1. Purchase of property — Fraud by vendor — Un-executed conveyance deed — Application for refund of stamp duty under Section 48, Maharashtra Stamp Act, 1958. (Para 2 , 3 , 4 )
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2024 Supreme(SC) 494
SUPREME COURT OF INDIA
B.R. GAVAI, PRASHANT KUMAR MISHRA, JJ.
Bano Saiyed Parwaz – Appellant
Versus
Chief Controlling Revenue Authority and Inspector General of Registration and Controller of Stamps and Others – Respondents
Civil Appeal No. 6533 of 2024, Arising Out of SLP (C) No. 4111 of 2020
Decided On : 17-05-2024
Advocates appeared:
For the Petitioner(s): Mr. Narender Kumar Verma, AOR
For the Respondent(s): Mr. Aaditya Aniruddha Pande, AOR Mr. Siddharth Dharmadhikari, Adv. Mr. Bharat Bagla, Adv. Mr. Sourav Singh, Adv. Mr. Aditya Krishna, Adv. Ms. Preet S. Phanse, Adv. Mr. Adarsh Dubey, Adv.
For the Petitioner(s): Mr. Narender Kumar Verma, AOR
For the Respondent(s): Mr. Aaditya Aniruddha Pande, AOR Mr. Siddharth Dharmadhikari, Adv. Mr. Bharat Bagla, Adv. Mr. Sourav Singh, Adv. Mr. Aditya Krishna, Adv. Ms. Preet S. Phanse, Adv. Mr. Adarsh Dubey, Adv.
IMPORTANT POINT
Refund of stamp duty – When State deals with a citizen it should not ordinarily rely on technicalities even though such defences may be open to it – Period of expiry of limitation prescribed under any law may bar remedy but not right.
Headnote:
Stamp Act, 1899 – Section 47 – [Bombay Stamp Rules, 1939 – Rules 21 and 22A] – Refund of stamp duty – Appellant being a bona-fide purchaser is a victim of fraud played upon her by vendor – Her effort to contact vendor to execute a cancellation deed did not fructify immediately because of unavailability of Vendor – Due to intervention of Police, Vendor could be traced and cancellation deed was executed – Appellant was pursuing her remedies in law and she was not lax in her approach towards seeking refund of stamp duty paid by her and she has been denied the same only on the ground of limitation – Evidence required and enquiry to be made in terms of Section 47 of Act is a separate process altogether and apropos circumstances for refund under Section 47 (c) (1) & (5) of Act, evidence is not required to be filed along with application – When State deals with a citizen it should not ordinarily rely on technicalities even though such defences may be open to it – Period of expiry of limitation prescribed under any law may bar remedy but not right – Case of appellant is fit for refund of stamp duty – State directed to refund stamp duty deposited by appellant. (Paras 10, 11, 13, 15, 16 and 17)
Facts of the case:
Instant appeal is directed against the judgment and order impugned dated 02.08.2019 passed by High Court of Judicature at Bombay in Writ Petition whereby High Court, dismissed appellant’s demand for refund of Stamp Duty paid towards an un-executed conveyance deed. In effect, impugned order has upheld orders of respondents rejecting demand of appellant.
Findings of Court:
Finding returned by High Court in impugned order that appellant’s application for refund dated 22.10.2014 is not maintainable in law as it has been filed before cancellation of conveyance deed dated 13.11.2014 is misplaced in so far as while submitting online application there was no caution to appellant that all of documents and materials for satisfaction of Collector should be filed with application- either online or hard copy- itself.
Result : Appeal allowed.
Legal Category Hierarchy
Table of Contents
2. Whether refund application is time-barred if filed before the execution of a cancellation deed — Interpretation of limitation periods under Sections 47 and 48 of the Act. (Para 5 , 6 , 7 , 8 )
3. Application for refund within the limitation period is maintainable regardless of whether the cancellation deed is executed simultaneously; evidence is a separate subsequent process. (Para 10 , 11 , 12 , 13 )
4. Expiry of a prescribed limitation period may bar the remedy but does not extinguish the underlying right, especially where the State should not rely on technicalities. (Para 14 , 15 , 16 )
