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2018 DIGILAW 87 (ALL)

Asha Kapoor v. State of U. P.

2018-01-09

B.AMIT STHALEKAR

body2018
JUDGMENT : B. Amit Sthalekar, J. 1. Heard Dr. S.B. Singh, 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 orders dated 10.12.2007 and 06.08.2008 arising out of proceedings under the Indian Stamp Act. 3. Briefly stated the facts of the case as stated in the writ petition is that he purchased an area of 0.0942 hectares out of Plot no. 2049-Kha from one Abdul Rahman through registered sale deed dated 9.10.2006. She also paid Rs. 31,500/- towards stamp duty on a valuation of the property at Rs. 3,93,000/-. Proceedings under section 47A of the Indian Stamp Act were initiated against the petitioner on a complaint that the said Abdul Rahman has sold three portions of the same plot, two through sale deed dated 5.12.2005 and one through sale deed dated 7.6.2006 at residential rates, therefore, there was deficiency of stamp duty paid by the petitioner. Notice was issued to the petitioner on 31.01.2007 to which the petitioner submitted her written objections/reply. In her objections, she has stated that the land was agricultural land which was purchased by Abdul Rahman through auction and a portion of that land was purchased by the petitioner for agricultural purposes and that all around the property, there is agricultural work going on. In para 8 of her objections, she has clearly stated that there is no construction on the said plot of the land and it is lying vacant. 4. The Additional Collector (Finance and Revenue) Ghaziabad, however, by the impugned order dated 10.12.2007 held that there was deficiency of stamp duty and has determined the market value of the property at residential rates of Rs. 2,000/- per square metre and has determined its market value at Rs. 18,74,000/- on which the stamp duty payable calculated is Rs. 1,68,400/- and after deducting the amount already paid by the petitioner i.e. Rs. 31,500/- the deficiency of stamp duty has been determined at Rs. 1,36,900/- plus Rs. 73,100/- as penalty which comes to Rs. 2,00,000/- with interest @ 1.5 % per month. Aggrieved by the order of the Additional Collector, the petitioner preferred a stamp appeal which has also been rejected by the Commissioner, Meerut Division, Meerut upholding the order of the Additional Collector and reducing the penalty to Rs. 7,000/- instead of Rs. 73,100/-. 5. The submission of Dr. 2,00,000/- with interest @ 1.5 % per month. Aggrieved by the order of the Additional Collector, the petitioner preferred a stamp appeal which has also been rejected by the Commissioner, Meerut Division, Meerut upholding the order of the Additional Collector and reducing the penalty to Rs. 7,000/- instead of Rs. 73,100/-. 5. The submission of Dr. S.B. Singh, learned counsel for the petitioner first and foremost is that in the show cause notice issued on 31.01.2007 it was never disclosed to the petitioner as to what was the deficiency of stamp duty and on what material evidence this deficiency of stamp duty was to be calculated and therefore, the petitioner had no occasion to meet the allegation of the Additional Collector that the three portions of the same plot have been sold by Abdul Rahman at residential rates. However, the firm stand of the petitioner in her objection, Annexure-4 to the writ petition was that the land surrounding the property in question was being used for agricultural purpose and that even on the plot in question, there was no construction made and it was lying vacant and otherwise used for agricultural purpose. The submission is that the reference to the sale deed by way of exemplar has been referred to for the first time in the order of the Additional Collector without disclosing the same to the petitioner in the show cause notice. 6. From a perusal of the show cause notice, it is seen that though notice has been issued on an allegation that the petitioner was guilty of deficiency of stamp duty but it has not been disclosed anywhere that as to how there was a deficiency of stamp duty and what was the material before the Additional Collector to come to the conclusion that there was deficiency of stamp duty. Therefore, without disclosing to the petitioner the material on the basis of which the market value of the property has been determined at residential rates, the petitioner had absolutely no occasion to give an effective reply to the show cause notice. The law in this regard has been settled by the Division Bench of this Court in Smt. Vijaya Jain vs. State of U.P. and Others, 2015 (129) RD 703 . Paragraph 23 of the said judgment reads as under:- "23. The law in this regard has been settled by the Division Bench of this Court in Smt. Vijaya Jain vs. State of U.P. and Others, 2015 (129) RD 703 . Paragraph 23 of the said judgment reads as under:- "23. From the provisions extracted above, it is apparent that the Collector proceeds under sub-section (3) of section 47-A read with Rule 7 when he has reason to believe that the market value