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TMI Blog2014 (3) TMI 1123X X X X Extracts X X X X X X X X Extracts X X X X ..... d machinery which has been purchased by petitioner is to be removed or displanted or that it is not affixed or attached to earth etc. Though it has been pleaded that only land and building has been purchased but paras 3 and 4 of sale deed clearly show that U.P. Financial Corporation took over physical possession of entire building and its assets - there is no error on the part of respondents-Revenue Authorities in holding that stamp duty was chargeable on entire sale consideration of ₹ 118 lacks and to this extent the impugned orders warrants no interference. Penalty - Held that:- The transaction of sale took place on 02.03.1995 and the impugned order was passed by Additional Collector (Finance & Revenue), Bahraich on 30.01.1996. On that day under Section 33/47-A of Act, 1899 there was no provision empowering Collector to impose penalty in case the value of property set forth in document presented for registration is not true market value of the entire value and there is a deficiency of stamp duty - penalty set aside. Appeal allowed in part. - Writ C No. 5441 of 2002 - - - Dated:- 7-3-2014 - Sudhir Agarwal, J. Counsel for Petitioner :- Shashi Nandan,Pooja Agarwa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the U.P. Financial Corporation took over possession of entire industrial unit of M/s Gauri Steel Alloys (P) Ltd., situate at Plot No. 217, Mauza Vishunpur Rahu, Pargana, Tehsil and District Bahraich by exercising its power under Section 29 of State Financial Corporation Act, 1951 and the entire mortgaged property together with free hold right of land, building etc. was transferred to vendee, i.e., petitioner, vide para 4 of the sale deed. 7. Learned counsel for the petitioner has not disputed that another agreement was executed between parties on 02.03.1995 (Annexure-7 to the writ petition), whereby entire property, building, plant and machinery was shown as purchased by petitioner for a total consideration of ₹ 118 lacs. Para 5 thereof would be relevant to reproduce hereat: 5. It is agreed between the corporation and the purchaser that the former will sell and later will purchase the entire mortgaged properties together with the free hold/lease hold land, building, plant and machinery etc. on as is where is basis more specifically stated in the schedule attached herewith. 8. For total consideration of ₹ 118 lacs, ₹ 35 lacs were already deposited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss. 14. Whether plants and machinery set up in a factory premises, fastened to earth or things attached to earth, can be held to be a moveable or immoveable property, came to be considered before this Court in Official Liquidator Vs. Sri Krishna Deo and Ors., AIR 1959 All 247. The Court appointed an Advocate Commissioner to inspect premises of company to ascertain whether machinery and plants were fixed and attached to earth or not. The report submitted shows that plants and machinery of company were either embedded in the earth or permanently fastened to things attached to earth. On behalf of State, argument was raised that most parts of machinery are fixed to their bases with bolts and nuts, and can be removed by removing the nuts. It thus cannot be said that such machineries are permanently fastened inasmuch as, the same can be moved away by removing the nuts and hence should be held movable property . The argument was noticed and rejected, by following House of Lords decision in Reynolds Vs. Ashby Son, 1904 ACJ 466, wherein Lord Lindley has observed: The purpose for which the machines were obtained and fixed seems to me unmistakable; it was to complete and use the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts and entire factory is leased out with plants and machinery, which are fastened to earth or attached or fixed to the things permanently attached to earth and such positions is necessary for the purpose of beneficiary enjoyment thereof, it would be an immoveable property and no otherwise view can be taken. This is how the facts of this case also find distinction from what was involved in Sirpur Paper Mills Vs. Collector of Central Excise Hyderabad (supra). 16. Whether chattel attached to the earth or building constitute an immoveable property, would depend upon degree, manner, extent and strength of attachment of chattel to earth or building. Broadly speaking, there are certain broad features, which are to be looked into in such cases. The attachment should be such as to partake the character of attachment of trees or shrubs, rooted to earth, or walls or buildings, embedded in that sense, and, further test is whether, such an attachment is for permanent beneficial enjoyment of immovable property to which it is attached. For a property and to be regarded as such property, it must become attached to immovable property as permanently as a building or a tree is attached to earth. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anner. Scientifically speaking, nothing can be treated immoveable. In the context of plants and machinery, where it is permanently fastened or attached to earth, it has to be seen from the point of utility also. If it cannot be used without being attached to earth, it may be immovable property in the industries like one up for consideration in this matter. Unless, such fastening is there, the plant and machinery cannot be put to a rational use. They generally do not move or taken away unless a particular plant and machinery has become obsolete or when the factory is closed or otherwise circumstances so warrant and the owner decide to remove and sell it. Such contingency do not arise every day. They are very rare and occasional. Removal of plants and machinery from earth in a working unit is a decision which is not normally taken in ordinary circumstances, that too when entire land, building along with machinery is leased out for the purpose of running the same. 20. It is worthy to mention that in the entire writ petition there is no pleading that the plant and machinery which has been purchased by petitioner is to be removed or displanted or that it is not affixed or attached to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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