Research › Search › Judgment

Allahabad High Court · body

2009 DIGILAW 331 (ALL)

VEER BAL SINGH v. STATE OF U. P.

2009-01-30

PRAKASH KRISHNA

body2009
JUDGMENT Honble Prakash Krishna, J.—The petitioners mother purchased a piece of land bearing Arazi No. 88/0-813 hectare, Arazi No. 136/0-109 hectare, Arazi No. 137/0-388 hectare and Arazi No. 147/0-085 Hectare situate in Village Khujjhi, Pargana and Tehsil Kerakat, District Jaunpur by means of a registered sale deed dated 23.6.2003 for a sum of Rs. 6,60,000/-. The stamp duty however, thereon was paid on the presumption of market value of Rs. 16,00,000/-. 2. The sale deed was impounded for deficiency of stamp duty and the matter was referred to the Collector to find out the market value of the property covered under the said instrument and the stamp duty payable thereon as provided for under Section 47-A of the Stamp Act. A report from the Tahsil authority was called for. The Upper Zila Adhikari after spot inspection submitted a report dated 10.10.2003. It was found that the land in question is situate one kilometer away from road 5 kilometer away from Railway Station and 10 kilometer away from town area. The Sub-Divisional Magistrate/Assistant Commissioner, Stamp, respondent No. 3 after taking into consideration the said report found that the instrument in question is deficit in the stamp duty by Rs. 1,78,880/-. By the order dated 13.3.2006 the petitioner was directed to pay the aforesaid duty along with interest @ 1.5% per annum. The said order was challenged in Appeal No. 39 of 2006 before the C.C.R.A./Commissioner, Varanasi Division, Varanasi who by the impugned order dated December 4, 2007 dismissed the appeal. 3. Shri C.B. Yadav, learned Counsel for the applicant raised several issues in the present petition. He submits that even from the report dated 10.10.2003, which is the basis of the impugned orders, it is evident that the land in question is agricultural land. The relevant revenue records do also show that the land in question was agricultural land on the relevant date i.e. 23.6.2003 when the sale deed was executed and it continues to be same even today as is apparent from the Khasras of the subsequent years. 4. The relevant revenue records do also show that the land in question was agricultural land on the relevant date i.e. 23.6.2003 when the sale deed was executed and it continues to be same even today as is apparent from the Khasras of the subsequent years. 4. The further submission is that the stamp duty was paid as per the circle rate fixed by the Collector under the provisions of the Stamp Act but the authorities below while calculating the payability of quantum of the stamp duty have wrongly applied the rate per square meter which is applicable to land other than agricultural land i.e. the land purchased for residential and commercial purposes. The sum and substance of the argument is that the petitioner has paid the stamp duty as per the circle rate fixed by the Collector and there being no material to hold that the instrument in question is deficiently stamped, the additional demand for stamp duty is uncalled for and is liable to be quashed. 5. The learned Standing Counsel on the other hand supports the impugned orders and submits that from the report dated 10.10.2003, it is evident that the instrument was deficiently stamped and therefore demand for payment of additional stamp duty perfectly justified. 6. Considered the respective submissions of the Counsel for the parties and perused the record. 7. As noticed herein before, it is not in dispute that the petitioner purchased the land in question after paying a sale consideration of Rs. 6,16,000/-and has paid the stamp duty on the presumption of market value of the said land at Rs. 16,00,000/-. 8. The first question which falls for consideration is whether the land covered under the instrument is agricultural land or not. Except the report dated 10.10.2003, there is no material on record to show that the land in question is not agricultural land. It may be noticed that the land in question at the time of sale was agricultural land. It is also not the case of the respondents that any declaration was granted or the land was treated as non-agricultural land under Section 143 of U.P. Zamindari Abolition & Land Reforms Act. A copy of the said report dated 10.10.2003 has been annexed as Annexure-1 to the writ petition, wherein it is mentioned that the plots No. 88,136,137, 147 are one kilometer away from the road. A copy of the said report dated 10.10.2003 has been annexed as Annexure-1 to the writ petition, wherein it is mentioned that the plots No. 88,136,137, 147 are one kilometer away from the road. The Column No. 2 which requires to state as to whether the road is Kachchi, Pakki or metal has been left blank. It is situate at a distance of 4 