Allowed

Ashutosh Natwarlal Desai v. State of Gujarat

Gujarat HC17 Jun 2022SCA/4085/2022

Case brief

AI extract

What is this about?

The High Court quashed a stamp duty notice and order issued 25 years after the registration of the instrument, holding the action time-barred under Section 32A(4) of the Stamp Act. The Court exercised writ jurisdiction despite alternate remedies because the proceedings were wholly without jurisdiction.

What did the court decide?

The impugned notice dated 11.11.2021 and order dated 21.12.2021 were quashed and set aside. The original sale deed dated 17.06.1996 was directed to be returned within four weeks.

Ashutosh Natwarlal Desai Vs State of Gujarat — Contract and Commercial Disputes | Gujarat HC (2022)

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

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R/SPECIAL CIVIL APPLICATION NO. 4085 of 2022

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FOR APPROVAL AND SIGNATURE: sd/HONOURABLE MR. JUSTICE A.S. SUPEHIA

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1	Whether Reporters of Local Papers may be allowed to see the judgment ?	NO
2	To be referred to the Reporter or not ?	NO
3	Whether their Lordships wish to see the fair copy of the judgment ?	NO
4	Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ?	NO

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ASHUTOSH NATWARLAL DESAI

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Versus

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STATE OF GUJARAT

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Appearance:

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MR MIHIR H PATHAK(5261) for the Petitioner(s) No. 1 MR HARDIK MEHTA, AGP or the Respondent(s) No. 1 NOTICE SERVED for the Respondent(s) No. 2,3

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CORAM: HONOURABLE MR. JUSTICE A.S. SUPEHIA Date : 17/06/2022 ORAL JUDGMENT

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RULE. Learned Assistant Government Pleader Mr.Mehta, waives service of notice of rule on behalf of the respondent No.1. Though served, the respondent Nos.2 and 3 have chosen not to appear.

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The present writ petition has been filed seeking the following prayers.

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“9. (B) Your Lordships may be pleased to quash and set aside the impugned notice dated 11.11.2021, as the same is time barred as per Section 32A(4) of the Stamp Act, 1958 and may further quash and set aside the consequential impugned order dated 21.12.2021 as the same is avoid ab-initio and illegal in the eye of law.

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Page 1 of 7

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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B-1 YOUR LORDSHIP may be pleased to direct the authority to return the original sale deed No.2956 dated 17.006.1996 to the immediately;

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B-2 Pending the petition, Your Lordship may be pleased to stay the implementation of the impugned Notice dated 11.11.2021 as well as the impugned order dated 21.12.2021, till final disposal of the Petition.”

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By way of the present writ petition, the petitioner has challenged legality and validity of the notice dated 11.11.2021 issued under Section 32A of the Stamp Act, 1958 (for short, “the Act”) read with Rule 4(2) of the Bombay Stamp (Determination of market Value of Property) Rules, 1984 and the order dated 21.12.2021 passed by the respondent authority.

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The facts, in nutshell, read as under.

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4.1 The petitioner had purchased plot Nos.215 and 219 approximately 2,304 sq.mtr., situated at Manjalpur, Vadodara being Survey Nos.430 and 454/1 at Manjalpur, District Vadodara, vide Sale Deed No.2956 dated 17.06.1996. Out of the plot No.215, which is around 1038.26 sq.mtr., it was subdivided amongst the petitioner, Dr.Sudha Marva and Mr.Shardul Majmudar being 345.88 sq.mtr. respectively in the year 1996.

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4.2 All three sale deeds were executed on the same date and for the same land. Out of them, the original sale deed of the petitioner has not been cleared by the authority, whereas the other two original sale deeds have been returned by the authority without any objection,

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Page 2 of 7

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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4.3. The petitioner had initially taken finance from Anayonya Sahakari Bank and Shree Cooperative Bank to purchase the said property. Those loans were closed in the year 1997 itself. Thereafter, the petitioner mortgaged this property in Alvi Cooperative Bank for financial support to his business, which got settled in the year 2018. In June 2021, when the petitioner was in need of finance for his business, he approached the Abhyudaya Cooperative Bank for financial assistance, that bank asked for the original sale deed, as the copy supplied by the petitioner is mini-certified copy of the original sale deed.

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4.4 The petitioner thereafter approached the respondent no.3-authority on October, 2021 seeking the original documents, and he was asked to deposit the differential amount of duty, and vide notice dated 11.11.2021, the authority quantified the value of the property as Rs.10,51,900/and assessed the duty as Rs.1,47,266/-, out of which Rs.23,470/- has been paid by the petitioner, at the relevant point of time and the rest of Rs.1,23,796/- has been asked to deposit by the authority along with penalty of Rs.250/-, totaling to Rs.1,24,046/-.

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4.5 The petitioner raised objection and filed reply dated 26.11.2021, raising an objection that on the very same day for the same land three sale deeds were executed having same value of land, out of them, two documents were released, and there was no question for the said lands/sale deeds and as to why the third document has been valued at the excessive value of Rs.10,00,000/-.

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4.6 It is the case of the petitioner that thereafter, the respondent authority, without giving opportunity of hearing as

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Page 3 of 7

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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well as without giving cogent reasons, has passed the impugned order dated 21.12.2021. The petitioner has preferred the present petition challenging the impugned notice dated 11.11.2021 as well as the impugned order dated 21.12.2021, as the same is time barred as per section 32A (4) of the Act.

