JUDGMENT
P.L.N. Sarma, J.
1. The parties and the questions involved in both the writ petitions are common and they are being disposed of by a common order.
2. W.P. No. 12663 of 1989 was filed for a direction to the respondents to refund forthwith a sum of Rs. 30,75,300.50 to the petitioner which was collected for the years 1982-83 and 1983-84 towards Central sales tax demands for the said years on the ground that the assessment itself was set aside by the Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad by its order dated January 11, 1989, in T.A. Nos. 551 of 1987 and 1528 of 1987.
3. It is alleged in the affidavit filed in support of the writ petition that the petitioner-company, which is a public limited company, is engaged in the business of manufacturing and selling cotton yarn, having its factories at Kakinada and Vijayanagaram. The first respondent made assessment for the years 1982-83 and 1983-84 of February 6, 1987 and October 31, 1987, respectively under the Central Sales Tax Act, 1956. It is further alleged that the assessment was made erroneously treating the consignments of cotton yarn sent to the petitioner’s agents and depots as inter-State sales. Aggrieved by the assessment orders, the petitioner filed appeals to the Appellate Deputy Commissioner of Commercial Taxes, Kakinada, who confirmed the orders against which appeals in T.A. Nos. 551 and 1528 of 1987 were preferred to Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad. While the abovementioned appeals were pending, the respondents collected sales tax pursuant to the assessment orders referred to supra, by resorting to drastic coercive steps. The total amount of sales tax collected by the respondents, pursuant to the abovementioned assessment orders, came to Rs. 30,75,300.50.
4. While so, the Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad, allowed the appeals in T.A. Nos. 551 of 1987 and 1528 of 1987 by its order dated January 11, 1989, setting aside the orders of assessment in respect of assessment years 1982-83 and 1983-84 and remanded the matter to the assessing authority for fresh disposal in the light of the observations contained in the said order.
5. As a result of the order passed in the appeals, refund of the sales tax amount of Rs. 30,75,300.50, paid under the assessment orders which were set aside in appeal, became due to the assessee and the assessing authority is bound to refund the amount even without the petitioner having to make any claim in that behalf. However, the petitioner applied to the first respondent, making a copy to the second respondent, on April 14, 1989, for refund of the amount of Rs. 30,75,300.50. A reminder dated July 15, 1989, was also sent to the first respondent and there was no response from the respondents to the written representations for refund of the amount. Therefore, this writ petition was filed for directing the respondents to refund the amount of Rs. 30,75,300.50 to the petitioner.
6. A counter was filed on behalf of the respondents. The respondents also adverted in the counter to the merits of the case with which we are not now concerned in this writ petition. It is admitted in the counter that the appeals preferred by the assessee against the assessment orders were allowed by the Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad, and the same were remanded to the assessing authority for fresh disposal. It is also admitted that the petitioner made representations to the assessing authority to refund the sales tax amount paid by the petitioner. However, it is stated in the counter that the second respondent under the powers vested in him under section 33-C of the A.P. General Sales Tax Act, 1957 (for Short “the Act”) permitted the Commercial Tax Officer, Jagannaikpur, Kakinada, to withhold refund of the tax as it will adversely affect the State revenue. It is further mentioned in the counter that the assessing authority was of the opinion that the grant of refund will adversely affect the State revenue and obtained prior approval of the second respondent as contemplated under section 33-C of the Act and passed on order withholding the refund till the final assessment proceedings are completed.
7. While the above writ petition is pending, the second respondent herein issued proceedings in his Ref. A1/3650/87 dated October 31, 1989, stating that the Commercial Tax Officer, Jagannaikpur, Kakinada, is of the opinion that the grant in this case is likely to adversely affect the revenue and therefore, the assessing authority is permitted to withhold the refund of the amount.
