IMPORTANT POINT
The principles of natural justice, particularly the right to be heard, are fundamental in administrative proceedings, especially when imposing financial liabilities such as additional stamp duty. The state must provide clear evidence to justify any claims of deficiency in stamp duty.

JUDGMENT :

(Hon’ble Shekhar B. Saraf, J.) :

1. The instant writ petition under Article 226 of the Constitution of India has been filed by Vinod Kumar Jain (hereinafter referred to as the ‘Petitioner’) assailing the order dated December 7, 2006 passed by the District Magistrate/Collector, Jhansi (hereinafter referred to as the ‘Respondent No. 2’).

FACTS

2. The facts giving rise to the instant writ petition are delineated below:

a. The Petitioner purchased certain plots of land vide a registered sale deed dated July 17, 2002 and the paid stamp duty on the same.

b. The name of the Petitioner was recorded in revenue records as bhumidhar with transferable rights.

c. After a period of three years from the date of execution of the sale deed, the Petitioner was served with a show cause notice dated January 7, 2005 which was based on an alleged inspection report dated December 4, 2004.

d. On the date fixed, that is on June 26, 2006, the authority concerned proceeded with the matter ex parte and passed an order on the same day imposing deficiency of stamp, penalty along with interest on the Petitioner. The Petitioner submitted an application on the same day before the authority concerned in order for his reply to be taken on record. However, the authority concerned rejected the said application saying that since the order has been passed, the reply will not be considered.

e. Aggrieved with the aforesaid order dated June 26, 2006 the Petitioner approached this Court by way of a writ petition which was dismissed by this Court on the ground that the Petitioner had an alternative efficacious remedy available.

f. Thereafter, the Petitioner preferred a revision application before the Respondent No.2 and deposited 1/3rd of the deficit amount as alleged by the Department. The said revision application was dismissed vide order dated December 7, 2006.

g. Aggrieved by the order dated December 7, 2006, the Petitioner has preferred the instant writ petition before this Court.

CONTENTIONS OF THE PETITIONER

3. Learned counsel appearing on behalf of the Petitioner has made the following submissions:

a. The nature of the land at the time of execution of the sale deed dated July 17, 2002 was agricultural and the same has been admitted by the Respondent No.2 in his order dated June 26, 2006.

b. The authorities concerned have treated the land as non-agricultural for the purposes of levying additional stamp duty. This too has been done after three years of the execution of the registered instrument without there being any material basis to do so or any exemplar to compare.

c. No notice was give to the Petitioner regarding the alleged spot verification. The same has also not been denied by the Respondents. The spot verification was not carried out as per Rule 7(3)(c) of the Uttar Pradesh Stamp (Valuation of Property) Rules, 1997 (hereinafter referred to as "the Rules"), which is mandatory.

d. As per Rule 7(3)(c) of the Rules, spot inspection has to be conducted after giving due notice to the parties to the instrument. While a spot inspection was conducted on January 4, 2004, no notice of the same was ever given to the Petitioner. After the said spot inspection, a show cause notice dated January 7, 2005 was issued to the Petitioner.

e. At the relevant point of time, the land in question was agricultural in nature and there were no structures or any activity apart from agriculture being carried out on the said land.

f. The Collector must have material on record to come to a finding as to the potential use of the land and only thereafter, assess the same on the basis of such potential use.

g. Spot inspection report does not disclose any material relied upon to come to the conclusion that the Petitioner's land is non-agricultural in nature.

h. Respondents do not dispute the fact that the Petitioner's land was being used only for agricultural purposes at the time of execution of the sale deed and also at the time of the alleged spot inspection.

CONTENTIONS OF THE RES