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HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
MR. JUSTICE AVNEESH JHINGAN, MR. JUSTICE ASHUTOSH KUMAR, JJ
M/s Rampabhu Hotels India Private Limited – Appellant
Versus
State Of Rajasthan, Through Secretary Finance (Tax) Department, Jaipur. – Respondent
Order :
AVNEESH JHINGAN, J
1. This petition is filed seeking quashing of order dated 03.08.2015 passed by the Collector (Stamps), Alwar (for short ‘the Collector’).
2. The relevant facts are that the petitioner is a private limited company (hereinafter referred to as ‘company’) registered under the Companies Act, 1956 . The company purchased an agriculture land bearing Khasra Nos. 171, 212, 212/870, 212/871, 214, 215, and 212/869 situated in village Liwari, District Alwar (hereinafter referred to as ‘property’). After following the procedure under Section 90B of the Land Revenue Act, 1956 (for short ‘the Act of 1956’) and Section 60 of Urban Improvement Trust Act, 1959 (for short ‘the Act of 1959’), the Urban Improvement Trust, Alwar (hereinafter referred to as ‘UIT’) issued allotment letter dated 25.01.2023 in the name of the company. On 05.04.2003 the lease deed of the property for ninety nine years was executed by the UIT in favour of the company. The allotment to the company was through directors Mr. Mahavir Prasad Katta, Mr. Pradeep Kumar Katta, Mr. Prem Narain Gupta and Mr. Yogesh Chand Gupta. The directors of the company transferred their shares and new directors were appointed
A company is a distinct legal entity, and changing its directors does not constitute a transfer of property, thus invalidating the stamp duty demand.
Substitution of a lessee’s name post-death does not attract additional stamp duty if it does not establish a new lease.
Change in shareholding does not constitute a transfer of property interest; the shareholder remains distinct from the company assets, which must adhere to due legal process for any property transfer.
In Court-ordered sales, stamp duty applies only to the sale consideration, not to market value, as established by the Transfer of Property Act.
The correction deed executed due to clerical error should not be treated as a new instrument requiring full stamp duty, but rather charged minimal duty to complete the transaction.
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