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2017 DIGILAW 2030 (ALL)

Yogesh Kumar v. State of U. P.

2017-08-30

B.AMIT STHALEKAR

body2017
JUDGMENT : B. AMIT STHALEKAR, J. 1. Heard Sri H.N. Singh, learned Senior Counsel assisted by Sri Arpit Agarwal, learned counsel for the petitioners and Sri Shashi Kant Upadhyay, learned Standing Counsel for the State-Respondents. 2. The petitioners are seeking quashing of the order dated 19.06.2017 passed by the Collector, Pilibhit. 3. According to the petitioners they have jointly purchased a building measuring 418.06 sq.m. situate at Mohalla Muria Panai alias Sungarhi, Pilibhit for a consideration of Rs.1,24,00,000/-. The valuation of the property was Rs.1,37,67,000/- on which stamp duty of Rs.9,64,000/- was paid by the petitioners. The sale deed was executed on 05.11.2012 and submitted before the Sub-Registrar, Pilibhit on 09.11.2012 on which he raised an objection regarding valuation and of deficiency of stamp duty. According to the Sub Registrar the valuation of the property was Rs.4,56,56,000/-on which stamp duty payable was Rs.31,95,950/- and since the petitioners had paid Rs.9,64,000/-therefore there was deficiency of stamp duty of Rs.22,31,920/-. Proceedings under Section 47-A of the Indian Stamp Act, 1899 (hereinafter referred to as the Act, 1899) were initiated against the petitioners and thereafter the impugned order was passed and ultimately the deficiency of stamp duty was held to be Rs.4,48,420/-. It is against this order that the present writ petition has been filed. 4. A preliminary objection has been raised by the learned Standing Counsel that the petitioners have a remedy of preferring an appeal under Section 56 of the Act, 1899 before the Commissioner. 5. Learned Senior Counsel for the petitioners submitted that the remedy before the Commissioner is not always the best remedy and that in any case alternative remedy is not a bar for entertaining the writ petition by the High Court. Learned Senior Counsel has referred several decisions. 6. Since the preliminary objection is with regard to the maintainability of the writ petition particularly when the petitioners have a remedy of appeal under the Act, 1899 it would be appropriate to take up the cases which specifically deal with the Act, 1899 on the question of jurisdiction. 7. The first case relied upon by the learned Senior Counsel for the petitioners is the case of Har Devi Asnani v. State of Rajasthan and Others, (2011) 14 SCC 160 . 7. The first case relied upon by the learned Senior Counsel for the petitioners is the case of Har Devi Asnani v. State of Rajasthan and Others, (2011) 14 SCC 160 . The provisions of Section 65 (1) proviso to the Rajasthan Stamp Act, 1998 was challenged for its constitutionality on the ground that it contained a provision for deposit of 50% of the recoverable amount before a revision could be filed before the Chief Controlling Revenue Authority by a person aggrieved by an order made by a Collector. The Supreme Court relied upon the judgment of an earlier Supreme Court judgment in the case of Smt. P. Laxmi Devi (supra) where an identical provision under Section 47-A of the Andhra Pradesh Stamp Act, 1998 had been challenged on the same ground. The Supreme Court in paragraph 18 of Smt. P. Laxmi Devi (supra) held that there was no violation of Articles 14, 19 or any other provision of the Constitution by the enactment of Section 47-A as amended by the Andhra Pradesh Amendment Act 8 of 1998. Paragraphs 20, 21 and 24 of the judgment in the case of Har Devi Asnani (supra) read as under : 20. We need not refer to all the decisions cited by the learned counsel for the parties because we find that in Government of Andhra Pradesh and Others vs. P. Laxmi Devi (supra) this Court has examined a similar provision of Section 47-A of the Stamp Act, 1899, introduced by the Indian Stamp Act (A.P. Amendment Act 8 of 1998). Sub-section (1) of Section 47-A, introduced by Andhra Pradesh Act 8 of 1998 in the Indian Stamp Act, is extracted hereinbelow : "47-A. Instruments of conveyance, etc. Sub-section (1) of Section 47-A, introduced by Andhra Pradesh Act 8 of 1998 in the Indian Stamp Act, is extracted hereinbelow : "47-A. Instruments of conveyance, etc. how to be dealt with-(1) Where the registering officer appointed under the Registration Act, 1908, while registering any instrument of conveyance, exchange, gift, partition, settlement, release, agreement relating to construction, development or sale of any immovable property or power of attorney given for sale, development of immovable property, has reason to believe that the market value of the property which is the subject-matter of such instrument has not been truly set forth in the instrument, or that the value arrived at by him as per the guidelines prepared or caused to be prepared by the Government from time to time has not been adopted by the parties, he may keep pending such instrument and refer the matter to the Collector for determination of the market value of the property and the proper duty payable thereon : Provided that no reference shall be made by the registering officer unless an amount equal to fifty per cent of the deficit duty arrived at by him is deposited by the party concerned." 