Shamjibhai vs The on 18 March, 2009

Gujarat High Court

Shamjibhai vs The on 18 March, 2009
Author: K.A.Puj,&Nbsp;
Gujarat High Court Case Information System

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SCA/3897/2008 14/ 14 JUDGMENT

IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD

SPECIAL
CIVIL APPLICATION No. 3897 of 2008

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 Shamjibhai vs The on 18 March, 2009

For
Approval and Signature:

HONOURABLE
MR.JUSTICE K.A.PUJ

=========================================================

Whether
Reporters of Local Papers may be allowed to see the judgment ?

To be
referred to the Reporter or not ?

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 Shamjibhai vs The on 18 March, 2009

Whether
their Lordships wish to see the fair copy of the judgment ?

Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?

Whether
it is to be circulated to the civil judge ?

=========================================================

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 Shamjibhai vs The on 18 March, 2009

SHAMJIBHAI
RANCHHODBHAI DABHI - Petitioner(s)

Versus

THE
CHIEF CONTROLLING REVENUE AUTHORITY & 2 - Respondent(s)

=========================================================
Appearance :
MR
SH SANJANWALA with MR RS SANJANWALA for
Petitioner(s) : 1,
MS TRUSHA K. PATEL, ASST. GOVERNMENT PLEADER
for Respondent(s) : 1 - 3.
NOTICE SERVED for Respondent(s) :
1,
=========================================================

CORAM
:

HONOURABLE
MR.JUSTICE K.A.PUJ

Date
: 18/03/2009

ORAL

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 Shamjibhai vs The on 18 March, 2009

JUDGMENT

The petitioner has filed this petition under Article 226 of the Constitution of India praying for the
direction to the respondent no.1 to accept and decide the application dated 05.01.2007 at Annexure
'K' of the petition under the provisions of Bombay Stamp Act, 1958 and the Bombay Stamp
(Determination of Market Value of Property) Rules, 1984. The petitioner has also prayed for the
declaration that the letter dated 31.05.2007 by the respondent no.1 issued to the petitioner is illegal,
void and inoperative and hence the petitioner has prayed for quashing and setting aside the same
and also the direction to grant refund of the excess amount of stamp duty paid by the petitioner.

This Court has issued Rule on 21.04.2008. Pursuant to the service of rule, an affidavit-in-reply is
filed on behalf of the respondent no.1 on 29.12.2008.

Heard Mr. S.H. Sanjanwala, the learned Senior Counsel with Mr. R.S. Sanjanwala, the learned
Advocate for the petitioner and Ms. Trusha K. Patel, the learned Asst. Government Pleader
appearing for the respondent.

It is the case of the petitioner that the petitioner has purchased the land bearing Survey No.37, Block
No.109, admeasuring 3 hectare 17 Are 68 Sq. meters, i.e. total 31,768 sq. meters situated at Village
Bharthana, Taluka Choryasi, District Surat. The said undivided land was equally owned by two
different sets of persons. Half portion of the said land belonged to Jethiben Thakorebhai Ambelal
Patel and others. The petitioner purchased the said half portion of the land from the said owners
through their power of attorneys for a sum of Rs.23,99,100/= by executing a sale deed dated
27.02.2006. The sale deed was presented to the respondent no.3 for registration under the
provisions of the Registration Act, 1908. Notice dated 27.02.2006 under Rule 3(2) of the Bombay
Stamp (Determination of Market Value of Property) Rules, 1984 came to be issued whereby the
respondent no.3 called upon the petitioner to pay the deficit stamp duty of Rs.30,00,215/= within
30 days from the date of receipt of the said notice and conveyed that incase of default, the said
document will be sent to the respondent no.2 under Section 32A(1) of The Bombay Stamp Act.

