M/S Embassy Property Developments Private Limited Vs the Deputy Commissioner

M/S EMBASSY PROPERTY DEVELOPMENTS PRIVATE LIMITED (A COMPANY INCORPORATE UNDER THE PROVISIONS OF COMPANIES ACT, 1956) HAVING ITS OFFICE AT FIRST FLOOR, EMBASSY POINT, 150, INFANTRY ROAD, BENGALURU - 560 001. REP BY ITS DIRECTOR. MR. NARPAT SINGH CHORARIA.

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…PETITIONER

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Digitally signed by SUMA B N Location: HIGH COURT OF KARNATAKA

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(BY SRI. V. SRINIVAS RAGHAVAN LEARNED SENIOR COUNSEL FOR SRI. SANJAY NAIR.,ADVOCATE)

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AND:

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THE DEPUTY COMMISSIONER (REGISTRATION) AND DISTRICT REGISTRAR, OFFICE AT 70/16, 2^ND MAIN ROAD, VYALIKAVAL, KODANDARAMPURA, MALLESHWARAM WEST, BENGALURU 560003. ALSO AT NO. 17, MARUTHI PLAZA, 2^ND MAIN ROAD, VYALIKAVAL EXTENTION, BENGALURU - 560 003.

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NC: 2026:KHC:1148 WP No. 31712 of 2019

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HC-KAR

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THE SUB REGISTRAR OF INDIA OFFICE AT NH-7, BELLARY ROAD, OPPOSITE TO POLICE STATION, CHIKKAJALA, BENGALURUL NORTH TALUK, BENGALURU - 562 157.

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…RESPONDENTS

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(BY SMT. B. SUKANYA BALIGA ., AGA FOR R1 & R2)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER DATED 09.11.2017 ANNEXURE-A PASSED BY R-1 IN CASE NO.46A/JALA/33/2016-17, DOCUMENT NO. SALE AGREEMENT2640/2010-11, SALE 3434/2011-12 AND CASE NO.46A.JALA/34/2016-17, DOCUMENT NO. SALE AGREEMENT2640/2010-11, SALE 640/2012-13 AND CASE NO.46A.JALA/35/2016-17, DOCUMENT NO.SALE AGREEMENT2640/2010-11, SALE 3002/2011-12 AND ORDER DATED 04.04.2019 PASSED BY THE KARNATAKA APPELLATE AUTHORITY, BANGALORE AS PER ANNEXURE-B IN (REVENUE) APPEAL NO.124 OF 2018 AND CONSEQUENT NOTICE FOR RECOVERY DATED 20.06.2019 UNDER REFERENCE NO.46/JALA/33/2016-17 ISSUED BY R-1 AS PER ANNEXURE-C

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THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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NC: 2026:KHC:1148 WP No. 31712 of 2019

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HC-KAR

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CORAM: HON'BLE MR. JUSTICE M.G.S. KAMAL

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ORAL ORDER

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Petitioner is before the Court being aggrieved by the Order dated 09.11.2017 passed by respondent No.1 at Annexure-A and the Order dated 04.04.2019 passed by the Karnataka Appellate Authority as per Annexure-B as well as the consequent notice dated 20.06.2019 issued by respondent No.1 as per Annexure-C in terms of which the respondent-Authorities have found that in a sale transaction of immovable property measuring 51 acres 31 guntas situated in Hosahali Village, which had been entered into between petitioner and M/s. Sammys Dreamland Company Pvt. Ltd., there is a suppression of actual value of the sale transaction. In that though total sale consideration as per the agreement dated 10.05.2012 is shown at Rs.265,00,00,000/- in the deeds of sale, it is shown as settled at Rs.257,00,00,000/-. That in the agreement of sale there was a mention of petitioner having parted with a post dated cheque for Rs.165,00,00,000/- which transaction is not reflected in the deeds of sale resulting in suppression of the actual value of sale consideration. It is this, based on which

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NC: 2026:KHC:1148 WP No. 31712 of 2019

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HC-KAR

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the respondent-authorities have passed the impugned orders

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and consequent notices.

