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2018 DIGILAW 685 (ALL)

ABDUL AZIZ v. STATE OF U. P.

2018-03-21

B.AMIT STHALEKAR

body2018
JUDGMENT : Hon'ble B. Amit Sthalekar,J. Heard Sri Aditya Singhal, learned counsel for the petitioner and the learned Standing Counsel for the respondents. 2. The petitioner in the writ petition is seeking quashing of the order dated 24.12.2004 passed by the Commissioner, Meerut Division, Meerut dismissing the petitioner's stamp appeal no. 35 of 2002-2003. 3. Briefly stated the facts of the case are that the petitioner participated in an auction bid along with other persons issued by the Nagar Palika Parishad, Bulandshahar for collection of Teh Bazaari of cattle fair, stand fees, advertisement hoardings for the year 2000-01 beginning from 1.4.2000 to 31.3.2001. It is stated that the petitioner's bid was the highest and, therefore, it was accepted for Rs. 42,62,000/- . The petitioner was required to submit an indemnity bond which he also submitted. On an allegation that there was deficiency of stamp duty, proceedings under Section 47-A of the Indian Stamp Act, 1899 were initiated against the petitioner. Notice was issued to which he submitted his reply. The Additional District Magistrate (Finance and Revenue)/Collector, Stamp, Bulandshahar, however, by his order dated 25.1.2003 has held that the instrument in question was actually a lease deed, and therefore, he computed the deficiency of stamp duty as Rs. 4,26,000/- after deducting Rs. 100/- already paid by the petitioner along with penalty of Rs. 3,900/-, total Rs. 4,30,000/-. Aggrieved by the order dated 25.1.2003, the petitioner preferred a stamp appeal which has also been dismissed by the impugned order dated 24.12.2004. 4. The contention of the learned counsel for the petitioner is that there was no lease deed in existence and it was only the indemnity bond submitted by the petitioner which was treated to be a lease deed and that an indemnity bond cannot be said to be a lease deed. His contention further is that the lease bid was never accepted by the Nagar Palika Parishad. 5. The learned standing counsel on the other hand submitted that the Collector, Stamp has recorded a clear finding that the Nagar Palika Parishad had accepted the petitioner's bid and on the auction bid there was the signature of the Executive Officer, Nagar Palika as well as the petitioner for collection of Teh Bazaari and therefore, the Collector has rightly held the instrument in question to be a lease and subjected the same to stamp duty as per law. 6. 6. From a reading of the writ petition what is noticeable is that in para 3 of the writ petition, the petitioner has himself admitted that the petitioner's bid was the highest at Rs. 42,62,000/- which was accepted for the year 2000-01 beginning from 1.4.2000 to 31.3.2001. In para 4 of the writ petition, it is stated that the petitioner also deposited a sum of Rs. 42,62,000/- with the Nagar Palika Parishad, Bulandshahar and the Nagar Palika Parishad also issued a no dues certificate. This clearly shows that not only the bid of the petitioner was accepted but in pursuance thereof he has also deposited a sum of Rs. 42,62,000/- and thereafter a no dues certificate was also issued by the Nagar Palika Parishad. The document filed as Annexure-1 to the writ petition though mentions the same as Indemnity Bond but it bears the signature of the petitioner as well as the executive officer of the Nagar Palika Parishad.It is also not denied anywhere in the writ petition that the auction bid was also acted upon by the petitioner. 7. Annexure-2 to the writ petition is the order of the Executive Officer, Nagar Palika Parishad, Bulandshahar dated 13.5.2002 which shows that the teh bazaari rights for the year 2000-01 was granted in favour of the petitioner for Rs. 42,62,000/- on submission of an indemnity bond of Rs. 100/- stamp paper. Thus, there is absolutely no doubt about the fact that the auction bid for tehbazaari of the petitioner for a sum of Rs. 42,62,000/- was accepted by the Nagar Palika Parishad, Bulandshahar and, therefore, even though the instrument does not mention that it was a lease but nevertheless it would fall within the definition of lease deed as defined under Section 2 (16) (c) of the Indian Stamp Act, 1899, which reads as under:- "2. (16)(c) any instrument by which tolls of any description are let." 8. The law in this regard has been settled by a Division Bench of this court in the case of Trilok Chand Vs Chief Controlling Revenue Authority, AIR 1973 Alld 473 wherein referring to the facts of that case, it was held that the 'bid-sheet' itself, did not create any right or liability in the applicant till such time that the offer was not accepted by the Town Area Committee. The applicant could withdraw the bid before its acceptance and in that event, there would be no liability on him to pay the money bid at the auction. It did not also create any right, for till such time that the bid was accepted, the applicant could not enforce the offer. 