Andhra Pradesh High Court - Amravati
The vs Unknown on 22 September, 2021
Author: M. Ganga Rao
Bench: M. Ganga Rao
HONOURABLE SRI JUSTICE M. GANGA RAO
Writ Petition No.4761 of 2018
ORDER:
The petitioners filed this Writ Petition to issue a writ of mandamus declaring the proceedings No.E2/515/215 dated 31.1.2017 imposing 10 times penalty on the deficit stamp duty of Rs.31,598/- on the agreement dated 6.3.1997 in OS.No.28/2009 on the file of Senior Civil Judge, Proddatur without considering the judgment of this Hon'ble Court in 2013 (3) ALT 13 as directed in WP.No.25819/2016 as illegal, arbitrary and against the letter and spirit of Stamp Act and consequently set aside the same.
2. The case of the petitioners is that they purchased agricultural land to an extent of Ac.31.22 cents situated in various Survey Numbers (Ac.8.05 cents in Sy.No.246, Ac.13.61 cents in Sy.No.243, Ac.4.90 cents in Sy.No.245/1, Ac.2.55 cents in Sy.No.245/2 and Ac.2.11 cents in Sy.No.244/1 prior to 6.3.1997 for a consideration of Rs.5,28,300/- @ Rs.30,000/- per acre from Y.M.Chenna Reddy. Total sale consideration was paid and physical possession of the land was given to the petitioner. The petitioners could not get the sale deed executed due to lack of money for payment of stamp duty and registration fees. They got executed agreement of sale on 6.3.1997 and the vendor promised to register the sale deed as and when demanded by the petitioners. When the vendor failed to register the sale deed, they got issued legal notice on 4.8.2006 demanding him to register the sale deed. In spite of receipt of notice, neither the vendor came forward to register the property nor gave any reply. Then, they filed suit in OS.No.28/2009 on the file of Senior Civil Judge, Proddatur for specific performance of agreement of sale dated 6.3.1997 against Y.M.Chenna Reddy and others. When they sought 2 MGR, J W.P.No.4761 of 2018 to tender the agreement of sale dated 6.3.1997 in the suit, the defendants objected for marking of the said document on the ground that the agreement of sale is not property stamped. The agreement of sale shows that array of possession was given to the vendors and it should be treated as a sale under Article 47-A of Scheduled 1-A of Indian Stamp Act as applicable to Andhra Pradesh and that it requires to be stamped as a sale deed minus Rs. 5/-. The petitioner made an application for sending the document of agreement of sale dated 6.3.1997 for impounding and the said application was allowed and the agreement of sale was sent to the 2nd respondent for impounding it under Section 40 of the Indian Stamp Act. The 2nd respondent, by order dated 29.02.2016, without notice to the petitioners calculated the deficit stamp duty and penalty and found that deficit stamp duty chargeable as Rs.58,113/- and penalty to be paid as Rs.5,81,130/- totaling an amount of Rs.6,39,243/- to be paid by the petitioners. Aggrieved by the same, the petitioners filed W.P.No.25819 of 2016 before this Court, which was allowed on 16.08.2016 setting aside the order dated 29.02.2016 directing the 2nd respondent to issue notice to the petitioner calling for objections if any, and on filing such objections, the 2nd respondent shall consider the same and pass appropriate orders thereon in accordance with law by keeping in view the judgment passed by this Court in C.V.Manmoharan v. Government of Andhra Pradesh, repl. by its Principal Secretary, Revenue Department and others. The 2nd respondent issued notice to the petitioners on 01.10.2016. The petitioners submitted their explanation on 15.12.2016 stating that they are wage earners and all the vendors died and on account of lack of money for obtaining sale deed, agreement was executed on Rs.10/- stamp paper and there was no intention to avoid the stamp duty.
3 MGR, J W.P.No.4761 of 2018 Considering the same, the 2nd respondent by order dated 31.01.2017 decided that the stamp duty leviable as Rs.31,598/- and 10 times penalty on it as Rs.3,15,980/- and the total amount payable as Rs.3,47,578/- and directed them to pay the same. Aggrieved by the same, the present Writ Petition came to be filed.
