Period of Limitation for cases covered u/s 49(a) of Stamp Act is Six Months from Date on which Stamp Paper was Spoiled: Delhi HC directs to Refund 90% of Stamp Duty [Read Order]

The Delhi High Court directed to refund 90% of stamp duty and observed that period of limitation for cases covered under Section 49(a) of the Stamp Act, 1899 is six months from date on which stamp paper was spoiled.

The petitioner, Ramesh Chandra Kalra has filed the present petition being aggrieved by the order dated 12.02.2019 whereby, his application for refund of stamp duty (E-stamp Certificate) for an amount of ₹15,00,000/- was rejected on the ground that the same was filed beyond the period of six months from the date of its purchase. In the aforesaid context, the petitioner impugns Section 50(2) of the Indian Stamp Act, 1899 as being ultra vires Articles 14 and 265 of the Constitution of India. The petitioner also impugned Section 54(c) of the Stamp Act as ultra vires to Article 14 of the Constitution of India.

The petitioner claimed that withholding of refund of stamp duty violates Article 265 of the Constitution of India as it amounts to exacting tax without authority of law. The petitioner rests his case on the decision dated 18.03.2019 of a Coordinate Bench of this Court in Govt. of NCT of Delhi & Anr. v. Dr. Poornima Advani & Anr.

It was contended on behalf of the petitioner that since stamp paper had not been used for engrossing the Agreement – the purpose for which it was purchased – the amount of stamp duty is required to be refunded notwithstanding that the application has been filed beyond the period of six months from the date of purchase of the same.

A Division Bench of Justices Vibhu Bakhru and Amit Mahajan observed that “The period of limitation for cases covered under Section 49(a) of the Act would be six months from the date on which the stamp paper was spoiled. No enquiry as to when the stamp paper was spoiled was undertaken by the respondents. However, the petitioner’s contention that the stamp paper had been marked just prior to making an application for refund is also not seriously contested. It must, therefore, be accepted.”

“In view of the above, we consider it apposite to dispose of the present petition by directing the respondents to refund 90% of the stamp duty, that is ₹13,50,000/-, along with interest, at the rate of 6% per annum, from the date of application till the date of payment. It is so directed” the Court concluded.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates