THE HON’BLE Ms. JUSTICE G.ROHINI And THE HON’BLE SRI JUSTICE T.SUNIL CHOWDARY WRIT PETITION No.1464 OF 2014 Dated: 24.01.2014 Between:
M/s. Hathway Cable & Datacom Limited .. Petitioner And Assistant Commissioner (CT)- V, Enforcement Wing, Hyderabad and 2 others .. Respondents THE HON’BLE Ms. JUSTICE G.ROHINI And THE HON’BLE SRI JUSTICE T.SUNIL CHOWDARY WRIT PETITION No.1464 OF 2014 ORDER: (Per Hon’ble Ms. Justice G.Rohini) The petitioner is a registered dealer under the A.P. Value Added Tax Act, 2005 (for short, ‘AP VAT Act, 2005’). This writ petition is filed aggrieved by the order dated 3.1.2014 passed by the 1st respondent imposing 100% penalty for the tax period from 1.7.2011 to 31.5.2013, purportedly in exercise of powers under Section 53 (3) of the A.P. VAT Act, 2005 and directing the petitioner to pay the penalty so levied within 15 days.
We have heard the learned counsel for the petitioner as well as Sri P. Balaji Varma, the learned Standing Counsel for Commercial Taxes appearing for the respondents.
Admittedly the impugned order was preceded by the show- cause notice dated 12.09.2013. However, the grievance of the petitioner is that the said show-cause notice was absolutely silent about the grounds on which the penalty was sought to be imposed. Relying upon Viceroy Hotels Limited v. Commercial Tax Officer,
[1]
General Bazar Circle, Hyderabad and others , it is contended by the learned counsel for the petitioner that levy of penalty at 100% is not justified particularly in the absence of an allegation that the petitioner had committed fraud or was guilty of wilful neglect in payment of the underdeclared tax.
As we could see, there was no allegation at all in the show- cause notice dated 12.09.2013 that the petitioner had committed fraud or wilful neglect. It may be true that in the impugned order of penalty various reasons have been assigned to substantiate the imposition of penalty at 100%, however as per the settled law the same cannot be substituted to the show-cause notice. Admittedly this is a case where there was no opportunity for the petitioner to meet the allegations on which the impugned penalty came to be levied.
Under the facts and circumstances of the case, we find force in the submission of the learned counsel for the petitioner that the issue involved is squarely covered by a ratio laid down in Viceroy Hotels Limited’s case (1 supra).
Accordingly, following the decision in Viceroy Hotels Limited’s case, the impugned penalty order dated 03.01.2014 is set aside and the Writ Petition is disposed of leaving it open to the 1st respondent to issue a fresh show-cause notice and take the appropriate steps in accordance with law. No costs.
Consequently, Miscellaneous Petitions, if any, pending in this Writ Petition shall stand closed.
G.ROHINI, J T.SUNIL CHOWDARY, J Date: 24.01.2014 Ivd
[1] (2011) 43 VST 424 (AP)