The main legal point established in the judgment is that the stamp duty becomes payable only upon execution of the document, and the applicability of Section 31(4) of the Maharashtra Stamp Act, 1958.

JUDGMENT :

Akil Kureshi, J.

1. Heard learned counsel for the parties for the final disposal of the petition. The petitioner has challenged the action of the respondents of issuing demand of stamp duty and the notices issued for recovery of such stamp duty.

2. The petition has arisen in following background:- The petitioner is a Limited Company registered under the Companies Act. The petitioner has been in use and occupation of office premises admeasuring 57,664 sq ft (hereinafter referred to as the "said premises") situated at 'A' Wing, Kensington Building, Hiranandani Business Park, Powai, Mumbai 400 076 since 14.9.2007 on lease.

3. The said premises has been leased to the petitioner by one HGP Community Pvt Ltd ("HGP" for short). Upon expiry of the previous lease agreement, the petitioner and HGP wanted to execute a fresh lease agreement in relation to the said premises extending the lease for five years. According to the petitioner, a draft of such fresh lease agreement was prepared jointly by both sides. However, before executing such document, the parties wanted to ascertain the stamp duty liability on such agreement. An application was, therefore, filed before Respondent No. 2 - Collector of Stamps, Mumbai on 29.5.2017 for adjudication of the stamp duty payable on such agreement in terms of Section 31 of the Maharashtra Stamp Act, 1958 ("the Act" for short). Along with such application, a copy of the lease agreement was annexed.

4. Respondent No. 2 passed an adjudication order on 19.9.2017 holding that stamp duty of Rs. 6,90,51,450/- would be payable on such document. The petitioner was of the opinion that such assessment of stamp duty was excessive, worked out to nearly one year's lease payment for a lease period of five years. The parties, therefore, did not desire to act on such document since such enormous amount of stamp duty would make the transaction commercially unviable. According to the petitioner, the higher stamp duty assessment was on account of respondent No. 2 incorrectly interpreting the lease agreement as one of perpetual lease whereas the parties desired to execute lease for the period of five years with a renewable clause.

5. The petitioner and the lessor, therefore, prepared a fresh draft agreement which made it absolutely clear that the lease period was only for the period of five years and presented such draft before respondent No. 2 on 9.10.2017 requesting for adjudication of the stamp duty payable on such agreement. According to the petitioner, the second draft was prepared primarily to indicate the intention of the parties more clearly that the lease agreement was only for a period of five years. Respondent No. 2 on the said application passed the adjudication order on 2.11.2017 determining stamp duty payable at Rs. 77,36,500/-. On 8.11.2017, the petitioner paid the stamp duty as determined by respondent No. 2 and executed the lease agreement on 22.12.2017 which was duly registered on 27.12.2017.

6. On 12.2.2018, the petitioner addressed a letter to respondent No. 2 and withdrew the lease document which was submitted for adjudication on 29.5.2017. Respondent No. 2 also returned the document pursuant to the petitioner's request letter dated 12.2.2018. Subsequently, however on 5.4.2018, respondent No. 2 issued a letter dated 5.4.2018 demanding unpaid stamp duty of Rs. 6,90,51,450/- on the basis of the adjudication order dated 19.9.2017. It was conveyed to the petitioner that if such amount is not deposited, penalty @ 2% per month would be collected from the petitioner. On 31.5.2018, respondent No. 2 wrote another letter to the petitioner conveying that the lease agreement in question was executed document; the subsequent lease agreement was a separate document; the petitioner, therefore, must pay the stamp duty. Yet another communication was issued on 11.7.2018 raising the same demand.

7. On 23.7.2018, the petitioner wrote to respondent No. 2 and contended that the first draft was never executed or acted u