APHC010215632025 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3536] WEDNESDAY, THE THIRTIETH DAY OF APRIL TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO THE HONOURABLE DR JUSTICE Y. LAKSHMANA RAO WRIT PETITION NO: 11329/2025 Between: Swathi Engineering Constructions. ...PETITIONER AND The Assistant Commissioner St and Others ...RESPONDENT(S) Counsel for the Petitioner: 1. L CHANDRA OBUL REDDY Counsel for the Respondent(S): 1. GP FOR PANCHAYAT RAJ RURAL DEV 2. GP FOR ROADS BUILDINGS 3. GP FOR COMMERCIAL TAX The Court made the following order: (per Hon’ble Sri Justice R Raghunandan Rao) The petitioner is a partnership firm, engaged in the works contract services of the State Government. It had executed various infrastructure works in the years 2021-22 and 2022-23. The bills relating to these works were released in the year 2022-23 by the State Government. 2 RRR, J & Dr. YLR, J W.P.No.11329 of 2025 2. The petitioner, under the belief that works, executed for the State Government and State Government Authorities, would attract tax @ 12%, had collected 12% tax from respondents 4 to 8, who were the Executive Engineers of various divisions where the petitioner had executed works and had paid the same to the Commercial Tax Department. 3. Thereafter, the 1st respondent passed an order of assessment, dated 27.02.2025, against the petitioner. In the order of assessment, the 1st respondent assessed the turn-over of the petitioner @ 12% upto 17.07.2023 and 18% from 18.07.2023. 4. Aggrieved by this order of assessment, the petitioner filed the present Writ Petition, contending that the rate of tax would have to be taken to be 12% from the entire tax period and sought a writ to be issued for setting aside the order of assessment. 5. The contention of the petitioner is that notifications bearing Nos.11/2017, dated 28.06.2017, 20/2017, dated 22.08.2017 and 24/2017, dated 21.09.2017, make it clear that the rate of tax that would have been levied on the petitioner was 12%. In the alternative, the petitioner also sought a direction to respondents 4 to 8 to pay differential rate of tax @ 6% along with interest and penalty, which would amount to Rs.1,58,00,262/- either to the petitioner or to the Tax Department directly. 3 RRR, J & Dr. YLR, J W.P.No.11329 of 2025 6. This Court, in a similar circumstance, after considering the issue of rate of tax that would be payable before 18.07.2022 and after 18.07.2022, had held that the rate of tax payable, after 18.07.2022 would be 18% percent. 7. In the present case, the Assessing Authority had applied the rate of 18% with effect from 18.07.2022 on the basis of notification No.3/2022. 8. In that view of the matter, the order of the 1st respondent, applying 18% as rate of tax with respect to the works executed upto 18.07.2022, does not require any interference. 9. However, the respondents 4 to 8, as the Executive Engineers, acting on behalf of the 2nd respondent, would be required to make good the differential rate of 6% tax, which has been levied on the petitioner, by virtue of the impugned order, dated 27.02.2025. It is settled law that in a case of indirect taxation, the person who is primarily liable for payment of such tax is permitted to pass on the burden to the purchaser provided there is such an arrangement between the two of them. In the present case, the respondents 4 to 8, having paid 12% tax to the petitioner, cannot dispute the further rate of 6% tax. 10. In the circumstances, this Writ Petition is disposed of, affirming the impugned order, dated 27.02.2025, vide DIN: 3727022557609, passed by the 1st respondent for the tax period 2022-23. However, there shall also be a direction to respondents 4 to 8 to pay the tax of differential amount for the 4 RRR, J & Dr. YLR, J W.P.No.11329 of 2025 period 2022-23 to the petitioner to enable the petitioner to pass on the said tax to the GST Department. The said payment shall be cleared within a period of two (02) months from the date of receipt of this order. Needless to say, if any interest is recoverable from the petitioner for late payment, the same would also have to be borne by respondents 4 to 8. There shall be no order as to costs. As a sequel, interlocutory applications pending, if any shall stand closed. _______________________ R RAGHUNANDAN RAO, J ________________________ Dr. Y. LAKSHMANA RAO, J Date: 30.04.2025 MJA 232 5 RRR, J & Dr. YLR, J W.P.No.11329 of 2025 THE HON’BLE SRI JUSTICE R RAGHUNANDAN RAO AND THE HON’BLE DR JUSTICE Y. LAKSHMANA RAO WRIT PETITION NO:11329 of 2025 (per Hon’ble Sri Justice R. Raghunandan Rao) 30.04.2025 MJA