9. Paragraphs 7, 8 and 9 of the judgment read as under:- "7. The Standing Counsel has urged that the bid-sheet is an instrument by which tolls have been let out. Section 2(14) defines 'an instrument as including a document by which any right or liability is, or purports to be created, transferred, limited, extended, extinguished or recorded. We may assume that the bid-sheet is an instrument, but that by itself would not make it a lease, because the tolls should have been let out by that instrument. Before, however, any tolls can be said to be let out, there must be an agreement. An agreement postulates the making of a proposal by a person and the acceptance of the said proposal by the other. After proposal has been accepted, an agreement between the parties is created. In the present case, it appears from the bid-sheet that the reserved price fixed by the Town Area Committee was Rs. 10,000/-. This meant that the officials of the Town Area Committee, who sanctioned the rights, could not finalise auction unless the reserved price had been bid at the auction. In the present case, the bid offered was much less than the reserved price. This being so, the officials of the Town Area Committee who acted as auctioneers could not possibly accept the proposal made on behalf of the applicant which consisted of an offer to pay Rs. 6200/- only. The mere fact that the highest bidder, and the officers of the Town Area Committee who conducted the auction, put their signature on the auction bid, would not alter the position in law, for the signature on the bid-sheet by these two parties were only for the purposes of giving authenticity to the auction proceedings which took place on that date. It is, however, contended that even if it can be said that the bid-sheet did not mature into a lease on the 20th March, 1960, it became such, on the 22nd March, 1960, when the Chairman signed the same in token of his approval of the bid. It is, however, contended that even if it can be said that the bid-sheet did not mature into a lease on the 20th March, 1960, it became such, on the 22nd March, 1960, when the Chairman signed the same in token of his approval of the bid. We are not impressed by this argument too. In the first place it is doubtful as to whether the Chairman of the Town Area Committee had any authority to enter into a contract on behalf of the Town Area Committee without a requisite resolution being passed by the Town Area Committee. It is however not necessary to express any final opinion on this matter for otherwise too the mere signing of the bid-sheet by the Chairman, Town Area Committee, would not convert it into a binding contract between the applicant and the Town Area Committee. It has been seen that the bid-sheet only contains a memo of the highest bids made by the various persons who participated in the auction. It does not contain any terms or conditions relating to: 1. The maximum rate of tolls chargeable by the applicant. 2. The duration of the lease. 3. The mode, manner and time of the payment of the auction money. 4. The consequences of any breach on the part of the applicant of the terms of the agreement. 10. In the absence of some of these conditions the agreement, if any, that came into existence would be unenforceable on the ground of vagueness. The bid-sheet as such cannot be treated as a lease of the tolls in question, as no concluded enforceable contract between the parties emerged by the mere signing of the bid-sheet. It cannot also be treated as an agreement to let out the tolls, inasmuch as it does not evidence any such enforceable contract. A similar view has been taken by the Madras High Court in the case of The Rajanagram Village Cooperative Society v. P. Veerasami Mudaly, AIR 1951 Mad 322 and also in the case of Sir Rameshwar Singh Bahadur v. Shaik Kitab Ali, AIR 1926 Pat 487 by the Patna High Court. We are in respectful agreement with the views expressed in these cases. We are in respectful agreement with the views expressed in these cases. The Board of Revenue, which is the Chief Controlling Revenue Authority, has in its referring order referred to two decisions of this Court one, in the case of Amar Nath Khanna v. State Government, (Civil Misc. Writ No. 345 of 1956 decided on 21-3-1961 (All)) and in the case of Mumtaz AH v. Town Area Committee, Bharwari, 1970 AllLJ 114, on the basis of which it took the view that the document in question would be dutiable under Article 35 Schedule I-B of the Act. None of the cases referred deal directly with the question raised in the present reference. The answer to the first question must, therefore, be returned in the negative. 