The petitioner also purchased the other half portion of the said land from its owners and power of
attorneys namely Balubhai Kanjibhai Patel and others by paying a consideration of Rs.56,99,176/=.
The said sale deed was also presented before respondent no.3 for registration under the provisions
of the Registration Act. The respondent no.3 issued notice under Rule 3(2) of the said Rules and
called upon the petitioner to pay the deficit stamp duty as stated therein. The petitioner paid the
said stamp duty and the said sale deed came to be registered.

Thereafter the respondent no.3 referred the sale deed dated 27.02.2006 to the respondent no.2. The
petitioner filed his reply on 03.06.2006 stating therein that even as per Jantri, the rate of the said
agricultural land was only Rs.600/= per sq. meters whereas much higher value was stated in the
said notice. By an order dated 06.06.2006, the respondent no.2 fixed the value of the said land at
Rs.3,24,03,360/= and directed to pay the deficit stamp duty of Rs.25,19,886/= and Rs.250/=
towards penalty. The petitioner accordingly paid the stamp duty and as a result thereof, the
respondent no.3 registered the sale deed at Serial No.2504 on 03.08.2006.

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 Shamjibhai vs The on 18 March, 2009

During the month of August 2006, while going through the sale deed dated 27.02.2006, it came to
the notice that in the said registered sale deed, by mistake the area of the undivided half portion of
the land purchased by him is mentioned as land admeasuring 63,536 sq. meters. While infact, the
actual area of the said land sold to the petitioner is 15,884 sq. meters. To rectify the said mistake in
the registered sale deed dated 27.02.2006, the petitioner executed a correction deed and got it
registered on 02.09.2006 at Serial No.11395 in the office of the respondent no.3.

The petitioner thereafter gave an application dated 15.09.2006 to the respondent no.3 and brought
to notice the fact about the mistake in the area stated in the registered sale deed dated 27.02.2006
and the correction deed dated 02.09.2006 whereby the said mistake came to be rectified and further
prayed for the refund of the excess amount of stamp duty paid. Instead of deciding the said
application, the respondent no.2 vide his order dated 29.11.2006 directed the petitioner to approach
the respondent no.1. Accordingly the petitioner filed an application dated 05.01.2007 before
respondent no.1.

Instead of deciding the petitioner's application on merits, respondent no.1 vide letter / order dated
31.05.2007 informed the petitioner that Section 32A of the Act is not included in Section 44 of the
said Act. It is further stated in the said letter / order that as per Section 44, the application is to be
filed within three months from the date of the order of respondent no.2. The stamp duty is paid on
22.07.2006 and considering that also the application is not within limitation period and there being
no jurisdiction to accept the application preferred after limitation period, the application filed by the
petitioner was not accepted.

Mr.

S.H. Sanjanwala, the learned Senior Counsel for the petitioner has submitted that the impugned
action of the respondent no.1 in rejecting the application of the petitioner for refund of the excess
stamp duty on the ground of being beyond the period of limitation as prescribed under Section 44 of
The Bombay Stamp Act is illegal, arbitrary, unjust, improper and requires to be quashed and set
aside. He has further submitted that respondent no.1 has not appreciated the fact that the Sale Deed
came to be registered on 03.08.2006 at Serial No.2504 in Book No.1 maintained by respondent no.3
and thereafter the discrepancy in the area of the land sold vide sale deed came to the notice of the
petitioner where upon a correction deed dated 02.09.2006 was executed and immediately on
15.09.2006, an application for refund of the excess stamp duty was preferred before respondent
no.2, who vide order dated 29.11.2006 directed the petitioner to file the same before respondent
no.1. The petitioner, accordingly on 05.01.2007 filed an application before respondent no.1. Thus, as
such there is no delay on part of the petitioner in preferring the said application for refund. Till
August 2006, the petitioner was under the false impression that the amount paid towards stamp
duty is proper and legal. The petitioner noticed the discrepancy as regards area of the land
purchased in the said instrument and immediately on 02.09.2006, the correction deed came to be
executed and then an application dated 15.09.2006 came to be preferred. After a period of about two
and half months, the respondent no.2, after hearing, directed the petitioner to file the said
application before respondent no.1, which was immediately filed on 05.01.2007. Mr. Sanjanwala
has, therefore, submitted that considering these facts and considering the actions taken by the

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 Shamjibhai vs The on 18 March, 2009

petitioner, there is no delay on part of the petitioner and therefore the respondent no.1 was required
to entertain the said application and decide the same on merits. Having not done so, the respondent
no.1 has failed to exercise the jurisdiction vested in him.

