Allahabad High Court
Santosh Gupta vs State Of U.P. And 4 Others on 24 July, 2024
Author: Piyush Agrawal
Bench: Piyush Agrawal
HIGH COURT OF JUDICATURE AT ALLAHABAD Neutral Citation No. - 2024:AHC:118158 Court No. - 2 Case :- WRIT - C No. - 22313 of 2023 Petitioner :- Santosh Gupta Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Amit Sharma,Sundeep Agarwal,Vinod Kumar Sharma Hon'ble Piyush Agrawal,J.
1. Heard Mr. Sundeep Agarwal for the petitioner and Mr. A.C. Mishra, learned Additional Chief Standing Counsel for the State-respondents.
2. By means of present petition, the petitioner is praying, inter alia, for the following reliefs:-
"I. Issue a writ, order or direction in the nature of certiorari, quashing the impugned order dated 15.5.2023 passed by respondent no. 2 in Revision No. 00498/2021 (Santosh Kumar Vs. State of UP) U/s 56(1-A) of Indian Stamp Act 1899 (Annexure No. 1 to this writ petition).
II. Issue a writ, order or direction in the nature of certiorari for quashing the order dated 10.02.2021 passed by respondent no. 3 in Case No. 5780 /2017 (State Vs. Santosh Gupta) U/s 47 - A of Indian Stamp Act, 1899 (Annexure No. 2 to this writ petition).
III. Issue a writ, order or direction in the nature of mandamus, directing the Respondents to refund the entire disputed amount already deposited along with interest."
3. Learned counsel for the petitioner submits that registered gift deed was executed in favour of the petitioner on 7.7.2017 by his real brother namely Rajiv Gupta gifting the property in question. The said gift deed was treated as sale of the property and on that basis a report was submitted by the Sub Registrar, Agra on 18.8.2017, thereafter a notice was issued by Sub Divisional Magistrate, Sadar, Agra on 10.11.2017 on which an objection was filed by the petitioner on 8.3.2018 however being not satisfied with the same, an order was passed on 11.10.2021 treating the said gift deed as sale of the property. Feeling aggrieved to the said order, the petitioner has preferred a revision which was dismissed by respondent no. 2 vide order dated 15.5.2023 without considering the material on record.
4. In support of his arguments, learned counsel for the petitioner has relied upon the judgement of this Court in the cases of Sheel Mohan Bansal Vs. State of UP, Writ C No. 18282 of 2023 decided on 10.4.2023; Sumit Gupta Vs. State of UP, 2011 (113) RD 204, and Vijay Kumar Vs. Chief Controller, Board of Revenue and others, 2017 (136) RD 364, and submits that gift deed cannot be treated as sale of the property.
5. Per contra, learned ACSC has supported the impugned order and prays for dismissal of the present writ petition.
6. After hearing learned counsel for the parties, the Court has perused the records.
7. It is admitted between the parties that petitioner is real brother of one Rajiv Gupta, who has executed a registered gift deed dated 7.7.2017 in favour of the petitioner against which the proceedings under Section 47A of the Stamp Act was initiated. The issue in hand is not res integra as this Court in the case of Sumit Gupta (supra) has already decided the present controversy.
8. The relevant part of the judgement passed in the case of Sumit Gupta (supra) is quoted hereunder:
7. A Gift-deed is chargeable to stamp duty under under Article 33 of Schedule 1-B of the Act, which is reproduced as under:
Description of instrument Proper Stamp-duty
33.
Gift - Instrument of, not being a Settlement (No.58), or Will or Transfer (No.62) Hiring Agreement or Agreement of Service - See "Agreement" (No.5) The same duty as a Conveyance No.23 clause (a) for a consideration equal to the value of the property.
Note: Emphasis supplied
8. It provides that a gift is chargeable to stamp duty as a conveyance provided under Article 23 clause (a) for a consideration equal to the value of the property.
9. It may be noted that in the above Article words used are "value of the property" as distinguished from the "market value", meaning thereby that for the purposes of determining stamp duty on a gift-deed market value is not required to be mentioned/determined. The disclosure of the value of the property in the gift is sufficient for the purposes of payment of stamp duty.
10. A perusal of Section 47-A of the Act indicates that it comes into play only where the market value of the property in the instrument is disclosed to be lesser than that determined in accordance with the Rules made under the Act. So disclosure of market value of the property is mandatory for the applicability of Section 47-A of the Act and it should be less than the market value determined under the Rules ie. the circle rate prescribed/notified under the Act/Rules.
11. Thus, there is a clear departure in the language used in Article 33 of the Schedule I-B of the Act and Section 47-A of the Act. Section 47-A of the Act uses the expression in "market value" whereas for levying stamp duty on a gift-deed Article 33 of Schedule 1-B of the Act uses the expression "value of the property".