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Learned Senior Counsel Sri. V. Srinivas Raghavan,

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appearing for Sri. Sanjay Nair, learned counsel for the petitioner taking this Court through the records, more particularly a letter dated 19.07.2019 issued by HDFC Bank addressed to the petitioner herein, submits that though the agreement in question indeed reflected issuance of a post dated cheques for Rs.165,00,00,000/-, the said cheque was never encashed. He submits that the value of actual transaction that had taken place has been truly and duly reflected in the deeds of sale. Since the respondent-authorities are calling upon the petitioner to pay the stamp duty on the amount which was never paid by the petitioner, the order is arbitrary and illegal.

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In response, learned AGA drawing attention of this Court to internal page No.8 of the impugned order submits that the suppression of payment of Rs.165,00,00,000/- has been found during audit of the documents in terms of the provisions of the Karnataka Stamp Act. That since the petitioner had not given any justifiable reasons, the impugned orders have been

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passed and no irregularity or illegality can be recovered

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thereof.

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Heard and perused the records.

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Paragraph Nos.11 and 14 of the impugned order reads

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as under:

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11. ಅಂದ�ೆ ರೂ .1682723500/- ಗಳನು� ��ಧ�ೆ�ಗಳಮೂಲಕ�ಾವ��ರುವ�ದು ಕಂಡುಬರುತ � ೆ . ಆದ�ೆ ಈ !ಂ�ೆ "#ಾಂಕ 25-10-2010 ರಂದು $ಾ%&ೊಂ%ರುವ ಕ'ಯದ ಕ�ಾರು ದ)ಾ�*ೇಜು ಸಂ.ೆ/ 2640/2010-11 ರ01 �ಾವ��ರುವ ಮುಂಗಡ ಹಣ ರೂ .1000000000/- ಗಳನು� ವ4ಾ $ಾ% ಉ6ದ 7ತ� ರೂ .682723500/- ಗಳನು� �ಾವ��ರುವ�ದು ಕಂಡುಬರುತ � ೆ . ಆದ�ೆ ¸ÀzÀj PÀæAiÀÄzÀ PÀgÁj£À PÀArPÉ 35 gÀ°è cheque No.493011, HDFC Bank Ltd., Kasutrba Gandhi Marg, Bangalore. "#ಾಂಕ 25-07-2011 ರಂದು �ೆ� ಮೂಲಕ post dated �ಾವ��ರುವ ರೂ .1650000000/- ಗಳನು� ಬ8ೆ9 ನಮೂ"ಸ�ೇ ಮ�ೆ $ಾ:ರು;ಾ � ೆ . <ಾಗೂ ಸದ= ಕ'ಯದ ಕ�ಾರು - ದ)ಾ�*ೇಜು ಕಂ%&ೆ 8(f) ರ01 ಸದ= post dated �ೆ� ಮೂಲಕ �ಾವ��ರುವ ಮು�ಾ'ಂಕ ಶುಲ?ವನು� @ಾವ��ೇ #ಾ/Aಕ / ಅ�ೆ #ಾ/Aಕ ಆ�ೇಶಗಳನು� <ೊರತು �ೆ� ಮೂಲಕ �ಾವ��ರುವ 7ತ�ವನು� B01ಸದಂ;ೆ ಷರತು� �D�ರುವ�ದು ಕಂಡುಬರುತ � ೆ . <ಾಗೂ ಸದ= post dated cheque ಮೂಲಕ �ಾವ��ರುವ7ತ�ರೂ .1650000000/- ಗಳನು� $ಾ!�ಯನು� ಕ'ಯದ ದ)ಾ�*ೇEನ01 ನಮೂ"ಸ�ೇ ಪ'�*ಾ"ಗಳG ಮ�ೆ$ಾ:ರುವ�ದು ಕಂಡುಬರುತ � ೆ . ಆದH=ಂದ ಮ<ಾIೇಖ�ಾ®gÀ ಆKೇಪLೆಯನು� ಒNO &ೊರ;ೆ ಶುಲ? �ಾವ�ಸಲುಆ�ೇPಸುವ�ದುಸೂಕ�*ೆಂದುಅQ�ಾ'ಯಪಡIಾAತು .

