cess in concerned and to grant six equal monthly installments for payment of the APGST No. 950, 951 dt. 10-09-2003 G.O.Ms.No.682 G.O.Ms.No.25 dt. 09-11-1996 and arbitrary, illegal, without jurisdiction and as amount of Rs. 66,269/- for the year 2002-2003. l-A. NO: 1 OF 2006rWPMP. NO: 32128 OF 2006^ /'f. 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 ^ hpleas^d grant stay of all further proceedings pursuant to the demand notice dt;,0Z-i:i -2OO6 issued under Section-25 of the Revenue Recovery act. ‘r )' • -■ . '• I.A. NO: 1 OF 2007rWVMP. NO: 998 OF 2007) Between: 1. The Commercial Tax, Officer, Markapur. 2. The Deputy Commercial Tax Officer, Markapur. ...Petitioners/Respondents AND 3. M/s. Venkateswara Boiled & Raw Rice Mill, Pothavaram reo bv Proprietor Mr. Ravi Venkateshwarlu ...Respondent/Writ Petitioner 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 to vacate the Interim order granted on 4-12-2006 passed in WP.MP.No.32128/2006 in WP.No.25097/2006 Counsel for the Petitioner: SRI M.S.HARISHITHA FOR SRI GUDURI VENKATESWARA RAO Counsel for the Respondents: GP FOR COMMERCIAL TAX (AP) Counsel for the Respondents: SRI DANTU SRINIVAS, (SPLSC FOR CT)

The Court made the following: ORDER

APHC010120632006 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Juri iction) SMB [3438] a MONDAY, THE EIGHTEENTH DAY OF MARCH TWO THOUSAND AND TWENTY FOUR PRESENT THE HONOURABLE SRI JUSTICE U.DURGA PRASAD RAO THE HONOURABLE SRI JUSTICE A V RAVINDRA BABU WRIT PETITION NO; 25097/2006 Between: M/s. Venkateswara Boiled & Raw Rice Mill, PETITIONER • •• AND k The Commercial Tax Officer Markapur and Others RESPONDENT(S) • •• Counsel for the Petitioner: l.GUDURI VENKATESWARA RAO Counsel for the Respondent(S): 1.9459/DANTU SRINIVAS( SPL SC FOR CT) 2.GP FOR COMMERCIAL TAX (AP) The Court made the following Order: The petitioner seeks writ of mandamus challenging the action of it the respondents in not extending the benefit of waiver of demand of Rural Development Cess for the Assessment Year 2002-03 pursuant to 2 the G.O.Ms.No.950 & 951 (fated 10.09.2003, G.O.Ms.No.682 & 683 dated 03.09.2004, G.O.Ms.No.25 dated 09.01.1996 and G.O.Ms.No.290 dated 07.09.2005 as arbitrary, illegal and consequently to set aside the demand notice dated 07.11.2006 issued by the D.C.T.O., Markapur in Form-4 under Revenue Recovery Act [for short “RR Act”] as far as Rural Development Cess is concerned and to grant six equal monthly installments for payment of the APGST amount of Rs.66,296/- for the year 2002-03 and to pass such other orders. The petitioner’s case sufjcinctly is thus:

2.

(a) Petitioner is engaged in rice milling and as a registered dealer under the roles of respondent under Andhra Pradesh General Sales Central Sales Tax Act (for Tax Act (for short ‘APGST Act’) as well short ‘CST Act’). Petitioner purchases paddy from the agriculturists and converts into rice through milling and sell to the Food Corporation of as India (for short ‘FCI’) as levy rice and sells the balance quantity to the dealers in and outside the State of Andhra Pradesh. (b) Further case of the petitioner is that the rice millers purchase paddy from the agriculturists on minimum support price (for short ‘MSP’) fixed by the Central Government from the season to season.

3 However, sometimes due to. the competitions and non-availability of paddy, the millers pay premium over and above the MSP and procure the paddy, mill and supply to the F.C.I. wtiile so, for the purpose of levy of Rural Development Cess (for short ‘RDC’) under the Andhra Pradesh Rural Development Cess Act, 1996, [ for short “APRDC Act 991 the entire purchase of the paddy including premium is taken into consideration by the authorities. As it caused much hardship, the millers made representation and the Government of Andhra Pradesh issued G.O.Ms.No.950 Revenue (CT.II) Department, dated 10.09.2003, whereunder levy of RDC is restricted to the MSP of paddy in exclusion of the premium. (c) While so, the Government of Andhra Pradesh issued a further G.O.Ms.951, Revenue (CT.II) Department, dated 10.09.2003 granting exemption of RDC component of purchase value on paddy by the rice millers from the levy of sales tax. (d) Subsequently, the Government issued G.O.Ms.No.952 Revenue (CT.II) Department, dated 10.09.2003 waiving the outstanding demand relating to the levy of RDC on actual purchase prices paid by ‘ A towards and also the outstanding arrears value of paddy till date. and above MSP rDC component of purchase millers over sales tax on issued G.O.Ms.No.682 Revenue effect to (e) Thereafter, the Government , dated 03.09.2004 giving retrospective (CT-II) Department G.O.Ms.No.951 condition that where the from 30.10.1995 subject to finalized and the demands were raised and collected, assessments were such assessments shall not be re-opened. issued G.O.Ms.No.683 (f) Subsequently, the Government .2004 directing that the orders from 30.10.1995 finalized and shall not be re-opened. Revenue (CT-II) Department, dated 03.09 in G.O.Ms.No.950 shall be applied retrospectively that where the assessments were subject to condition demands raised were collected, such assessments the further case of the petitioner is that in spite of above actual (g) Then successive G.Os issued by the Government waiving the RDC on MSP and sales tax on the purchase prices paid by millers over and above e value of paddy, the 2 respondent issued nd RDC component and purchase qon 25 of R.R Act for 26.10.2006 under Section Form-4 notice dated of an amount towards APGST for the year of Rs.78,825/- i f ,00,514/- towards RDC recovery nd for the said period, later the 2 2002-03 and Rs.3

