Ramesh Ranganathan, J.

The proceedings under challenge in this writ petition is the order passed by the Appellate Deputy Commissioner dated 07.06.2016, for the tax period April, 2013 to August, 2015, confirming the order passed by the 2nd respondent dated 26.03.2016 levying penalty on the petitioner under Section 53(3) of the A.P. Value Added Tax Act, 2005 (for short the Act).

The petitioner herein is a registered dealer on the rolls of the 2nd respondent, and is engaged in the business of milling of paddy and sale of rice. An assessment order was passed by the 1st respondent dated 30.11.2015 holding that there was a huge variation, between the turnover reported in the returns and in the audited books of accounts, for the tax period 2013-14 and 2014-15. The petitioner invoked the jurisdiction of this Court by way of W.P.No.1858 of 2016 which was dismissed by order dated 25.01.2016 on the ground that the petitioner had the alternative remedy of preferring an appeal to the Appellate Deputy Commissioner. The petitioner approached the Appellate Authority who dismissed the appeal on 30.05.2016. Consequent thereto, the assessment order attained finality.

Even before the appeal was dismissed by the appellate authority on 30.05.2016, the 1st respondent issued notice dated 28.12.2015 proposing to levy 100% penalty on the petitioner under Section 53(3) of the Act. The petitioner submitted their reply thereto. However, by order dated 26.03.2016, penalty of Rs.24,85,358/- was imposed on them. Aggrieved thereby, the petitioner carried the matter in appeal and, by the order impugned in this writ petition, the appellate authority dismissed the appeal affirming the order of penalty passed by the assessing authority.

In the show cause notice, proposing imposition of penalty under Section 53(3) of the Act, the 1st respondent stated that, even though the dealer had admitted their sales turnover in their audited trading and P&L account for the years 2013-14 & 2014-15, and had also uploaded the utilised waybills information into C.T. Department website, the said sale turnover was not reported by them in their monthly VAT 200 returns; they had, thereby, under-declared the sale turnover, and had evaded payment of the legitimate tax due to the Government, which was clear cut evidence of wilful neglect on their part; and non-disclosure of the sales turnover in the VAT 200 returns, and non-payment of tax on the suppressed sales turnover, established that wilful neglect has been committed by the dealer with a view to evade payment of the tax legitimately due to the exchequer.

In their reply to the said show cause notice, the petitioner stated that the audit officer had levied tax of Rs.24,85,358/- based mainly on the way bills without considering whether the dealer had actually received the sale consideration; they did not receive any sale consideration in respect of the way bills alleged to have been issued; the control order required the dealer to supply 75% of its milled rice, and the balance could be sold in the open market; with an intention to supply the entire rice milled under the levy, they had inflated the figures by another 25%; and, though this fact was brought to the notice of the audit officer, tax was levied.

In the order, whereby penalty was imposed, the 1st respondent observed that, as per the Act, the audit officer was not required to wait, till receipt of consideration, to assess the dealer to tax; even on the deferred consideration, by way of credit invoices, the dealer was liable for payment of tax; the demand was raised, in the assessment, on the strength of the recorded evidence like invoices, waybill utilization and the audited trading and P&L account; the objection of the dealer in this regard was untenable; the dealer had, themselves, stated that the figures adopted in their books of accounts were inflated, and hence tax should be levied on the actual sales as per Section 4 of the Act; it was clear from the waybill utilisat