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2023 DIGILAW 111 (ALL)

Jitendra Devi Pandey Stamp v. State of U. P.

2023-01-11

MANISH MATHUR

body2023
JUDGMENT Manish Mathur, J. Heard learned counsel for petitioner and learned State Counsel appearing on behalf of the opposite parties. 2. Petition has been filed challenging the order dated 13th of September, 2011 passed under Section 47A of Indian Stamp Act, 1899 as well as the order dated 27th of July, 2012 passed in Appeal under Section 56 of the Act. 3. Learned counsel for petitioner submits that the property in question which is immovable in nature was leased out to one Smt. Neera Khanna W/o Sri. Mahendra Singh Khanna by means of registered lease deed dated 10th March, 1995 executed by the Uttar Pradesh Avash and Vikas Parisad, Lucknow for a period of 30 years. She transferred the lease hold rights by means of assignment in favour of one Pradeep Agarwal, who in turn transferred his lease hold rights to the petitioner by means of lease deed dated 15.02.2008 which was presented for registration and stamp duty thereupon was paid in terms of Article 63 of Schedule 1-B of the Act whereafter proceeding under Section 47-A(3) of the Act was referred, whereby the deed of assignment has been treated to be a deed of sale in view of the Clauses contained therein. Appeal filed there against under Section 56 of the Act has also been rejected. 4. Learned counsel for petitioner submits that the authorities have erred in law in treating the deed of assignment of lease to be deed of sale only on the basis that vacant possession of lease hold plot of land was being transferred to the assignee as well as the fact that the assignee was granted rights of mutation and for getting the said property freehold in her favour. It is submitted that the authorities have totally lost sight of the fact that no transfer of title of the property had taken place and only rights of possession over the property in terms of assignment of lease had been provided for a particular consideration and, as such, the authorities have erred in law in treating it as an instrument of transfer of title. 5. Learned counsel has placed reliance on the Division Bench judgment of this Court in the case of Sri. 5. Learned counsel has placed reliance on the Division Bench judgment of this Court in the case of Sri. Ajay Shanker Dixit and Another v. State of U.P. and Others and other connected matters in Writ Petition No. 3056(MB) of 2003 in which this Court by means of judgment and order dated 09.08.2018 has held that the language of deed will not decide the nature of deed of transfer and if the transferer has been given only lease hold rights, then only lease hold rights can be transferred further and not absolute ownership. It has, therefore, been held that despite the language of deed, it is to be treated as a lease deed and not as a deed of absolute sale and, therefore, stamp duty cannot be directed to be paid as per market value considering such a deed to be deed of sale. Relevant portions of the judgment are as follows: "The basic concept for deciding the stamp duty is based on principle that a person cannot transfer a better title than what he has. Now, a person in whose favour lease deed has been executed is only entitled to transfer the lease hold rights and he can not transfer the absolute ownership in the property. The language of deed will not decide the nature of deed of transfer and even if it has been written in the deed that transferor is having absolute right in regard to the property, it cannot be accepted as such. If transferor was given only lease hold rights, then he is entitled only to transfer the lease hold rights and not the absolute ownership. Accordingly, the earlier contention of learned Additional Chief Standing Counsel that as per language of deed, it is to be treated as absolute sale or lease deed, cannot be accepted and stamp duty cannot be directed to be paid as per market value. Although, it has come in the evidence that at present, there is no construction on the disputed property and only the land is to be transferred by way of an assignment. Even if construction is there, then so far land is concerned, the transferor is not having absolute right and, accordingly, cannot transfer the land absolutely. Although, it has come in the evidence that at present, there is no construction on the disputed property and only the land is to be transferred by way of an assignment. Even if construction is there, then so far land is concerned, the transferor is not having absolute right and, accordingly, cannot transfer the land absolutely. So far land is concerned, its lease hold rights can be transferred but if construction is there, then same can be transferred on the basis of absolute ownership and on that stamp duty will be charged on market value. In case any construction is being raised by the lease holders, then construction will be in the ownership of lease holder and in case any deed is executed in reference to the construction, then same can be transferred absolutely, but so far land is concerned, that can only be transferred by instrument of transfer of lease by way of an assignment." 6. Reference has also been made to law propounded by Hon'ble Supreme Court in the case of Resident Welfare Association Noida v. State of Uttar Pradesh, (2009) 14 SCC 716 . 