TMI Blog2015 (11) TMI 1388X X X X Extracts X X X X X X X X Extracts X X X X ..... he Forest Department has not denied the petitioner's assertion that no assessment orders were passed by the Commercial Tax Department against the Forest Department of the Government of Andhra Pradesh. The impugned notice relates to arrears of tax, allegedly due from the Forest Department, under the APGST Act for the years 1991-92 to 2004- 05 - in case the Forest Department of the Government of Andhra Pradesh demands payment of sales tax on the bamboo cuts supplied by them, it is always open to the petitioner to challenge such orders in appropriate legal proceedings. - Petition disposed of. - Writ Petition No. 1767 of 2008 - - - Dated:- 20-11-2014 - RAMESH RANGANATHAN AND SATYANARAYANA MURTHY M. JJ. M. V. J. K. Kumar for the petitioner. The Government Pleader for Commercial Taxes and Government Pleader for Forests for the respondents. ORDER The writ petition is filed to quash the impugned garnishee notice dated September 14, 2007 whereby the petitioner was called upon to pay ₹ 1,41,54,373 representing the sales tax payable by the Forest Department, in respect of the bamboo supplied by them to the petitioner, for the assessment years 1991-92 to 1998-99, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... January 23, 2008; the impugned garnishee notice falls foul of the decisions of the Supreme Court in Titaghur Paper Mills Co. Ltd. [1985] 60 STC 213 (SC), and Bhadrachalam Paperboards Ltd. v. Government of Andhra Pradesh [1998] 111 STC 657 (SC) and the decision of this court in Andhra Pradesh Paper Mills Limited v. Government of Andhra Pradesh [1989] 73 STC 26 (AP), and Bhadrachalam Paperboards Limited v. Government of Andhra Pradesh [1989] 75 STC 262 (AP); no tax can be demanded, without there being an assessment order followed by the service of a demand notice; the Commercial Tax Department has nowhere stated that they have initiated assessment proceedings, against the Forest Department, in respect of these transactions; the garnishee notice, served on the petitioner, is merely an attempt to collect the said amount as tax from the petitioner; for a notice to be issued under section 17 of the Act, a prior assessment order must be in existence; the demand notice, in the present case, was not preceded by any order either under the APGST Act or the A. P. VAT Act; without an assessment order being passed, no garnishee proceedings can be issued; the consistent stand of the Sales Tax Dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner's contention that the Forest Department issued demand notice on July 3, 2007 due to pressure from the Commercial Tax Department is not correct; the Forest Department had earlier issued demand notices, from time to time, for payment of Sales Tax/VAT; a consolidated demand notice was issued on July 3, 2007; as per agreement condition No. 15, the petitioner failed to pay the sales tax dues, despite repeated demand notices; the Commercial Tax Officer, Kothagudem was justified in asking the Forest Department to pay sales tax of ₹ 1,37,79,653 due from the petitioner; the demand notices were sent to the petitioner as per rules, and not due to pressure from the Commercial Taxes Department; the definition of goods , as interpreted by the Supreme Court in Titaghur Paper Mills Co. [1985] 60 STC 213 (SC), has been amended from July, 1985; as per the new definition, all growing crops, grass and things attached to or forming part of the land, which are agreed to be severed before sale or under the contract of sale, are goods ; issuing demand notices, after the goods (BIC) are quantified and numbered, is valid; since the petitioner pays the selling price and extraction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned proceedings dated September 14, 2007, the third respondent informed the petitioner that the Forest Department had supplied bamboo cuts to them; and they had to pay arrears of sales tax, under the APGST Act for the years 1991-92 to 2004-05, for ₹ 1,41,54,373. The third respondent, in the exercise of his powers under section 17 of the Act, informed the petitioner that, as they were holding, or may subsequently hold, money due or which would become due from them to the Forest Department, they should pay the amount towards arrears of tax due from the Forest Department. The petitioner was also informed that, if the amount was not paid as required under the notice, it would be recoverable from them as arrears of land revenue. Section 17 of the APGST Act relates to recovery of tax, and other dues payable under the Act, from persons from whom money is due to the dealer. Section 17(1) enables the assessing authority, at any time, by notice in writing (a copy of which shall be forwarded to the dealer at his last known address), to require any person, from whom money is due or may become due to the dealer or any person who holds or may subsequently hold money for or on acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of A. P, could a notice have been issued to the petitioner under section 17(1) of the Act; and, as sales tax paid by a selling dealer can be passed on to the purchaser, payment of the amount, under the notice under section 17(1), may be construed as a tacit admission by the petitioner that the bamboos supplied to them, by the Forest Department, constitute sale of goods liable to tax under the Act; and the Forest Department may later claim that the said amount represents the sales tax component of the sale value of bamboo supplied by them to the petitioner. Both under clauses (1) and (2) of section 6A of the APGST Act, it was only if a dealer, who in the course of business, purchased any goods, the sale or purchase of which was liable to tax under the APGST Act, was he required to pay tax on the turnover relating to the said purchases at the same rate at which tax would have been leviable on such goods under section 5 or 6 of the Act. Section 5(1) required every dealer to pay tax under the Act for each year on every rupee of his turnover of sales or purchases of goods. Section 6 related to the tax in respect of declared goods and, there under, the dealer was liable to tax at t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
