The court held that the demand for stamp duty on the rectification deed should only reflect the actual excess area of 178.27 sq. mtrs., not the inflated figure of 925.30 sq. mtrs.

JUDGMENT :

JITENDRA JAIN, J.

1. By this petition under Article 226 of the Constitution of India, petitioners have challenged an order dated 11th August 2015 passed by respondent no. 3-Collector and appeal order dated 5th January 2016 passed by respondent no. 2-Appellate Authority, whereby demand of Rs.53,63,050/- on account of stamp duty on deed of rectification has been raised and confirmed.

Brief Facts:

2. In July 2009, Lease Deed was executed between Mr. & Mrs. Sheth as “lessors” and petitioner no. 1 as “lessee” for lease of land admeasuring 3872.53 sq. mtrs. bearing CTS Plot No. 53A/1-B (Part) and 53A/1-C (Part) on the terms and conditions specified therein for a period of 99 years. Both the plots were adjacent to each other but there was no demarcation. The schedule to the said lease deed reads as under:

“ALL THAT piece and parcel of land bearing C.T. S. No. 53-A/1-B (Part) and C.T. S. No. 53-A/1-C (Part) admeasuring 3872.53 sq. mtrs. Bearing S. No. 17 of Village Chandivali, Taluka Kurla, Mumbai Suburban District, Mumbai.”

3. The property card on the date of execution of the aforesaid lease deed for CTS Plot No. 53A/1-B states area as 3125.50 sq. mtrs. and the said plot is reserved for “playground.” The property card for CTS Plot No. 53A/1-C states the area as 3872.53 sq. mtrs. and same is reserved for “Municipal Primary School.”

4. Based on the above, the Stamp Authorities adjudicated the stamp duty payable on the lease deed by arriving at market value of Rs.16,99,08,000/- for area 3872.53 sq. mtrs. and a certificate to that effect was issued. Petitioner paid stamp duty, determined on the said document, of Rs.76,45,860/- on 4th December 2009. The adjudication was done by respondent no. 3-Collector of Stamp, Kurla.

5. On 15th October 2005, an order was passed by Collector for sub-division/ amalgamation in respect of the aforesaid properties being CTS Plot Nos.53A/1-B and 53A/1-C. As per the said order, area of 3872.53 sq. mtrs. was divided into 3125.50 sq. mtrs. being CTS No. 53A/1-B and 747.03 sq. mtrs. being CTS No. 53A/1-C. Petitioner has averred that the said sub-division/amalgamation was required to carve out a separate area reserved for “primary school.” The sub-division/amalgamation order was given effect to after measurement in the year 2010 which resulted into plot bearing CTS Plot No. 53A/1-C being divided into two plots namely; 53A/1- C/1 admeasuring 2947.23 sq. mtrs. and 53A/1-C/2 admeasuring 925.30 sq. mtrs. being physically demarcated. The newly created plot bearing CTS Plot No. 53A/1-C/2 admeasuring 925.30 sq. mtrs. was merged with CTS Plot No. 53A/1-B which originally admeasured 3125.50 sq. mtrs. Post the amalgamation, the total area of CTS Plot No. 53A/1-B worked out to 4050.80 sq. mtrs. (3125.50 sq. mtrs. + 925.30 sq. mtrs.). Thereafter, a separate property card was prepared by City Survey Office wherein plot bearing CTS Plot No. 53A/1-B was shown at 4050.80 sq. mtrs. and new plot CTS Plot No. 53A/1-C/1 was shown as reduced to 2947.23 sq. mtrs. since area of 747.03 sq. mtrs. was amalgamated into 53A/1-B.

6. The above exercise resulted into original area under lease deed dated July 2009 being increased from 3872.53 sq. mtrs. to 4050.80 sq. mtrs., the excess being 178.27 sq. mtrs. Petitioner, thereafter, on 29th July 2011 executed a Rectification Deed wherein the abovereferred events were narrated and it was stated that new area of plot bearing CTS Plot No. 53A/1-B measured at 4050.80 sq. mtrs. compared to old area of plot bearing CTS Plot No. 53A/1-B (Part) and CTS Plot No. 53A/1-C (Part) admeasuring 3872.53 sq. mtrs. Petitioner, thereafter, made an application under Section 31 of the Bombay Stamp Act (now The Maharashtra Stamp Act, 1958) to respondent no. 3 for adjudicating the stamp duty payable on the rectification deed whereby the original area of 3872.53 sq. mtrs. was increased to 4050.80 sq. mtrs. thereby resulting into increase of 178.27 sq. mtrs.

7. On 13th July 2015, a letter was addressed by the represent