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14. ಕ#ಾRಟಕಮು�ಾ'ಂಕ&ಾTH 1957 ರಕಲಂ 28 ರ%ಶುಲ? ಆಕರLೆ $ಾಡUೇ&ಾದ ಅಂಶಗಳಬ8ೆ9 ದ)ಾ�ೇEನ01ನಮೂ"ಸುವ�ದು ಕVಾWಯಾXರುತ � ೆ . ಪ'�*ಾ"ಗಳG ಈ ಕYೇ=ಯ ಹಲವ� #ೋZೕ[ಗಳನು� �\ೕಕ=�ದHರೂ ��ಾರLೆ8ೆ <ಾಜ�ಾXರುವ�"ಲ1 . <ಾಗೂ @ಾವ��ೇ ಆKೇಪLೆಯನು� ಸ01�ರುವ�¢®è .

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NC: 2026:KHC:1148 WP No. 31712 of 2019

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HC-KAR

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ಪ')ಾ�ವ#ೆಯ01 �ವ=�ರುವ ಅಂಶಗಳ !#ೆ�Iೆಯ01 <ಾಗೂ ಲಭ/�ರುವ �ಾಖIೆಗಳ ಆ^ಾರದ_ೕIೆ ಪ'ಕರಣವನು� ಆ�ೇPಸುವ�ದುಸೂಕ�*ೆಂದುಅQ�ಾ'ಯಪಡIಾAತು . ಮ<ಾIೇಖ�ಾಲರು ಆKೇN�ರುವಂ;ೆ "#ಾಂಕ 25-07-2011 ರಂದು ಪ'�*ಾ"ಗಳG ಸ\��ನ $ಾ0ೕಕ=8ೆ Post dated cheque �ಾವ��ರುವ ಮುಂಗಡ ಹಣ ರೂ .1650000000/- ಗಳಅಂಶವನು� ಮ�ೆ $ಾ:ರುವ�ದು ಸOಷ`*ಾಗುತ � ೆ . ಆದH=ಂದ ಮ<ಾIೇಖ�ಾಲರಆKೇಪLೆಯನು� ಒNO &ೊರ;ೆ ಶುಲ? �ಾವ�ಸಲು ಈ&ೆಳಕಂಡಂ;ೆ ಆ�ೇP��ೆ .

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ಆ�ೇಶ

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''f¯Áè¢üPÁj (ªÀÄÄzÁæAPÀ) ªÀÄvÀÄÛ f¯Áè £ÉÆÃAzÀuÁ¢üPÁj, eÁ® £ÉÆÃAzÀtÂ f¯Éè, ¨ÉAUÀ¼ÀÆgÀÄ DzÀ £Á£ÀÄ PÀ£ÁðlPÀ ªÀÄÄzÁæAPÀ PÁAiÉÄÝ, 1957 gÀ PÀ®A 46-J gÀr ºÁUÀÆ £ÉÆÃAzÀtÂ PÁAiÉÄÝ, 1908gÀ PÀ®A 80-J gÀr ¥ÀæzÀvÀÛªÁzÀ C¢üPÁgÀªÀ£ÀÄß ZÀ¯Á¬Ä¹, ¸ÀéwÛ£À ªÀiÁgÀÄPÀmÉÖ ªÀiË®åªÉAzÀÄ ¥ÀjUÀtÂ¹ ªÀåvÁå¸ÀzÀ ±ÀÄ®ÌUÀ¼À£ÀÄß ¥ÁªÀw¸À®Ä F PÉ¼ÀPÀAqÀAvÉ DzÉÃ²¹zÉ.

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1	ಮೂರು ದ)ಾ�*ೇಜುಗಳ01 ನಮೂ"�ರುವಂ;ೆ ಸ\��ನ ಒಟು` ªÀiË®å	ರೂ_. 2570000000 .00_
2	"#ಾಂಕ_25-07-2011_ರಂದುPost dated cheque�ಾವ��ರುವ ಮುಂಗಡ ಹಣ	ರೂ_. 1650000000-00_
3	ಸ\��ನ ಒಟು` ªÀiË®å	ರೂ_. 4220000000-00_
4	ಮು�ಾ'ಂಕ ಶುಲ? ಮತು� #ೋಂದb ಶುಲ?ಗಳನು� �ಾವ��ರುವ ªÀiË®å	ರೂ_. 2570000000-00_
5	ವ/;ಾ/ಸದ ªÀiË®å	ರೂ_. 1650000000-00_
6	ರೂ_.1650000000/-_ಗಳ ಮುಂಗಡ ಹಣದ _ೕIೆ �ಾವ�ಸUೇ&ಾದ ಮು�ಾ'ಂಕ ಶುಲ? cೇಕVಾ_5.65_ರಂ;ೆ	ರೂ_. 93225000-00_
7	ರೂ_.1650000000/-_ಗಳ ಮುಂಗಡ ಹಣದ _ೕIೆ �ಾವ�ಸUೇ&ಾದ #ೋಂದb ಶುಲ? cೇಕVಾ_1_ರಂ;ೆ	ರೂ_. 16500000-00_
8	ಒಟು` �ಾವ�ಸUೇ&ಾದ &ೊರ;ೆ ಶುಲ?ಗಳG	ರೂ_. 109725000-00_

