Allahabad High Court
M/S G.T.M. Builders And Promotors Pvt. ... vs State Of U.P. And Others on 10 January, 2020
Equivalent citations: AIRONLINE 2020 ALL 2744
Author: Piyush Agrawal
Bench: Piyush Agrawal
HIGH COURT OF JUDICATURE AT ALLAHABAD A.F.R. RESERVED Court No. - 90 Case :- WRIT - C No. - 24535 of 2010 Petitioner :- M/S G.T.M. Builders And Promotors Pvt. Ltd. Respondent :- State of U.P. and Others Counsel for Petitioner :- A.D. Saunders,Rahul Sripat,Vipin Sinha Counsel for Respondent :- C.S.C. Hon'ble Piyush Agrawal,J.
Heard Shri Rahul Sripat, learned Senior Counsel, assisted by Shri Ishir Sripat, learned counsel for the petitioner and Ms. Archana Tyagi, learned standing counsel for the State - respondents.
The present writ petition has been filed for the following, amongst other, relief:-
"i) issue a writ, order or direction in the nature of certiorari quashing the order dated 28.01.2010 passed by Chief Controlling Revenue Authority, U.P., Allahabad (Circuit Court at Meerut) in Stamp Appeal No. 09 of 2007-08; M/s G.T.M. Builders & Promoters (P) Ltd. Versus State of U.P. (Annexure No. 8)."
It is averred in the writ petition that M/s Modipon Fibres Company (a division of Modipon Limited) claimed to have held land measuring 201 bighas, 6 biswas situated in Village - Bishokher, Aurangabad, Gadana and Begumabad Gadana in the District - Ghaziabad. The said land was alleged to have been transferred to M/s Modipon Fibres Company by the State Government vide transfer deed dated 01.08.1994. The petitioner entered into an agreement dated 19.01.2006 to purchase the land in question from M/s Modipon Fibres Company. M/s Modipon Fibres Company was permitted to sell the land vide order dated 10.08.2001 by the State Government. It is further averred that some dispute arose between the parties and the possession of the land was never delivered to the petitioner. It is further averred that a photocopy of the deed dated 19.01.2006 was submitted by the Assistant Commissioner of Stamps to the Collector, Ghaziabad on 21.04.2006 for levy of stamp duty. Consequently, the Collector registered a case under section 33 of the Indian Stamp Act, 1899 (registered as Case No. 17 of 2006-07) and was transferred to the Assistant Commissioner of Stamps, Ghaziabad vide order dated 03.06.2007.
It is further stated that on 16.06.2006, a notice under sections 17, 27, 33, 40, 47-A & 64 of the Indian Stamp Act read with rules 7, 8, 9 & 10 of the U.P. Stamp (Valuation of Property) Rules, 1997 was issued by the Assistant Commissioner of Stamps to the petitioner. Pursuant to the notice, the petitioner submitted its reply/objection.
The Assistant Commissioner of Stamps, vide order dated 27.09.2007, held that the petitioner is liable to pay the stamp duty in accordance with the Schedule I-B at Serial No. 5 of the Indian Stamp Act and also imposed penalty. Aggrieved by the order of the Assistant Commissioner of Stamps, the petitioner preferred Stamp Appeal No. 9 of 2007 before the Chief Controlling Revenue Authority, U.P. (CCRA) under section 56(I-A) of the Indian Stamp Act. During the pendency of the appeal, recovery citation dated 20.11.2007 was issued against the petitioner. Aggrieved petitioner, filed Writ Petition No. 483 of 2008 before this Court, which was disposed of vide order dated 05.11.2009 directing the appellate authority to decide the stamp appeal within three months.
Pursuant to the order of this Court, the appellate authority has passed an order dated 28.01.2010 dismissing the stamp appeal of the petitioner. Hence, this writ petition.
Learned counsel for the petitioner submits that the petitioner entered into Memorandum of Understanding with M/s Modipon Fibres Company, which was never acted upon as M/s Modipon Fibres Company was not vested with the right to transfer the property. It is further submitted that against M/s Modipon Fibres Company, Original Suit No. 150 of 2001 was pending before the Debt Recovery Tribunal and therefore, the Company cannot sell the land without the permission of the Debt Recovery Tribunal, Delhi. It is further submitted that within 15 days from the date of Memorandum of Understanding dated 19.01.2006, the petitioner and M/s Modipon Fibres Company were to jointly measure the land and required to record the exact measurements in the Memorandum to be signed by them.
Learned counsel for the petitioner further submits that the notice, which has been issued on 17.06.2007, never called for the original deed, failing which section 33 of the Indian Stamp Act cannot be pressed into service as no original deed was with M/s Modipon Fibres Company and therefore, it cannot be said that there is any deficiency of stamp duty. It is further submitted that the authorities below have failed to consider the fact as to whether photocopy, in absence of original instrument, can be subjected to the proceedings for imposition of deficiency in stamp duty. It is further submitted that the entire proceedings are wholly illegal and in contravention with the provisions of the Indian Stamp Act as the proceedings were initiated on the basis of the photocopy of the deed dated 19.01.2006.
