JUDGMENT Hon’ble Dr Devendra Kumar Arora, J.—Heard Sri Ram Karan Verma, learned Counsel for the petitioner and Standing Counsel for the respondents. 2. The sole question involved in the instant writ petition is whether the stamp duty is payable on the property as it stands on the date of execution of deed or demand for additional stamp duty can be created on the presumption of future or intended change of use to which the property may be put to by the vendee. 3. Abdul Rasheed, the petitioner, by means of a registered sale-deed dated 27.8.2002 purchased the ¼ piece of land of Gata No. 126/.242 hectare situate in village Pipariya Dhani Pargana Atwapipariya, Tehsil Mohammadi, District Kheri from one Karamjeet Singh son of Jagdish Singh and paid the stamp duty as applicable to agricultural land at the relevant time. After a long time, proceedings under Section 47-A of the Indian Stamp Act were initiated on the report of Sub Registrar and a show-cause notice was issued to the petitioner requiring him to pay a sum of Rs. 64,936/- as there has been deficiency in the payment of stamp duty. A report in this connection was also sought for from the Naib-Tehsildar, who after inspection submitted his report indicating therein that the land in question situates in close proximity to residential area and commercial establishment on main road of Mohammadi-Gola. Therefore, the land being purchased for residential purposes, as such the stamp duty is payable thereon at the rate applicable to an Abadi land. In response to the show-cause notice, the petitioner submitted that the proper stamp duty has been paid on the instrument in question as per circle rate fixed for this purpose by the Collector. It has been contended that the land purchased by them was and still is being used for agricultural purposes and the stamp duty has been paid accordingly. The said plea did not find favour with the authority concerned, who under the order dated 21.3.2003 held that the land purchased by the petitioner was for residential purpose and as such, the stamp duty is payable thereon at the rate applicable to an Abadi land. A sum of Rs. 64,936/- was demanded towards the deficiency in stamp duty, Rs. 4240/- towards registration charge and Rs. 10,390/- towards penalty. 4. A sum of Rs. 64,936/- was demanded towards the deficiency in stamp duty, Rs. 4240/- towards registration charge and Rs. 10,390/- towards penalty. 4. The said order dated 21.3.2003 was challenged by way of Appeal No. 232/2002-03 under-Section 56 of the Indian Stamp Act before the Commissioner, Lucknow Division, Lucknow, unsuccessfully. He, by the order dated 12.5.2005 dismissed the appeal on the ground that the order of the Collector Stamps/Sub Divisional Officer, Mohammadi, Kheri is perfectly justified, which is based on cogent materials. 5. Being dis-satisfied with the aforesaid orders, the petitioner has filed the instant writ petition questioning the correctness and validity of the aforesaid impugned orders. 6. The learned Counsel for the petitioner submits that the authorities below have wrongly held that the land in question is not agricultural land. The date when it was purchased, it was recorded as agricultural land in the Revenue records and it continues to be so even till date. There being no declaration under Section 143 of the UP ZA & LR Act declaring it as a Abadi/residential, the authorities below have acted arbitrarily and illegally in treating the land in question as non-agricultural land. The burden to prove that the land was other than the agricultural land, lay upon the shoulders of respondents and not on the petitioners. 7. To substantiate the aforesaid assertions, the petitioner has placed reliance on Anirudha Kumar and Ashwini Kumar v. Chief Controlling Revenue Authority, 2000 (3) AWC 2587 and Smt. Anasuya Singh v. Commissioner, Faizabad Division, 2008(26) LCD 588, Surendra Singh and another v. State of U.P. and others, 2009(106) RD 427, Smt. Anasuya Singh v. Commissioner Faizabad Division, Faizabad, 2009(2) ADJ 560 , Kuldeep Chaurasia v. State of U.P. and another, decided on 14.11.2008. 8. The learned Standing Counsel, on the other hand, supports the impugned orders and submits that authorities below were justified in treating the land in dispute as non-agricultural land in view of the spot inspection report of the Naib Tehsildar. 