Case Note & Summary
The petitioner, Nirmala Manherlal Shah, entered into an agreement for sale of immovable property in Mumbai. The agreement did not involve delivery of possession. The Superintendent of Stamps and other respondents demanded stamp duty treating the agreement as a conveyance under the Bombay Stamp Act, 1958. The petitioner challenged this demand by filing a writ petition in the Bombay High Court. The court examined the definitions under the Act, particularly 'conveyance' under Section 2(g) and 'instrument' under Section 2(l). It noted that an agreement for sale without possession does not transfer any interest in property and thus cannot be treated as a conveyance. The court relied on the principle that stamp duty is chargeable on the instrument as per its true character. The court held that the agreement was chargeable only under Article 5 (Agreement) and not under Article 25 (Conveyance). Consequently, the court allowed the petition, quashed the demand, and directed the respondents to refund any amount collected, if any, with interest.
Headnote
A) Stamp Duty - Agreement for Sale - Conveyance - Bombay Stamp Act, 1958, Sections 2(g), 2(l), Article 25, Article 5 - The petitioner entered into an agreement for sale of immovable property without delivery of possession. The Stamp Authorities demanded stamp duty as a conveyance. The Court held that an agreement for sale simpliciter, without possession, does not fall within the definition of 'conveyance' under Section 2(g) and is chargeable only under Article 5 (Agreement) and not Article 25 (Conveyance). The demand was quashed. (Paras 2-5)
Issue of Consideration
Whether an agreement for sale of immovable property without delivery of possession is chargeable to stamp duty as a conveyance under the Bombay Stamp Act, 1958.
Final Decision
The court allowed the writ petition, quashed the demand for stamp duty as conveyance, and directed the respondents to refund any amount collected with interest.
Law Points
- Stamp duty
- Agreement for sale
- Conveyance
- Bombay Stamp Act
- 1958
- Section 2(g)
- Section 2(l)
- Article 25
- Article 5
