Hon’ble Prakash Krishna, J.—Bungalow known as ‘White House’ being House No. 15/71, Civil Lines Kanpur standing on plot Nos. 104, 104-A, 104-B, total area of about 14972 sq. yards was sought to be purchased by the present applicant, namely, Sri Ramesh Chandra Srivastava (now dead) and represented by his heirs and legal representatives from its owner namely Lucknow Diocesan Trust Association (L.D.T.A), duly incorporated under the Companies Act, for a sum of Rs. 1,50,000/-. On 5th May, 1960 the applicant and LDTA entered into registered agreement to purchase the aforesaid premises by means of a registered agreement to purchase. Applicant paid Rs. 5,000/- as earnest money for the aforesaid bungalow standing on lease hold property and there was a condition in the lease deed prohibiting alienation except with the sanction of the District Magistrate, and, therefore, an application for permission to sell the lease hold rights in favour of the applicant was moved. Requisite permission was granted by the District Magistrate on 27th August, 1970. The owner of the aforesaid property, for one reason or the other failed to execute the sale deed in pursuance of the aforesaid agreement, which led to the filing of Suit No. 207 of 1982 in the Court of 1st Addl. Civil Judge, Kanpur, for specific performance of the aforesaid sale agreement. The suit was decreed on 14th May, 1984 directing the vendors to transfer the said property as agreed upon by the sale agreement, within three months, failing which the Court will execute the sale deed. The Court as a matter of fact on the failure of the vendor (owner), executed sale deed on 3rd January, 1985. The said sale deed/sale certificate under signature of Civil Judge 1st Kanpur was sent for its registration to the Sub Registrar Kanpur, who in turn in exercise of power conferred on it under Section 47-A (1) of the Indian Stamp Act, 1899 (hereinafter referred to as the Act), referred it to the District Stamp Officer for determination of proper stamp duty on the aforesaid sale deed. It was registered as Stamp Case No. 87 of 1986.

2. In response to the show cause notice issued by the District Stamp Officer, the applicant took a stand that legally leviable stamp duty has been paid and affixed on the document, inasmuch as the sale deed in question was executed in pursuance of agreement to sell, dated 5th May, 1960, although sale deed was executed by the Court on 3rd January, 1985, but for the purpose of stamp duty, the sale consideration mentioned in the said sale agreement should be taken into account, market value of the premises in question prevailing on the date of execution of agreement to sell-alone is relevant, and the present market value of the property in question in the year 1985 is irrelevant.

3. The Assistant Commissioner Stamps, Kanpur, who received the file on transfer, vide order dated 18th March, 1991 rejected above contention of the applicant and found that the market value of the property in question should be determined with reference to the date of execution of the deed, i.e. on the basis of the prevailing circle rate (as fixed by the District Magistrate) applicable on the date of execution of the deed in question i.e. 3.1.1985. On that criterion, he calculated market value of the property at Rs. 48,91,040/- which required stamp duty of Rs. 5,13,607.50; after adjusting stamp duty already paid he detected deficiency in stamp duty to the tune of Rs. 4,97,857.50 and also imposed penalty of Rs. 2,20,142.50. Thus, by the order dated 18th March, 1991. the liability of Rs. Seven lac was created towards payment of deficit stamp duty and penalty.

4. The aforesaid order was challenged by way of Revision, under Section 56 (1) of the Act, before the Chief Controlling Revenue Authority i.e. Board of Revenue, Allahabad who in turn referred the matter after framing the following two questions of law under Section 57 (1) of the Act for determination to this Court. The questions referred to this Cou