kilometer away from Railway Station and 5 Kilometer away from the Government Office, Factory etc. Under Column No. 6, it is mentioned that Plot No. 88 is abadi and the remaining plots are near to the Abadi. Under Column No. 7 it is mentioned that Plot No. 88 is about half Kilometer away from the abadi and remaining plots No. 136 are about 200 meters away from the Abadi, 137 and 147 are covered with Abadi. Certain standing trees were also found. The one construction in the form of Khaprail raised before the Consolidation operation in the Village has been reported which has no sanitary fittings, electricity fittings, water supply etc. 9. The report in my considered view is not sufficient to hold that the land in dispute, is non-agricultural land. An agricultural land can be treated as non-agricultural land only under two circumstances. Firstly, when there is a declaration under Section 143 of U.P. Zamindari Abolition & Land Reforms Act or it is recorded as such in the revenue record. None of the authorities below has found fulfilment of the either of the conditions. It is not the case of the respondents that at the time of the execution of the sale deed or prior to it, the plots in question were non-agricultural land. Along with the writ petition, the extract of Khasra of 1413 Fasli has been filed which shows that paddy crops were sown in these plots. 10. The submission of petitioners Counsel is that firstly, the land in question was purchased as agricultural land and it was recorded as agricultural land and there being no declaration under Section 143 of the U.P.A.Z. & L.R. Act declaring it as Abadi land, the stamp duty be charged treating as the agricultural land as on the date of the sale deed it was agricultural land. The crux of the argument is that the nature of the land under the instrument should be considered on the date of execution of the instrument and not the future use to which the land may be put by the buyer. Reliance has been placed by him on Anirudha Kumar and Ashwini Kumar v. C.C.R.A., 2000 (3) AWC 2587 which fully supports the above contention. The approach adopted by the authorities is patently erroenous and without jurisdiction, as it runs to the contrary to the aforesaid ruling. 11. In M/s. Maya Food and Vanaspati Ltd. Co. v. Chief Controlling Revenue Authority (Board of Revenue) Allahabad, 1990 (90) RD 57, the Court held that the market value of the land could not be determined with reference to the use of the land to which the buyer intends to put in use. The Court held that a buyer may intend to establish an industrial undertaking thereon and that another buyer may intend to use it for agricultural purposes and a third person may intend to dedicate it for charitable purposes and that these different intentions of individual buyers may affect the price of each of them would be willing to pay for the property but the market value would not depend upon what each individual would offer for the property in question and that the market value would be that which a general buyer would offer and what the owner reasonably accepts for that property, the Court held that in determining the market value, the potential of the land as on the date of sale alone could be taken into account in determining the market value and that the potential value of the land that could be put in use in future could not to be taken into consideration. 12. In Smt. Anasuya Singh v. Commissioner, Faizabad Division, Faizabad and another, 2008 (104) RD 725, the Court held that an agricultural land situate at a roadside in a semi-urban area could not be treated as commercial or residential unless that area was declared as a commercial or a residential area by the authorities. In Kunj Behari v. State of U.P. and others, 2008 (104) RD 750 , a similar view was taken by the Court. 13. The aforesaid judgments have been followed in Ashok Kumar Dubey v. State of U.P. and others, 2008(8) ADJ 748 . In Kunj Behari v. State of U.P. and others, 2008 (104) RD 750 , a similar view was taken by the Court. 13. The aforesaid judgments have been followed in Ashok Kumar Dubey v. State of U.P. and others, 2008(8) ADJ 748 . The similar view has been taken in 2007(6) ADJ 169 , Sarva Hitkarini Sahkari Awas Samiti Ltd. v. State of U.P. and 2008 (104) RD 725, Ansuiya Singh v. Commissioner, Faizabad Division, Faizabad. 