3. The 2nd respondent filed counter stating that as per the orders passed in W.P.No.25819 of 2016 dated 16.08.2016, a notice was issued to the petitioner under Section 40 (1) of the Indian Stamp Act inviting their objections on the assessment of stamp duty and penalty on 1.10.2016 and that the petitioners have not submitted any objections for the notice. In the meanwhile, the Senior Civil Judge, Proddatur remanded the matter to expedite the process vide letter dated 3.12.2016. In response to the same, another notice was issued inviting objections from the petitioners on 2.12.2016. In response to the said notice, the petitioners submitted their objections on 15.12.2016 stating that they have no capacity to pay the deficit stamp duty and penalty as they are poor and small farmers and living on by wage earnings and it is also stated that they paid only Rs.2,00,000/- out of sale consideration of Rs.5,28,300/- and neither the vendors nor the principal legal heirs are alive. They approached the Senior Civil Judge Court, Proddatur to validate their unregistered sale deed. Except expressing their inability to pay the deficit stamp duty and penalty, the petitioners have not brought any valid grounds to impose lesser penalty than that of 10 times penalty. The agreement of sale itself speak that they have paid the entire sale consideration of Rs.5,28,300/- to the vendors. They got executed the agreement of sale to evade the stamp duty and registration charges. Initially petitioners did not choose to go for registration or to pay the stamp duty under the provisions of stamp act and kept silent for more than 4 MGR, J W.P.No.4761 of 2018 12 years. When the neighbors created problem, they brought the sale to the light and approached the Senior Civil Judge Court, Proddatur. Even after filing the case, the petitioners are trying to evade the stamp duty and penalty and dragging the matter for years in gaining time on one pretext or the other. The petitioners are deliberately trying to evade the stamp duty/revenue to the State. The Senior Civil Judge, Proddatur directed the respondents to return the document without impounding vide letter dated 07.12.2017. In response to the same, the 2nd respondent addressed letter No.E2/515/2015 dated 16.12.2017 brining to the notice of various provisions of the Indian Stamp Act, 1899 in dealing with unstamped/deficitly stamped instruments. Payment of stamp duty is neither an option nor a choice but it is a responsibility cast upon the executing/claiming party to pay the stamp duty. However, the Senior Civil Judge, Proddatur once again directed the 2nd respondent on 16.02.2018 to return the deficitly stamped unregistered instrument as the Advocate for the plaintiff filed a memo for return of the same stating that the plaintiff is unable to pay the stamp duty and penalty. The impugned order was passed in strict adherence to the provisions of the Section 40 (1) (b) of the Indian Stamp Act.
4. Learned counsel for the petitioners states that the 2nd respondent passed the impugned order dated 31.01.2017 deciding the deficit stamp duty leviable as Rs.31,598/- and 10 times penalty on it Rs.3,15,980/- and demanding the payment of total amount of Rs.3,47,578/- without considering the explanation submitted by the petitioners on 15.12.2016 in its proper perspective and without taking into consideration the law laid down by this Court in the case of C.V.Manmoharan v. Government of Andhra Pradesh, repl. by its Principal Secretary, Revenue Department and others. He would 5 MGR, J W.P.No.4761 of 2018 further contend that the impugned order was passed by the 2nd respondent arbitrarily exercising his power or discretion to impose 10 times penalty in an unreasonable manner contrary to the provisions of Section 40 (1) (b) of Indian Stamp Act, 1899 and prays to set aside the impugned order.
5. Per contra, the learned Assistant Government Pleader (Stamps and Registration) reiterating the averments made in the counter affidavit further state that the petitioners themselves sought for impounding the document under the provisions of Section 40 of Indian Stamp Act. The agreement of sale dated 6.3.1997 was sent to the 2nd respondent through Senior Civil Judge, Proddatur for impounding the same. The 2nd respondent as directed by this Court in W.P.No.25819 of 2016 dated 16.08.2016 after due notice considering the objections of the writ petitioner in strict adherence to the provisions of Section 40 (1) of the Indian Stamp Act and taking into consideration the decision of this Court in C.V.Manmoharan v. Government of Andhra Pradesh, repl. by its Principal Secretary, Revenue Department and others passed the impugned order. There is no illegality or irregularity in passing the impugned order, which warrants interference by this Court. The petitioners also sought in this Writ Petition a declaratory relief but the Writ Petition is not filed for issue of writ of certiorari to consider the impugned order. This court exercising the certiorari jurisdiction under Article 226 of the Constitution of India has to look into the procedural irregularity but cannot deal with the entire evidence to set aside the impugned order. The 2nd respondent duly considering the objections submitted by the petitioners to the notice dated 2.12.2016 submitted on 15.12.2016 found that the petitioners are in possession of the landed properties purchased through agreement of sale and their contention that they 6 MGR, J W.P.No.4761 of 2018 are small farmers and wage earners cannot be believed and after paying the entire sale consideration of Rs.5,28,300/-, they have purchased the same. Instead of executing the sale deed only to evade the stamp duty and registration charges, they got executed the agreement of sale dated 6.3.1997 and remained silent for long years. Only when problem arose with neighbors land, they filed suit. The payment of stamp duty and registration charges by executing the sale deed is a statutory obligation. Payment of stamp duty is not a choice. The petitioners evaded payment of stamp duty and registration charges to the State. However, on repeated letters of the Senior Civil Judge, Proddatur for return of the document without collecting the stamp duty. Even the Senior Civil Judge, Proddatur addressed letter dated 22.02.2018 informing the District Registrar, Proddatur that the petitioners have filed I.A.No.274/2018 to summon him for producing the suit sale agreement. On 23.02.2018 as directed by the Court, the deficit sale instrument/document was returned to the Senior Civil Judge Court. After delay of more than one year, the petitioners filed representations without availing the remedy available under the provisions of Section 56 of the Indian Stamp Act and filed the Writ Petition and the same is liable to be dismissed.
