Allahabad High Court
Hasan Aaga And Another vs State Of U.P. And Another on 9 January, 2020
Author: Pankaj Bhatia
Bench: Pankaj Bhatia
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 44 Case :- WRIT - C No. - 880 of 2010 Petitioner :- Hasan Aaga And Another Respondent :- State of U.P. and Another Counsel for Petitioner :- P.K. Singhal Counsel for Respondent :- C.S.C. Connected with Case :- WRIT - C No. - 883 of 2010 Petitioner :- Tanveer Ali Respondent :- State of U.P. and Another Counsel for Petitioner :- P.K. Singhal Counsel for Respondent :- C.S.C. Hon'ble Pankaj Bhatia,J.
The present petitions have been filed challenging the orders dated 21.5.2009 and 30.9.2009 passed by the respondent nos. 3 and 2 respectively.
The brief facts giving rise to the filing of the Writ-C No. 880 of 2010 is that the petitioners purchased agricultural land no. 2M/2.092 Hectare, 62/0.3282 Hectare, 182M/0.657 Hectare, 283M/0.798 Hectare (total land 3.875 Hectare), situated at Village Katai for a sum of Rs. 5,65,000/- by a registered sale deed dated 4.8.2007 and paid a stamp duty of Rs. 1,74,000/- on a sum of Rs. 21,81,000/- as per the circle rates fixed w.e.f. 6.3.2006.
The submission is that the stamp duty was paid in terms of the circle rate, although the sale consideration was less than the circle rate. A report of the Tehsildar was called by the respondent no. 3, who by his report dated 9.3.2009 (Annexure-4) opined that the valuation of the property appears to be Rs. 4 Lakhs per acre. In pursuance to the said report, the petitioners were called upon to file their objections to the notice proposing to assess deficiency of stamp duty and levy penalty, to which the petitioner filed their detailed objection denying any liability and also denying that no case for deficiency of stamp duty or penalty is made out.
The respondent no. 3 vide his order dated 21.5.2009 passed an order determining the market value of the property at Rs. 4 Lakhs per acre, based upon the report of the Tehsildar alone while returning the finding on the valuation, the objections filed by the petitioners were not even considered. Thus, vide order dated 21.5.2009, an order was passed holding that the stamp duty payable is deficient by Rs. 133260/- and further a penalty of Rs. 133260/- total Rs. 266520/- was assessed against the petitioners and was directed to be paid along with interest at the rate of 1.5% per month.
Aggrieved against the said order, the petitioners preferred an appeal under the statute, however the same was dismissed vide order dated 30th September, 2009.
The facts relating to Writ-C No. 883 of 2010 are as under:-
The petitioner purchased 3-36 hectare of agricultural land, Khasra No. 268 at Village Katai for a sum of Rs. 5,65,000/- by a registered sale deed dated 4.8.2007 and paid a stamp duty of Rs. 1,27,000/- on a sum of Rs. 15,86,000/- as per the circle rates fixed w.e.f. 6.3.2006 @ 1,90,000/- per acre.
Based upon ex-parte report of the Collector, which is similar to the report in Writ Petition No. 880 of 2010 and on that sole basis stamp deficiency of Rs. 1,39,400/- as well as penalty of equal amount total Rs. 2,78,800/- along with interest at the rate of 1.5% per month have been made. Appeal against the said order was also dismissed.
The said two orders have been assailed in the present petitions.
Common questions arise for determination in the present two writ petitions, as such the same are being disposed off by means of this common judgment.
The brief submission of Sri P.K. Singhal is that there is nothing on record to demonstrate as to how the Tehsildar came to a conclusion that the valuation of the property was Rs. 4 Lakhs per acre whereas in terms of the rates notified under the Stamp Act, the same was much less. He further submits that it is well settled that once the sale deed has been executed, the burden to establish its valuation lies on the State. He further relies upon a judgment of this Court in the case of Varun Gopal v. State of U.P. and Others, judgment dated 23.12.2014, Writ Petition No. 50295 of 2013.
The Standing Counsel on the other hand has placed reliance on a report filed as Annexure-CA-1 dated 29.7.2008 submitted by the Additional Commissioner (Stamps), which states that on the basis of an inspection carried out it appears that stamp duty paid is deficient. A perusal of the said report reveals that it does not even refer to the property or its location or any other basis to come to a conclusion that the market value of the property is higher.
This Court in the case of Varun Gopal v. State of U.P. considered the entire gamut of cases and held as under:-
"The sine qua non for invoking provisions of Section 47-A(3) of the Act is that the Collector had reason to believe, that the value had not been properly set forth in the instrument as per market value of the property. Once the instrument is registered and the stamp duty as prescribed by the Collector was paid, the burden to prove that the market value was more than the minimum prescribed by the Collector under the rules, was upon the Collector. The report of the sub-Registrar or Tehsildar was not sufficient to discharge that burden. (Vijay Kumar v. Commissioner, Meerut Division) The expression "reason to believe" is not synonymous with subjective satisfaction of the officer. The belief must be held in good faith, it cannot be merely a pretence. It is open to the court to examine the question whether the reasons for the belief have a rational connection or a relevant bearing to the formation of the belief and are not irrelevant or extraneous to the purpose of the section. (Dr. Pratap Singh V. Director of Enforcement Foreign Exchange Regulation Act) The word "reason to believe" means some material on the basis of which department can reopen proceedings. However, "satisfaction" is necessary in terms of material available on record, which should be based on objective satisfaction arrived at reasonably. (BPL Limited v. Deputy Commissioner, Gift Tax, Central Circle-II).
The word "reason to believe" means a cogent reason for believing that the value mentioned in the instrument is not truly set forth and such reason should be based on material on record. (Harvinder Kaur (Smt.) v. State of M.P.).
Penalty can be imposed, if there is an attempt to evade stamp duty. Penalty presupposes culpability and an intention to conceal or to play fraud with authorities. Before imposing penalty, authorities must record finding based on relevant material that the purchaser or the person liable to pay stamp duty had concealed relevant facts in execution of sale deed and had intention to evade payment of stamp duty. (Asha Kapoor (Smt.) v. Additional Collector (Finance and Revenue), Ghaziabad)."
I have no hesitation in holding that the State has miserably failed in establishing the burden cast upon the State as there is no material on record to come to a conclusion that the stamp duty paid was deficient. A mere view of the Tehsildar or the A.D.M. cannot form the basis for, 'reasons to believe' which is 'sine qua non' for initiating proceedings under Section 47-A of the Indian Stamp Act, the State having failed to discharge its burden. I have no hesitation in quashing the orders dated 21.5.2009 and 30.9.2009 passed by the respondent nos. 3 and 2 respectively. Both the orders are hereby quashed.
The amount already deposited in pursuance to the order passed by this Court shall be refunded to the petitioner on his moving an application within a period of four months from today.
Both the writ petitions are allowed in terms of the said order.
Order Date :- 9.1.2020 SR