5. Appeal allowed — Impugned orders set aside — State directed to refund the stamp duty amount. (Para 17 )
6. Is a refund application for stamp duty maintainable if filed before the formal execution of a cancellation deed?
Yes. The requirement under Section 48 of the Maharashtra Stamp Act is that the application for relief be made within six months. The execution of a cancellation deed and the subsequent enquiry or evidence process are separate from the initial application for refund. (Para 12 , 13 )
7. Does the expiry of the limitation period for claiming a refund of stamp duty extinguish the right to the refund?
No. The court held that while the expiry of a limitation period prescribed by law may bar the remedy, it does not bar the right to claim the refund, particularly in just cases. (Para 14 , 16 )
8. Should the State rely on technical grounds to deny a citizen's just claim for refund?
No. When dealing with a citizen, the State should not ordinarily rely on technicalities, even if legal defenses are available, and should act as an honest person if the case is just. (Para 14 , 15 )
1. Leave granted.
2. The instant appeal is directed against the judgment and order impugned dated 02.08.2019 passed by the High Court of Judicature at Bombay in Writ Petition No. 281 of 2019 whereby the High Court, dismissed the appellant’s demand for refund of Stamp Duty paid towards an un-executed conveyance deed. In effect, the impugned order has upheld the orders of respondent nos. 1 and 2 dated 09.06.2015 and 25.02.2016 rejecting the aforesaid demand of the appellant.
3. Briefly stated, the facts of the matter are that the appellant agreed to purchase the property bearing C.T.S. No. 340.340/1 to 340/14 of Kurla-1 Division situated lying and being Fitwalla Cottage, Fitwalla Compound Bazaar Ward, Old Agra Road, Kurla (West), Mumbai-400070 from the Vendor - Mohammed Hanif Ahmed Fitwala and to that effect, they prepared a deed of conveyance which was sent for adjudication to respondent no. 1 on 07.05.2014 for payment of stamp duty, which was assessed at Rs. 25,34,350 (Rupees Twenty-Five Lakhs Thirty-Four Thousand Three Hundred Fifty Only). Accordingly, the appellant paid this sum and purchased the stamp duty on 13.05.2014 for registration of conveyance deed.
4. Albeit, the stamp duty was paid by the appellant to respondent no. 1 on 13.05.2014, said conveyance deed was not lodged for registration as the vendor of the appellant by playing fraud on the appellant had earlier sold the said property to a third party in 1992. However, before executing the said conveyance deed, the appellant had given a public notice but nobody objected to the said transaction. Thereafter, in view of these facts, the appellant decided to cancel the said transaction, for which he tried to contact the said vendor but he was not available, compelling the appellant to file a complaint with the Police Authority. Thereafter, the Vendor executed the cancellation deed on 13.11.2014. However, the appellant had on 22.10.2014 already applied online for refund of the said amount as per Section 48 of the Maharashtra Stamp Act, 19581 [‘Act’] and had filed written application on 06.12.2014 along with the documents. The appellant’s case was rejected by respondent nos. 1 & 2 on the ground that the application filed by her was beyond the limitation period as per Section 48 of the Act.
5. The learned counsel for the appellant submits that the appellant’s case is squarely covered within the circumstances laid down in Section 47 (c) (1) and (5) of the Act and Rules 21 and 22A of the BOMBAY STAMP RULES , 19392 [‘Rules’] which read as under:
“47. (c) the stamp used for an instrument executed by any party thereto which:
(1) has been afterwards found (by the party) to be absolutely void in law from the beginning; 2(1A) has been afterwards found by the Court, to be absolutely void from the beginning under section 31 of the Specific Relief Act, 1963.
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(5) by reason of the refusal of any person to act under the same, or to advance any money intended to be thereby secured, or by the refusal or non-acceptance of any office thereby granted, totally fails of the intended purpose.”
“21. Evidence as to circumstances of claim to refund or renewal.
The collector may require any person claiming a refund or renewal under chapter v of the Act, or his duly authorized agent, to make oral deposition oath or affirmation, or to file an affidavit, setting forth the circumstances under which the claim has arisen, and may also' if he thinks fit, call for the evidence of witnesses in support of the statement set forth in any such deposition or affidavit.
NOTES
Claim for refund of stamp duty.
Under rule 21 where a claim for refund of stamp duty is made, the procedure laid down under the rule to take evidence by the Collector. Accordingly, the Collector may direct any person claiming a refund under Chapter v to make an oral deposition on oath or affirmation or to file an affidavit, setting forth the circumstances under which the claim has arisen and if he thinks fit call all evidence of witnesse
