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GUJARAT HIGH COURT
Rajesh H. Shukla, J
Sarabhai Piramal Pharmaceuticals Ltd – Appellant
Versus
Collector and Additional Superintendent of Stamps – Respondent
SPECIAL CIVIL APPLICATION NO. 1255 of 2001
For the Appellants/Petitioners: Mihir Thakore, Sandeep Singh
For the Respondents: Bharat Vyas
Stamp duty jurisdiction for the assignment of trademarks is determined by the place of registration. Authorities in one state cannot impound instruments executed and registered in another state, especially when statutory procedures for impounding registered documents are ignored.
Headnote:(A) Stamp Act, 1958 - Sections 3, 33, 33A and 68 - Constitution of India - Articles 14, 226 and 300A - Impounding of documents - Assignment of Trademarks - Territorial jurisdiction - The deed of assignment of trademark was executed and registered at Bombay on payment of stamp duty - For the purpose of intellectual property like trademarks, the situs is determined by the place of registration under the Trade Mark Act - Where the trademark is registered at Bombay, the authorities in the State of Gujarat lack territorial jurisdiction to levy stamp duty or impound the instrument under the Stamp Act as applicable to Gujarat, as nothing further is required to be done in the State of Gujarat to complete the transfer. (Paras 5, 11)
(B) Procedure for Impounding - Section 33A of Stamp Act, 1958 - When an instrument is registered under the Registration Act, 1908, it is the Registering Officer who has the authority to call for the instrument, record reasons in writing, and impound it after giving the party an opportunity of hearing - A Sales Tax Officer visiting premises for inquiry cannot bypass this procedure to impound a registered document. (Paras 4, 11)
(C) Writ Jurisdiction - Maintainability - Where an executive authority acts without jurisdiction, causing harassment and lengthy proceedings, the High Court under Articles 226 and 227 of the Constitution of India is obligated to set aside such orders, regardless of the availability of an alternative statutory remedy. (Paras 9, 12)
Facts of the case:
The petitioner challenged the action of the Respondent (Collector and Additional Superintendent of Stamps) in impounding Deeds of Assignment of trademarks dated 3rd October 1997 and 19th October 1999. These deeds were executed and registered in Bombay. The documents were impounded by a Sales Tax Officer during an inquiry in Gujarat, leading to notices and orders demanding differential stamp duty on the basis that the product was manufactured in Gujarat.
Findings of Court:
The court found that trademarks do not have a physical situs in the traditional sense and the relevant situs for stamp duty purposes is the place of registration. Since the registration occurred in Bombay, the Gujarat authorities had no jurisdiction. Furthermore, the impounding was procedurally flawed as it was conducted by a Sales Tax Officer instead of the Registering Officer as mandated by Section 33A of the Stamp Act.
Issues: Whether the stamp authorities in Gujarat had territorial jurisdiction over trademarks registered in Bombay and whether the impounding of the registered deed by a Sales Tax Officer was procedurally legal.
Ratio Decidendi: The court ruled that the situs of a trademark is the place of its registration; therefore, a document executed and registered outside Gujarat is not chargeable under the Gujarat Stamp Act if no further act is required within the state. Additionally, the statutory procedure for impounding registered documents must be strictly followed by the authorized Registering Officer.
Result: Petition allowed.
ORAL JUDGMENT
1. The present petition has been filed by the petitioner under Articles 14, 300A and 226 of the Constitution of India for the following prayers :
A) This Hon’ble Court may be pleased to issue a writ of or a writ in the nature of Mandamus and/or a writ of or writ in the nature of Certiorari and/or any other appropriate writ, direction or order to quash and set aside :
(i) the impugned action of the Respondent of impounding the instruments, namely the Deeds of Assignment dated 3rd October, 1997 and 19th October, 1999 at Annexure “A” (colly) hereto;
(ii) the impugned Notices dated 23rd November, 2000 at Annexure “B” (colly) hereto and;
(iii) the impugned orders dated 17th January, 2001 passed by the Respondent, at Annexure “C” (colly) hereto;
B) Pending the hearing and final disposal of this Petition, this Hon’ble Court may be pleased to stay the operation and implementation of the impugned orders at Annexure “C” (colly) hereto;
C) Pending the hearing and final disposal of this petition, this Hon’ble Court may be pleased to restrain the Respondent, his officers and agents from initiating any coercive measures for recovery of the alleged differential stamp duty and/or penalty as demanded by the Respondent in the impugned orders at Annexure “C” (colly) hereto.
D) Ex-parte ad-interim stay in terms of prayers (B) and (C) may kindly be granted;
E) Any other relief that this Hon’ble Court may deem fit may be granted.
2. Learned senior counsel, Shri Mihir Thakore appearing with learned counsel, Shri Sandeep Singhi for Singhi & Co. for the petitioners referred to the papers and submitted that show cause notice and impounding of the document in purported exercise of powers under Section 33 read with Section 7(3) of the Stamp Act, 1958 as applicable to the Gujarat is bad and illegal. Learned senior counsel, Shri Thakore referred to the papers and submitted that as per deed of assignment of trademark dated 3rd October, 1997, assignment of the trademark has been made for which the registration has been made at the office at Bombay upon payment of stamp duty. Learned senior counsel, Shri Thakore submitted that the document has been impounded as per the order dated 17.01.2001 produced at Annexure-C in purported exercise of power under Section 7(3) read with Section 33 of the Stamp Act for the alleged deficit of stamp duty. He submitted that the notice at Annexure-B dated 23.11.2000 was issued under Section 39(1)(b) of the Stamp Act, pursuant to which, the document has been impounded and a close look at the notice would clearly suggest that nowhere in the notice, it has been mentioned that the document is required to be impounded. Learned senior counsel, Shri Thakore submitted that as could be seen from the deed of assignment, it is evident that deed of assignment dated 3rd October, 1997 is not executed or registered in Gujarat and since it is regarding the assignment of the trademark, it will not have any situs. Learned senior counsel, Shri Thakore therefore submitted that situs of said property would be at a place where such document is registered before the authority like Bombay in the present case. He submitted that deed of assignment of trademark has been duly registered on payment of stamp duty and, therefore, the respondent no.1 has no jurisdiction whatsoever. Learned senior counsel, Shri Thakore submitted that same was replied that considering the definition of ‘conveyance’ as provided in Section 2(g) of the Stamp Act, it includes movable and immovable property. The movable property as defined in Section 2(pa) of the Stamp Act provides as under :-
““Movable property” includes standing timber, growing crops and grass, fruits upon and juice in trees and property of every other description, except immovable property, by which any right or liability is or is purported to be created, transferred, limited, extended, extinguished or recorded.”
3. Learned senior counsel, Shri Thakore therefore submitted that immovable includes