6. Considering the facts and circumstances of the case and on perusal of the record, this court found that the petitioners having purchased the land admeasuring Ac. 31.22 cents in various survey numbers paid the total consideration of Rs.5,28,300/- @ Rs.30,000/- per acre and got executed agreement of sale on 6.3.1997 and took physical possession of the lands instead of executing regular sale deed by paying the stamp duty and registration charges. After several years when the neighbors started creating problems to the petitioners, they filed suit in OS.No.28/2009 before the Senior Civil Judge, 7 MGR, J W.P.No.4761 of 2018 Proddatur against the vendor Y.M.Chenna Reddy for specific performance of agreement of sale dated 6.3.1997. When the plaintiffs want to mark the agreement of sale dated 6.3.1997 in evidence, the defendants objected for marking of document on the ground that the agreement of sale is deficitly stamped, as the document reveals that the possession was given to the petitioners and the agreement of sale to be treated as sale under Article 47-A of Schedule 1-A of Indian Stamp Act as applicable to the Andhra Pradesh and document needs to be impounded. On the request made by the petitioners for sending the document to the Collector for impounding the same under the provisions of Section 40 (1) of the Stamp Act, the 2nd respondent after due notice as directed by this Court in W.P.No.25819 of 2016 dated 16.08.2016 after considering the objections passed the impugned order. The only objection stated by the petitioners is that they are having no capacity to pay the deficit stamp duty and penalty as they are poor and small farmers and living on wage earnings. On considering the said objection, the Collector rightly opined that the petitioners are not small farmers as they purchased large extent of Ac.17.61 cents of land on paying total sale consideration of Rs.5,28,300/- and since 28 years they are enjoying the said land without getting it registered by paying stamp duty and registration charges to the State. Instead of executing the sale deed, they got executed agreement of sale dated 6.3.1997 only to evade payment of stamp duty and registration charges. As per the provisions of Section 17 of the Stamp Act, all instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution. As per Section 33 of the Stamp Act, every person having by law or consent of parties authority to receive evidence, and every person in charge of a public office, except an officer of police, 8 MGR, J W.P.No.4761 of 2018 before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance in his functions shall, if it appears to him that such instrument is not duly stamped, impound the same. As per Section 40 of Stamp Act, Collector is empowered to impound the instrument. The Collector is having discretionary power to impose 10 times of penalty as per Section 40 (1) (b) of the Stamp Act. The action of the Collector in imposing 10 times penalty while impounding the documents in the facts and circumstances of the case as stated supra cannot be said to be unfair and unreasonable. While imposing 10 times penalty, the 2nd respondent has given valid, cogent and sufficient reasons. Even the petitioners got returned the agreement of sale without paying the requisite deficit stamp duty to the court shows that their audacity not to pay the deficit stamp duty and penalty as per the order impugned. This Court as discussed above found that the Writ Petition is devoid of merits and is liable to be dismissed and is accordingly, dismissed. No order as to costs.
As a sequel thereto, miscellaneous petitions, if any, pending shall stand closed.
___________________
M. GANGA RAO, J
Date: .09.2021
CSR
9 MGR, J
W.P.No.4761 of 2018
HON'BLE SRI JUSTICE M. GANGA RAO
WRIT PETITION No.4761 OF 2018
DATE: -09-2021
CSR