Release deeds executed by a member of a Hindu Undivided Family cannot create new rights for one member over others and must be treated as conveyances subject to stamp duty.

JUDGMENT :

(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL)

1. Letters Patent Appeal No. 689 of 2023 is filed by the State against the judgment and order dated 12.12.2022 passed by the learned Single Judge in holding that the orders dated 02.07.2019 and 03.06.2020 passed by the authorities under the Gujarat Stamp Act’ 1958 are illegal and hence liable to be set aside, further that the money recovered by the State respondents from the original petitioners is to be refunded. Whereas, the Letters Patent Appeal No.864 of 2023, is a cross-appeal preferred by the original Writ petitioner to modify the Judgment of the learned Single Judge dated 12.12.2022 to the extent of granting 12% interest on the amount directed to be refunded by the State respondents. Hence, both the appeals are heard together and decided by this common judgement and order.

2. The original petitioner namely the respondent herein had filed the writ petition challenging the orders passed by the Stamp authorities in impounding two documents termed as release documents treating them as “transaction for-say” and imposing stamp duty on it, based on the market price.

3. Certain facts relevant to decide the controversy, at hands, are that the father of the original petitioner namely Mr. Mukeshbhai Hirabhai Patel purchased two parcels of agricultural lands in Zundal Village, District Gandhinagar admeasuring 0–51–60 sq.mts as Survey No. 11/1, and land admeasuring 0–54–62 sq.mts in Survey No. 11/2, by way of two registered sale deeds dated 24.02.2000. The lands in question were converted into Non-agricultural lands. On 26.03.2013 and 07.07.2013, the father of the petitioner declared the pedigree stating that the Joint Hindu family in the name of Mukeshbhai Hirabhai Patel (HUF) comprised of himself, his wife, a daughter and a son (who is the original petitioner herein). In the year 2015, the names of the wife, daughter and son were mutated in the revenue records in Form – 6 and Form – 7/12 along with the owner – father namely Mr. Mukesh Patel, on an application filed by the owner father during his lifetime.

4. Vide two Release Deeds dated 27.12.2016, executed on a stamp paper of Rs.100/-, the daughter had relinquished her right to the extent of her share in favour of the son (namely her brother, i.e. the petitioner herein) in respect of the two lands namely Survey No. 11/1 and Survey No. 11/2. The said documents executed as Release deeds were presented before the Sub-Registrar for registration when show-cause notices dated 08.05.2017 and 14.09.2017 were issued impounding the documents under Section 33 of the Gujarat Stamp Act’ 1958. The stamp authorities opined that the stamp duty of Rs.100/- was inadequate and the correct stamp duty was to be levied on the basis of the market value of the relinquished portion of the share of the executant in the lands in question.

5. Before the learned Single Judge, it was argued by the learned counsel for the original petitioner that the instruments of release presented for registration cannot attract the stamp duty under Schedule I of Article 20 as a ‘conveyance’ by treating the said documents falling within the ambit of Article 49 (b) of Schedule I read with Section 2(c), Section 5 and Section 39(1)(b) of the Gujarat Stamp Act’ 1958.

6. It was argued that the release deeds relinquishing her share was executed by the sister in favour of her real brother out of love and affection and without any consideration and therefore, it cannot be said to be a transaction or conveyance for the purposes of levy of stamp duty at the market value. As regards the mutation entries of entering the names of three family members in the revenue records during the lifetime of the owner, it was argued that the mutation entries are made only for fiscal purposes and they cannot be considered as transaction or conveyance in favour of the persons, whose names were recorded in the revenue record. Moreover, the lands in question were belonging to HUF and th