Allahabad High Court
State Of U.P. Through Asst. ... vs Farookh Ahmad on 13 April, 2023
Author: Rohit Ranjan Agarwal
Bench: Rohit Ranjan Agarwal
HIGH COURT OF JUDICATURE AT ALLAHABAD Court No. - 9 Case :- WRIT - C No. - 7731 of 2006 Petitioner :- State of U.P. through Asst. Commissioner, Stamp, Pilibhit Respondent :- Farookh Ahmad Counsel for Petitioner :- C.B. Yadav Counsel for Respondent :- S.C.,Ajeet Singh,S.K. Singh,S.P. Singh,Suneel Kumar Hon'ble Rohit Ranjan Agarwal,J.
1. Heard Sri Manish Goyal, learned Additional Advocate General assisted by Sri Indra Bhan Singh, learned Standing Counsel for the State and Sri Sanjay Kumar Pandey, learned counsel for the sole respondent.
2. This writ petition has been filed assailing the order dated 20th May, 2004 passed by Chief Controlling Revenue Authority (CCRA) in Stamp Revision No.161 of 2004 (Farookh Ahamad vs. State) allowing the revision.
3. The case in nutshell is that in the auction the sole respondent was declared as highest bidder and therefore he was granted fishries right and an agreement was executed on 11.10.2002. The Revenue Authorities found that the stamp duty of Rs.100/- was paid and as the agreement was for the fisheries right for a period of three years, the respondent was liable to pay stamp duty treating the agreement to be a ''lease'. A notice was issued to the respondent which was replied and by the order of Collector, deficiency of stamp duty of Rs.13,71,580/- was imposed along with penalty of Rs.2 lacs and interest at the rate of 1.5% per month from the date of execution of agreement till the date of payment.
4. Aggrieved by the order of Collector, Stamp Revision was preferred by the respondent before Board of Revenue which was allowed by order impugned hence this writ petition.
5. Sri Manish Goyal, learned Additional Advocate General submitted that the matter relating to payment of stamp duty on the agreement executed between the State and respondent for the fisheries right amounts to a ''lease' and stamp duty is payable according to Article 35(b) of Schedule 1-B of Indian Stamp Act (hereinafter called as "the Act"). He invited the attention of the Court to five judges judgment of this Court rendered in Smt. Guddi vs. State of U.P. & Others 1998 (89) RD 361. Relevant paras 4, 11 and 12 of the judgment reads as under :
"4. Before taking up the merit of the case, it would be convenient to notice a few statutory provisions relevant for decisions on the points. Section 2(16) of the Act defines `lease' as follows:
2(16) `lease' means a lease of immovable property, and include also-
(a) a Patta:
(b) a kabuliyat or other undertaking in writing, not being a counterpart of a lease, to cultivate, occupy or pay or deliver rent, for immovable property:
(c) any instrument by which tolls of any description are let:
(d) any writing on an application for a lease intended to signify that the application is granted:
(e) any instrument by which mining lease is granted in respect of minor minerals as defined in Clause (e) 4O of Section 3 of the Mines and Minerals (Regulations and Development) Act. 1957.
The Indian Stamp Act does not define the term immovable property. In Section 3 of the General Clauses Act. 1897 it is laid down that in this Act, and in all Central Acts and Regulations made after the commencement of this Act, unless there is anything repugnant in the subject or context-`Immovable property' shall include land, benefits to arise out of land, and things attached to the earth or permanently fastened to anything attached to the earth.
In Section 3 of the Transfer of Property Act, 1882 (T.P. Act of short) it is laid down that in this act. unless there is something repugnant in the subject or context, `Immovable property' does not include standing timer, growing crops or grass, Section 105 of the T.P. Act. which defines `lease.' provides that a lease of immovable property is transfer of a right to enjoy such property, made for a certain time, express or implied. or perpetuity, in consideration of a price paid or promised, or of money, share of crops service or any other thing of value, to be rendered periodically or non specified occasions to the transferor by the transferee, who accepts the transfer on such terms. Section 107 of the T.P. Act makes provision how leases are to be made. It is laid down herein that a lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument. All other lease of immovable property may be made either by a registered agreement or by oral agreement accompanied by delivery of possession. Section 107 of the T.P. Act as amended in the State of U.P. reads as follows:
"107, Lease how made.- A lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by registered instrument.
All other leases of immovable property may be made either by a registered instrument or , by an agreement oral or accompanied by delivery of possession."
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11. Coming to the question of correctness or otherwise of the three Judge decision of this Court in, Board of Revenue, v Mulak Raj 1984 ALJ 331, it is our considered view that though the decision of the Supreme Court in, Ananda Behera's case, has been noticed, but it has not been properly appreciated and applied. It appears to us that the decision is also not in consonance with the ratio of the Supreme Court noted earlier. Referring to. Ananda Behera's case it is stated in paragraph 23 of the judgment: `In that case the dispute was about fishery rights. Their Lordships held that the rights were in the nature of `profit a prendre' and the same could only be acquired by a document in writing. In that case both the requirements necessary for claiming the rights of profits a prendre were satisfied. The Court while holding that the nature of the right involved was in the nature of profit a prendre, took the view that the land itself was not the subject-matter of the agreement. The land could not be taken away or used in any way except that the produce, viz., sand and gravel which lay on the land. It could not be taken away from any other land except the one which was specified and the intension of the parties was clear from the documents in question that only the produce had to be collected-stacked and taken away. The Court held that it was a specified right without in any way affecting the land on which the produce was available and since there was no transfer of immovable property, the document was not intended to be a lease but was in the nature of a licence, i.e., away the produce of the land. As discussed earlier, the Supreme Court has categorically held that a profit a prendre coupled with permission to sue land in whatever manner is `immovable property' as defined in Section 3(26) of the General Clauses Act and, therefore, requires a registered document for creating any interest therein. In view of the exposition of the position of law by the Supreme Court, the decision of this Court in, Board of Revenue, v. Mulk Raj cannot be taken to be good law.