21. Under sub-section (1) of Section 47-A quoted above, a reference can be made to the Collector for determination of the market value of property and the proper duty payable thereon where the registering officer has reason to believe that the market value of the property which is the subject-matter of the instrument has not been truly set forth in the instrument, or that the value arrived at by him as per the guidelines prepared or caused to be prepared by the Government from time to time has not been adopted by the parties. The proviso of sub-section (1) of Section 47-A, however, states that no such reference shall be made by the registering officer unless an amount equal to fifty per cent of the deficit duty arrived at by him is deposited by the party concerned. This proviso of sub-section (1) of Section 47-A was challenged before the Andhra Pradesh High Court by P. Laxmi Devi and the Andhra Pradesh High Court held that this proviso was arbitrary and violative of Article 14 of the Constitution and was unconstitutional. This proviso of sub-section (1) of Section 47-A was challenged before the Andhra Pradesh High Court by P. Laxmi Devi and the Andhra Pradesh High Court held that this proviso was arbitrary and violative of Article 14 of the Constitution and was unconstitutional. The Government of Andhra Pradesh, however, filed an appeal by special leave before this Court against the judgment of the Andhra Pradesh High Court and this Court held in para 18 at page 735 of Government of A.P. v. Laxmi Devi ( 2008 (4) SCC 720 ) that there was no violation of Articles 14, 19 or any other provision of the Constitution by the enactment of Section 47-A as amended by the Andhra Pradesh Amendment Act 8 of 1998 and that the amendment was only for plugging the loopholes and for quick realisation of the stamp duty and was within the power of the State Legislature vide Entry 63 of List-II read with Entry 44 of List-III of the Seventh Schedule to the Constitution. 24. In our considered opinion, therefore, the proviso to Section 65(1) of the Act is constitutionally valid and we are therefore not inclined to interfere with the order dated 16.11.2009 in D.B.CWP No.14220 of 2009. The Civil Appeal arising out of S.L.P. (C) No.20964 of 2010 is therefore dismissed.” 8. However, what is noticed is that on the question of maintainability of the writ petition the Supreme Court in Har Devi Asnani (supra) held that the learned Single Judge should have examined the facts of the case to find out whether the determination of the value of the property purchased by the appellant and the demand of additional stamp duty made from the appellant by the Additional Collector was so exorbitant as to call for interference under Article 226 of the Constitution of India. Paragraphs 26, 27 and 28 of the judgment read as under : “26. The learned Single Judge of the High Court and the Division Bench of the High Court have taken a view that as the appellant has a right of revision under Section 65(1) of the Act, the writ petition of the appellant challenging the determination of the value of the land at Rs.2,58,44,260/- and the demand of additional stamp duty and registration charges and penalty totaling to Rs.15,70,000/- could not be entertained under Article 226 of the Constitution. The learned Single Judge of the High Court and the Division Bench of the High Court have not considered whether the determination of market value and the demand of deficit stamp duty were exorbitant so as to make the remedy by way of revision requiring deposit of 50% of the demand before the revision is entertained ineffective. 27. In Government of Andhra Pradesh and Others vs. P. Laxmi Devi (supra) this Court, while upholding the proviso to sub-section (1) of Section 47-A of the Stamp Act introduced by Andhra Pradesh Amendment Act 8 of 1998, observed : "29. In our opinion in this situation it is always open to a party to file a writ petition challenging the exorbitant demand made by the registering officer under the proviso to Section 47-A alleging that the determination made is arbitrary and/or based on extraneous considerations, and in that case it is always open to the High Court, if it is satisfied that the allegation is correct, to set aside such exorbitant demand under the proviso to Section 47-A of the Stamp Act by declaring the demand arbitrary. It is well settled that arbitrariness violates Articles 14 of the Constitution vide Maneka Gandhi vs. Union of India [ (1978) 1 SCC 248 ]. Hence, the party is not remediless in this situation." 28. In our view, therefore, the learned Single Judge should have examined the facts of the present case to find out whether the determination of the value of the property purchased by the appellant and the demand of additional stamp duty made by the appellant by the Additional Collector were exorbitant so as to call for interference under Article 226 of the Constitution.” 