2024 INSC 443 1

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. OF 2024

(arising out of SLP (C) No. 4111 of 2020)

BANO SAIYED PARWAZ …. APPELLANT

VERSUS

CHIEF CONTROLLING REVENUE

AUTHORITY AND INSPECTOR

GENERAL OF REGISTRATION

AND CONTROLLER OF STAMPS & ORS. ...RESPONDENTS

J U D G M E N T

PRASHANT KUMAR MISHRA, J.

Leave granted.

2. The instant appeal is directed against the judgment and

order impugned dated 02.08.2019 passed by the High Court of

Judicature at Bombay in Writ Petition No. 281 of 2019 whereby

the High Court, dismissed the appellant’s demand for refund of

Stamp Duty paid towards an un-executed conveyance deed. In

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effect, the impugned order has upheld the orders of respondent

nos. 1 and 2 dated 09.06.2015 & 25.02.2016 rejecting the

aforesaid demand of the appellant.

3. Briefly stated, the facts of the matter are that the appellant

agreed to purchase the property bearing C.T.S. No.340.340/1 to

340/14 of Kurla-1 Division situated lying and being Fitwalla

Cottage, Fitwalla Compound Bazaar Ward, Old Agra Road, Kurla

(West), Mumbai-400070 from the Vendor - Mohammed Hanif

Ahmed Fitwala and to that effect, they prepared a deed of

conveyance which was sent for adjudication to respondent no.1

on 07.05.2014 for payment of stamp duty, which was assessed

at Rs. Rs.25,34,350 (Rupees Twenty-Five Lakhs Thirty-Four

Thousand Three Hundred Fifty Only). Accordingly, the appellant

paid this sum and purchased the stamp duty on 13.05.2014 for

registration of conveyance deed.

4. Albeit, the stamp duty was paid by the appellant to

respondent no.1 on 13.05.2014, said conveyance deed was not

lodged for registration as the vendor of the appellant by playing

fraud on the appellant had earlier sold the said property to a

third party in 1992. However, before executing the said

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conveyance deed, the appellant had given a public notice but

nobody objected to the said transaction. Thereafter, in view of

these facts, the appellant decided to cancel the said transaction,

for which he tried to contact the said vendor but he was not

available, compelling the appellant to file a complaint with the

Police Authority. Thereafter, the Vendor execute d the

cancellation deed on 13.11.2014. However, the appellant had on

22.10.2014 already applied online for refund of the said amount

as per Section 48 of the Maharashtra Stamp Act, 1958

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and had

filed written application on 06.12.2014 along with the

documents. The appellant’s case was rejected by respondent

nos.1 & 2 on the ground that the application filed by her was

beyond the limitation period as per Section 48 of the Act.

5. The learned counsel for the appellant submits that the

appellant’s case is squarely covered within the circumstances

laid down in Section 47 (c) [1] and [5] of the Act and Rules 21

and 22A of the Bombay Stamp Rules, 1939

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which read as

under:

“47. (c) the stamp used for an instrument executed by any party

thereto which—

1. ‘Act’

2. ‘Rules’

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(1) has been afterwards found 1[by the party] to be

absolutely void in law from the beginning; 2[1A] has been

afterwards found by the Court, to be absolutely void from the

beginning under section 31 of the Specific Relief Act, 1963;

***

(5) by reason of the refusal of any person to act under the

same, or to advance any money intended to be thereby

secured, or by the refusal or non-acceptance of any office

thereby granted, totally fails of the intended purpose;”

“21. Evidence as to circumstances of claim to refund or

renewal.

The collector may require any person claiming a refund or

renewal under chapter v of the Act, or his duly authorized

agent, to make oral deposition oath or affirmation, or to file

an affidavit, setting forth the circumstances under which

the claim has arisen, and may also' if he thinks fit, call for

the evidence of witnesses in support of the statement set

forth in any such deposition or affidavit.

NOTES

Claim for refund of stamp duty.

Under rule 21 where a claim for refund of stamp duty is

made, the procedure laid down under the rule to take

evidence by the Collector. Accordingly, the Collector may

direct any person claiming a refund under Chapter v to

make an oral deposition on oath or affirmation or to file an

affidavit, setting forth the circumstances under which the

claim has arisen and if he thinks fit call all evidence of

witnesses in support of the statement set forth in any such

deposition or affidavit. Rule 22A deals with matters relating

deducting to deduction to be made from the amount of

spoiled or misused or unused stamps. The word “spoiled

stamps” is not expressly defined either in the Act or in the

Rules but Section 47 describe instances of such spoiled

stamps for the purpose of claiming refund.

22A, Rule of deduction from the amount of stamps,

allowance for spoiled, misused or unused etc.

When any person is in possession of –

(a) spoiled stamps, under section 47, misused stamps under

section 50, or printed forms on- stamped paper no longer

required under section 49 and he applies to the collector for

making allowance in respect or the same.