8. Coming now to the second question. The document in question not being chargeable as a lease, the question arises as to whether it is chargeable under any other item of the Schedule or the Act. The only possible item under which it could be brought is "bond" as defined in Section 2(5) or a "conveyance" as defined in Section 2(10) of the Act. Clauses (a) and (c) of Section 2(5) are clearly inapplicable. We are thus left with clause (b) of that sub-section which reads:-- "(b) any instrument attested by a witness and not payable to order or bearer, whereby a person obliges himself to pay money to another." Clause (b), however, only applies if the document in question is (1) an instrument, and (2) attested by a witness. How the document in question, which is a bid-sheet of the auction held on 22-3-1960 has been signed by all the bidders who were parties to the auction and the officer concerned, who conducted the auction. There is no attestation of the document by a witness. It would as such not answer the description of "a bond". It also does not appear that it is "an instrument" as defined in Section 2(14) of the Act. The bid-sheet itself, did not create any right or liability in the applicant toll such time that the offer was not accepted by the Town Area Committtee. The applicant could withdraw the bid before its acceptance, and in that event, there would be no liability on him to pay the money bid at the auction. The bid-sheet itself, did not create any right or liability in the applicant toll such time that the offer was not accepted by the Town Area Committtee. The applicant could withdraw the bid before its acceptance, and in that event, there would be no liability on him to pay the money bid at the auction. It did not also create any right, for till such time that the bid was accepted, the applicant could not enforce the offer. The position of the auction had stipulated that in the event of a bidder resiling from his bid, he would be liable to pay damages, for if that were so, the bid would create a liability and the document in question would than be "an instrument". There is, however, nothing on the record to warrant such a conclusion. It is also not "a conveyance" for no move-able or immovable property has been transferred by the bid-sheet, and a conveyance can only be executed after an agreement, and in the present case, it has been seen that no agreement had come into existence. The document as such is not chargeable to duty under the Act. 9. We, therefore, answer the first question in the negative and the second question by holding that the document is not chargeable with stamp duty under any other Article of the Stamp Act. The applicant is entitled to costs which we assess at Rs. 200/-. Answered accordingly." 11. On the facts of the present case, in my opinion it cannot be said that no agreement came into existence between the petitioner and the Nagar Palika Parishad and that the petitioner had only submitted an indemnity bond. When the petitioner's own case was that his bid was accepted for Rs. 42,62,000/- and he had also deposited the said amount to the Nagar Palika Parishad and also received a no dues certificate and further that Nagar Palika Parishad had also issued a letter dated 13.5.2002 accepting the petitioner's bid, it cannot be said that there was no instrument between the parties which did not subscribe to the definition of 'lease' as defined in clause (c) of Sub Section (16) of Section 2 of the Act, 1899. 12. Therefore, for reasons aforesaid and the law laid down by this court in Trilok Chand (supra), I do not find any illegality or infirmity in the impugned order. 13. 12. Therefore, for reasons aforesaid and the law laid down by this court in Trilok Chand (supra), I do not find any illegality or infirmity in the impugned order. 13. The writ petition lacks merit and is accordingly, dismissed.