Allahabad High Court
Mc Graw-Hill Education India Pvt. Ltd. ... vs State Of U.P. Through Secy Civil ... on 7 February, 2020
Author: Pankaj Bhatia
Bench: Pankaj Bhatia
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 30 Case :- WRIT - C No. - 60586 of 2008 Petitioner :- Mc Graw-Hill Education India Pvt. Ltd. Sector 63 Noida Respondent :- State Of U.P. Through Secy Civil Secretriat And Another Counsel for Petitioner :- Rakesh Pande Counsel for Respondent :- C.S.C. Hon'ble Pankaj Bhatia,J.
Heard Ms. Vishakha Pande, holding brief of Sri Rakesh Pande, Senior Advocate, for the petitioner and learned Standing Counsel for the State-respondents.
The present petition has been filed challenging the order dated 25.8.2008 passed by the Additional District Judge, (Finance and Revenue), Gautam Budh Nagar.
The contention of learned counsel for the petitioner is that the petitioner took a premises no. B-4, Sector 63, Noida on lease by means of a registered lease deed dated 27.12.2006 for the period 01.7.2006 to 30.6.2015.
The counsel for the petitioner highlights that on 19.8.2006 a prior agreement was entered into in between the owner of premises bearing no. B-4, Sector 63, Noida and the petitioner herein, however that agreement was never acted upon and thus never presented for registration as registered lease deed was itself executed on 27.12.2006 for the period 01.07.2006 to 30.6.2015.
A show cause notice dated 15.1.2008 was issued to the petitioner based upon a report dated 15.9.2007 that another agreement for lease has been executed on 19.8.2006 on which the requisite stamp duty was not paid and thus it was alleged that the petitioner has contravened the provisions of Sections 17, 27, 33, 40, 40-A and 64 of the Indian Stamp Act, 1899 read with Rules 7, 8, 9 and 10 of the Stamp Valuation Rules.
The petitioner filed its reply highlighting therein that the registered lease deed was executed on 27.12.2006 on which requisite stamp duty has also been paid.
The Additional District Magistrate completely overlooking the reply passed an order dated 25.8.2008 observing that the impugned lease deed in respect of property bearing no. B-4, Sector 63, Noida was executed on 19.8.2006 and as the same was unregistered, as such there was clear contravention of provisions of Section 17 of the Indian Stamp Act, 1899 (hereinafter referred to as the 'Act') and thus held that the petitioner was liable to pay Rs. 29,11,740/- as deficit stamp duty and Rs. 29,00,000/- as penalty total Rs. 58,11,740/- along with statutory interest at the rate of 1.5% per month. The said order is under challenge in the present petition.
The contention of the counsel for the petitioner is that for the same property and for the lease executed for the same period, the stamp duty cannot be imposed twice. She submits that in respect of the same period and the same premises a registered lease deed was executed on 27.12.2006 on which the requisite stamp duty was paid. She further submits that the earlier lease deed was never acted upon in view of the fact that subsequently a registered lease deed was got executed and thus there was no error committed in not presenting the said lease deed dated 19.8.2006 for its presentation. Her next submission is that the order is without jurisdiction as there was no power vested in the Additional District Magistrate to pass an order under Section 47-A which pertains to exercise of powers for the instruments which are presented and there appears to be under valuation.
The next submission is that the document on which the impugned order has been passed being document dated 19.8.2006 has never been impounded or produced in any court of law and in fact has never been acted upon, as such the orders passed are without authority of law.
This Court vide order dated 15.12.2019 had specifically directed the State Government to file an affidavit specifying whether the instrument dated 19.8.2006 has ever been impounded, no affidavit has been filed by the State in compliance of the said order.
Thus, what emerges from the pleadings and the arguments raised at the bar are that an agreement was executed on 19.8.2006 for taking on lease the premises no. B-4 Sector 63, Noida which was never acted upon and, subsequently, registered lease deed was executed on 27.12.2006 in respect of the same premises on which requisite stamp duty were paid. In the impugned order passed there is no whisper about the contention of the petitioner that for the same premises and for the same period two lease deeds cannot be executed and thus it can never be alleged or established that there was any non-payment of stamp duty. The contention of counsel for the petitioner on that count merits acceptance.
The order impugned is further bad in law as the exercise of powers under Section 47-A can be resorted to only when an instrument is presented for registration and the registering authority has "reasons to believe" that the said instrument is under valued and proper stamp duty has not been paid thereupon.
47-A. Under-valuation of the instrument.- [(1)(a) If the market value of any property which is the subject of any instrument, on which duty is chargeable on the market value of the property as set forth in such instrument, is less than even the minimum value in accordance with the rules made under this Act, the registering officer appointed under the Registration Act, 1908, (Act no. 16 of 1908), notwithstanding anything contained in the said Act, immediately after presentation of such instrument and before accepting it for registration and taking any action under Section 52 of the said Act, require the person liable to pay stamp duty under Section 29, to pay the deficit stamp duty as computed on the basis of the minimum value determined in accordance with the said rules and return the instrument for presenting again in accordance with Section 23 of the Registration Act, 1908.