8. Questioning the abovesaid order, Writ Petition No. 16209 of 1989 was filed by the petitioner to declare that the action of the respondents in seeking to withhold the refund of excess Central sales tax due to the petitioner in respect of the assessment years 1982-83 and 1983-84 is illegal and without jurisdiction. In this writ petition, it is contended by the petitioner that the petitioner is entitled to refund of the amount by virtue of the orders of the Sales Tax Appellate Tribunal in the appeals in T.A. Nos. 551 and 1528 of 1987 under section 33-B of the Act. It is further contended that the respondents have the power to withhold under section 33-C of the Act, provided the conditions precedent for the exercise of the power under the said section are satisfied. It is alleged that the conditions are not satisfied. It is further contended that section 33-C of the Act is an exception and therefore, it should be strictly construed. It was specifically stated that the second respondent has no power and authority to pass the order under section 33-C of the Act. It is only the assessing authority who should have passed the order withholding the refund of the amount subject to the prior approval of the second respondent.
9. It is seen from the above that after the filing of W.P. No. 12663 of 1989 claiming refund of the tax paid by the petitioner consequent to the order in appeals in T.A. Nos. 551 and 1528 of 1987, the orders were passed by the respondents purporting to exercise the power under section 33-C of the Act. Questioning the order of the second respondent dated October 31, 1989, the second writ petition was filed.
10. In both the writ petitions, the main question involved is whether the petitioner is entitled for a direction to refund of the amount of Rs. 30,75,300.50 as a result of the order passed in T.A. Nos. 551 and 1528 or 1987 by the Sales Tax Appellate Tribunal or not.
11. The provisions of the Act which are relevant for the purpose of deciding the point at issue are sections 33-B and 33-C of the Act which are as follows :
“33-B. Refund on appeal, etc. – Where as a result of any order passed in appeal or other proceeding under this Act, refund of any amount becomes due to the assessee or licensee, the assessing or licensing authority shall refund the amount to the assessee or licensee without his having to make any claim in that behalf, or adjust or apply, such amount is provided in section 33.
33-C. Power to withhold refund in certain cases. – Where an order giving rise to a refund to an assessee or licensee is the subject-matter of an appeal or further proceeding, or where any other proceeding under this Act is pending, and assessing or the licensing authority is of the opinion that the grant of the refund is likely to adversely affect the revenue, the assessing or the licensing authority may, with the previous approval of the Deputy Commissioner, withhold the refund till such time as the Deputy Commissioner may determine.”
12. Sri P. Ramachandra Reddy, the learned counsel for the petitioner, contended that the petitioner paid the tax pursuant to the assessment orders for the years 1982-83 and 1983-84. The said orders were set aside by the Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad by its order dated January 11, 1989 and matters were remanded to the assessing authority for fresh disposal. Therefore, the learned counsel for the petitioner contends that as a result of the order passed in appeals by the Sales Tax Appellate Tribunal, refund of the amount of sales tax paid by the petitioner pursuant to the assessment orders which were set aside in appeals, became due to it and the assessing authority is bound to refund the amount to the petitioner without its having to make any claim in that behalf.
13. The second contention raised on behalf of the petitioner is that the ingredients of section 33-C of the Act are not satisfied in the present case as no order withholding the refund was passed by the assessing authority. The order that was passed on October 31, 1989 is that of the second respondent. The second respondent under section 33-C of the Act has to give prior approval to the assessing authority to withhold the refund. It is the assessing authority who has to form an opinion that the grant of the refund of tax is likely to adversely affect the revenue and pass an order withholding the refund with the prior approval of the Deputy Commissioner concerned. In the present case, the second respondent alone issued the order dated October 31, 1989 and that will not satisfy the ingredients of section 33-C of the Act.
14. On the other hand, the learned Government Pleader contended that the assessing authority formed the opinion that the grant of refund is likely to adversely affect the revenue and sought prior approval from the second respondent herein for withholding the refund. The second respondent gave permission to withhold the refund. Accordingly, the assessing authority issued the order dated November 6, 1989, in his Ref. A/332/89 withholding the refund. It is perfectly in accordance with section 33-C of the Act and the petitioner is not entitled to the refund of the tax paid as claimed by him.
