Allahabad High Court
Northern India Iron Press vs State Of U.P. & Others on 18 October, 2019
Equivalent citations: AIRONLINE 2019 ALL 2617
Author: Manish Mathur
Bench: Manish Mathur
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH ?Court No. - 24 Case :- MISC. SINGLE No. - 2 of 1993 Petitioner :- Northern India Iron Press Respondent :- State Of U.P. & Others Counsel for Petitioner :- N.K. Seth Counsel for Respondent :- C.S.C. Hon'ble Manish Mathur,J.
Heard Shri Ashish Chaturvedi, learned counsel for the petitioner and learned State counsel appearing on behalf of opposite parties.
Under challenge is order dated 22.9.1992 passed under the Stamps Act whereby sale-deed dated 30.01.1992 regarding purchase of agricultural property khasra no.833 situate in village Udaipur, Pargana Nigoha, Tehsil Mohanlalganj, Lucknow has been impounded on account of deficiency in stamp fees.
Learned counsel for petitioner submits that a perusal of the impugned order clearly indicates that stamp fees has been found to be inadequate considering the fact that petitioner has a registered company and would therefore not be indulging in agricultural activities upon the property in question. He has further submitted that it is settled law that stamp fees is to be imposed only as per existing nature of the property in question and not as per the anticipated use in future. Learned counsel for petitioner has also submitted that the authority erred in passing the impugned order on the ground of placing burden upon petitioner company to undertake that it was conducting agricultural activities since there is no such provision under the Stamp Act for discharge of such burden.
Learned counsel for petitioner has relied upon the judgment of Hon'ble Supreme Court in the case of Prakashwati vs. Chief Controlling Revenue Authority Board of Revenue, reported in (1996) AWC 1331 and of this Court in the case of Anirudh Kumar vs. Chief Controlling Revenue Authority reported in (2000) 3 AWC 2587 along with Rakesh Chandra Mittal and Others vs. Additional District Magistrate, reported in (2004) 3 UPLBEC 2434 to buttress his arguments.
Learned counsel for petitioner has drawn attention to the judgment and order dated 15.4.2015 passed in Writ Petition No. 3(MS) of 1993 (Northern Indian Press Works (Private) Limited vs. State of U.P. and Others in which the same issue was in question regarding another agriculture plot purchased by petitioner.
Learned State counsel appearing on behalf of the opposite parties while refuting the submissions advanced by learned counsel for petitioner submits that impugned order has been passed while considering the fact that petitioner is a registered company and therefore would definitely be using the purchased property for non-agricultural purposes and as such stamp fees imposed upon the petitioner has been correctly done which does not warrant any interference.
Heard learned counsel for the parties and perused the record.
A perusal of the impugned order dated 22.9.1992 makes it apparent that burden has been placed upon petitioner to discharge the onus that property purchased would not be used for non-agricultural purposes. The stamp fees has been found to be deficient on account of the fact that petitioner is a registered company and may use the purchased property for non-agricultural purposes such as construction of a cement factory. It is a pertinent aspect that impugned order does not dispute the fact that the present use of property purchased is agricultural in nature and that the usage has not been changed according to Section 143 of U.P. Zamindari Abolition and Land Reforms Act, 1950.
A perusal of the judgment and order dated 15.4.2015 passed in the case of Northern Indian Press Works (supra) pertaining to petitioner company regarding purchase of another agricultural plot would indicate the finding recorded by this Court earlier that although petitioner is a company under provisions of Companies Act, 1956 but as per its memorandum of association one of the objects for which the company was established was to carry on business of farming including dairy farming etc, as has been indicated in Clause 27 (C) (5) which reads as follows :-
"To carry on the business of farming including as dairymen, fruit, farmers livestock breeders, poultry farmers, timber growers, horticulturists, seed merchants, processors of agricultural proceeds and generally to manage improve, farm cultivate, acquire, lease undertake, exchange, purchase, sell or otherwise deal with or dispose of agricultural lands and generally to carry on the business of advisers on problems relating to the administration, organization and work of farms, training of personnel thereof, of system or process relating to the production, storage, distribution, marketing and sale thereof and/ or relating to the rendering of service in connection therewith."
A perusal of the Clause in the memorandum of association clearly indicates that petitioner company is carrying on business of farming also and is not set-up for non-agricultural business only.
So far as imposition of stamp duty on undisputed use of the property is concerned, Hon'ble Supreme Court in the case of Prakashwati (supra) has clearly held that situation of a property close to residential or commercial colony would not be a factor in determining the market value or stamp fees to be imposed upon the property. The same dictum has been followed in the case of Anirudh Kumar (supra) and Rakesh Chandra Mittal (supra). The relevant paragraphs of the said case laws are as follows :-
"7. In Aniruddh Kumar and others (supra), this Court has referred the aforesaid Prakashwati's case (supra) and observed as under :-
"In the present case, the market value is to be determined on the basis of the value that would satisfy the vendor. Thus, the question of future potential cannot be a factor for determining the market value of such a land for the purpose of stamp duty payable under the Stamp Act. The vendee pays the price that satisfies the vendor and, therefore, it is the utility of the land as on the date of transfer by the vendor and as such, if the land was an agricultural land, it has to be treated as such and the valuation has to be done accordingly. Whether in future the purchaser puts the land into residential use or changes the character is immaterial for the purpose of payment of stamp duty. The principle that has been laid down in P. Ram Reddy (supra) can be attracted for the purpose of determining the market value only to the extent of potential as on the date of transfer and not beyond. Thus, the market value has to be determined according to the factors, which includes the situation of the land, the amenities available in and around and various other factors, including the close proximity of the residential area as well as any transfer made immediately before the transfer or after the transfer in the close proximity if such documents are produced in respect of the area that similarly situated land by either of the parties."
8. In Rakesh Chandra Mittal and Ors. vs. Addl. District Magistrate and others reported in (2004) 3 UPLBEC 2434, a Division Bench of this Court held as under :-
"It is well settled that market value of the property has to be determined with reference to the date on which the document is executed. Market value as such keeps on varying and changing. Any subsequent improvement or change in the nature of or user of the land, which may result into enhancement of the market value of the property on the date of execution of the document that is to be considered for the purpose of determination of proper stamp duty payable on the instrument."
Upon application of aforesaid judgments, it is clear that order impugned in present writ petition has been passed merely on the basis of anticipated use of property in future while completely ignoring its present use which is contrary to the law laid down by not only the Hon'ble Supreme Court but by this Court as well.
In view of the aforesaid, writ in the nature of certiorari is issued quashing the order dated 22.9.1992. As a consequence, the petition stands allowed.
Order Date :- 18.10.2019 mks