of the property comprised in the instrument has not been truly set forth and that in the opinion of the Collector, circumstances exist warranting him to undertake the enquiry contemplated under rule 7. What we however find from the notice dated 09 September 2013 is that the Collector has proceeded to record, albeit prima facie, that the instrument in question has been insufficiently stamped to the extent of Rs. 8,89,000/-. The notice apart from referring to a note dated 20 May 2013, received from the Assistant Inspector General of Registration neither carries nor discloses any basis upon which the Collector came to the prima facie conclusion that the appellant was liable to pay Rs. 8,89,000/- as deficit stamp duty. In our opinion a notice of this nature must necessarily disclose to the person concerned the basis and the reasons upon which the Collector has come to form an opinion that the market value of the property has not been truly set forth. In the absence of a disclosure of even rudimentary details on the basis of which the Collector came to form this opinion, the person concerned has no inkling of the case that he has to meet. A notice in order to be legally valid and be in compliance with the principles of natural justice must necessarily disclose, though not in great detail, the case and the basis on which action is proposed to be taken against the person concerned. Not only this and as is evident from a bare reading of rule 7, at the stage of issuance of notice, the Collector has to proceed on the basis of material which may tend to indicate that the market value of the property has not been truly and faithfully disclosed in the instrument. The stage of computation of market value comes only after the provisions of sub-rules (2) (3) and (4) of rule 7 come into play. The stage of computation of market value comes only after the provisions of sub-rules (2) (3) and (4) of rule 7 come into play. At the stage of issuance of notices, the Collector calls upon the person concerned to show cause "as to why the market value of the property.... be not determined by him." 7. Therefore, in view of the law laid down by the Division Bench, the notice under Section 47A itself was defective and denied the petitioner an opportunity of giving a suitable and adequate response to the show cause notice. 8. The second submission of the learned counsel for the petitioner is that at no point of time, was any spot inspection conducted by the Additional Collector or by any responsible officer as directed by him. The impugned order of the Additional Collector for purposes of determining the market value of the property at residential rates and the consequential deficiency of stamp duty does not mention anywhere nor does it demonstrate that any spot inspection was ever conducted to find out the nature of the land. The specific plea of the petitioner in her written objection to the show cause notice was that the surrounding land was being used for agricultural purposes and the plot in question was also purchased for agricultural purposes and it was lying vacant and in any case there was no residential construction on the said plot. 9. This aspect of the matter could have been examined by the Additional Collector only if an effective spot inspection had been conducted. In the absence of any spot inspection having been conducted to find out the nature of the land, the Additional Collector could not have come to the conclusion that the land was being used for residential purposes only on the basis of three sale deeds in which the land was sold at residential rates. 10. In para 7 and 8 of her memo of appeal, the petitioner has taken a specific ground that the land surrounding the property in dispute was being used for agricultural purposes and that there was no declaration in respect of the land in question under Section 143 of the U.P. Z.A. & L.R. Act for change of nature of land from agricultural to abadi. A specific plea was also taken that no spot inspection was conducted for determining the nature of the land. A specific plea was also taken that no spot inspection was conducted for determining the nature of the land. Neither of these pleas have been considered or referred to by the Commissioner, Meerut Division, Meerut while passing the appellate order. The appellate authority appears to have been completely swayed by the three sale deeds in which the market value of the plot had been determined at residential rates. 11. For reasons aforesaid and in view of the law laid down by this court in Smt. Vijaya Jain (Supra), the impugned orders dated 10.12.2007 and 06.08.2008 are wholly illegal and arbitrary and are accordingly set aside. 12. The writ petition is allowed. 13. The matter is remitted to the respondent no. 3-Additional Collector (Finance and Revenue), Ghaziabad to re-examine the matter in the light of the observations made above and pass fresh orders in accordance with law within a period of three months from the date of receipt of a certified copy of this order in his office.