Stamp Duty Leviable Only When Agreement To Sell Is Followed By Delivery Of Possession In State Of Punjab – SC Confirms
A Supreme Court Bench of Justice MR Shah and Justice Krishna Murari heard an appeal against an order passed by the Punjab and Haryana High Court by which the High Court had dismissed a Revision Petition preferred by the Appellant and confirmed an order directing the Appellant to pay a deficit stamp duty along with penalty.
Setting aside the order of the High Court, the Supreme Court observed that "As per Entry No. 5 (cc) of Schedule 1-A applicable under the State of Punjab, "in the case of agreement to sell followed by or evidencing delivery of possession of the immovable property agreed to be sold", the stamp duty is leviable under Column No. 2 of Entry No. 23 of Schedule 1-A. As observed hereinabove, the plaintiff was already in possession prior to the execution of the aforesaid agreements as per the recitals in the aforesaid two agreements. It is to be noted that even the plaintiff has also not sought the possession in the suit filed by him and has in fact sought the permanent injunction restraining the defendants from interfering in the peaceful possession of the plaintiff and from dispossessing or causing to dispossess the plaintiff from the suit property."
Bakshi & Associates appeared for the Appellant. Although served, no one appeared on behalf of the Respondents.
In this case, the Appellant instituted a Civil Suit before the Trial Court for specific performance of a Memorandum of Agreement and the agreement to sell, with regard to the suit land.
In the suit, the Trial Court passed an order directing the Appellant to pay the deficient stamp duty as leviable under Sub-column No. 2 of Column No. 2 of Entry No. 23 of Schedule 1-A. In this regard, the Trial Court observed that as per Schedule 1-A, Entry No. 5 with respect to Memorandum of Agreement or Agreement to Sell followed by or evidencing delivery of possession of the immovable property agreed to be sold, the stamp duty shall be leviable under Sub-column No. 2 of Column No. 2 of Entry No. 23 of Schedule 1-A as amended by the State of Punjab.
Aggrieved by the order passed by the Trial Court, the Appellant preferred a Civil Revision Petition before the High Court. The High Court dismissed the Petition.
Hence, the Appellant approached the Supreme Court.
Going through the Memorandum of Agreement and Agreement to Sell, the Supreme Court opined that the possession had not been delivered under the agreements and that the Appellant was already in possession prior to executing the agreements.
Further, the Court noted that the Appellant had not sought possession in the suit filed by him, and had only sought a permanent injunction restraining the defendants from interfering with his peaceful possession of the suit land, and from dispossessing or causing to dispossess the Appellant from the suit land.
Therefore, the Court held that Entry No. 5 of Schedule 1-A of the Indian Stamp Act as amended by the State of Punjab would not be applicable. To that end, the order passed by the High Court and the Trial Court was held unsustainable and set aside.
Cause Title - Vikay Kumar Goel (Dead) Thr L.R. v. Neena Rani & Ors.