Learned counsel for the petitioner has placed reliance upon the judgement of the apex Court in the case of Hariom Agrawal Vs. Prakash Chand Malviya reported in 2007 (6) ALD 105 (SC) (paragraph nos. 5 & 13) as well as the judgement of this Court in Som Dutt Builders Limited Vs. State of U.P. & Others reported in AIR 2005 (Alld) 234 (paragraph nos. 8 & 9).
Per contra, learned standing counsel submits that the petitioner has never denied the execution of the Memorandum of Understanding. He further submits that the notices were issued directing the petitioner to submit the original deed, but the petitioner never submitted the original deed and therefore, the proceedings under section 33 of the Indian Stamp Act were rightly initiated against the petitioner. Learned standing counsel further submits that the instrument, as per section 17 of the Indian Stamp Act, is chargeable to stamp duty as soon as the same is executed by the person. It is immaterial as to whether the conditions of the agreement were fulfilled or not, as as soon as the agreement is executed, the liability for payment of stamp duty arises. It is further submitted that in the case in hand, part payment was made by the petitioner to M/s Modipon Fibres Company, which itself shows execution of the agreement and part performance thereof. Learned standing counsel further submits that the judgements cited by the petitioner are not applicable in the facts and circumstances of the present case. He further submits that the orders passed by the authorities below are in accordance with law and do not call for any interference by this Court.
The Court has perused the record.
On the basis of the submissions made by the learned counsel for the parties, the issue, which arises for consideration by this Court, is as to whether on the basis of photocopy of the instruction, i.e., the agreement dated 19.01.2006, can the deficiency of stamp duty be imposed upon the petitioner without calling for the original instrument for the purpose of satisfying with regard to adequacy of the stamp duty paid thereon.
For appreciation of the controversy involved in this case, sections 2(12), 2(14), 17, 33(1), (4) & (5) of the Indian Stamp Act are relevant, which are quoted below:-
Section 2(12): "Executed" and "Execution". "Executed" and "Execution" used with reference to instruments, mean signed and signature;
Section 2(14): Instrument. "Instrument" includes every document by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded;
Section 17: All instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution.
Section 33 (1): Every person having by law or consent of parties authority to receive evidence, and every person in charge of a pubic office, except an officer of police, before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance of his functions, shall, if it appears to him that such instrument is not duly stamped, impound the same.
Section 33 (4): 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 under section 10 on the copy of the instrument:
Provided that no action under sub-section (3) or sub-section (4) shall be taken after a period of four years from the date of execution of the instrument.
Section 33 (5): 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 under section 40 on the copy of the instrument:
Provided that no action under sub-section (4) or sub-section (5) shall be taken after a period of four years from the date of execution of the instrument:
Provided further that with the prior permission of the State Government an action under sub-section (4) or sub-section (5) may be taken after a period of four years but before a period of eight years from the date of execution of the instrument."
From the perusal of the aforesaid provisions of the Indian Stamp Act, it is evident that section 2(12) provides that "Executed" and "Execution" is used with reference to instruments, mean signed and signature; section 2(4) provide that "Instrument" includes every document by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded; section 17 provides that all instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution.
Section 33 of the Indian Stamp Act empowers the authority to examine and impound the instruments before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance of his functions. Sub-section (4) thereof provides that 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 under section 10 on the copy of the instrument. Sub-section (5) empowers the authority that 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 under section 40 on the copy of the instrument.
Learned counsel for the petitioner has vehemently argued that the notice dated 17.06.2007 was issued without calling for the original agreement dated 19.01.2006, which has been rebutted by the learned standing counsel.
This Court has perused the notice dated 17.06.2007. The relevant part of the notice is quoted below:-
"आप कृपया दिनांक 30/6/2006 को प्रातः 10:30 बजे उपरोक्त सन्दर्भ में इस न्यायालय में विचाराधीन मूल अभिलेख सहित उपरोक्त पते पर ... आना सुनिश्चित करे, मूल अभिलेख इस न्यायालय में दाखिल करे तथा पत्रावली के अध्ययन के उपरांत अपना पक्ष एवं उसके समर्थन में साक्ष्य/ साक्षी/ अभिलेख, इस न्यायालय के आदेश के अनुसार निर्धारित तिथि में प्रस्तुत करना चाहें। "
The notice under section 33 of the Indian Stamp Act, as aforesaid, itself is very clear directing the petitioner to produce the original agreement on or before 30.06.2006, but in spite of service of notice, the original instrument was not produced by the petitioner.
It is not the case of the petitioner that he tried to submit the original instrument as per the notice dated 17.06.2007, the same was not accepted by the authorities below. Once, by notice dated 17.06.2007, when the original documents were sought to be produced and the petitioner failed to do so, the proceedings initiated under sub-sections (4) & (5) of section 33 of the Stamp Act are wholly justified. Further, the record shows that no where, either in the grounds of appeal or before this Court, the petitioner submitted that the agreement dated 19.01.2006 was not executed, but it has been only argued that after execution of the agreement dated 19.01.2006, it was never acted upon.
As soon as the petitioner accepted the execution of the agreement, section 17 of the Indian Stamp Act comes into picture and is pressed to service for getting the agreement duly stamped. It is immaterial as to whether, on the basis of the agreement dated 19.01.2006, the performance, as contemplated therein, was done or not done. Once, there is no denied of the execution of the agreement, at any stage, then the liability of stamp duty does arise.
The reliance placed by the petitioner upon the Hariom Agrawal (supra) and Som Dutt Builders Limited (supra) would be of no help to the petitioner, as in that case, the authorities never call upon for submission of original instrument. But in the present case, vide notice dated 17.06.2007, the petitioner was directed to produce the original agreement, but he failed to submit the same.
Another judgement in Som Dutt Builders Limited (supra) relied upon by the learned counsel for the petitioner is also of no help to the petitioner. Relevant paragraph nos. 8 & 9 of the aforesaid judgement is quoted below:-
"8. As regards the first issue, although the agreement had been executed on 11.6.1987, action was first sought to be initiated only on 31.10.1994, which was after a lapse of more than 7 years. Admittedly the said action was initiated on the basis of a photo copy of the document dated 11.6.1987, by summoning the original document. The first proviso to Section 33 of the Act makes it clear that no action can be taken under Section 33(4) of the Act (which deals with the cases where copy of the document is produced and the original instrument is called for) after a period of four years from the date of execution of the instrument. Since admittedly action was being taken on the basis of a document executed on 11.6.1987 and more than four years had elapsed, the provision of Section 33(4) of the Act could not be attracted. The second proviso to Section 33 of the Act having been inserted only w.e.f. 1.9.1998 would not be attracted in this case.
9. As regards the second issue that the Additional District Magistrate had no jurisdiction to initiate proceedings on a photo copy of the document by summoning the original document for the purposes of ascertaining the liability of stamp duty under the Act, even if the notice dated 31.10.1994 and the action taken by the respondents in pursuance thereof could be said to be covered under Section 33(1)of the Act (although the petitioner disputes the same), still the said action would also be illegal and without jurisdiction. In response to the letter dated 31.10.1994 written by the Additional District Magistrate to the Kanpur Development Authority, the Kanpur Development Authority on 1.11.1994 is said to have sent the document in question to the Respondent No. 3. According to the petitioner the document so sent was only a copy of the original and not the original, which was and still remains in the possession of the petitioner. Specific assertion to that effect has been made in paragraph 31 of the writ petition that the original agreement is with the petitioner and the same has not been denied by Kanpur Development Authority or the State of U.P. in their counter affidavits. The learned Standing Counsel had also placed the original records of the case before me and the original agreement was not found there. The learned Standing Counsel could also not justify as to on what basis it has been claimed by him that the original document had been placed before the Additional District Magistrate on which action has been taken. At the time of hearing, the original document was actually placed before me by the learned counsel for the petitioner to show that the same was and still is in the possession of the petitioner. As per Section 33(1) of the Act, once the document or instrument appears to be under-stamped, the officer concerned shall impound the same, In the present case, the original document had never been impounded. The procedure for impounding a document has been laid down in section 40 of the Act and it is no one's case that the same had been followed in the present case. Further, the said document was never produced nor came before the Additional District Magistrate in the performance of his official functions and hence the provisions of Section 33(1) of the Act could not have been attracted. In the case of R.A. Remington v. Deputy Commissioner & Collector, Pithoragarh 1966 A.L.J. 514 the Apex Court has held that the authorities have no power under Section 33(1) of the Act to summon the document for the purposes of finding out whether it had been properly stamped or not. Thus the submission of the petitioner, that the case of the respondents for imposing penalty on the document would also not be covered under the provisions of Section 33(1) of the Act, has force."
In the said case, the proceedings were initiated after a lapse of more than seven years; whereas, section 33 of the Act very clearly provides the limitation of four years. In the case in hand, the proceedings have been initiated within a period of 13 months. Further, section 33 of the Act has been inserted with effect from 01.09.1998; whereas, in the aforesaid case, the agreement was executed on 11.06.1987 and for the first time, proceedings were initiated on 31.10.1994. Therefore, the Court was of the opinion that the initiation of proceedings was without jurisdiction. But, in the case in hand, the agreement has been executed on 30.06.2006 and the notice was issued on 17.06.2007, i.e., within a period of 13 months, which is well within the period of limitation as prescribed under the Act.
In the case in hand, the original agreement was directed to be produced by the petitioner vide notice dated 17.06.2007 and the petitioner failed to produce the same. Therefore, the proceedings under section 33(4) & (5) were rightly initiated.
In view of the aforesaid facts and circumstances of the case, the impugned order does not call for any interference by this Court. The question, framed above, is answered, accordingly, in favour of the State and against the petitioner.
The writ petition fails and it is hereby dismissed.
No order as to costs.
Order Date :-10/01/2020 Amit Mishra