8. The learned Standing Counsel, on the other hand, supports the impugned orders and submits that authorities below were justified in treating the land in dispute as non-agricultural land in view of the spot inspection report of the Naib Tehsildar. Placing reliance on the decisions rendered in Wasi Ur Rehman and another v. Commissioner Moradabad Division Moradabad, 2015(3) ADJ 361 ; Haroon Ahmad and another v. State of U.P. and others, 2012(4) ADJ 179 and Radhey Shyam v. State of U.P. and others (decided on 6.8.2013), learned Standing Counsel submitted that property in question was undervalued, not disclosing that the property has future potential, whereas stamp duty was paid as applicable on agricultural property. 9. In the case of Prakashwati v. Chief Controlling Revenue Authority, Board of Revenue; 1996 AWC 1331, the Apex Court had held that situation of a property in an area close to a decent colony not by itself would make it part thereof and should not be a factor for approach of the authority in determining the market value. According to the said decision, valuation has to be determined on constructive materials which could be made available before the authorities concerned. 10. In Anirudha Kumar and Ashwini Kumar v. Chief Controlling Revenue Authority, 2000 (3) AWC 2587 and Smt. Anasuya Singh v. Commissioner, Faizabad Division, 2008(26) LCD 588, on which reliance has been placed by the petitioner, this Court has referred the aforesaid Prakashwati’s case [supra] and observed as under : “In the present case, the market value is to be determined on the basis of the value that would satisfy the vendor. Thus, 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, therefore, it is the utility of the land as on the date of transfer by 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. 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. The principle that has been laid down in P. Ram Reddy (supra) can be attracted for the purpose of determining the market value only to the extent of potential as on the date of transfer and not beyond. Thus, the market value has to be determined according to the factors, which includes the situation of the land, the amenities available in and around and various other factors, including the close proximity of the residential area as well as any transfer made immediately before the transfer or after the transfer in close proximity if such documents are produced in respect of the area that similarly situated land by either of the parties.” 11. In Rakesh Chandra Mittal’s case [supra] a Division Bench of this Court held: “It is well-settled that market value of the property has to be determined with reference to the date on which the document is executed. Market value as such keeps on varying and changing. Any subsequent improvement or change in the nature or user of the land, which may result into enhancement of the market value of the property on the date of execution of the document that is to be considered for the purpose of determination of stamp duty payable on the instrument.” 12. Apart from the above decisions, recently a Full Bench of this Court in the case of Shri Ramesh Chandra Srivastava, Kanpur v. State of U.P. and others; 2007 UPTC 335, held that the market value of the property has to be determined with reference to the date on which the document is executed. 13. Recently, a question was referred to the Full Bench in the case of Smt. Pushpa Sareen v. State of U.P. and others, 2015(33) LCD 1575, as to whether the Collector Stamps has power to fix the valuation of a plot on the assumption that the same is likely to be used for commercial purposes, and whether the presumed future prospective use of the land can be a criterion for valuation by the Collector? 14. 14. The Full Bench while answering the aforesaid question answered as follows : “Now insofar as the second question is concerned, the issue posed for consideration before the Court is whether the Collector has the power to fix the valuation of a plot on the assumption that it is likely to be used for commercial purposes and whether the presumed future prospective use of the land can be a criterion for valuation by the Collector. The Collector, while exercising his jurisdiction under Section 47-A, is required to determine the market value of the property on the date of the instrument. It is a well-settled principle of law that stamp duty is a levy which is imposed not on the transaction but on the instrument.” 