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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
S. SUNIL DUTT YADAV, J.
Mr. Harish S/o. Mr. Kariyappa - Petitioner
Versus
Smt. Pushpakumari W/o. Mr. M. Madan Lal & Ors. - Respondents
Writ Petition No. 6721 of 2022 (GM-CPC)
Decided On : 13-02-2023
Stamp Duty - Karnataka Stamp Act, 1957 - Article 5 (e) (ii)
Fact of the Case:
The petitioner challenges the correctness of the trial court's order calculating the duty and penalty for a deficit stamp duty. The petitioner argues that no possession was handed over under the agreement, and therefore, the calculation should be based on Article 5 (e) (ii) of the Karnataka Stamp Act, 1957. The court agrees and sets aside the impugned order, remitting the matter to the trial court for recalculation of duty and penalty based on Article 5 (e) (ii). The court also directs the trial court to dispose of the suit expeditiously in accordance with administrative directions issued by the High Court for disposal of old cases.
Finding of the Court:
The court analyzes the calculation of duty and penalty and finds that it was based on the incorrect premise that possession was delivered under the agreement. The court determines that the applicable provision is Article 5 (e) (ii) of the Karnataka Stamp Act, 1957, which sets the maximum amount at Rs.20,000/- and the minimum amount at Rs.500/-.
Ratio Decidendi: The court sets aside the impugned order and remits the matter to the trial court for recalculation of duty and penalty based on Article 5 (e) (ii) of the Karnataka Stamp Act, 1957. The court also directs the trial court to dispose of the suit expeditiously in accordance with administrative directions issued by the High Court for disposal of old cases.
Result: The impugned order is set aside and the matter is remitted to the trial court for recalculation of duty and penalty based on Article 5 (e) (ii) of the Karnataka Stamp Act, 1957. The trial court is directed to dispose of the suit expeditiously in accordance with administrative directions issued by the High Court for disposal of old cases.
ORDER :
Learned AGA accepts notice and has been heard in this matter.
2. The petitioner who is the plaintiff before the trial court has called in question the correctness of the order passed on 02.03.2022, whereby the trial court has calculated the duty and penalty by recording a finding that the deficit stamp duty is Rs.53,700/- and that the penalty is 10 times and accordingly, found that the plaintiff is required to pay duty and penalty of Rs.5,90,700/-.
3. The learned counsel for the plaintiff submits that a reading of the document would make it clear that no possession is handed over under the agreement. If that were to be so, the calculation of duty and penalty in terms of Article 5 (e) (ii) of the Karnataka Stamp Act, 1957 would be upto a maximum of Rs.20,000/- but not less than Rs.500/-. Accordingly, it is submitted that the calculation of the trial court regarding duty and penalty is erroneous on the face of it.
4. Perused the impugned order.
5. Clearly the calculation of duty and penalty is on the premise that duty and penalty is to be calculated at 0.1% of the market value. As possession has not been delivered under the agreement, the same is apparently erroneous and not in terms of Article 5 (e) (ii) of the Karnataka Stamp Act, 1957, which would be the applicable provision.
6. Article 5 (e) (ii) of the Karnataka Stamp Act, 1957 reads as follows :
7. Accordingly, the impugned order is set aside. The matter is remitted to the trial court to calculate duty and penalty in terms of Article 5 (e) (ii) while taking note that under Article 5 (e) (ii) the maximum amount is Rs.20,000/- and would not be less than Rs.500/- and the duty must be fixed within the upper limit of Rs.20,000/-. This would be the applicable provision as possession is not handed over.
8. The suit to be disposed off expeditiously taking note of the applicable administrative directions issued by the High Court with regard to disposal of old cases.
The calculation of duty and penalty for a deficit stamp duty should be based on Article 5 (e) (ii) of the Karnataka Stamp Act, 1957, which sets the maximum amount at Rs.20,000/- and the minimum amoun....
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Point of law: 1957 Act the adjudicating authorities such as courts, arbitrators, etc., do not have discretion to disobey the legislative command to recover the deficit stamp duty along with the presc....
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The main legal point established in the judgment is that the trial Court had the authority to impound the document for non-payment of deficit stamp duty and penalty, and to calculate the stamp duty a....
The central legal point established in the judgment is the discretionary power of the competent authority to impose penalties for deficiency in stamp duty, the requirement of rational exercise of dis....
The court clarified the jurisdiction of the court in requiring payment of deficit stamp duty and penalty, and the process for depositing the penalty amount and seeking a refund from the Collector.
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