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Learned advocate Mr.M.H.Pathak, appearing for the petitioner has submitted that as per section 32A(4) of the Act the authority has been empowered to call for the documents for payment of the unpaid stamp duty within a period of two years from the date of registration of instrument referred in sub-section (1) of Section 32 of the Act, but in this case the authority has issued a show-cause notice, after delay of about 25 years from the date of registration of the stamp and, therefore, the same is time barred. Learned advocate for the petitioner has relied upon sub-section (4) of Section 32A of the Act, which reads thus:-

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(4) The Collector of the district may suo moto or on receipt of information from any source, within two years, from the date of registration of any instrument referred to in subsection. (1), (not being Instrument upon which an endorsement has been made under section 32 of the Instrument in respect of which the proper duty has been determined by him under sub-section (3) or an Instrument executed before the date of the commencement of the Bombay Stamp (Gujarat) Amendment Act, 1982 (Guj 21 of 1982) call for and examine the instrument for the purpose of satisfying himself as to the correctness of the consideration or of the market value of the property which Is the subject matter of such instrument and the duty payable thereon; and If on such examination, he has reason to believe that the consideration does not approximate to the market value of such Property or, as the case may be, market value of such property has been truly and fully set forth in the instrument, he shall proceed as Provided in subsections (2) and (3).”

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Page 4 of 7

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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5.1 Learned advocate for the petitioner has further submitted that the impugned notice and order dated 21.12.2021, are illegal and abuse of process of law, as the notice is barred by limitation period as prescribed under section 32A(4) of the Act. It is submitted that since the impugned show cause notice itself is not maintainable, all subsequent proceedings are void ab initio . It is submitted that the impugned notice as well as the order passed by the respondent No.3 is required to be quashed and set aside.

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5.2 Learned advocate Mr.Pathak, appearing for the petitioner has submitted that the issue is squarely covered by the various decisions of this Court, one of which, he has placed reliance is delivered on 13.09.2006 passed in Special Civil Application No.3926 of 2006 and allied matters. Thus, he has submitted that the impugned notice as well as the order passed by the respondent authorities are without jurisdiction and the same is required to be quashed and set aside.

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In response to the aforesaid submissions made by learned advocate for the petitioner, learned Assistant Government Pleader Mr.Mehta, has submitted that the impugned notice as well as the order are just and proper and, therefore, the same may not be interfered with, since the petitioner has an alternative remedy to file an appeal.

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I have heard the learned advocates for the respective parties to the lis . I have also perused the relevant documents.

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The facts which are not in dispute are that the impugned notice and order have been passed after delay of approximately 25 years, whereas as per the provisions of sub-

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Page 5 of 7

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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section (4) of Section 32A of the Act, the limitation provided is of 6 years for initiating the actions.

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At this stage, it would be apposite to refer to the observations made by the Coordinate Bench of this Court in the aforesaid decision dated 13.09.2006 passed in Special Civil Application No.3926 of 2006 and allied matters, which reads thus:-

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“In view of the aforesaid judgments and provision of sub-section (4) of section 32-A of the Act,1958, the impugned order is hereby quashed as the same is time barred. The document in question was executed on 17^th September,1997, whereas, the Notice was issued on 22^nd July,2004 by the respondent authority (Annexure “D” to the memo of the petition) and, therefore, there is a clear breach of section 32A(4) of the Act, 1958, which imposes a limitation of 6 years. Thus, except this matter, rest of the matters are hereby remanded for afresh decision by Deputy Collector/ Collector, Stamp Duty Valuation Organisation.”

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Thus, the impugned notice as well as the order passed by the respondent authorities are without jurisdiction and de hors the provisions of sub-section (4) of Section 32A of the Act, and hence, this Court, while exercising the powers under Article 226 of the Constitution of India can set aside the same. The Apex Court in the case of Radha Kirshan Industries Vs. State of Himachal Paresh and others, 2021 SCC OnLine SC 334, has summarized the principles governing the exercise of writ jurisdiction by the High Court in the presence of an alternate remedy. The Apex Court has observed thus:-

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“28. The principles of law which emerge are that:

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(i) The power under Article 226 of the Constitution to issue writs can be exercised not only for the enforcement of fundamental rights, but for any other purpose as well;

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Page 6 of 7

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C/SCA/4085/2022 JUDGMENT DATED: 17/06/2022

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(ii) The High Court has the discretion not to entertain a writ petition. One of the restrictions placed on the power of the High Court is where an effective alternate remedy is available to the aggrieved person;

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(iii) Exceptions to the rule of alternate remedy arise where

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(a) the writ petition has been filed for the enforcement of a fundamental right protected by Part III of the Constitution;

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(b) there has been a violation of the principles of natural justice;

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(iv) An alternate remedy by itself does not divest the High Court of its powers under Article 226 of the Constitution in an appropriate case though ordinarily, a writ petition should not be entertained when an efficacious alternate remedy is provided by law.”

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The case of the petitioner will fall under exception (c) as reproduced hereinabove. In view of the above, this petition is allowed. The impugned show case notice dated 11.11.2021 as well as the order dated 21.12.2021, are hereby quashed and set aside. As the consequence thereof, the respondent No.3 is directed to return the original sale deed No.2956 dated 17.06.1996 to the petitioner within a period of 04 (four) weeks from the date of receipt of the writ of this order. Rule is made absolute. Direct Service is permitted.

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MAHESH BHATI/81

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Page 7 of 7

Ashutosh Natwarlal Desai v. State of Gujarat

Case brief

What is this about?

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Ashutosh Natwarlal Desai v. State of Gujarat

Case brief

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