7. Learned State Counsel, on the other hand, has submitted that the deed of assignment itself indicates three conditions in Paragraph nos. 2, 6 and 7 that possession over the vacant immovable property has been transferred to the petitioner who has also been granted rights to get her name mutated in the revenue records with further right being granted that the assignee would be entitled to get the freehold of plot executed at her own cost. It is, thus, submitted that by means of the aforesaid instrument, interest in the property has been transferred alongwith possession thereon and, as such, despite the instrument indicating it to be a lease deed, in effect rights and title over the property has been transferred and, therefore, stamp duty has been imposed treating deed to be a deed of sale. 8. 8. Upon consideration of submissions advanced by learned counsel for the parties and perusal of material on record, it appears that orders under Section 47-A(3) of the Act have been passed primarily on account of clauses in deed of assignment whereby possession of lease hold plot has been delivered to the assignee who has also been recorded rights to get her name mutated in revenue records, with further right of entitlement to get the plot freehold at her own cost. The aforesaid three conditions are given on which the deed of assignment has been treated to be a deed of sale and stamp duty in accordance thereof has been imposed. 9. From the Division Bench judgment in the case of Sri. Ajay Shanker Dixit (supra), it is evident that as per law propounded by Division Bench of this Court, it has been held that basic concept for deciding the stamp duty is based on principle that a person cannot transfer a better title than what he has. As a natural correlate, a person having only lease hold rights, cannot be deemed to have transferred title since he himself does not have title over the property concerned and, as such, can be deemed only to have transferred rights of lease holder. The Division Bench has also held that language of the deed will not decide the nature of deed of transfer even if certain conditions with regard to absolute right with regard to property have been indicated therein primarily on the premise that a person cannot transfer a better title that he has. 10. Hon'ble the Supreme Court in the case of Resident Welfare Association Noida (supra) has held as follows: "...............Moreover, the concerned lease deed specifically provides for a lease of 99 years of the land along with its appurtenances thereto with the right of reversion. So it is clear from the above-mentioned provision that the land along with its appurtenants would be reversed back to the lessor after the stipulated period. The alleged documents is therefore a transfer of the assignment of lease and not an outright sale of its appurtenants. ..........." 11. The said judgment also refers to the case of Madras Refinery Ltd. C.S. reported in (1977)2 SCR 565 ; in the following manner: "23. The alleged documents is therefore a transfer of the assignment of lease and not an outright sale of its appurtenants. ..........." 11. The said judgment also refers to the case of Madras Refinery Ltd. C.S. reported in (1977)2 SCR 565 ; in the following manner: "23. Before we part with this aspect of the matter, that is to say, whether the document/instrument was in fact a deed of assignment or an outright sale, we must also keep in mind that the nomenclature to the document of assignment cannot be said to be determining factor in deciding whether a particular deed or document was a lease or a deed of assignment. In Madras Refinery Ltd. v. C.S. :[1977] 2 SCR 565, it was held that in order to decide whether a particular document is a lease or a deed of assignment, one has to look at the substance of the deed of assignment to the document and not the nomenclature. Therefore, it must be held that no importance can be given to the nomenclature to the document. Although some of the members of the association had termed the document as a deed of sale or transfer cum sale deed instead of as a deed of assignment, it remains as a deed of assignment as has been noted above by us." 12. Upon applicability of the aforesaid judgments, it is apparent that by means of deed in question dated 15th of February, 2008 executed in favour of the petitioner, only lease hold rights have been granted to the petitioner, particularly in view of the fact that lessor himself had only lease hold rights and not title over the property in question. 13. The aforesaid judgments also make it evident that the nature of a deed is to be considered only as per substance of the deed and not its nomenclature. In the present case, it is notice that the deed was issued granting rights over the immoveable property only for a period of 30 years and therefore the lessor had reserved rights of reversion to himself and as such the deed could have been considered only as lease deed instead of deed of sale. 14. In the present case, it is notice that the deed was issued granting rights over the immoveable property only for a period of 30 years and therefore the lessor had reserved rights of reversion to himself and as such the deed could have been considered only as lease deed instead of deed of sale. 14. In view of aforesaid judgments and law propounded by the Division Bench, it is evident that the impugned orders are contrary to the aforesaid judgments and, therefore, the aforesaid orders dated 13th of September, 2011 passed under Section 47- A of Indian Stamp Act, 1899 as well as the order dated 27th of July, 2012 passed in Appeal under Section 56 of the Act, are set aside. 15. Consequently, the writ petition is allowed. Parties to bear own costs. Consequences to follow.