S. ANANDA REDDY, J. ( 1 ) THIS writ petition is filed praying for the issue of a writ of mandamus or any other appropriate writ declaring the collection of tax of rs. 12,529 and penalty of Rs. 62,645 by the respondent from the 1st petitioner as illegal, arbitrary, without jurisdiction and violative of Article 265 of the Constitution of India and consequently direct the respondent to refund the said amounts and to pass any other appropriate orders. ( 2 ) THIS writ petition is filed by two individuals. The 1st Petitioner is an individual and the 2nd Petitioner is a proprietary concern of one K. Chandrasekhar rao carrying on business in jewellery at jaggayyapet, Krishna district. It is stated that the 1st petitioner is the nephew of sri K. Chandrasekhar Rao, the proprietor of the 2nd petitioner herein. The 2nd petitioner is the registered dealer on the rolls of the Deputy Commercial Tax Officer, jaggayyapet and he is engaged in the business of sales of Jewellery. The 2nd petitioner also undertakes collection of old silver articles from the customers and other dealers and exchanges them at Sale for new silver articles. In the course of its business, the 2nd petitioner sent the 1st petitioner to Salem with certain old silver articles and cash of Rs. 1,74,0007 -. Accordingly, the 1st petitioner was travelling from Jaggayyapet to Salem via Tirupathi on 17-6-1996 for the said purpose and while he was waiting at the bus-stand, Tirupathi to catch a bus to go to Salem, police personnel conducted a random check of the luggage of the 1st petitioner and the police did not find any irregularity. However, they referred the matter to the respondent, assistant Commercial Tax Officer, intelligence, Tirupathi. The Respondent detained the petitioner and issued notices dated 17-10-1996 stating that the 1st petitioner was transporting the silver ornaments without valid documents and was doing business without registration and proposed to levy the tax and penalty. It is stated that the 1 st petitioner immediately thereafter gave a letter to the respondent requesting time for 15 days for filing objections and for obtaining instructions from his uncle, the proprietor of the 2nd petitioner herein. But, the respondent estimated the turnover and collected tax at Rs. It is stated that the 1 st petitioner immediately thereafter gave a letter to the respondent requesting time for 15 days for filing objections and for obtaining instructions from his uncle, the proprietor of the 2nd petitioner herein. But, the respondent estimated the turnover and collected tax at Rs. 12,529 and penalty of Rs 62,645/- respectively on the spot without even allowing the time of three days for filing objections, as specified in the show cause notice. The respondent issued receipt in favour of the 1st petitioner, though it was explained that the articles and cash relates to the 2nd petitioner. It is stated that the 1st petitioner pleaded that he was not liable to pay any amount of tax, as he was only transporting the goods as a representative of the 2nd petitioner and that there is no sale in the transaction. It is stated that the reference to the vehicle check in the notices of the respondent is false, since the 1st petitioner was checked when he was waiting for the bus. Therefore, the action of the respondent in detaining the 1st petitioner and treating him as a casual trader and collecting the tax and penalty from him is illegal and without jurisdiction. ( 3 ) IT is further stated that the respondent has recorded a statement from the 1st petitioner on 17-10-1996. After collection of the tax and penalty, the 2nd petitioner approached directly as well as through the representative for obtaining copy of the statement recorded from the 1st petitioner in order to assail the action of the respondent. But the respondent initially gave an endorsement stating that no statement was recorded from the 2nd petitioner, though the copy of the statement requested was of the 1st petitioner. But on the second occasion, when a similar representation was made again, the respondent did not respond at all. Hence, this writ petition for declaring the action of the respondent as illegal, without jurisdiction and violative of article 265 of the Constitution of India but also for a consequential direction to refund the amounts to the 2nd petitioner. ( 4 ) A counter-affidavit is filed by the respondent denying the claim of the petitioners that they are entitled for the relief sought in the writ petition. ( 4 ) A counter-affidavit is filed by the respondent denying the claim of the petitioners that they are entitled for the relief sought in the writ petition. In the counter, it was specifically admitted by the respondent that when the respondent and his staff conducted the check, the 1st petitioner was on the platform at the General Bus-Stand, tirupathi with two suitcases. The respondent has also admitted the involvement of the police when the check was conducted. As per the counter, the suitcases were found containing old silver articles weighing 20 kgs. , (Rs. 1,30,000/-); silver ingot weighing 4. 26 kgs. , (Rs. 27,690/-), in addition to a cash of Rs. l,74,000/ -. The 1st petitioner was also having an Order Book and the respondent found in the said book that serial numbers 1 to 11 were used whereas numbers 12 to 25 were not used. The total quantity of orders booked, as per this order book, amounted to 45. 