9. This brings us to the judgment of the Supreme Court in the case of Government of Andhra Pradesh and Others v. P. Laxmi Devi, (2008) 4 SCC 720 where also with regard to the facts of that case the Supreme Court enunciated the principle of law with regard to the maintainability of writ petition inspite of remedy of appeal under the Act, 1899. It will be necessary to reproduce paragraph 28 and 29 of the judgment in Smt. P. Laxmi Devi (supra) which read as under : “28. We may, however, consider a hypothetical case. Supposing the correct value of a property is Rs. It will be necessary to reproduce paragraph 28 and 29 of the judgment in Smt. P. Laxmi Devi (supra) which read as under : “28. We may, however, consider a hypothetical case. Supposing the correct value of a property is Rs. 10 lacs and that is the value stated in the sale deed, but the registering officer erroneously determines it to be, say, Rs. 2 crores. In that case while making a reference to the Collector under Section 47A, the registering officer will demand duty on 50% of Rs.2 crores i.e. duty on Rs.1 crore instead of demanding duty on Rs. 10 lacs. A party may not be able to pay this exorbitant duty demanded under the proviso to Section 47A by the registering officer in such a case. What can be done in this situation? 29. In our opinion in this situation it is always open to a party to file a writ petition challenging the exorbitant demand made by the registering officer under the proviso to Section 47A alleging that the determination made is arbitrary and/or based on extraneous considerations, and in that case it is always open to the High Court, if it is satisfied that the allegation is correct, to set aside such exorbitant demand under the proviso to Section 47A of the Indian Stamp Act by declaring the demand arbitrary. It is well settled that arbitrariness violates Article 14 of the Constitution vide Maneka Gandhi vs. Union of India AIR 1978 SC 597 . Hence, the party is not remedy-less in this situation.” 10. The illustration given in paragraphs 28 and 29 of P. Laxmi Devi (supra) are itself illustrative of the exercise of jurisdiction by the High Court notwithstanding alternative remedy where the alternative remedy would render preferring such remedy extremely harsh to a party which may be required to deposit an irrational amount which he cannot afford. It is in those circumstances that the Court would not insist or relegate the party to exhaust his alternative remedy from the judgment of the Supreme Court. No such view can be culled out from the said judgment that notwithstanding alternative statutory remedy the High Court must interfere under Article 226 of the Constitution of India. 11. The other judgment relied upon by the petitioners is of Sumati Nath Jain v. State of U.P. and Another, 2016 (2) ADJ 533 . No such view can be culled out from the said judgment that notwithstanding alternative statutory remedy the High Court must interfere under Article 226 of the Constitution of India. 11. The other judgment relied upon by the petitioners is of Sumati Nath Jain v. State of U.P. and Another, 2016 (2) ADJ 533 . In that case the Court while interfering under Article 226 and ignoring the alternative remedy of appeal noted that the initial stamp duty which stood paid on the instrument by the appellant was Rs.1,07,600/-. However, the order of the Stamp Authority held the appellant liable to pay additional stamp duty as well as penalty, totaling Rs.8,93,313/-. The Court noted that this represented an increase of eight times over the initial stamp duty which was paid on the instrument and observed that this was clearly one of the exceptional situations envisaged by the Supreme Court in Smt. P. Laxmi Devi (supra) and Har Devi Asnani (supra) as instances where the petitioner was not liable to be relegated to the alternative remedy of an appeal or a revision under Section 56 of the Act, 1899. Paragraph 9 of Sumati Nath Jain (supra) reads as under : “9. In the facts of the present case, we may note that the initial stamp duty which stood paid on the instrument by the appellant was Rs. 1,07,600/-. The order of the second respondent held the appellant liable to pay additional stamp duty as well as penalty totaling Rs.8,93,313/-. This we may note represents an increase of eight times over the initial stamp duty which was paid on the instrument. This was, therefore, clearly one of the exceptional situations which were envisaged by the Supreme Court in Smt. P. Laxmi Devi and Har Devi Asnani as instances where the petitioner was not liable to be relegated to the alternative remedy of an appeal or a revision under Section 56 of the Act.” 12. Coming to the facts of the present case what is noticed is that the deficiency of stamp duty determined by the Stamp Authority is Rs.4,48,420/- which in itself is just about 50% of what has been paid by the petitioners as stamp duty and if the petitioners are relegated to the Appellate Authority to exhaust the statutory remedy of appeal they would have to deposit 1/3rd of the deficiency so computed, namely, 1/3rd of Rs.4,48,420/-. This is in my opinion cannot be said to be exorbitant in the facts and circumstances of the case when they have already deposited the stamp duty of Rs.9,64,000/-, therefore, in my opinion, this is not a case where this Court would be required to exercise its jurisdiction under Article 226 of the Constitution of India at this stage without the petitioner first exhausting the statutory remedy provided under Section 56 of the Act, 1899. 13. For reasons aforesaid, the writ petition lacks merit and is accordingly dismissed.