5 respondent issued a revised Fonn-4 notice dated 07.11.2006 and reduced the APGST from Rs.78,825/- to Rs.66,269/-. In the light of successive G.Os., the issuance of Form-4 notice insofar as demanding RDC of Rs.3,00,514/- is illegal and without juri iction. So far APGST of Rs.66,269/- is concerned, the petitioner could not pay the said amount due to severe financial crisis and it is ready to pay the same in installments. as Hence the writ petition.

3.

Respondent filed counter opposing the writ petition. Succinctly stating, while admitting the different G.Os issued by the Government narrated in the writ petition, the respondent however contends that the petitioner being a dealer under the provisions of AP GST Act, 1957 and under the APRDC Act, purchased 20039 Quintals of paddy during the year 2002-03 from the Ryots with MSP fixed by the Government. From the said quantity of paddy, the petitioner milled 17808 Quintals and obtained 12466 Quintals of rice for being supplied to FCI under levy control order. Thereafter, Assessment Order for the year 2002-03 was completed on 10.02.2006 determining the value of the paddy Rs.99,72,799/-. The 5% cess on the above value worked out at as at 6 Rs.4,98,640/-. The cess amount was recovered by the petitioner from the FCI in the sale price of the irce.

4.

The further case of the respondent is that the assessment of the 10.02.2006 levying tax on the As per the assessment tax petitioner under APGST Act was made on purchase of the paddy and sale of rice, demand of Rs.66,269/- was raised under AP GST Act. The said amount does not relate to RDC compdfrent. Since the petitioner failed to pay the tax amount as well as cess, notice in Form-4 under RR Act, 1864 was issued.

5.

The G.Os cited by the petitioner are not in dispute, outstanding tax and cess payable by the dealer like petitioner from its However, these G.Os did not envisage a The profits shall be waived, situation where the dealer collected tax/cess from the customers and did not remit to the State. Such non-payment of tax/cess by the petitioner within the ambit of after collecting from the cust?)mers does not come outstanding tax/cess due by the dealer to attract the above G.Os. If the tax/cess collected by the petitioner from its customer is allowed to be retained by enrichment by the petitioner at the cost of public money in him without remitting to the State, then it amounts to unjust the form of 7 tax/cess collected in the name of the State. Hence the Form - IV notice issued to the petitioner is legal and justified. So far as tax of Rs.66,269/- is concerned, the petitioner himself admits his liability and therefore he has to pay the said amount. The respondent thus prayed to dismiss the writ petition.

6.

Heard Ms. S. Harishita, learned counsel representing Giduri Venkateswara Rao, learned counsel for the petitioner and learned Government Pleader for Commercial Taxes for respondents. Both the learned counsel reiterated their pleading^ in their respective arguments.

7.

The point for consideration is whether there are merits in the writ petition to allow ?

8.

POINT: Admittedly two components are involved in this case i.e., tax component of Rs.66,269/- under AP GST Act for the year 2002- 03 and RDC of Rs.3,00,514/- for the year 2002-03. So far as tax of Rs.66,269/- is concerned, the petitioner admits its liability to pay the said amount but on the ground of some financial difficulties the petitioner prays to grant six equal monthly installments for payment of the said amount. As rightly contended by the Government Pleader, this Court cannot consider the said request and order the payment of tax under installments. The petitioner can approach the concerned authority and make a representation in that regard if so advised.

9.

So far as RDC of Rs.3,00,514/- is concerned, the petitioner is not disputing the quantum of the cess but only questions its validity on the ground that in view of several G.Os narrated supra, the petitioner shall be exempted from payment of the cess. The respondent opposes the claim of the petitioner on the main contention that in the normal circumstances the petitioner is entitled to the exemption, but however. since the petitioner has already collected the cess amount from the FCI for the relevant period, the petitioner is not entitled to claim exemption and if such exemption is granted, it will amount to facilitating the petitioner to get undue enrichment. We find force in the said contention of learned Government Pleader. If the petitioner has already collected the cess amount from the FCI, it has to remit the same to the Government as otherwise granting exemption will amount to undue enrichment on the part of the petitioner. It should be noted that the petitioner did not file any rejoinder challenging the counter averments that the petitioner has already collected the cess amount from the FCI.

9 As such, the said contention shall be accepted as a true fact. In that view, the petitioner is not entitled for any relief in this writ petition.

10.

Accordingly, the writ petition is dismissed. No costs. As a sequel, interlocutory applications pending, if any shall stand closed. K. TATA RAO DEPUT\^EGI^AR otoi^Tofficer //// SE To,

1.

One CC to Sri Guduri Venkateswara Rao, Advocate [OPUC]

2.

One CC to Sri Dantu Srinivas, (SPL SC for CT) [OPUC] [OUT]^^ Commercial Tax, High Court of Andhra Pradesh.

4.

Two CD Copies • RAM(MBT)

» yr''. ■' /■ v* V HIGH COURT i' ( DATED:18/03/2024 •> . \ ORDER WP.No.25097 of 2006 DISMISSING THE WP WITHOUT COSTS

Reproduced from the public record of the Andhra Pradesh High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.