The Bombay High Court has held that the fiscal l is is not an adversarial proceeding but if a particular person is entitled to refund, since he has paid the excess tax then certainly the State cannot retain it. Therefore, the belated application made by the petitioner for refund of the stamp duty is required to be considered on merits by condoning the delay in making the application.
The bench of Justice K. R. Shriram and Justice Jitendra Jain has observed that retention of stamp duty of the amount of Rs.78,65,000/- would be contrary to Article 265 and 300A of the Constitution of India. Therefore, the petition can be treated as an application under Section 5 of the Limitation Act and accepting the reason for the delay, the petition is required to be allowed by condoning the delay in making the refund application.
The petitioner/assessee entered into a development agreement. The stamp duty of Rs.78,65,000 has been paid by way of challan. The deed has been registered. A supplementary agreement was entered into by Petitioner and on payment of stamp duty of Rs.300 and registration fees of Rs.1,720, the supplementary agreement was registered.
The parties decided to cancel the development agreement and it was agreed that instead, the Keshav Krishanlal Syngal would convey the property to Petitioner for valuable consideration. Accordingly, Petitioner and Keshav Krishanlal Syngal executed a cancellation deed for cancelling the development agreement. The cancellation deed has been registered.
The Petitioner and Keshav Krishanlal Syngal entered into conveyance deed also executed on 25th June 2015 by which the property was conveyed to Petitioner. On the conveyance deed, Petitioner has paid stamp duty of Rs.1 crore and the conveyance deed is registered vide registration No.BDR1-5757-2015 dated 26th June 2015.
The petitioner filed an application for refund of the stamp duty paid on the development agreement and the application was filed seeking refund of Rs.78,65,000 paid on the development agreement that was cancelled.
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The application for refund has been filed 2 years, 7 months and 20 days late from the date of registration. The application should have been made within 6 months from the date of registration of the cancellation agreement and since it was not so filed the order came to be passed rejecting the application.
The petitioner contended that as a consequence of cancellation of the development agreement on which the Government had collected stamp duty amounting to Rs.78,65,000/- and then on execution of conveyance deed between the same parties, State has collected stamp duty amounting to Rs.1 crore. This would in effect mean, the Government has collected stamp duty twice on the same property / plot and on transaction between the same parties. The Government is entitled to only Rs.1 crore that has been paid on the conveyance deed and if the refund is not granted by the State it would amount to unjust enrichment and if the refund is granted no loss would be caused to the Government.
Section 48 of the Stamp Act provides an outer limit of 6 months to make the application from the date of instruments, it does not say that applications made beyond the period 6 months will not be entertained. In the Stamp Act, there is no provision conferring power of condonation to the authority under the Act or any provision which states that power of condonation cannot be exercised after the extended period of limitation.
The court analysed the Stamp Act and found that there is no provision which excludes applicability of Section 5 of the Limitation Act, 1963 to the Stamp Act and more particularly in Section 48 which provides for time limit for making the application for refund of stamp duty. The authority constituted under the Stamp Act does not have the power to condone the delay if the application is made beyond the time specified in Section 48 Act. The petition is filed under Article 226 of the Constitution of India for seeking condonation of delay in making an application for refund of the stamp duty. There is no dispute that Petitioner is entitled to apply for the refund under consideration, but the only ground of the denial of the refund is the delay on the part of Petitioner in making the refund application.
The court condoned the delay in filing the application for refund. The authorities will decide the application for refund of the stamp duty of Rs.78,65,000 that was paid on the development agreement.
Case Title: Nanji Dana Patel Versus State of Maharashtra
Case No.: Writ Petition No.1897 Of 2019
Date: 27/08/2024
Counsel For Appellant: Bernardo Reis
Counsel For Respondent: Shahaji Shinde
