The High Court of Madhya Pradesh while quashing the order of the respondent authority directed the Authority to directed to refund the amount of INR 9,00,000 to the petitioner which was paid by him towards excess stamp duty in terms of proviso (c) to Article 25 of Indian Stamps Act, 1899 within a period of 6 months.
The petitioner company, Brilliant Foundation has earlier entered into an agreement to sell in respect of a plot for its use as an educational purpose for a consideration. Prior to that, an agreement of sale was executed between the parties. Due to deficit stamp duty paid under the said Agreement, the Collector of Stamps passed the order and directed the petitioner to pay a sum of INR 8,50,000 and also imposed a penalty of INR 50,000. In compliance with the said direction passed in order by the Collector of Stamps, the petitioner deposited a sum of INR 9,00,000.
The stamp duty paid on sale deed in pursuance to the agreement has not been refunded to the petitioner company. The petitioner already paid a sum of INR 8,50,000 being 1% stamp duty of the total sale consideration by virtue of the then-existing provision of Section 5(e)(ii) of the Indian Stamps Act, 1989 which was inserted and remained in the statute book. The amount of INR 8,50,000 was liable to be adjusted in the stamp duty payable on the sale deed executed by virtue of the provision when the petitioner applied for a refund of the amount was dismissed by the respondent authority.
The respondent contended that the amount of INR 8,50,000 can not be adjusted as there was no such option in the e-registration Sampada software.
The petitioner contended that the respondent authority erred in imposing a precondition of payment of Stamp Duty at the rate of 5% for availing benefit of Proviso (c) to Article 25. A bare perusal of Proviso (c) to Article 25 would reveal that no such pre-condition is imposed by the Legislature and therefore, the imposition of such precondition for adjustment on the Stamp Duty is not only arbitrary but also illegal and dehors the Statutory Provision, and thus, bad in law.
The Single judge bench of Justice Vandana Kasrekar while quashing the order of the respondent authority directed the Authority to directed to refund the amount of INR 9,00,000 to the petitioner which was paid by him towards excess stamp duty in terms of proviso (c) to Article 25 of Indian Stamps Act, 1899 within a period of 6 months.