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2025 Supreme(HP) 779
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
Ajay Mohan Goel, J.
M/s Power Chem Plast Limited - Petitioner
Versus
State of Himachal Pradesh and others - Respondents
CWP No. 8154 of 2022
Decided On : 27-03-2025
Advocate Appeared:
For the Petitioner:Mr. Rakesh Gupta, Advocate.
For the Respondent:Mr. Rajpal Thakur, Additional Advocate General, Mr. Mehar Chand, Advocate, Mr. N.K. Sood, Senior Advocate, with Mr. Aman Sood, Advocate
Auction purchasers are exempt from stamp duty for registration of sale certificates, and demands for unearned increase from them are unjustified.
Headnote:
(A) Security Interest (Enforcement) Rules - Sale Certificate registration - The petitioner sought to quash the refusal to register a sale certificate for property purchased at auction, asserting exemption from stamp duty. The court held that the insistence on stamp duty was illegal, referencing the precedent set in Mohan Singh Guleria Vs. State of H.P & Ors. (Paras 12, 14, 24).
(B) Unearned Increase - The court ruled that the demand for unearned increase from the petitioner was unjustified, clarifying that such obligations arise only under specific conditions outlined in the Conveyance Deed (Paras 16, 21, 24).
Facts of the case:
The petitioner purchased property at auction, but the registration was refused due to stamp duty demands and unearned increase claims by respondents.
Findings of Court:
The court directed the registration of the Sale Certificate without stamp duty and ruled that no unearned profit was payable by the petitioner.
Issues: The main issues were the legality of the stamp duty demand for registration and the obligation to pay unearned increase.
Ratio Decidendi: The court emphasized that auction purchasers are exempt from stamp duty for registration, and unearned increase claims do not apply to the petitioner.
Result: Writ petition allowed.
JUDGMENT :
Ajay Mohan Goel, J.
By way of this writ petition, the petitioner has, inter alia, prayed for the following reliefs:-
“(1) To issue an appropriate writ in the nature of certiorari quashing the impugned letter dated 26.8.2022 vide which respondent No.6 has refused to register the sale certificate with regard to sale of property bearing Plot No.8, measuring 10109 sq. meters situated in Industrial Area, Baddi, Tehsil Baddi, Distt. Solan, Himachal Pradesh, which the petitioner has purchased free from all encumbrances in terms of the sale certificate dated 4.7.2022.
(2) Further to issue an appropriate writ in the nature of mandamus in favour of the petitioner with appropriate directions to respondent No.6 to register the sale certificate dated 4.7.2022 in accordance with the provisions of the Security Interest (Enforcement) Rules, issued by the Authorized Officer, IFCI.
(3) Further to issue an appropriate writ in the nature of mandamus directing respondents No. 2 and 3 to immediately transfer the land in favour of the petitioner in their records, without the demand of unearned increase.
(4) Further to issue an appropriate writ in the nature of mandamus directing respondent No.5 to immediately pay the unearned profit from the sale consideration received by IFCI from the petitioner, to remove the objection in this regard.”
2. As per the petitioner, HPSIDC is the owner of plot No.8 in Industrial Area, Baddi, District Solan, measuring 10109 sq. metres. In terms of a Conveyance Deed executed on 09.09.1988, the property was let out to Himachal Advanced Circuits Limited for the purpose of setting up of an industry. In the year 1990, HPSIDC permitted Himachal Advanced Circuits Limited to mortgage the property with financial institutions to raise money with the condition that unearned profit was to be paid by Himachal Advanced Circuits Limited to HPSIDC. Further, as per the petitioner, on 23.11.1992, the land in issue was mortgaged by Himachal Advanced Circuits Limited with a consortium of banks with IFCI Bank being the lead bank. The Unit went into red and it was taken over by the Official Liquidator in the year 2022. This was followed by litigation under the Companies Act.
3. This Court, in a Company Petition, permitted IFCI to auction the properties of Himachal Advanced Circuits Limited under the provisions of the SARFAESI Act. Thereafter, vide advertisement dated 20.09.2021, the property was put to auction and the petitioner herein is the successful bidder.
4. The Court stands informed that thereafter, the Company Court permitted IFCI Bank to issue a Sale Certificate in favour of the petitioner, which was duly issued. This was followed by the handing over of the auctioned property to the petitioner by the Official Liquidator in terms of the direction passed by the Company Court in Company Petition No. 15 of 2003.
5. The petitioner has approached this Court with the grievance that the Sale Certificate in issue is not being registered in the name of the petitioner and the respondent- State is insisting upon the payment of stamp duty for the purpose of registration, whereas, in light of the fact that the petitioner had purchased the property in an auction, it is exempted from paying the stamp duty. It is further the grievance of the petitioner that respondents No.2 & 3 are not transferring the property in favour of the petitioner and are demanding unearned increase as well as certain other charges. 6. Learned counsel for the petitioner has argued that in the light of the fact that the property in issue was purchased by the petitioner in a bid conducted under the provisions of the SARFAESI Act, the demand by the State of stamp duty for registration of the Sale Certificate in the name of the petitioner is per se bad. Learned counsel has relied upon the judgment of Hon’ble Division Bench of this Court in CWP No. 221 of 2019, titled Mohan Singh Guleria Vs. State of H.P & Ors., decided on 08.10.2020 and submitted that this issue is no more res
