Court rules against arbitrary stamp duty valuation, orders refund with interest for petitioner Smt Raziya Kahtoon.
In a significant judgment, the Allahabad High Court at Lucknow Bench quashed the orders passed by the Collector, Barabanki, and the Deputy Commissioner, Faizabad Division, regarding stamp duty deficiency levied against Smt Raziya Kahtoon. The court ordered the refund of the amount deposited by the petitioner along with interest, highlighting procedural lapses and the reliance on ex-parte reports in determining the market value of the property.
The petitioner, Smt Raziya Kahtoon, had challenged the orders dated February 4, 2016, and May 24, 2017, which imposed a penalty and additional stamp duty on her land purchase. The High Court, presided by Justice Syed Qamar Hasan Rizvi, found that the valuation for stamp duty was improperly conducted based on an ex-parte inspection report without credible evidence.
The court emphasized the mandatory requirement under Rule 7(3)(c) of the U.P. Stamp (Valuation of Property) Rules, 1997, for a property inspection with due notice to the parties involved. The absence of such notice and the reliance on presumptions about future commercial use of the land rendered the valuation unsustainable.
Justice Rizvi pointed out that the determination of the property's market value must be based on its nature and use at the time of the sale deed's execution, not on hypothetical future uses. The state failed to provide any documentary evidence or comparable sale instances to support the claim of under-valuation.
The High Court further criticized the authorities for not adhering to the procedural requirements and for imposing penalties without substantial evidence. It ruled that the orders were based on irrelevant presumptions and lacked proper material assessment.
The judgment mandates the Collector, Barabanki, to refund the amount deposited by Smt Raziya Kahtoon within one month, with an interest of 6% per annum if delayed, reinforcing the importance of due process in administrative proceedings.
Bottom Line:
Determination of market value for stamp duty under Section 47A of the Indian Stamp Act, 1899 must be based on credible evidence and material, and cannot rely solely on ex-parte inspection reports or presumptions about future use of the property.
Statutory provision(s): Indian Stamp Act, 1899 Section 47A, U.P. Stamp (Valuation of Property) Rules, 1997 Rule 7(3)(c), U.P. Zamindari Abolition & Land Reforms Act, 1950 Sections 142 and 143.
Smt Raziya Kahtoon v. State of U.P, (Allahabad)(Lucknow) : Law Finder Doc Id # 2817578