14. The other limb of the argument is that the market value of the land cannot be determined with reference to use of the land to which buyer intends to put it in use, has substance. The matter in depth has been examined by this Court in Shakumbari Sugar and Allied Industries Ltd. v. State of U.P. and others, 2007 (5) ADJ 602 . In this case, reliance has been placed on earlier judgment in M/s. Maya Foods and Vanaspati Ltd., Allahabad v. Chief Controlling Revenue Authority, 1998 (4) AWC 636 wherein the following passage has been reproduced : "Learned Chief Controlling Revenue Authority has observed that the land was purchased for an industrial purpose and the Collector is not arbitrary in deciding the price of the land on the basis of the proposed usage. This proposition is legally incorrect. The market value of the land cannot be determined with reference to the use of the land to which buyer intends to put it. One buyer may intend to establish an industrial undertaking thereon, another may intend to use it for agricultural purpose and a third person may intend to dedicate it for charitable purposes like leaving it open as pasture ground or a cremation ground or a playground. These different intentions may affect the price that each of them may be willing to pay for the property and such prices have wide variations but the market value is not what each such individual may offer for the property. The market value is what a general buyer may offer and what the owner may reasonably expect. In determining the market value, the potential of the land as on the date of sale alone can be taken into account and not what potential it may have in the distant future." 15. The market value is what a general buyer may offer and what the owner may reasonably expect. In determining the market value, the potential of the land as on the date of sale alone can be taken into account and not what potential it may have in the distant future." 15. More or less the similar view has been taken in Smt. Neelam Gupta v. Commissioner, Kanpur Division, Kanpur, 2007 (1) ADJ 289 wherein the Court has placed reliance upon on para 19 of a judgment of the Apex Court in P. Ram Reddy v. Land Acquisition Officer, Hyderabad, JT 1995 (1) SC 593. The para 19 is reproduced below : "The question of future potential cannot be a factor for determining the market value of such a land for the purpose of stamp duty payable under the Stamp Act. The vendee pays the price that satisfies the vendor and as such, if the land was an agricultural land, it has to be treated as such and the valuation has to be done accordingly. Whether in future the purchaser puts the land into residential use or changes the character is immaterial for the purpose of payment of stamp duty." 16. None of the authorities below besides the report of the Sub-Registrar has referred any other material in support of their orders. In Ram Khelawan @ Bachha v. State of U.P. through Collector, Hamirpur and another, 2005 (98) RD 511, it has been held that the report of the Tehsildar may be a relevant factor for initiation of the proceedings under Section 47-A of the Act, but it cannot be relied upon to pas an order under the aforesaid Section. In other words, the said report cannot form itself basis of the order passed under Section 47-A of the Act. In the case of Vijai Kumar v. Commissioner, Meerut Division, Meerut, 2008 (7) ADJ 293 (para 17), the ambit and scope of Section 47-A of the Act has been considered with some depth. In other words, the said report cannot form itself basis of the order passed under Section 47-A of the Act. In the case of Vijai Kumar v. Commissioner, Meerut Division, Meerut, 2008 (7) ADJ 293 (para 17), the ambit and scope of Section 47-A of the Act has been considered with some depth. Taking into consideration the Division Bench judgment of this Court in Kaka Singh v. Additional Collector and District Magistrate (Finance and Revenue), 1986 ALJ 49; Kishore Chandra Agrawal v. State of U.P. and others, 2008 (104) RD 253 and various other cases it has been held that under Section 47-A (3) of the Act, the burden lay upon the Collector to prove that the market value is more than minimum as prescribed by the Collector under the Rules. The report of the Sub-Registrar and Tehsildar itself is not sufficient to discharge that burden. 17. Viewed as above, it is, thus, evident that the report of the Sub-Registrar could not legally form basis of the impugned orders. There is no material in possession of the respondents to show that on the date of the execution of the sale deed, the land in dispute was not agricultural land. 18. In view of above discussions, the impugned orders are liable to be quashed as the proceedings under Section 47-A of the Stamp Act is unwarranted on the facts of the present case. 19. In the result, the writ petition succeeds and is allowed. The impugned orders passed by the respondents are hereby set aside with costs. The amount, if any, deposited by the petitioner in pursuance of the impugned orders shall be refunded to the petitioner within a period of one month from the date of production of certified copy of this order. 20. In case of default in making the refund as stipulated above, the respondents shall be liable to pay interest @ 10% per annum from the date of deposit to the date of actual refund. ————