The court affirmed that the petitioner is entitled to VAT reimbursement as per statutory provisions and government memos, establishing the respondents' obligation to refund the amounts deducted.

ORDER :

This Writ Petition is filed under Article 226 of the Constitution of India for the following relief:

“….to issue Order or orders direction or directions Writ or Writs nature of Writ of Mandamus declaring the action of the respondents in not paying/reimbursing VAT paid by the petitioner during the period 20.08.2009, 20.09.2010 and 20.10.2011 to the supply of diets to inpatients and duty doctor in the 3 to 5 respondent hospitals as per the Sec 15 of the AP VAT Act 2005 Govt Memo No 25827/M1/20051 dt 22.12.2005 and Memo No 9790/M1/20061 dated 23.05.2006 and time to time instruction issued by Health Medical and Family Welfare M1 Department Govt of AP and violative of Article 14 and 21 of the Constitution of India and consequently direct the respondents to pay/ reimburse amount of Rs.39,11,769/- which was paid by the petitioner towards VAT for the supplies of diet supplied to inpatients and duty doctor in the 3 to 5 respondents Hospitals for the period 20.08.2009 to 20.10.2011 and pass …”

2. Brief facts of the case are that the petitioner is a diet contractor who had supplied the diet to in-patients and duty doctors in the state of Andhra Pradesh and Telangana. During the period 2008-2009 to 2010-2011 even though the petitioner supplied diet to the Respondents No.3 to 5 hospitals due to ignorance and oversight neither he paid the VAT nor have the hospital authorities complied with the payment of VAT. As such, the vigilance department conducted enquiry about the supplies made by the petitioner to various hospitals and obtained records and report from the concerned hospitals and accordingly instructed the commercial tax department to assess the tax liability for the petitioner for the relevant period. The commercial tax department on 02.01.2014 assessed the Petitioner’s VAT liability for the period of 2008-09 to 2010-2011 vide Notice of Assessment of Value Added Tax from VAT 305A, dt.27.11.2013 at Rs.58,90,709/- and also levied a penalty of Rs.15,76,025/- for nonpayment of VAT within time, the total demand is Rs.74,66,734/- towards food supplies for the hospitals during that period. After payment of entire demanded VAT tax and penalty as the petitioner has entitled for re-imbursement of the amount, he made several representations to the concerned hospital authorities for re-imbursement of VAT Tax paid by him for the supplies made by him. Even though the superintendent of the concerned hospitals have sought for release of necessary budgets duly affirming that the petitioner has not claimed and the hospitals have not reimbursed the VAT tax to him. In spite of that there is no payment till today.As such the petitioner filed the present writ petition.

3. The 2^nd Respondent has filed counter contended that the petitioner has participated in the diet tender for supply of diet to the in-patients with abide conditions at Para No. (V) (7) of G.O.Ms.No.539 Health, Medical & Family Welfare (M1) Department, Dated: 08.11.1993 that the final payment of diet supplies will be made on production of a certificate by the contractor obtained from Income Tax authorities confirming that all income tax was paid by him up to the end of the previous accounts year. The same conditions apply to sales tax also. It is stated that 1st respondent issued Govt Memo No. 25827/M1/2005 Dt:22-12-2005 and Memo No. 9790/M1/2006-1 Dt:23-05- 2006 clarified that the there is no provision to deduct the tax on direct supplies of goods under APVAT Act, 2005 and the deductions if any made on diet charges, shall be refunded. The petitioner never registered with Commercial Tax Department until 24-04-2011 and the question of paying any tax and/or claiming any deductions doesn't arise for want of registration with Commercial Tax Department. Thus, the Petitioner cannot rely on the said Govt Memo No.25827/M1/2005 Dt:22-12-2005 and Memo No. 9790/M1/2006-1 Dated:23-05-2006.

It is further stated that the 1st Respondent has issued directions vide Memo No.9790/M1/2006-1,HM&FW(M1)Dept.,