Mr.

Sanjanwala has further submitted that if any delay has occurred, then the same is because of the
application was preferred by the petitioner before the wrong forum, i.e. respondent no.2. Section 44
of The Bombay Stamp Act provides that such application is to be made before respondent no.1.
However on account of wrong legal advice, the same came to be preferred first before respondent
no.1 who took about two and half months and then directed the petitioner to appear before
respondent no.2. Had, the respondent no.2 immediately taken a decision, the said delay, if any,
would not have occurred. He has therefore submitted that the there was no delay in preferring the
application.

Mr.

Sanjanwala has further submitted that it is a common knowledge that despite all care and caution,
the possibility of a mistake creeping in a document cannot be ruled out altogether. The mistake in
the case of a document could be arithmetical, regarding area of plot of land or the building or survey
number or boundaries of the property. Such mistakes can always be corrected by executing a
correction document and getting it registered. The rectification may call for refund of the excess
amount of consideration or stamp duty paid on the implied promise on what is termed as 'subject to
errors and omissions' in common parlance. The party concerned or the State cannot raise its hands
and decline refund of excess payment of stamp duty by taking a stand that it does not fall within the
purview of Section 44 of The Bombay Stamp Act. He has submitted that in the present case the State
is trying to wriggle out of its obligations by taking an unethical stand. He has therefore submitted
that appropriate directions be issued to the respondent for refund of the excess stamp duty paid by
the petitioner on the said sale considerations.

Mr.

S.H. Sanjanwala has further submitted that the rejection of the petitioner's claim for refund of the
excess stamp duty is absolutely unjustified and contrary to the provisions of the Act as well as the
settled legal position. In support of his claim, he relied on the decision of the Honourable Supreme
Court in the cases of State of Madhya Pradesh Vs. Bhailal Bhai and Others, AIR 1964 SCC, Page
1006 and U.P. Pollution Control Board Vs. Kanoria Industrial Ltd., (2001) 2 SCC, Page 549. Based
on the ratio laid down in the two judgments, Mr. Sanjanwala has submitted that the respondent
authorities be directed to grant refund of the excess stamp duty paid by the petitioner to the State
Government.

Ms.