(b) a stamp or stamps which have not been spoiled or

rendered unfit or useless for the purpose intended, but, for

which he has no immediate use and he delivers up the same

to the collector for cancellation, then the collector may, give

in lieu thereof may repay to such person, the same, value in

money of such stamp or stamps or printed forms on stamped

papers, after deducting rupees ten for each stamp or printed

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form on stamped paper or amount equal to (ten per cent) of

the value of such stamp or such printed form, whichever is

more”.

6. The learned counsel for the appellant further submitted that

the law of refund embodied in Sections 47 and 48 of the Act and

Rules 21 and 22A of the Rules, envisages two separate and

distinct stages for refund of stamp duty i.e., i) making of

application for refund within six months and ii) holding of enquiry

and leading of evidence as per Rules made by the State

Government, to satisfy the Collector that case of refund is

covered by one or more of the circumstances (a) (b) and (c) [1]

to [8] set out in Section 47 of the Act.

7. The learned counsel for the appellant would further submit

that the respondent no. 2 and the High Court as well

misconstrued the provisions of Sections 47 & 48 of the Act and

has also overlooked Rules 21 and 22A of the Rules. In as much

as, the appellant’s application was within time and the same

could not have been rejected as barred by limitation.

8. Per contra, the learned counsel for the respondents

vehemently opposed the present appeal and submitted that in

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the present proceeding though the appellant filed application for

refund of stamp duty on 22.10.2014, but the cancellation deed

executed between the appellant and the seller of the said

property was dated 13.11.2014 i.e., beyond the limitation period

of six months from the date of purchase of stamp duty, after

cancellation of those documents, as prescribed under Section 48

of the Act. As per Section 48 of the Act, the last date for applying

for the refund was 12.11.2014, therefore, the application filed

by the appellant was beyond the period of limitation.

9. We have heard both the counsel for the parties and perused

the pleadings.

10. 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

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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 on 13.11.2014.

11. From the above admitted facts, prima facie it appears that

the appellant herein was pursuing her remedies in law and she

was not lax in her approach towards seeking refund of the said

stamp duty paid by her and she has been denied the same only

on the ground of limitation.

12. The finding returned by the High Court in the impugned

order that the appellant’s application for refund dated

22.10.2014 is not maintainable in law as it has been filed before

the cancellation of the conveyance deed dated 13.11.2014 is

misplaced in so far as while submitting the online application

there was no caution to the appellant that all of the documents

and materials for the satisfaction of the Collector should be filed

with the application- either online or hard copy- itself and the

finding of the learned single judge is contrary to the

requirements stipulated by Sections 47 & 48 which envisages

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only the application for relief under Section 47 of the Act to be

made within six months of the date of the instrument which

prima facie is appeared to have been done by the appellant in

the present case.

13. 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.

14. In Committee-GFIL v. Libra Buildtech Private Limited

& Ors.

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, wherein the issue of refund of stamp duty under the

same Act was in question, this Court has observed and held inter

alia as under:

“29. This case reminds us of the observations made by M.C.

Chagla, C.J. in Firm Kaluram Sitaram v. Dominion of

India [1953 SCC OnLine Bom 39 : AIR 1954 Bom 50] . The

learned Chief Justice in his distinctive style of writing observed

as under in para 19: (Firm Kaluram case, SCC OnLine Bom)

“19. … we have often had occasion to say that when the State

deals with a citizen it should not ordinarily rely on

technicalities, and if the State is satisfied that the case of the

citizen is a just one, even though legal defences may be open

3. (2015) 16 SCC 31

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to it, it must act, as has been said by eminent Judges, as an

honest person.”

We are in respectful agreement with the aforementioned

observations, as in our considered opinion these observations

apply fully to the case in hand against the State because

except the plea of limitation, the State has no case to defend

their action.

xxx xxx xxx

32. In our considered opinion, even if we find that applications

for claiming refund of stamp duty amount were rightly

dismissed by the SDM on the ground of limitation prescribed

under Section 50 of the Act yet keeping in view the settled

principle of law that the expiry of period of limitation

prescribed under any law may bar the remedy but not the

right, the applicants are still held entitled to claim the refund

of stamp duty amount on the basis of the grounds mentioned

above. In other words, notwithstanding dismissal of the

applications on the ground of limitation, we are of the view

that the applicants are entitled to claim the refund of stamp

duty amount from the State in the light of the grounds

mentioned above.”

15. The legal position is thus settled in Libra Buildtech (supra)

that when the State deals with a citizen it should not ordinarily

rely on technicalities, even though such defences may be open

to it.

16. We draw weight from the aforesaid judgment and are of the

opinion that the case of the appellant is fit for refund of stamp

duty in so far as it is settled 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

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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.

17. For the foregoing reasons, the appeal is allowed, and we

set aside the impugned order dated 02.08.2019 as well as orders

of respondent nos.1 and 2 dated 09.06.2015 and 25.02.2016

and direct the State to refund the said stamp duty amount of Rs.

25,34,400/- deposited by the appellant.

…………………………………….. J.

(B.R. GAVAI)

.......………………………………. J.

(PRASHANT KUMAR MISHRA)

NEW DELHI;

May 17, 2024.