350 kgs. , valued Rs. 2,94,775. It is also admitted by the respondent that on enquiry the 1st petitioner deposed that he was on his way to Salem in Tamilnadu and the silver articles and ingots were meant to be taken to Salem and to be exchanged for new articles and that he was working as a sales and purchase representative in the shop of the 2nd petitioner. The respondent, however, stated that the 1st petitioner could not prove the ownership of the goods by producing any Way-Bill in Form-X issued by the alleged owners of the goods nor he could furnish satisfactory explanation regarding the possession of huge cash and he was unable to prove or confirm whether the transactoins under question were reported to the Departmental authorities and the tax was paid thereon. Therefore, considering the circumstances, the value of the old silver articles, silver ingots, the quantities of the silver articles sold as per the Order Book vide pages 1 to 11 and cash amounting to rs. 1,74,000/- for which no explanation was given, the same was considered as sale proceeds of silver and thus the total turnover of Rs. 6,26,465 was proposed to be assessed to tax. It is also stated in the counter that while coming to the conclusion to treat the 1st petitioner as a casual trader, the following facts pertaining to law were also considered. 6,26,465 was proposed to be assessed to tax. It is also stated in the counter that while coming to the conclusion to treat the 1st petitioner as a casual trader, the following facts pertaining to law were also considered. ( 5 ) ACCORDING to the respondent, section 2 (hxl) of the A. P. General Sales tax Act would attract, as the 1st petitioner was transporting the goods in a vehicle. If so, under sub-rule 4 (1) of Rule 45 of the apgst Rules, read with Section 26 of the apgst Act, the 1st petitioner should carry the Way-Bill issued by the Dealer, who claimed ownership of the goods. In the absence of any such Way-Bill to establish the ownership of any person other than the 1st petitioner, the respondent has decided to treat the 1 st petitioner as a casual trader and proceeded accordingly. According to him, the transport involves evasion of tax. Therefore, it was considered necessary to levy penalty also. Accordingly, notices were issued proposing to levy not only the tax but also the penalty, which is equal to five times the tax due and the 1st petitioner was called to file objections within three days. The notices were served on the 1st petitioner on the same day and in response to the said notices, the 1 st petitioner filed two separate letters expressing consent to pay the tax as well as the penalty and he has even stated that he does not require any more time for the purpose of filing objections. Accordingly, the paid the amount after receiving the orders of assessment and penalty. ( 6 ) WITH reference to the copy of the statement sought for, it is stated that a letter seeking copy of the statement dated 17-10-1996 was filed by the 2nd petitioner. Similarly, one Mr. M. Rqjagopala Naidu, chartered Accountant also filed a similar petition seeking Xerox copy of the statement recorded from the 1st petitioner on the ground that he was authorised representative of the 2nd petitioner. As the 2nd petitioner was not a party to the said proceedings, the request of both the 2nd petitioner and his authorised representative could not be complied with. Hence, they were informed accordingly through an endorsement. As the 2nd petitioner was not a party to the said proceedings, the request of both the 2nd petitioner and his authorised representative could not be complied with. Hence, they were informed accordingly through an endorsement. Therefore, it was stated that the action of the respondent is proper and just and the petitioners are not entitled to any relief sought for in this writ petition. ( 7 ) FROM the above rival contentions, the issue that falls for consideration is whether the respondent has acted legally in detaining the 1st petitioner and treating him as a casual trader and whether he collected the tax and penalty from the petitioner by coercion? ( 8 ) IT is not disputed that the 2nd petitioner is a registered dealer and carrying on business in silver articles and his place of business is at Jaggayyapet, Krishna District. This fact is also born out from the records that were found by the respondent at the time of check. The Order Book clearly shows the registration numbers under both the apgst Act as well as CST Act. In addition, a statement was recorded form the 1st petitioner immediately after the check. In the statement, the 1st petition has clearly state d that he is only a sales and purchase representative of the 2nd petitioner and he was taking old silver articles/ingot as well as the cash to Salem for the purpose of exchange of those old articles for new articles and in addition to make some purchases. The respondent did not bother to check the correctness or otherwise of the facts that were stated either by the 1st petitioner or the facts that were born out from the material available with the 1st petitioner at the time of check. It is not in dispute that the check was conducted when the 1 st petitioner was waiting at the platform in Bus-Stand, tirupathi. The notices dated 17-10-1996 proposing to make an assessment on the 1 st petitioner shows that he was transporting the silver articles without valid documents and in the counter the respondent referred to section 2 (h) (i), as if the petitioner was transporting the silver articles in a transporting vehicle, referred to in that section, though the said fact was not stated in the notice. Apart from that, in the statement recorded on 17-10-1996, the petitioner has categorically stated that the jewellery in his possession belongs to the 2nd petitioner and he was going to Salem for the purpose of exchanging the old jewellery, in addition to make certain purchases and the cash in his possession is intended for the purpose of making purchases. There is absolutely no other material available with the respondent to disbelieve the statement of the 1st petitioner and to assess the silver articles and the cash. The respondent presumed that the 1st petitioner has evaded the payment of sales tax was doing clandestine business and therefore proposed to collect sales tax at 2% on the total turnover of