(b) When the deficit stamp duty required to be paid under clause (a) is paid in respect of any instrument and the instrument is presented again for registration, the Registering Officer shall certify by endorsement thereon, that the deficit stamp duty has been paid in respect thereof and the name and the residence of the person paying them and register the same.
(c) Notwithstanding contained in any other provisions of this Act, the deficit stamp duty may be paid under clause (a) in the form of impressed stamps containing such declaration as may be prescribed.
(d) If any person does not make the payment of deficit stamp duty after receiving the order referred to in clause (a) and presents the instrument again for registration, the registering officer shall, before registering the instrument refer the same to the Collector, for determination of the market value of the property and the proper duty payable thereon.] (2) On receipt of a reference under sub- section (1), the Collector shall after giving the parties a reasonable opportunity of being heard and after holding an enquiry in such manner as may be prescribed by rules made under this Act, determine the market value of the property which is the subject of such instrument and the proper duty payable thereon.
(3) The Collector may, suo motu, or on a reference from any Court or from the Commissioner of Stamps or an Additional Commissioner of Stamps or from a Deputy Commissioner of Stamps or from an Assistant Commissioner of Stamps or any officer authorized by the State Government in that behalf, within four years from the date of registration of any instrument on which duty is chargeable on the market value of the property, not already referred to him under sub- section (1), call for an examine the instrument for the purpose of satisfying himself as to the correctness of the market value, of the property which is the subject of such instrument and the duty payable thereon, and if, after such examination, he has reason to believe that market value of such property has not been truly set forth in such instrument, he may determine the market value of such property and the duty payable thereon:
Provided that, with the prior permission of the State Government, an action under this sub-section may be taken after a period of four years but before a period of eight years from the date of registration of the instrument on which duty is chargeable on the market value of the property.
[Explanation: The payment of deficit stamp duty by any person under any order of registering officer under sub-section (1) shall not prevent the Collector from initiating proceedings on any instrument under sub-section (3).] (4) If on enquiry under sub-section (2) and examination under sub-section (3) the Collector finds the market value of the property-
(i) truly set forth and the instrument duly stamped, he shall certify by endorsement that it is duly stamped and return it to the person who made the reference;
(ii) not truly set forth and the instrument not duly stamped, he shall require the payment of proper duty or the amount required to make up the deficiency in the same together with a penalty of an amount not exceeding four times the amount of the proper duty or the deficient portion thereof.
[(4-A) The Collector shall also require alongwith the deficit stamp duty or penalty required to be paid under clause (ii) of sub-section (4), the payment of a simple interest at the rate of one and half percent per mensem on the amount of deficit stamp duty calculated from the date of the execution of the instrument till the date of actual payment:
Provided that the amount of interest under the sub-section shall be recalculated if the amount of deficit stamp duty is varied on appeal or revision or by any order of a competent Court or Authority.
(4-B) The amount of interest payable under sub-section (4-A) shall be added to the amount due and be also deemed for all purposes to be part of the amount required to be paid.
(4-C) Where realisation of the deficit stamp duty remained stayed by any order of any Court or Authority and such order of stay is subsequently vacated, the interest referred to in sub-section (4-A) shall be payable also for any period during which such order of stay remained in operation.
(4-D) Any amount paid or deposited by or recovered from, or refundable to, a person under the provision of this Act, shall first be adjusted towards the deficit stamp duty or penalty outstanding against him and the excess, if any, shall then be adjusted towards the interest, if any, due from him.] (5) The instrument produced before the Collector under sub-section (2) or under sub-section (3) shall be deemed to have come before him in the performance of his functions.
(6) In case the instrument is not produced within the period specified by the Collector, he may require payment of deficit stamp duty, if any, together with penalty on the copy of the instrument in accordance with the procedure laid down in sub-sections (2) and (4).
It is no doubt true when any instrument is presented in any judicial proceedings which the Judicial Officer has "reasons to believe" is improperly stamp, the same can be impounded under section 33 and the matter can be referred for assessment and levy of stamp duty thereupon, however, in the present case, admittedly the instrument dated 19.8.2006 has never been impounded and, thus, the Additional District Magistrate, (Finance & Revenue) did not have the jurisdiction to pass the order as has been done by passing an impugned order.
In view of the findings recorded above, I have no hesitation in quashing the order dated 25.8.2008 passed by the Additional District Magistrate (Finance & Revenue), District Gautam Budh Nagar. When the petition was entertained this Court had directed the petitioner to deposit a sum of Rs. 10,00,000/- (ten lacs) vide order dated 24.11.2008, which has been deposited by the petitioner. The said amount of Rs. 10 lac shall be refunded to the petitioner within a period of three months from the date of filing an application for refund before the respondent no. 2 along with interest at the rate of 6% per annum.
The writ petition is allowed in terms of the order passed above.
Order Date :- 7.2.2020 Puspendra