The above decision was followed by a Division Bench of this Court in the case of, Mohd. Ismail v. Collector Etawah. 1986 RD 110.
It is relevant to note here that a Special Bench of this Court in the case of Haji Sukhan Beg v. Board of Revenue AIR 1979 All 310 construing an agreement for three years conferring the right to take out by digging of manure and rubbish accumulated in trenches and drains within the municipal area and selling it, held that the right amounts to a benefit arising out of land and as such it is immovable property and, therefore, chargeable to stamp duty under Article 35(a)(ii) of Schedule I-B(U.P.) of the Act. It appears that this decision was not brought to the notice of the Bench in, Board of Revenue v. Mulak raj (supra).
12. On the analysis and the discussion in the foregoing paragraphs, our answers to the two questions formulated by the learned single judge are as follows:
1. In the decision in Board of Revenue v. Mulak Raj 1984 ALJ 331, the decision of the Supreme Court in. Ananda Behera v. State of Orissa. AIR 1956 SC 17, Shri Shri Tarakeshwar Sio Thakur Jiu v. Bar Das Dey and Co. and others AIR 1979 SC 1669, have not been correctly appreciated and, therefore, the decision in, Board of Revenue v. Mulak Raj 1984 ALJ 331 and the Division Bench decision in Mohd. Ismail's case do not lay down the correct law. The question in answered accordingly.
2. The right created under the instrument in question of catching the fish in favour of the petitioner from Pachaura tank reservoir for a period of five years on payment of premium is lease within the meaning of section 2(16) of the Indian Stamp Act and it is chargeable to stamp duty in accordance with Article 35 (b) Schedule I-B of the said Act in the light of the pronouncement of the Supreme Court in Ananda Behera v. State of Orissa (supra), decisions noted earlier. The question is answered accordingly.
The case will be placed before the appropriate Bench for being disposed of in the light of the answers to the questions formulated and in accordance with law."
6. He then contended that Board of Revenue was not correct in holding that agreement executed for granting fisheries right was in respect of an immoveable property and would not amount to ''lease' and no stamp duty would be attracted. According to him, the matter relating to fisheries right had already been settled by Constitution Bench of Apex Court in Ananda Behera and another vs. State of Orissa and another AIR 1956 SC 17. Relevant para 7 of the judgment is extracted hereas under :
"In their petition the petitioners claim that the transactions were sales of future goods, namely of the fish in these sections of the lake, and that as fish is moveable property Orissa Act I of 1952 is not attracted as that Act is confined to immovable property. We agree with the learned Solicitor-General that if this is the basis of their right, then their petition under article 32 is misconceived because until any fish is actually caught the petitioners would not acquire any property in it."
7. Per contra, Sri Pandey, counsel appearing for respondent relied upon Full Bench judgment of this Court in Civil Misc. Writ Petition No.23932 of 2001 (Ram Kumar vs. State of U.P.) decided on 29.09.2005. According to him, fisheries right is for the purposes which are agricultural within the meaning of Section 117 of Transfer of Property Act and it should be outside the purview of compulsory registration. According to him, the Full Bench though following the earlier decision in case of Smt. Guddi (supra) had made certain observation but had left it open to the State Government to issue appropriate notification for keeping the compulsory registration outside the purview by issuing necessary notification. According to him, State Government must have issued notification in respect of agreement entered for fisheries right and the same should not be treated as ''lease' and no stamp duty is attracted.
8. I have heard the respective counsel for the parties and perused the material on record.
9. The short controversy involved in the writ petition is as to whether agreement executed between the highest auction bidder and the State for grant of fisheries right would amount to ''lease' and payment of stamp duty is attracted or not?
10. The matter is no more res integra as it has already been decided by five Judges Bench judgment of this Court in Smt. Guddi (supra) wherein this Court relying upon earlier decision of Constitution Bench of Apex Court rendered in Ananda Behera and another (supra) had held that grant of fisheries right and agreement having been arrived is within the purview of ''lease', as defined under Section 2(16) of the Act and is chargeable to stamp duty under Article 35(b) of Schedule 1-B of the Act.
11. As regards the argument raised by respondent's counsel that the notification might have been issued by State Government after pronouncement of the judgment by the Full Bench in case of Ram Kumar (supra), this Court finds that the notification if issued by the State Government would be prospective in nature and would not apply in the present case as the agreement in the present case was executed in the year 2002 between the parties and would amount to ''lease', which is chargeable to stamp duty and therefore, no benefit can be accorded to the present respondent.
12. Moreover, the Full Bench in case of Ram Kumar (supra) had proceeded to follow the five Judges Bench judgment in Smt. Guddi (supra).
13. In view of the above as the matter has already attained finality by various decisions of this Court as well as Apex Court, the order passed by Board of Revenue dated 20.05.2004 (Annexure 5 to the writ petition) is unsustainable in the eyes of law and the same is hereby set-aside.
14. The writ petition succeeds and is hereby allowed.
15. The question, framed above, stands answered holding that the agreement executed between the parties amounts to ''lease' and is chargeable to stamp duty under Article 35(b) of Schedule 1-B of the Act.
Order Date :- 13.4.2023 Kushal