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ಈ_ೕ0ನಂ;ೆ BಧR=�ರುವಮು�ಾ'ಂಕಶುಲ? ರೂ .93225000/-, #ೋಂದbಶುಲ? ರೂ .16500000/- ಗಳನು� ಸ&ಾRರ&ೆ? �ಾವ�ಸಲು ಪ'�*ಾ"ಗ68ೆ ಆ�ೇP��ೆ . ಸದ= ಶುಲ?ವನು� ಈ ಆ�ೇಶ <ೊರ%�ದ "#ಾಂಕ"ಂದ 60 "ನಗಳ ಒಳ8ಾX , " EIಾ1 #ೋಂದLಾD&ಾ=ಗಳG , 8ಾಂDನಗರ , Uೆಂಗಳdರು " (District Registrar, Gandhinagar, Bangalore) 2 0 2.2./ ಹಣವನು� �ಾವ�� ಅಸಲು % . % ./ �ೇ

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NC: 2026:KHC:1148 WP No. 31712 of 2019

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HC-KAR

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ಆಡRರನು� ಮುಂ"ನ ಕ'ಮ ;ೆ8ೆದು&ೊಳGeವ ಸಲು*ಾX ಈ #ಾ/@ಾಲಯ&ೆ? <ಾಜರುಪ%ಸತಕ?ದುH .''

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From the perusal of the aforesaid reasoning, it is clear

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that the only basis on which the impugned order is passed is alleged suppression of payment of Rs.165,00,00,000/- by the petitioner by way of post-dated cheques in terms of the agreement of sale dated 10.05.2012 produced at Annexure-D.

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Though, in the agreement of sale dated 25.10.2010, the sale consideration is shown as Rs.265,00,00,000/-, however in the deeds of sale dated 30.09.2011, 02.11.2011 and 10.05.2012, the sale consideration is shown as Rs.165,27,23,500/-, Rs.30,15,50,300/- and Rs.58,57,26,512/respectively aggregating in a sum of Rs.257,00,00,012/-.

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The contention of respondent-authorities on the other hand, as noted above is, the alleged suppression of payment of Rs.165,00,00,000/-, which finds mention in the agreement of sale.

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Annexure-K is a letter dated 19.07.2019 issued by the HDFC Bank, which is now produced along with the writ petition

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HC-KAR

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would indicate that the said post-dated cheque has not been

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presented for encashment.

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In that view of the matter, the very basis on which the impugned orders have been passed requires reconsideration.

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In the light of the prima-facie grounds established by the petitioner, following:

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ORDER

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(i) Writ petition is allowed.

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(ii) Without expressing any opinion on the merits of the case, impugned Order dated 09.11.2017 passed by respondent No.1 as well as the Order dated 04.04.2019 passed by the Karnataka Appellate Authority are set-aside and the consequent notice dated 20.06.2019 issued by respondent No.1 as per Annexure-C is quashed.

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(iii) Matter is relegated to respondent No.1 to reconsider the matter afresh, taking into

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consideration the document, namely letter dated to 19.07.2019 issued by HDFC Bank addressed to the petitioner, indicating non-encashment of the postdated cheque bearing No.493021, which was reflected in the agreement of sale dated 25.10.2010, after affording sufficient opportunity to the parties, pass appropriate order thereon.

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Sd/(M.G.S. KAMAL) JUDGE

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RL

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List No.: 1 Sl No.: 13

M/S Embassy Property Developments Private Limited v. the Deputy Commissioner

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M/S Embassy Property Developments Private Limited v. the Deputy Commissioner

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