PRAKASH ENTERPRISES Vs. COMMERCIAL TAX OFFICER GOWLIGUDA HYDERABAD

JUDGEMENT

(1.) THESE writ petitions are filed under article 226 of the Constitution of India for issue of writs of mandamus declaring G. O. Ms. No. 1176, Revenue (CT-II) dated 17th December, 1987 published in the Andhra Pradesh Gazette on 21st December, 1987 as unconstitutional and appropriate directions quashing the provisional assessments made by the 1st respondent subjecting the petitioners to sales tax. The entire disputed turnover represents the total sale proceeds of cycle tyres and tubes effected by the petitioners during the period commencing from 15th June, 1987 and ending with 21st December, 1987.

(2.) ALL the petitioners are dealers in tyres and tubes including cycle tyres and tubes. Under item 17 of the First Schedule to the A. P. General Sales Tax Act, cycles, their accessories and parts including tyres and tubes and accessories used therewith made of rubber or other material are taxable at the point of first sale in the State at 6 paise in the rupee. On a representation received from the cycle trade by the Government of Andhra Pradesh, G. O. Ms. No. 379, Revenue (S) Department dated 9th April, 1986 was issued by the Government exempting from tax under the A. P. General Sales Tax Act, sales of cycles with effect from 1st April, 1986. On a further representation made by the cycle trade, G. O. Ms. No. 575, Revenue (S) Department dated 9th June, 1987 was issued by the Government exempting with effect from 15th June, 1987 tax payable under the Act on sales of parts and accessories of cycle. Later under G. O. Ms. No. 1176, Revenue (CT-II) dated 17th December, 1987 impugned in this batch of writ petitions, the notification issued under G. O. Ms. No. 575, Revenue (S) Department dated 9th June, 1987 was amended with effect from 15th June, 1987 withdrawing exemption granted on sales of tyres and tubes.

(3.) THE Government should act with some sense of responsibility and care in withdrawing exemptions with retrospective effect. Undoubtedly action on G. O. Ms. No. 575, Revenue (S) Department dated 9th June, 1987 cycle tyres and tubes were sold by the dealers without collecting sales tax. There is no evidence whatsoever to the effect that sales tax was collected in respect of sales of cycle tyres and tubes after 15th June, 1987. From the cases before us, we see that the sales of cycle tyres and tubes run into crores of rupees and the tax corresponding to that is considerable. Before calling upon the tax-payers to share burden of such a heavy amount of tax which was not collected the Government should consider the matters properly and take decisions concerning the serious liability that will be attached by implementation of the G. Os. withdrawing exemption with retrospective effect. What is more unfortunate in this case is that the Government showed total disregard and defiance to the decision of the Division Bench of this Court in Yemmiganur Spinning Mills Ltd. v. State of Andhra Pradesh [1976] 37 STC 314, referred to by my learned brother stating categorically the legal position that section 9 of the Act which empowers the Government did not confer power retrospectively giving effect to the notifications. The Government is either unaware of the decision above referred or if it is aware of the decision did not agree to implement the decision of this Court. We must express distress at this state of affairs. Writ petitions allowed. .