IMPORTANT POINT
Once a single instrument has been charged under a correct charging provision of Statute, Revenue cannot split instrument into two, because of reduction in stamp duty facilitated by a notification of Government.

JUDGMENT

V. Ramasubramanian, J.

1. Aggrieved by the opinion rendered by the Full Bench of the High Court of Gujarat in a Stamp Reference under Section 54(1)(a) of the Gujarat Stamp Act, 1958 (hereinafter referred to as the ‘Act’), made by the Chief Controlling Revenue Authority of the State of Gujarat, the Asset Reconstruction Company (India) Ltd., has come up with the above appeal.

2. We have heard Mr. V. Chitambaresh, learned senior counsel appearing for the appellant and Ms. Archana Pathak Dave, learned counsel appearing for the State of Gujarat.

3. The Oriental Bank of Commerce (‘OBC’ for short) granted certain facilities to a borrower and the borrower committed default in repayment. Unable to recover the loan, the Bank assigned the debt in favour of the appellant herein, which is an Asset Reconstruction Company registered with the Reserve Bank of India under Section 3 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘Securitisation Act 2002’). The assignment made by the OBC was under an Agreement dated 18.11.2008. The Assignment Agreement was registered with the Sub-Registrar, Bharuch, on 18.11.2008. In fact, the registration of the document was preceded by an adjudication under Section 31 of the Act.

4. However, an audit objection was raised by the Office of the Accountant General on the ground that the deed of assignment contained a reference to a Power of Attorney (‘PoA’ for short) in Schedule 3 and that the said PoA was chargeable to stamp duty under Article 45(f) of Schedule-I to the Act. A demand for deficit stamp duty to the tune of Rs.23,53,800/- was raised pursuant to the audit objection.

5. Thereafter, the Deputy Collector (Stamp Duty) referred the matter to the Chief Controlling Revenue Authority, who in turn issued a notice to the appellant herein. After considering the reply submitted by the appellant, the Chief Controlling Revenue Authority passed an order dated 04.01.2012 setting aside the order of adjudication passed on 23.10.2008 and directing recovery of the deficit stamp duty.

6. Aggrieved by the said order, the appellant submitted an application under Section 54(1)(a) of the Act. On the said application, the Chief Controlling Revenue Authority referred the following two questions for the opinion of the Court:­

“(A) Whether the objection raised by the Account General, Ahmedabad in audit para, in the year 2008 is proper or not, as per Article­45(f) of the Bombay Stamp Act, 1958 or not?

(B) Whether the Asset Reconstruction Company (India) Limited is liable to pay stamp duty of Rs.24,94,100/­ i.e. 4.9% as per Article­20(a) of the Bombay Stamp Act or not?”

7. For finding an answer to the above questions, the Full Bench of the High Court examined the recitals contained in the deed of assignment and found that the Bank had agreed to execute an irrevocable PoA in favour of the appellant herein, substantially in the form set out in Schedule 3 of the deed of assignment. The form set out in Schedule 3 contained recitals empowering the assignee, as the agent of the Bank, to sell any immovable property. Therefore, considering the fact that Article 45(f) of Schedule I to the Act makes a PoA given for a consideration and containing an authority to sell any immovable property chargeable to stamp duty as a conveyance, the High Court came to the conclusion that the appellant has to pay stamp duty as fixed by Article 45(f). The High Court opined that merely because the power to sell, forms part of the deed of assignment under Schedule 3, the appellant could not escape the charge of duty and that the PoA is required to be considered independently.

8. But we do not think that the above reasoning can be accepted. First of all, what was presented for registration by the appellant was a single document namely an “Assignment Agreement”. Clause 11