12. The legislature in its wisdom has differently used the words "value of the property"' and "market value" in the Act. It is not without purpose. "Market value" refers to the value of the property prevailing in the market on which the prospective purchaser is ready and willing to purchase and seller is ready and willing to sell the property in the ordinary course of business. Therefore, market value is a bilateral transaction depended upon the will of two persons. On the other hand, 'value' simply connotes the estimated monetary worth of the property in the eyes of the seller and is in the nature of a unilateral act.
13. In conveyance, such as sale of property, generally two parties, ie. seller and purchaser are involved and the market value of the property is determined on the basis of the market forces ie., demand and supply of the commodity. In a deed of gift it is only the person making the gift who is relevant. It is up to him how he values his property. The value of the property in the eyes of the person receiving the gift is not material. This being the situation, the legislature has deliberately used the word "value of the property" in Article 33 while subjecting the gift to stamp duty and has refrained from using the term "market value".
14. Accordingly, when market value is not at all relevant for levying stamp duty on a gift deed the provisions of Section 47-A of the Act does not come into play which necessitate determination of market value.
9. Similar view has been taken in the case of Vijay Kumar (supra) of which the relevant part is quoted hereunder:-
5. Reliance has been placed upon a judgment of a learned Single Judge of this Court in Writ petition (C) no. 66621 of 2010, Sumit Gupta vs State of U.P. and others. Relevant extract of the judgement read as under:-
Thus, there is a clear departure in the language used in Article 33 of the Schedule I-B of the Act and Section 47-A of the Act. Section 47-A of the Act uses the expression in "market value" whereas for levying stamp duty on a gift-deed Article 33 of Schedule 1-B of the Act uses the expression "value of the property".
The legislature in its wisdom has differently used the words "value of the property"' and "market value" in the Act. It is not without purpose. "Market value" refers to the value of the property prevailing in the market on which the prospective purchaser is ready and willing to purchase and seller is ready and willing to sell the property in the ordinary course of business. Therefore, market value is a bilateral transaction depended upon the will of two persons. On the other hand, 'value' simply connotes the estimated monetary worth of the property in the eyes of the seller and is in the nature of a unilateral act.
In conveyance, such as sale of property, generally two parties, ie. seller and purchaser are involved and the market value of the property is determined on the basis of the market forces ie., demand and supply of the commodity. In a deed of gift it is only the person making the gift who is relevant. It is up to him how he values his property. The value of the property in the eyes of the person receiving the gift is not material. This being the situation, the legislature has deliberately used the word "value of the property" in Article 33 while subjecting the gift to stamp duty and has refrained from using the term "market value".
Accordingly, when market value is not at all relevant for levying stamp duty on a gift deed the provisions of Section 47-A of the Act does not come into play which necessitate determination of market value."
10. Recently this Court in the case of Sheel Mohan Bansal (supra) has held as under :-
6. In light of the above judgement, it is patently clear that for levying stamp duty on a gift deed, the provisions of Section 47-A of the Act do not come into play. Furthermore, there is no requirement of determination of market value in case of gift deeds. This judgement was accepted by the authorities and has attained finality. The aforesaid judgment was thereafter cited in Vijay Kumar (Supra) and a coordinate Bench has held that Section 47-A of the Act would have no application whatsoever. The said principle was thereafter, reiterated by a coordinate Bench of this Court in Sai Janseva And Another (Supra).
7. Upon a perusal of the judgements provided above, it is clear that in case of a gift deed that has been accepted and registered, the authorities cannot take reference to Sub-section (3) of Section 47-A of the Act and suo moto seek additional stamp duty based on the market value of the property. However, the question arises that in the case of under valuation that may have been done by the executor of the instrument what recourse is available to the authorities.
8. In my view, the Indian Stamp Act, 1899 provides for various provisions that may be acted upon that are provided in Sections 27, 33, 62, 62-A, 64 and 64-B, wherein, if adequate stamp duty has not been affixed, the authorities can proceed against the executor for prosecution and collection of deficit stamp duty. However, the authorities cannot proceed under Section 47-A of the Act which is what has been done in the present case. It is also seen, that the respondents have not taken into account the judgements cited by the petitioner and proceeded to adjudicate upon their whims and fancies. It was incumbent upon the authorities to have taken note of the judgements cited by the petitioner and pass a reasoned order on the same, which has clearly not been done in the present case. The authorities are directed to be far more cautious in their approach in quasi judicial activities being carried out by them.
11. In view of the aforesaid law laid down by this Court, the writ petition is allowed. The impugned orders dated 15.5.2023 and 10.2.2021 are hereby quashed.
12. Any amount already deposited by the petitioner during pendency of the present litigation shall be refunded to him within a period of one month along with interest at the rate of 4 % per annum from the date of deposit till the date of actual payment of the said amount.
Order Date :- 24.7.2024 Rahul Dwivedi/-