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Trusha K. Patel, the learned Asst. Government Pleader appearing for the respondent authority on
the other hand has submitted that the petitioner has made payment of deficit stamp duty of
Rs.25,19,886/= and penalty of Rs.250/= in respect of Document No.2504 dated 27.12.2006 as per
the order dated 06.06.2006 passed by the Deputy Collector, Stamp Duty under Section 32A of the
Act. Thereafter the petitioner has made an appeal on 05.01.2007 under Section 44 of The Bombay
Stamp Act, 1958 for refund of excess payment of stamp duty under Section 32A of the Act. She has
further submitted that under the provisions of Section 44 of the Act, Where, in the opinion of the
Chief Controlling Revenue Authority stamp duty in excess of that which is legally chargeable has
been charged and paid 1[under Section 32, Section 34] or Section 39, such authority may, upon
application in writing made by the party concerned within three months from the date of receipt of
the order charging the same, refund the excess. She has submitted that as per Sub-section 2 of
Section 44 of the Act, the Chief Controlling Revenue Authority is empowered to refund the excess
stamp duty of that amount which is legally chargeable. Here in the present case, the amount is
charged under Section 32A of the Act and that Section is not incorporated in Section 44 of the Act.
Moreover the petitioner has made the application for refund beyond the period of three months as
envisaged in Section 44. She has therefore submitted that on both these grounds, the application for
refund cannot be entertained. Ms. Patel has further submitted that even if the above contention is
not accepted by this Court, in that case, she has given calculation of stamp duty of two different sale
deeds, one is dated 27.02.2006 and the another is dated 24.03.2006. Though both the sale deeds
are executed within a period of one month, in the first sale deed sale consideration is shown as
Rs.23,99,100/= whereas in the second sale deed, the sale consideration is shown as Rs.56,99,176/=.
Thereafter, the notice for deficit stamp duty was issued under Section 3(4) of the Act and deficit
stamp duty of Rs.3,21,754/= was demanded from the petitioner. The petitioner has accordingly paid
the said stamp duty. The said document was executed on 24.03.2006. The petitioner has paid total
stamp duty of Rs.8,00,554/=. If the same criteria is adopted with regard to the first Sale Deed
executed on 27.02.2006, the petitioner is liable to pay stamp duty to the extent of Rs.8,00,554/=.
Hence if the petitioner's claim is accepted for refund of the excess stamp duty, the amount of
Rs.8,00,554/= should be deducted from the total stamp duty paid by the petitioner in respect of the
sale deed executed on 27.02.2006 and the balance amount is required to be refunded.

Having heard the learned Advocates appearing for the parties and having considered the rival
submissions, the Court is of the view that there is no dispute about the fact that a mistake was
committed in mentioning the exact area of the land, which was 15,884 sq. meters as against it was
mentioned as 63,536 sq. meters and accordingly on this area of land, the petitioner has paid the
stamp duty of Rs.25,19,886/= + Rs.2,02,000/=. Thus in all Rs.27,21,886/= were paid by the
petitioner. In fact the petitioner is required to pay stamp duty of Rs.8,00,554/=. Thus the petitioner
is entitled to the refund of excess stamp duty paid. The petitioner's claim is objected only on the
ground that the application was not made in time and that the said deficit stamp duty was paid
under Section 32A of the Act. However, the respondent being a State Authority cannot retain any
amount paid in excess under some genuine or bonafide mistake. Equity demands that if the
petitioner is not liable to pay the stamp duty and still it is paid, the same is required to be refunded.
There is no justification on part of the respondent authority in denying the claim of refund of excess
stamp duty. However the Court looking to the issue involved and equity in the matter, tilts the
balance in favour of the petitioner and holds that the petitioner is entitled to refund of the excess

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 Shamjibhai vs The on 18 March, 2009

stamp duty paid under genuine or bonafide mistake.

However while considering this aspect of the matter, the Court will also take into consideration the
alternative submission made on behalf of the State Government and if within the period of one
month both the sale deeds are executed, the petitioner is supposed to pay the same stamp duty as
the properties covered by both the sale deeds are adjoining to each other and are situated in the
same vicinity and the sale deeds are executed within one month. The petitioner is, therefore,
required to pay the same stamp duty in respect of the first sale deed executed on 27.02.2006 as was
paid in respect of the second Sale Deed executed on 24.03.2006.

Considering the entire facts and circumstances of the case and considering the legal position as per
the the Honourable Supreme Court in the above referred two judgments, the Court holds that the
petitioner is entitled to the refund of the excess stamp duty paid by him as it was genuine and
bonafide mistake and accordingly the respondent authorities are hereby directed to refund the
amount of Rs.27,21,856.00 less Rs.8,00,554.00 = Rs.19,21,302.00 to the petitioner. The said
amount should be refunded to the petitioner within one month from the date of receipt of writ of
this Court or from the date of receipt of certified copy of the order, whichever is earlier.

Subject to the aforesaid directions, this petition is accordingly disposed off. Rule made absolute to
the above extent. Direct Service is permitted.

(K.A.

Puj, J.) Caroline Top

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