15. In this connection, the learned Government Pleader placed the relevant record before us. The record discloses that on October 31, 1989, the Commercial Tax Officer, Jagannaikpur, Kakinada, addressed a letter to the second respondent herein in his Ref. A/764/89 dated October 31, 1989, stating that in the instant case a huge amount of Rs. 30,75,300.50 is to be refunded if the verdict of the Sales Tax Appellate Tribunal is accepted and the same will generally affect the revenue position of the circle and therefore, requested the second respondent herein to issue necessary directions to him under section 33-C of the Act to withhold the refund till the end of March, 1990. Pursuant to the said communication, on the very same date, the second respondent herein in his Ref. A1/3650/87 permitted the assessing authority to withhold the refund. Consequently, the assessing authority in his Ref. A/332/89 dated November 6, 1989, passed orders withholding the refund of the tax paid by the petitioner for the years 1982-83 and 1983-84 under section 33-C of the Act.
16. It is, therefore, clear that the assessing authority formed an opinion that the grant of refund is likely to adversely affect the revenue and them sought the approval of the second respondent herein for passing an order withholding the refund. Having obtained the approval of the second respondent, the assessing authority, i.e., Commercial Tax Officer, Jagannaikpur, Kakinada, passed an order withholding the refund by his order dated November 6, 1989. Therefore, the ingredients of section 33-C of the Act are satisfied. The scheme of the section 33-C of the Act is that there should be an order giving rise to a refund and the same should be the subject-matter of an appeal of further proceedings and the assessing or licensing authority should form an opinion that the refund of the tax is likely to adversely affect the revenue and then obtain the approval of the Deputy Commissioner and pass an order withholding the refund of the tax till such time the Deputy Commissioner may determine. In this case, as seen from the record placed before us, the assessing authority formed an opinion that refund of the tax will adversely affect the revenue and then sought the permission of the Deputy Commissioner for withholding the refund of the tax and after obtaining approval of the second respondent herein, passed an order dated November 6, 1989, withholding the refund. Entire proceedings culminating in the passing of the order by the assessing authority dated November 6, 1989, is in accordance with the provisions of section 33-C of the Act an it is not possible for this Court to issue any direction for refund as prayed for in W.P. No. 12663 of 1989 and the order of the second respondent herein dated October 31, 1989, giving approval to the assessing authority to withhold the refund of the tax cannot be questioned as it was passed in terms of section 33-C of the Act.
17. Several contentions were raised by the petitioner stating that no orders were passed on his representation for refund by the authorities and that the order passed by the second respondent herein dated October 31, 1989, is not in accordance with section 33-C of the Act. Reliance is placed by the learned counsel for the petitioner on a decision Leader Valves Pvt. Ltd. v. Commissioner of Income-tax [1987] 167 ITR 542 (P&H), with regard to the scheme and ambit of section 241 of the Income-tax Act as it stood prior to the amending Act, 1989 which is in pari materia with section 33-C of the Act. It is not necessary, for the purpose of disposal of this writ petition, to consider the abovesaid decision in view of the fact that the contentions were advanced without the knowledge of the orders passed by the assessing authority dated October 31, 1989, as well as November 6, 1989. In view of the orders of the assessing authority as well as the order of the second respondent giving prior approval, all these contentions have no substance. In our opinion, withholding of the refund of the tax by the respondents is in accordance with section 33-C of the Act. Therefore, the writ petitions have no substance.
18. However, in view of the fact that the proceedings have taken such a long time and huge amount of Rs. 30,75,300.50 was paid pursuant to the assessment orders which were set aside by the Sales Tax Appellate Tribunal and refund of the same, which the assessee is entitled, is withheld by invoking the provisions of section 33-C of the Act, we are of the opinion that the respondents should be directed to complete the assessments of the petitioner for the years 1982-83 and 1983-84 within a period of three months from the date of receipt of this order, failing which a period of three months from the date of receipt of this order, failing which the respondents shall refund the amount of tax collected pursuant to the assessment orders in a sum of Rs. 30,75,300.50 with interest as provided under the Act.
19. Subject to the above directions, the writ petitions are dismissed. No costs. Advocate’s fee Rs. 250 is each case.
20. Writ petitions dismissed.