15. The valuation cannot be determined straightway on such an assumption that the land is situated in close proximity of ‘’abadi’ area or on the presumption that the land is to be used for a purpose other than the agriculture. As averred above, the Full Bench of this Court has clearly held on the basis of the various provisions of the Stamp Act, that the market value is to be determined with reference to the date on which the document was executed and that any subsequent change in the nature or use of the land which may result in the enhancement of the market value of the property was not to be taken into account. 16. Thus, the legal position which emerges out from the aforesaid cases is that the market value of the land cannot be determined with reference to the use of the land to which buyer intends to put it. The market value is what a general buyer may offer and what the seller 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. Any subsequent improvement or change in the nature or user of the land, which may result into enhancement of the market value of the property, is not to be taken into account and it is only the value of the property on the date of execution of the document that is to be considered for the purpose of determination of proper stamp duty payable on the instrument. 17. 17. In addition to above legal proposition, the State Government with a view to remove doubts of the Collector (Stamps) issued a Government Order dated 16.9.1999 to all the Divisional Commissioners, District Magistrates and Additional District Magistrates (Finance & Revenue), providing therein that while determining the valuation of the property under 1997 Rules, neither the future potential or use of the property nor the status of the purchaser (Organization, Society, Company etc.) will be taken into consideration. The relevant clause of the Government Order dated 16.9.1999 reads as under : ^^¼d½ vpy lEifŸk ds Hkfo"; esa laHkkfor mi;ksx rFkk Øsrk dk Hkwfe dks dz; djus ds ihNs Hkfo"; esa mldk D;k mn~ns’; gS] bldks cktkj ewY; ds fu/kkZj.k o mlds vkxa.ku dk vk/kkj ugha cuk;k tkuk pkfg,A ¼[k½ fnukad 01 flrEcj] 1997 ls izHkkoh dysDVj jsV fyLV esa ;fn Hkfo"; ds Hkw&Hkkx rFkk i{kdkj dsa fdlh fof'k"V uke ls gksus ds dkj.k ¼;Fkk fdlh fof'k"V iz;kstu gsrq LFkkfir dksbZ laLFkk] lfefr] dEiuh vkfn½ Hkwfe ds dz; gsrq jsV fyLV ls M~;ks<k&nqxquk] dh nj ls Hkwfe dk cktkj ewY; fy;k tkuk vafdr gks rks ,sls Áfo/kkuksa dks lwph ls gVk fn;k tkuk (Delete) pkfg,AÞ 18. Having considered the submissions made by the learned Counsel for the parties and the materials placed before this Court, it appears that the authority had proceeded to determine the value on the presumption that though the land is agricultural land but it has not been purchased for the said purpose. The said presumption does not appear to be sound and reasonable. 19. It may be added 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 sale-deed, the land in dispute was not agricultural land. The petitioner has brought on record copies of Khasra of 1422 Fasli and Khatauni of 1418-1423 Fasli (issued on 21.4.2015) to show the land is still recorded in the Revenue records as agricultural land and agricultural activities are being carried out by the petitioner. In view of the proposition of law as laid down in Prakashwati’s case by the Apex Court and by the Full Bench in Smt. Purshpa Sareen’s case, the case law relied upon by the Standing Counsel are of no avail. 20. In view of the proposition of law as laid down in Prakashwati’s case by the Apex Court and by the Full Bench in Smt. Purshpa Sareen’s case, the case law relied upon by the Standing Counsel are of no avail. 20. This being so, there is no hesitation to hold that the respondent No. 2 did not possess any cogent material on record to show that the instrument in question is deficiently stamped or under valued in any manner. The first respondent was, therefore, not justified in confirming the order passed by the Collector (Stamps). The Appellate Authority proceeded to dismiss the appeal without recording any finding for discarding the pleas as raised by the petitioner in his appeal. 21. In view of the above discussion, the impugned orders dated 21.3.2003 passed by the Collector (Stamps)/Sub Divisional Officer and the order dated 20.12.2005 passed by the Commissioner in appeal are quashed by issuing a writ of certiorari. Any amount deposited by the petitioner shall be refunded to him within a period of two month from the date of production of certified copy of the order. 22. With the aforesaid observations and directions, the writ petition is allowed. No order as to costs. ——————