M/S. Arikatla Venkateswarlu vs. The Deputy Commercial Tax Officer No.1

Held

The Court held that for financial years 2003-04 and 2004-05, the orders had attained finality under the APGST Act, 1957. The Government Memo dated 28.07.2010 was considered to be without jurisdiction and prejudicial to the interest of revenue. It was held that such a memo, even if termed an executive order, cannot restrain the implementation of statutory orders that have attained finality. The petitioner, if aggrieved, ought to have pursued legal remedies. Therefore, the writ petition for these years was dismissed. Regarding the financial year 2001-02, the Court observed that recovery should abide by the interim or final order in TREVC.No.26 of 2018, but recovery could not be stalled solely because of the memo dated 28.07.2010. The writ petition for this year was disposed of with these observations. The Court explicitly stated that Section 9 of the APGST Act, 1957, concerning exemptions, does not relate to granting exemption from tax or interest determined by judicial or quasi-judicial orders. The Court also noted that it was not the petitioner's case that the Commissioner invoked powers under Section 20 of the APGST Act, 1957.

Facts

The petitioner, M/s. Arikatla Venkateswarlu, filed a writ petition challenging the proceedings of the Deputy Commercial Tax Officer for attachment of immovable property for recovery of tax dues under the AP General Sales Tax Act, 1957. The challenge was based on a Government Memo dated 28.07.2010, which allegedly stayed recovery proceedings. The tax dues pertained to financial years 2001-02, 2003-04, and 2004-05. For 2001-02, assessment orders were passed, and an appeal (TA.No.535 of 2009) was partly allowed and partly dismissed, with the State filing a revision (TREVC.No.26 of 2018) which is pending. For 2003-04 and 2004-05, assessment orders were passed and revised, with the petitioner making representations to the government, leading to the impugned memo. The petitioner argued that these orders for 2003-04 and 2004-05 had not been challenged under the statute, but the memo prevented recovery.

Key Issues

1. Whether the Government Memo dated 28.07.2010, issued by the Principal Secretary to the Government, can prevent the revenue from proceeding with the recovery of tax dues under the APGST Act, 1957, for financial years 2003-04 and 2004-05, where the orders have attained finality under the statute? (Question of law turning on Section 17-C of APGST Act, 1957 and Section 27 of AP Revenue Recovery Act, 1864). 2. Whether the Government Memo dated 28.07.2010 can be treated as an executive order that overrides statutory recovery proceedings for tax dues that have attained finality? 3. Whether the recovery proceedings for financial year 2001-02 can be stalled due to the Government Memo dated 28.07.2010, considering the pendency of TREVC.No.26 of 2018? Petitioner's arguments: The impugned proceedings for attachment of property are illegal as they were initiated without considering the petitioner's reply and the Government Memo dated 28.07.2010, which stayed recovery. The memo was issued pursuant to the petitioner's representation and indicated that recovery steps should not be taken until the matter was settled. The Commissioner has powers of revision under Section 20 of the APGST Act, 1957. Respondents' arguments: The orders for financial years 2003-04 and 2004-05 have attained finality under the statute. The recovery proceedings are not without jurisdiction. The Government Memo dated 28.07.2010 is without jurisdiction and prejudicial to the interest of revenue.