The agreement of sale related to house property is chargeable under Article 6-B of the Indian Stamp Act, 1899, and the imposition of stamp duty and penalty was lawful.

ORDER :

N.V. Shravan Kumar, J.

This writ petition has been filed seeking the following prayer:-

“to declare the impugned Orders in Proceedings No. 3722/E/Val/2015 dated 14.03.2016 issued by the 3^rd respondent levying the stamp duty of Rs.13,500/- @ 5% on the agreement of sale/receipt dated 22.05.1996 under Article 6-B of Schedule-1A of Indian Stamp Act, 1989 and imposing the penalty @ 3 times i.e., Rs.40,500/- and directing the petitioner to pay a total amount of Rs.54,000/- towards deficit stamp duty and penalty as illegal, arbitrary and violation of principles of natural justice violation of Article 14 of Constitution of India and violation of Provisions of Indian Stamp Act, 1899 and consequently set-aside the said impugned Orders and further direct the 3^rd respondent to collect deficit stamp duty and penalty as per Article 6(A)(iv) of Schedule 1-A of Indian Stamp Act, 1899 from the petitioner,.”

2. Facts rising to file this writ petition briefly are that the petitioner submits that he intended to purchase residential house bearing No.5-74/C, admeasuring 183.3 Sq.yards, situated at Income Tax Colony, Kothapet, Uppal Revenue Mandal, Ranga Reddy District (hereinafter referred as ‘subject property’). The said property was owned by respondent No.5 and since the respondent No.5 was minor, his father i.e., respondent No.4 agreed to sell the said house to the petitioner. Thereafter, petitioner paid an advance amount of Rs.50,000/- and receipt dated 22.05.1996 was issued on white paper to the petitioner.

3. Learned counsel for the petitioner submitted that the petitioner paid total sale consideration of Rs.2,70,000/- in instalments and the last instalment was paid on 18-10-1996. Thereafter, respondent Nos.4 and 5 for an extent of 170 Sq.yards out of 183.3 Sq.yards, executed sale deed in favour of petitioner’s wife. It is further submitted that the petitioner for balance extent of land admeasuring 13.3 Sq.yards had paid additional amount of Rs.85,000/- to respondent No.4. However, respondent Nos.4 and 5 did not come forward for registration of balance extent of land. Hence, the petitioner on 17.07.2001, issued legal notice to respondent Nos.4 and 5 and when there was no response from the respondent Nos.4 and 5, petitioner filed suit for specific performance i.e., O.S.No.1510 of 2003 on the file of Prl.Junior Civil Judge, East and North, Ranga Reddy District and the same was transferred to II Additional Junior Civil Judge, Ranga Reddy District, L.B.Nagar.

4. Learned counsel for the petitioner submitted that the petitioner in the said suit filed a petition seeking to send the original receipt/agreement of sale dated 22.05.1996 to respondent No.3 for impounding the same for collecting deficit stamp duty with penalty and the trial Court on 19.11.2014 has sent the original receipt/agreement of sale to respondent No.3. Thereafter, respondent No.3 issued show cause notice dated 24.02.2016 stating ‘to show reasons why maximum penalty of ten times to the deficit stamp duty cannot be levied for this instrument’. Thereafter, petitioner submitted detail explanation on 08.03.2016, stating the following:-

“3. I submit that the suit agreement of sale dated 22-05- 1996 is a non-possessory agreement of sale. I submit that every non-possessory agreement of sale relating to immovable property is to be executed on a non-judicial stamp of Rs.100/- under Article 6(A) (iv) of Schedule 1-A of Stamp Act. Since the agreement of sale dated 22-05-1996 is executed on a white paper, the District Registrar has got authority to collect proper stamp duty of Rs.100/- together with penalty amount not exceeding ten times the amount of the proper stamp duty.

4. I submit that the District Registrar has power to collect the deficit stamp duty o