Case Law Details
Deputy Collector & Anr. Vs Meera S. Desai & Anr. (Gujarat High Court)
The case of Deputy Collector & Anr. vs. Meera S. Desai & Anr. before the Gujarat High Court revolves around the issue of whether stamp duty can be levied twice on the same sale consideration for property transfer. The appeal was filed by the state, represented by the learned AGP Ms. Hetal Patel, against the decision of the learned Single Judge who had quashed the show-cause notices and the order passed by the Stamp Authority.
The main contention of the appellant was that the notices were issued de hors the provision of Sub-Section (4) of Section 32(A), as no proceedings can be initiated after six years of the registration of the instrument. The Agreement to Sale in question was executed on 22.11.2004, and a show-cause notice was issued on 21.11.2012, which the petitioner argued was beyond the stipulated time limit.
The petitioners, who were purchasers of certain plots developed by the landowner, claimed that the Agreement to Sale was registered with possession, and the entire stamp duty leviable on the sale consideration had been paid at the time of registration. The Sale Deed was executed on 30.05.2005, and a notice under Section 33 of the Gujarat Stamp Act, 1958, was issued in 2005, leading to the order to pay deficit stamp duty and penalty in 2015.
The appellant argued that no stamp duty was paid at the time of registration of the sale deed, hence the notice was valid. However, the court rejected this argument, emphasizing that stamp duty is leviable on the sale consideration, which is part of the instrument of transfer. Since the stamp duty was paid at the time of registration of the agreement to sale with possession, it could not be levied again on the sale deed executed pursuant to the agreement.
The court referred to Article 20(cc), Explanation 1, which provides for the adjustment of duties leviable on the conveyance in case of subsequent conveyance in pursuance of an agreement of sale with possession. The provision states that stamp duty already paid on the agreement of sale shall be adjusted towards the total duty leviable on the conveyance executed subsequently.
Based on this interpretation, the court found no merit in the appeal, both regarding the delay and the claim of the appellant to levy stamp duty on the sale deed. Therefore, the appeal was dismissed, and the connected Civil Application was also dismissed accordingly.
In essence, the judgment reaffirms the principle that stamp duty cannot be levied twice on the same sale consideration for property transfer, and any attempt to do so is not legally tenable.
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
1. Heard learned AGP Ms. Hetal Patel for the State – Appellant
2. This appeal suffers from inordinate and unexplained delay of 570 days. The learned Single Judge has allowed the writ petition quashing the show-cause notices and the order passed by the Stamp Authority on the ground that the notices were issued de hors the provision of Sub-Section (4) of Section 32(A), inasmuch as, no proceedings in any manner can be initiated after the period of six years of the registration of the instrument.
3. The date of execution of the Agreement to Sale is 22.11.2004 with respect to which, show-cause notice has been issued on 21.11.2012.
4. Coming on the merits of the case of the appellant to assail the Order of the learned Single Judge, pertinent is to note that as per the claim of the petitioners, who are purchasers of certain plots developed by the land owner, the Agreement to Sale dated 22.11.2004 was a registered agreement with possession, and the entire stamp duty leviable on the sale consideration had been paid at the time of registration of the agreement. Deed of Conveyance namely the Sale Deed had been executed on 30.05.2005 by the land owner with respect to the said property. The impugned notice dated 21.12.2005, under Section 33 of the Gujarat Stamp Act, 1958, had been issued in a suo motu proceedings leading to passing of the order dated 22.04.2015 to pay deficit stamp duty as well as penalty.
5. Noticing the assertion of the petitioner that the entire stamp duty had been paid at the time of the registration of the agreement to sale with possession, we have raised a pointed query to the learned AGP appearing for the State – Appellant as to the deficiency, which was the basis of issuance of Notice dated 21.11.2012.
6. It was argued that no stamp duty was paid by the petitioners at the time of registration of the sale deed and hence, notice cannot be said to be bad.
7. We do not find any substance in the submission of the learned AGP for the simple reason that the stamp duty is leviable on the sale consideration, which is part of the instrument of transfer. In the instant case, the stamp duty was paid at the time of registration of the agreement to sale, as it was with possession.
8. The stamp duty was, thus, not leviable on the sale deed executed pursuant to the agreement to sale with possession as no stamp duty can be twice levied on the sale consideration with respect to one transfer.
9. Reference be made to Article 20 (cc), Explanation 1, which provides for adjustment of the duties leviable on the conveyance, in case of execution of a subsequent conveyance in pursuance to agreement of sale with possession, where stamp duty has been charged at the time of execution of the agreement and reads as under:
“[(cc) CONVEYANCE (not being a transfer charged or exempted under article No. 56) if relating to both movable and immovable property.
Explanation 1 For the purpose of this Article 161 [and subject to sub-item (a) of item (ii) of clause (f) of article 45], an agreements to sell an immovable property or an irrevocable power of attorney shall, in case of transfer of the possession of such property before, at the time of, or after the execution of such agreement or power of attorney, be deemed to be a conveyance and the stamp duty thereon shall be chargeable accordingly:
Provided that the provisions of section 32 A shall apply mutatis mutandis to such agreement or power of attorney as are applicable to a conveyance:
Provided further that where subsequently a conveyance is executed in pursuance of such agreement of sale, or an irrevocable power of Attorney, the stamp duty, if any, already paid and recovered on the agreement of sale or an irrevocable power of Attorney which is deemed to be a conveyance, shall be adjusted towards the total duty leviable on the conveyance.]”
10. For the above, we do not find any merit in the appeal, both from the point of view of delay as well as on the merit of the claim of the appellant to levy stamp duty on the sale deed dated 30.05.2005. The appeal is DISMISSED, accordingly. Consequently, connected Civil Application is dismissed.
Author Bio
