2015 (5) TMI 322 - HC - Indian Laws

Non hearing of appellant's petition - Non adjudication of request for determination of stamp duty - Held that - When the application dated 22.05.2012 was made, to respondent nos. 2 and 3, for adjudication, that application was preferred under Section 31 of the Act. Secondly, there was no order of adjudication passed, which is why, the petitioner approached this court by way of a writ petition. The direction issued by this court led to passing of the order on petitioner s several applications for adjudication, made in that behalf. Lastly, the impugned order dated 11.02.2013 has, however, been passed by respondent no.3 by taking recourse to Section 47A of the Act. - respondents will have to survive or fall by what is adverted to in the impugned order. The counter-affidavit filed on behalf of the respondents cannot portray a stand different from that which is reflected in the impugned order. The validity and/or the legal tenability of an order passed by the statutory authority has to be gauged from the reasons supplied in the order. The order of the statutory authority cannot be sustained or supplemented by fresh reasons supplied, in the shape of an affidavit. Impugned order dated 11.02.2013, is set aside. The respondent no.3 will accord full opportunity to the petitioner to present her case, and in that behalf, will follow scrupulously the mandate of Section 47A of the Act and the provisions of 2007 Rules. Respondent no.3, will also make, the relevant inquiry, if found necessary, as provided under Section 47A of the Act. Needless to say, the relevant exercise in this behalf will be completed as expeditiously as possible, though not later than twelve (12) weeks - Decided in favour of appellant.

Issues Involved:
1. Application of Section 31 and Section 47A of the Indian Stamp Act, 1899.
2. Adjudication of stamp duty.
3. Procedural lapses and violation of principles of natural justice.
4. Determination of market value for stamp duty purposes.
5. Delay in property conversion by the Delhi Development Authority (DDA).

Issue-wise Detailed Analysis:

1. Application of Section 31 and Section 47A of the Indian Stamp Act, 1899:
The petitioner sought adjudication under Section 31 of the Indian Stamp Act, 1899. The respondent, however, adjudicated the matter under Section 47A, which was applicable to the National Capital Territory of Delhi. Section 47A requires a particular procedure, including granting a reasonable opportunity to the affected party to be heard, which was not followed in this case. The petitioner argued that the provisions of Section 47A could only be triggered if the registering officer had reason to believe that the value of the property or the consideration had not been truly set forth in the instrument. The petitioner was neither given an opportunity of hearing, nor was an inquiry held as contemplated under Section 47A.

2. Adjudication of Stamp Duty:
The petitioner contended that the stamp duty was paid under protest based on an attested challan received from the respondents. The petitioner argued that the determination of the stamp duty should consider the consideration referred to in the agreements to sell, which had received approval from the appropriate authority under the Income Tax Act and the Reserve Bank of India under FERA. The respondents, however, determined the stamp duty based on the circle rates prevailing at the time of the sale deed's execution.

3. Procedural Lapses and Violation of Principles of Natural Justice:
The petitioner was not given a notice of hearing by the respondent before passing the impugned order. The court noted that the minimum guarantee of reasonable opportunity to the affected party was not accorded, which is mandated by the provision itself. Consequently, the impugned order was set aside, and a de novo hearing was directed to be accorded to the petitioner.

4. Determination of Market Value for Stamp Duty Purposes:
The court observed that the respondent did not ascertain whether the value mentioned in the sale deed was less than the market value and whether the petitioner had willfully under-valued the property with a fraudulent intention to evade proper stamp duty. The court referred to the Supreme Court judgments in V.N. Devadoss vs Chief Revenue Control Officer-cum-Inspector and Residents Welfare Association, NOIDA vs State of Uttar Pradesh & Ors., which emphasized the need to ascertain the relevant date for determining the property's value for stamp duty purposes. The court directed the respondent to consider whether the delay in executing the sale deed was intentional or not.

5. Delay in Property Conversion by the Delhi Development Authority (DDA):
The petitioner argued that the delay in converting the property from leasehold to freehold was attributable to the DDA, and therefore, the petitioner should not suffer on that account. The court noted that the DDA did not convert the property to freehold for five years and directed the respondent to address this factor while determining the stamp duty.

Conclusion:
The court set aside the impugned order dated 11.02.2013 and directed the respondent to accord full opportunity to the petitioner to present her case, following the mandate of Section 47A of the Indian Stamp Act and the provisions of the Delhi Stamp (Prevention of Undervaluation of Instrument) Rules, 2007. The relevant exercise was to be completed within twelve weeks from the date of the judgment. The writ petition was disposed of with the aforementioned terms, leaving the parties to bear their own costs.

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