Research › Search › Judgment

Punjab High Court · body

2011 DIGILAW 1984 (PNJ)

H. P. Singh v. State of Punjab

2011-11-04

RAJIV NARAIN RAINA

body2011
JUDGMENT RAJIV NARAIN RAINA, J. 1. The prayer in this writ petition filed under Article 226 of the Constitution is for a direction to the respondent-State Government and Punjab Urban Development and Planning Authority (for short, “PUDA”) to charge stamp duty from the petitioner for registration of an instrument of sale at par with stamp duty charged from Government, public sector undertakings or local bodies and to grant the petitioner exemption from the date of operation of notification dated 7.3.2011 (P5). 2. The petitioner is a land developer, who is stated to have set up a mega project at village Behlolpur District Mohali, Punjab in an area of 102.3 acres on being granted change of land use on 8.12.2008 by the Chief Town Planner, Punjab, Chandigarh for developing the land for residential/commercial purposes. Since the validity of the notification dated 7.3.2011 issued under the Punjab Stamp (Dealing of Under Valued Instruments) Rules, 1983 was challenged on the ground of discrimination, the matter was posted before this Bench following an order passed by the learned Single Judge on 31.10.2011 to be heard by an appropriate Bench as per roster and that is how the matter has come up for hearing before us. 3. We have heard learned counsel for the petitioner and with his assistance have examined the impugned notification dated 7.3.2011 (P5). The notification has been issued in exercise of powers conferred by Section 75 of the Indian Stamp Act, 1899 to further amend the Punjab Stamp (Dealing of Under Valued Instruments) Rules, 1983. The amendment carried out is in Rule 3-B. The old rule has been substituted by this notification which is the first amendment to 1983 rules. The notification has been issued in exercise of powers conferred by Section 75 of the Indian Stamp Act, 1899 to further amend the Punjab Stamp (Dealing of Under Valued Instruments) Rules, 1983. The amendment carried out is in Rule 3-B. The old rule has been substituted by this notification which is the first amendment to 1983 rules. The newly substituted rule 3-B reads as follows:- “3-B. Notwithstanding anything contained in Rule 3-A, the rate fixed for allotment at the fixed price or at the price accepted after public auction of an immovable property by the Government or a Public Sector Undertaking or a local body, shall be deemed to be the (collector’s rate as fixed under rule 3-A of such property, and the stamp duty shall be charged for registration of instrument of such property at the rate so fixed, at the time of execution of first conveyance deed of such property; provided the conveyance deed is got registered upon the 30th day of September, 2011, after making full amount of the said price, or within a period of one year from the date, the last installment of such price had fallen due as per the Schedule fixed for payment in respect of such property, as the case may be.” (Underlining for emphasis) 4. Rule 3-A provides for fixation of Collector rates for execution of the sale price/ conveyance deeds for such properties. The newly substituted Rule 3-B makes the rates fixed for allotment at fixed price or rates accepted after public auction of immoveable property by the Government or Public Sector Undertaking or Local Body would be deemed to be Collector rates. The new provision lays down that stamp duty would be chargeable for registration of the instrument of such property at the time of execution of the first conveyance deed of such property provided that the conveyance deed is registered up to 30.9.2011. As a consequence of this amendment, transfer of land by Government, Public Sector Undertakings and Local Bodies would make the first registration chargeable to Stamp Duty restricted by deeming fiction to Collector rates of such property but not for subsequent sale. It is the case of the petitioner that it would stand disadvantaged by operation of this notification, since as a land developer, it had paid substantial sums of money towards change of land use; for external development charges; Licence Fee of Rs. It is the case of the petitioner that it would stand disadvantaged by operation of this notification, since as a land developer, it had paid substantial sums of money towards change of land use; for external development charges; Licence Fee of Rs. 1crore; Urban and Development Fund of Rs. 1.34 crores, Social Infrastructure Fund of Rs.30,90,000/-, whereas Government/Public Sector Undertakings/Local Bodies are free from payment of such charges and stamp duty in their case would be charged only at the rate fixed at the time of execution of the first conveyance deed for such property provided that such conveyance deed is got registered up to 30.9.2010. It is then projected that Government agencies would offer plots at reserve prices and the petitioner who has spent substantial amounts to start his Mega Project would not be able to offer prices for its plots/flats at competitive rates as their properties would be inherently more expensive to the intending purchasers from private land developers like the petitioner and therefore, their projects might fail to take off due to availability of cheaper flats/plots. 5. We have heard Mr. H.N.S. Gill, learned counsel for the petitioner at length on the impact of the notification. 6. The State Government/Public Sector Undertakings and Local Bodies form a separate and distinct class from private land developers. A private developer like the petitioner develops land for sale in the market for promoting his business and this is subject to regulatory laws whereas the State Government/Public Sector Undertakings and Local Bodies develop and sell land for social purpose to meet the dire need of housing at a cost affordable to a distinct class that is not so affluent. The notification in our view does not practice any discrimination between the two distinct groups. The two groups, that is, Govt/ Govt agencies and private land developers on the other hand form two distinct and separate classes. The classification cannot be said to be unreasonable between the two sets so as to invite hostile discrimination. The impugned amendment does not restrict or curtail the right of the petitioner to do business in terms of the permissions granted at the time of change of land use. Having been given an inch they now want the proverbial yard. The classification cannot be said to be unreasonable between the two sets so as to invite hostile discrimination. The impugned amendment does not restrict or curtail the right of the petitioner to do business in terms of the permissions granted at the time of change of land use. Having been given an inch they now want the proverbial yard. Many imponderable factors may have been taken into consideration in forming opinion with regard to State finances and translating it into legislation in the shape of the first amendment to the rules which appear to be at the threshold beyond the reach of the Court. The petition does not excite us to take the matter further as ex facie nothing appears arbitrary in the notification. To us it appears that some mischief has been sought to be remedied by the amendment. The Learned Counsel has not been able to throw any light on this aspect as we heard him. We are afraid, no direction can be issued by this Court to include land of promoters/developers like the petitioner in the notification (P5) and afford them the same benefit. The petition is misconceived and misdirected. 7. We are unable to appreciate the contention of the Learned Counsel and find no substance in the prayers made and consequently, dismiss the petition in limine. Petition dismissed.