State Should Not Ordinarily Rely On Technicalities While Dealing With A Citizen: SC Allows Refund Of Stamp Duty Paid Towards An Un-Executed Conveyance Deed

The Bench noted that the appellant had been “pursuing her remedies in law” and “was not lax” in her approach towards seeking a refund of the said stamp duty paid by her and yet she was denied the same only on the ground of limitation.

Justice B.R. Gavai and Justice Prashant Kumar Mishra observed, “Admittedly, the appellant being a bonafide purchaser is a victim of fraud played upon her by the vendor. She has paid a sum of Rs.25,34,400/- towards stamp duty for registration of conveyance deed. However, the conveyance deed was not lodged for registration as she become aware of the fraud played by the Vendor and thereafter, she immediately applied online on 22.10.2014 for refund of the stamp duty. Her effort to contact the vendor to execute a cancellation deed did not fructify immediately because of unavailability of the Vendor which Led to a police complaint and it is only at this point of time, due to intervention of the Police, the vendor could be traced, and a cancellation deed was executed.”

"When the State deals with a citizen it should not ordinarily rely on technicalities, even though such defences may be open to it", the court added.

AOR Narender Kumar Verma represented the appellant, while AOR Aaditya Aniruddha Pande appeared for the respondents.

The appellant had attempted to purchase a property. After paying the stamp duty, the appellant discovered that the property had already been sold to another party in 1992. The appellant applied online for a refund of the said amount as per Section 48 of the Maharashtra Stamp Act, 1958 (the Act) and filed a written application along with the documents.

The appellant’s case was rejected on the ground that the application filed by her was beyond the limitation period as per Section 48 of the Act. However, the Supreme Court noted that “the appellant being a bonafide purchaser was a victim of fraud played upon her by the vendor.”

The Bench directed the State to refund the stamp duty amount to the appellant, a victim of fraud in a property transaction. The Bombay High Court dismissed the appellant’s demand for a refund of Stamp Duty on technical grounds.

“The evidence required and enquiry to be made in terms of Section 47 of the Act is a separate process altogether and apropos circumstances for refund under Section 47 (c) [1] & [5] of the Act, evidence is not required to be filed along with the application- either the online application or separately on the same day by way of hard copy,” the Court clarified.

The Court held that case of the appellant was fit for refund of stamp duty as it was a settled position of law that “the period of expiry of limitation prescribed under any law may bar the remedy but not the right and the appellant is held entitled to claim the refund of stamp duty amount on the basis of the fact that the appellant has been pursuing her case as per remedies available to her in law and she should not be denied the said refund merely on technicalities as the case of the appellant is a just one wherein she had in bonafide paid the stamp duty for registration but fraud was played on her by the Vendor which led to the cancellation of the conveyance deed.”

Consequently, the Court held that the High Court erred in entertaining the petition and interfering with the recovery notice while exercising the extraordinary writ jurisdiction conferred under Article 226 of the Constitution.

Accordingly, the Supreme Court allowed the appeal.

Cause Title: Bano Saiyed Parwaz v. Chief Controlling Revenue Authority and Inspector General of Registration and Controller of Stamps & Ors. (Neutral Citation: 2024 INSC 443)

Appearance:

Appellant: AOR Narender Kumar Verma

Respondents: AOR Aaditya Aniruddha Pande; Advocates Siddharth Dharmadhikari, Bharat Bagla, Sourav Singh, Aditya Krishna, Preet S. Phanse and Adarsh Dubey

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