Rs. 6,26,465/- and simultaneously served notices proposing to levy tax and the penalty of five times the tax due and in both the notices the respondent directed the petitioner to file objections within three days. But according to the respondent, the 1st petitioner voluntarily came forward to pay the tax. But the petitioner filed a copy of the letter dated 17-10-1996 addressed to the respondent seeking time of 15 days to file objections. Though this copy is filed along with the writ petition, the respondent did not refer to it and deny the same. Similarly, with reference to the application filed, seeking a copy of the statement recorded from the 1st petitioner, an endorsement was made on the application stating that no statement is recorded from K. Chandrasekhar Rao, proprietor of M/s. Chandrasekhara Jewellery mart, Jaggayyapet and hence copy of the statement could not be furnished; whereas in the counter it was stated that as the 2nd petitioner did not in the evasion of the tax, copy of the statement was not furnished and this stand taken by the respondent is contrary to the endorsement made by the respondent. The relevant file produced from the office of the respondent also shows that such an endorsement was made by the respondent. This shows that the assessee was not fairly dealt with by the respondent in the matter of furnishing copies of the statements. The relevant file produced from the office of the respondent also shows that such an endorsement was made by the respondent. This shows that the assessee was not fairly dealt with by the respondent in the matter of furnishing copies of the statements. In fact, though the records relating to the action of the respondent in respect of the 1st petitioner are produced, the same does not contain the proceedings sheet to show when actually the notices were issued to the 1st petitioner, and when the alleged assessment and penalty orders were passed and when the same was collected from the 1st petitioner. The proceedings sheet produced before the Court relates to the period commencing from December, 1996 and this situation is indicative of the fact that there is something fishy in the impugned action. There is no complete recorded to support the plea of the respondent. ( 9 ) THE learned Counsel for the petitioner, therefore, contended that the above material clearly shows the high-handed action of the respondent in framing an assessment against the 1st petitioner. Inspite of the fact that it was brought to the notice of the respondent that the silver articles that were in possession of the 1st petitioner belong to the 2nd petitioner, still the 1st petitioner was treated as if he was transporting the same in a vehicle, as envisaged in Section 2 000) of the Act and he was treated as casual trader, though the record clearly shows that the 1st petitioner was only a sales and purchase agent of the 2nd petitioner. In fact, the Order Book in possession of the 1st petitioner at the time of the check clearly shows that it was an order book of the 2nd petitioner and not that of the 1st petitioner. Inspite of it, the value of the orders booked by the 2nd petitioner was treated as sales by the 1st petitioner and assessed. The learned counsel also contended that the articles and jewellery made of silver are liable to tax under Item-21 of the First Schedule at the first sale only. The articles that were in the possession of the 1st petitioner are old silver articles, which are not liable to tax. In addition, the cash that was found with the 1st petitioner was also treated as sale proceeds of silver ornaments without any evidence. The articles that were in the possession of the 1st petitioner are old silver articles, which are not liable to tax. In addition, the cash that was found with the 1st petitioner was also treated as sale proceeds of silver ornaments without any evidence. The learned Counsel contended that the respondent has resorted to this illegal method and collected the tax and the penalty, though the petitioners are not liable to pay any tax. The learned Counsel also contended that even assuming that if the respondent has suspected that there is any evasion of any alleged sales tax, the matter ought to have been referred to the concerned officer, having jurisdiction over the 2nd respondent and ought to have got into enquired the matter, instead of resorting to this illegal collection of tax and the penalty, without even following the procedure that is contemplated under the provisions of the APGST Act. The reference to the requirement of Way- bills does not apply to the case of the petitioners and the same applies only when certain articles are being transported by a transport vehicles and not to a case of this type. ( 10 ) THE learned special Government pleader for Commercial Taxes would contest the correctness of the contentions of the petitioners. According to him, as the 1st petitioner was found to be in possession of silver articles, which he could not explain properly, he was treated as a casual trader and accordingly assessed to tax. ( 11 ) ON a consideration of the above material on record in the light of the contentions advanced by the learned Counsel for the petitioner, we find that the action of the respondent is clearly illegal and the same is liable to be declared as illegal and unauthorised. The respondent did not refer to any of the provisions under which the articles that were in possession of the 1st petitioner are liable to be taxed. Firstly, the articles and jewellery of silver are liable to tax at the first sale point only in the State under Item-21 of the First Schedule. It is not the case of the respondent that the articles, which are in possession of the 1st petitioner are new articles. Admittedly, they are old articles. Firstly, the articles and jewellery of silver are liable to tax at the first sale point only in the State under Item-21 of the First Schedule. It is not the case of the respondent that the articles, which are in possession of the 1st petitioner are new articles. Admittedly, they are old articles. Unless it is proved that the 1st petitioner is the first purchaser, he is not liable to pay tax in respect of the articles in his possession. Secondly, with reference to the orders booked, suffice it to state, the book is in the name of the 2nd petitioner. It is not known how the 1st petitioner could be treated as a seller with reference to those orders. Thirdly, with reference to the cash, there is no material either with the 1st petitioner or with the respondent to presume that the cash in his possession related to the sale proceeds of silver ornaments. Therefore, the action of the respondent is clearly illegal and liable to be set aside. In fact, a statement was recorded from the 1st petitioner, which is available on record, where he has categorically stated that he is only a sales and purchase agent of the 2nd petitioner and the 2nd petitioner is the owner of the articles that were found with the 1st petitioner and he was taking those articles to salem for exchange with the new articles. Without conducting any enquiry and without finding out the truth or otherwise of the statement of the 1st petitioner, especially when the Order Book in the possession of the 1st petitioner clearly shows that the 2nd petitioner is also a registered dealer under the APGST Act as well as CST Act. The assessment framed against the 1st petitioner treating him as a causal trader is illegal and without jurisdiction. The absence of proceedings sheet as to the issue of notices, proposing to make the assessment against the 1st petitioner as well as levying penalty also shows that the allegations of the petitioners are correct that the respondent had collected the tax and penalty by exercising duress and coercion. The absence of proceedings sheet as to the issue of notices, proposing to make the assessment against the 1st petitioner as well as levying penalty also shows that the allegations of the petitioners are correct that the respondent had collected the tax and penalty by exercising duress and coercion. The respondent though admitted that the check was conducted when the petitioner was at the platform in bus-stand, Tirupathi, he refers to the provisions of Section 2 (h) (i) and also to Rule 45 (4) (i) in order to justify his action that the 1st petitioner was not having a Way- bill in Form-X. The said contention of the respondent is only an improvement to justify his illegal action. Therefore, the action of the respondent is illegal and liable to be set aside. ( 12 ) THE learned Counsel relied upon the observations of this Court in the case of life Line Devices v. Commercial Tax Officer, 119 STC 52, wherein it was held that the officials of the Vigilance and Enforcement department or the Intelligence Wing should forthwith stop collecting post-dated cheques or money towards the tax- estimated or even admitted to be due and leave it to the competent assessing officer to do that part of the job after giving opportunity to the assessee before passing an order in conformity with the provisions of the Andhra Pradesh General Sales tax Act and the Rules. It was also held that provisions of the Act does not authorise on the spot collection of the tax by coercion. ( 13 ) THE learned Counsel also relied upon the judgment in the case of priyanka Wines v. Assistant Commissioner, 110 STC 73. In the said case, it was held on the facts that the fact that post-dated cheques were collected was suggestive of some pressure tactics exerted on the petitioner and the Court directed the respondent to return the post-dated cheques collected. ( 14 ) THE facts in the present case also, serving notice on the same date and collecting the tax and penalty, which was alleged by the petitioners by coercion and threat of detention, seems to be correct. In fact, it was alleged that a letter was filed by the petitioner seeking 15 days time, a copy of which was filed along with the writ petition. In fact, it was alleged that a letter was filed by the petitioner seeking 15 days time, a copy of which was filed along with the writ petition. Though a copy of the same is not found in the records produced by the resppndent, but filing of such a copy was not disputed nor denied by the respondent. When once the petitioners sought for 15 days time for filing objections, it is unbelievable that the petitioner ought to have come forward to pay the tax without even the requirement of minimum time of three days to file his objections. This clearly speaks volumes of the high-handed action of the respondent in collecting the tax and penalty by exerting coercion. The action of the respondent is clearly outside the provisions of the Act and is clearly liable to be quashed on that ground itself. The absence of the proceedings sheet with reference to the issue of notices as well as collection of tax also supports the view, which we have already taken. ( 15 ) UNDER the above circumstances, the impugned action of the respondent is set aside and the respondent is directed to refund the amount of tax and the penalty collected from the 1st petitioner. This, however, does not preclude the respondent, if the respondent proposed to conduct necessary enquiry as to the contentions of the petitioners and decide the matter afresh. It is also open to the respondent to refer the matter to the concerned authority, having jurisdiction over the 2nd petitioner, so as to have a comprehensive enquiry into the matter and for appropriate action. ( 16 ) THE writ petition is accordingly allowed with costs, quantified at Rs. 2,000/- payable within three weeks from today, which is directed to be recovered from the 2001 (4) officer, who has framed the assessment against the 1 st petitioner on 17-10-1996.