I N THE HI GH COURT FOR THE STATE OF TELANGANA AT HYDERABAD THE HONOURABLE SRI JUSTI CE P.SAM KOSHY AND THE HONOURABLE SRI JUSTI CE SUDDALA CHALAPATHI RAO WRI T PETI TI ON No.15698 of 2007 DATE: 13.10.2025 Between :

M/s. Raj Constructions, Represented by its Managing Partner, Raj Kumar Agarwal, S/o. Late Kedarnath Agarwal, Aged about 62 years, 1-9-1091 to 1094, Main Road, Vidyanagar, Hyderabad. …Petitioner AND The Commissioner of Commercial Taxes, Andhra Pradesh, Commercial Taxes Complex, M.J. Road, Nampally, Hydeabad and 2 others.

…Respondents

ORDER:

(per the Hon’ble Sri Justice P.Sam Koshy)

Heard Mr. M.V.J.K. Kumar, learned counsel for the petitioner;

and Mr. T.Chaitanya Kiran, learned Additional Government Pleader

appearing on behalf of Mr. Swaroop Oorilla, learned Special Government Pleader for State Tax, for the respondents.

2. The instant writ petition is filed by the petitioner under Article 226 of the Constitution of India praying the Court for following reliefs, viz., “For the reasons mentioned in the accompanying affidavit, the petitioner prays that this Hon’ble Court may be pleased to issue an appropriate writ or order or direction particularly in the nature of Writ of Mandamus after calling for the entire records pertaining to Circulars issued by the Commissioner of Commercial Taxes in CCT's Ref.No.BII(2)/22/2006, dated 08- 09-2006, 04-10-2006 and 10-10-2006 as also assessment order dated 27-06-2007 passed in Form VAT 305 in TIN No.28703528352 based on such Circulars by holding the same as illegal, arbitrary, unjust, improper, without jurisdiction and authority of law as also ultravires the provisions of the Andhra Pradesh Value Added Tax Act, 2005 more particularly Section 2(4), Section 3A and Rule 59(2) of the A.P. VAT Act and Rules, 2005 as also the Government Order dated 14-08-2006 and also in contravention of the law laid down by the Hon'ble Supreme Court reported in 141 STC p.298 and to declare the audit conducted by the 2^nd Respondent and also the circulars issued by the Commissioner of Commercial Taxes in CCT's Ref.No.B.II(2)/22/2006, dated 08-09-2006, 04-10-2006 and 10-10-2006 as illegal, arbitrary, unjust, improper, without jurisdiction and as also contrary to Section 2(4), Section 3A and Rule 59(2) of the A.P. VAT Rules, 2005 not finding any place under the statute and consequently direct the 3^rd Respondent to refund the money collected from the Petitioner by the Sub Registrar to the account of the 3rd Respondent at the time of registering the sale deeds with interest and grant such other relief or reliefs as this Hon'ble Court may deem fit and proper in the circumstances of the case.”

3. The facts of the case in nutshell are that the petitioner is engaged in the business of constructing residential flats. The petitioner purchased land in its own name, obtained all necessary approvals and permissions and constructed residential flats entirely at its own cost and risk on the said property. After the construction of the flats was completed, the petitioner entered into sale agreements with various purchasers for the sale of these completed flats. Therefore, these transactions constitute a sale of immovable property and not works contracts as the agreements were executed only after the flats were fully constructed. The dispute arose when the respondent No.2 conducted an advisory audit pursuant to Circulars issued by respondent No.1, dated 08.09.2006, 04.10.2006, 10.10.2006, and passed an assessment order dated 27.06.2007 treating the petitioner's transactions as "works contracts" under the Andhra Pradesh Value Added Tax Act, 2005, (for short the ‘APVAT Act’) demanding tax of Rs.20,62,328/-. 4. Learned counsel for the petitioner contended that the transactions in question constitute a sale of immovable property and not “work contracts” as defined under Section 2(4) of the APVAT Act. Learned counsel for the petitioner submits that the petitioner purchased land in its own name, obtained all necessary approvals and p