APHC010716732013 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3529] WEDNESDAY,THE TWENTY FIFTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY SIX PRESENT THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR WRIT PETITION NO: 22237/2013 Between: 1. M/S.OM INDUSTRIAL CORPORATION, REP. BY ITS PROPRIETOR, MR. KISHORE CHOUDHARY, DOOR NO.7-17-2&3, 1ST FLOOR, GAJUWAKA, BESIDE INDIAN OIL PETROL BUNK, VISAKHAPATNAM-530 026. ...PETITIONER AND 1. COMMERCIAL TAX OFFICER INT VISAKHAPATNAM 3 OTHERS, VISAKHAPATNAM. 2. APPELLATE DEPUTY COMMISSIONER CT, VISAKHAPATNAM. 3. STATE OF ANDHRA PRADESH REP BY ITS SECRETARY, REVENUE DEPARTMENT, SECRETARIAT, HYDERABAD. 4. AUTHORITY FOR CLARIFICATION ADVANCE RULING, UNDER THE APVAT ACT, 2005, COMMISSIONER OF COMMERCIAL TAXES BUILDING, NAMPALLY, HYDERABAD. 2 RRR,J & TCDS, J W.P.No.22237 of 2013 ...RESPONDENT(S): Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased toto issue a writ, order or direction, more particularly in the nature of Writ of Certiorari, quashing the order of 2nd Respondent in Appeal No.VSPNAT/062/2012-13, dated 29.4.2013 for the period 2009-10, 2010-11 & 2011-12 confirming the order of the lg Respondent dated 26.6.2012 as illegal, arbitrary and contrary to law and set-aside the proceedings and declare that the Petitioner is entitled for exemption on its sales to the contractors appointed by the Special Economic Zone units in terms of Section 7-A read with Entry 59-A of the First Schedule to the APVAT Act and pass such other order or orders as the Hon'ble Court may deem fit and proper in the circumstances of the case. IA NO: 1 OF 2013(WPMP 27249 OF 2013 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to grant stay of collection of balance disputed tax of Rs.8,42,980/- for the tax period 2009- 10, 2010-11 & 2011-12 pursuant to the order of 15t Respondent dated 26.6.2012, pending disposal of the Writ Petition as otherwise the Petitioner will be put to severe loss and hardship. IA NO: 2 OF 2013(WPMP 119406 OF 2013 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased Counsel for the Petitioner: 1. KARTHIK RAMANA PUTTAMREDDY Counsel for the Respondent(S): 3 RRR,J & TCDS, J W.P.No.22237 of 2013 1. GP FOR REVENUE 2. GP FOR COMMERCIAL TAX The Court made the following: 4 RRR,J & TCDS, J W.P.No.22237 of 2013 The Court made the following order: (per Hon’ble Sri Justice R. RaghunandanRao) The petitioner who is registered under AP VAT Act and CST Act had been making certain sales, for the years 2010-11, 2011-12, to contractors engaged by units of within a Special Economic Zone. The petitioner had claimed exemptions, from tax, on the turnover of the sales made to such contractors, on the basis of entry 59 (A) of the AP VAT Act. However, this claim was rejected by the assessing authority as well as appellate authority on the ground that section 7 (A), which starts with the non- obstante clause, specifically excludes entry 59 (A) of Schedule 1 of the AP VAT Act. The assessing officer as well as the appellate officer had further held that sale of goods to a contractor, engaged by SEZ units, would not eligible for exemption under section 7 (A) of AP VAT Act. Aggrieved by the said order of assessment as well as the appellate order dated 29.04.2013, the petitioner has approached this court by way of the present Writ Petition. 2. The learned counsel for the petitioner, relying upon the judgment of this Court dated 21.02.2025 in W.P.No.16649 of 2011 and batch contends that the insertion of Section 7 (A) of AP 5 RRR,J & TCDS, J W.P.No.22237 of 2013 VAT Act, does not eclipse or render entry 59(A), of the first schedule, null or void. 3. A Division Bench of this court had considered the question of whether insertion of section 7(A) would result in entry 59 (A) becoming otiose. The Division Bench had held that both section 7(A) and entry 59(A) can be read harmoniously to mean that while section 7 (A) grants limited exemption, a larger exemption is granted by entry 59 (A) of the first schedule to the AP VAT Act. 4. In such circumstances, entry 59(A) of the first schedule would have to be applied to the present case. The said entry exempts sales made to contractors engaged by the SEZ units. The learned Government Pleader would contend that sales were made to the sub-contractors and not the contractors engaged by the SEZ units. This contention would also have to be rejected in view of the Judgment of the Division Bench of the Erstwhile High Court at Hyderabad, in M/s. Larsen & Tuobro and others Vs. State of Andhra Pradesh 2006(148) STC 616. In this Judgment the Hon’ble High Court at Hyderabad had held that the term contractor would have to be interpreted to include sub- contractors. 6 RRR,J & TCDS, J W.P.No.22237 of 2013 5. In that view of the matter, the sales made by the petitioner, to the contractors/Sub-Contractors in the SEZ area, would be exempt from levy of tax, by virtue of entry 59(A) of the first schedule to the AP VAT Act. Accordingly, the Writ Petition is allowed setting aside the order in appeal dated 29.04.2013. As a sequel, pending miscellaneous applications, if any, shall stand closed. _______________________ R. RAGHUNANDAN RAO, J ________________ T.C.D. SEKHAR, J Date: 25.02.2026 CMK/SSA