ASHOK POLYMERS LTD Vs. COMMERCIAL TAX OFFICER, HYDERABAD

JUDGEMENT

(1.) THIS writ petition is filed by the petitioner seeking Mandamus challenging the order in Form VAT -305, dated 13.7.2011 issued by the 1 st respondent -Commercial Tax Officer, Mehdipatnam Circle, Hyderabad, as confirmed by the 3 rd respondent -Appellate Deputy Commissioner (CT), Punjagutta Division, Hyderabad, in Appeal No.CV/61/2011 -12, dated 21.2.2012, as arbitrary and illegal and consequently to declare that PP Woven Sacks are taxable only at 4% under Entry 90 of Schedule IV as packing material even before 2.6.2006.

(2.) THE petitioner is engaged in manufacture and trading of HDPE/PP Woven Sacks and fabric, having its Factory at Kattedan, Hyderabad, and also its units at Sholapur in Maharashtra and Gulburga in Karnataka States. It is a dealer on the rolls of 1 st respondent with TIN No.28340100287 under the provisions of the A.P. Value Added Tax Act, 2005 (for brevity the Act ). It is the case of the petitioner that it has purchased granules from local registered dealers and also from other States and manufactures plastic fabric, which are in turn converted into Woven Sacks, and sold as HDPE/PP woven sacks. For the period from April, 2005 to June, 2006, by classifying the goods manufactured by it under Entry 90 of Schedule -IV, the petitioner has paid tax at 4%. Subsequently, based on the audit objections, revised proceedings are initiated in exercise of powers under Section 21 of the Act. After issuing a show cause notice and inviting objections, the 1 st respondent -Commercial Tax Officer has passed assessment orders dated 13.7.2011 holding that the petitioner is a manufacturer of P.P. Woven Sacks and paying tax at 4% on the ground that PP Woven Sacks fall under Entry 90 of Schedule IV. It is stated that the rate of tax was reduced to 4% on PP Woven Sacks with effect from 1.6.2006 only after issuance of G.O.Ms.No.656, Revenue, dated 2.6.2006 by an amendment to Entry 100 of Schedule IV, as prior to amendment to Entry 100 of Schedule IV, the PP Woven Sacks are liable to tax at 12.5% and accordingly levied tax of Rs.1,51,37,770/ -. The appeal preferred against the said assessment order before the 3 rd respondent -Appellate Deputy Commissioner also ended in dismissal by order dated 21.2.2012. Hence, the present writ petition.

(3.) IT is the contention of the learned counsel for the petitioner that the assessment order is barred by limitation in view of the provision contained under Section 21(4) of the Act. It is submitted that as there is no allegation of evasion of tax, the petitioner bonafidely filed returns classifying the goods manufactured by it under Entry 90 of Schedule -IV of the Act and hence, the limitation period is four years and the orders passed by the assessing authority are barred by limitation. It is also contended that in the absence of any new material manufactured by the petitioner, it is not open to the assessing authority to pass a revised order.