The court ruled that a conveyance deed executed under the SFC Act, 1951 is exempt from stamp duty per Government Notification, and procedural rights must be honored in certificate proceedings.

JUDGMENT :

S.K.Mishra, J.

1. The Writ Petition has been preferred with a prayer to quash the impugned warrant of attachment dated 01.12.2015, as at Annexure-4, so also the proceeding in Certificate Case No.1 of 2007 pending in the Court of Certificate Officer, Sub-Collector Office, Jharsuguda (Opposite Party No.1).

2. The case of the Petitioner is that pursuant to an auction sale on 21.03.2002, being an auction purchaser, a registered deed of conveyance was executed between the Petitioner and the Orissa State Financial Corporation, shortly herein after, OSFC. The Petitioner took possession of the industrial concern in terms of Section 29 of the State Financial Corporations Act, 1951 (shortly, ‘SFC Act’, 1951). The case of the Petitioner is that by virtue of deed of conveyance he was exempted from payment of the stamp duty in terms of the Government Notification dated 14.03.2002.

When the matter stood thus, a certificate proceeding vide Certificate Case No.1 of 2007 was initiated against the Petitioner by the Opposite Party No.2 in the Court of Opposite Party No.1 to pay the stamp duty of Rs.8,33,200/- on the basis of audit objection calculated on the total outstanding due to the OSFC by the original borrower and not on the sale consideration, for which the aforesaid deed of conveyance was registered. Accordingly, a notice in Form No.3 under Section 6 of the Odisha Public Demands Recovery Act, 1962, (shortly, “OPDR Act, 1962”) was served on the Petitioner to pay the stamp duty. Pursuant thereto, the Petitioner filed a Petition under Section 8 of the OPDR Act, 1962 denying his liability stating therein that neither the Petitioner was given an opportunity to meet the audit objection nor the matter was ever referred to the Collector for determination of stamp duty and the purported requisition was filed without any certificate by the Opposite Party No.1. It was further stated in the said Petition that it was not served with any certificate along with notice. Thereafter, the Opposite Party No.1 issued warrant of attachment of the movable property lying on the schedule land covered under the aforesaid conveyance deed.

3. Mr. Udgata, learned Counsel for the Petitioner draws attention of this Court to Order 13829/R, dated 14.03.2002 issued by the Government of Orissa, Revenue Department and submits, in exercise of power conferred in Sub-Section (1) of Section 9 of the Indian Stamp Act, 1899 (2 of 1899), the State Government, with a view to give effect to certain incentives, declared under Resolution of the Industries Department dated 03.12.2001 on Industrial Policy, 2001, remitted the stamp duly payable under the said Act, in respect of the instruments as specified in Column (2) of the Schedule to the extent that deeds executed for transfer of Industrial Units to a new owner/management under the provisions of the SFC Act, 1951 is fully exempted/remitted from payment of stamp duty.

Mr. Udgata further draws attention of this Court to the relevant portion of the deed of conveyance, where in it has been specifically mentioned that said deed is exempted from payment of stamp duty under the Stamp Act, 1899, in view of the Notification dated 14.03.2002.

Learned Counsel for the Petitioner submits, despite such exemption from payment of stamp duty, a certificate proceeding was initiated against his client. Being noticed, the Petitioner filed Petition under Section 8 of the OPDR Act, 1962 denying liability. Without determining the said Petition under Section 9 of the said Act, 1962