Case Note & Summary
The petitioner, Mahesh Padmakar Jagtap, entered into an Agreement to Sale on 11 June 2009 for purchase of a flat for a total consideration of Rs.18,50,000/- and paid stamp duty of Rs.95,100/-. The agreement was registered. However, on 15 March 2010, the parties mutually cancelled the agreement due to disputes and the petitioner's inability to arrange finance for the balance consideration. A cancellation deed was registered on the same day. On 26 April 2010, the petitioner applied for refund of the stamp duty paid. The original authority (Joint District Registrar) and the appellate authority (Chief Controlling Revenue Authority) rejected the application on the ground that it was not made within six months from the date of the instrument (the agreement to sell) as required under Section 48(1) of the Bombay Stamp Act, 1958. The petitioner challenged these orders by way of a writ petition before the Bombay High Court. The court examined Section 48(1) as it stood at the relevant time, including the proviso and the amendment by Mah.5 of 2010 which came into effect on 12 April 2010. The court noted that the main provision of Section 48(1) requires an application to be made within six months of the date of the 'instrument'. The term 'instrument' is defined under Section 2(l) to include any document by which any right or liability is extinguished. Since the cancellation deed extinguished the rights and liabilities under the agreement, the court held that the six-month period should be counted from the date of the cancellation deed (15 March 2010), and the application made on 26 April 2010 was within that period. Alternatively, the court considered the proviso as amended by Mah.5 of 2010, which extended the time limit to two years from the date of registered cancellation deed if the cancellation was on grounds of dispute, inadequate finance, etc. Since the six-month period had not expired when the amendment came into force, the court held that the amended proviso applied and the application was within time. Further, the court observed that even under the first proviso (prior to amendment), the petitioner's case would fall within the exception of refusal to deliver possession, as the seller would not deliver possession without full payment. The court quashed the impugned orders and directed the respondents to refund the sum of Rs.95,100/- to the petitioner within four weeks, with permissible deductions.
Headnote
A) Stamp Duty - Refund - Time Limit - Section 48(1) Bombay Stamp Act, 1958 - Application for refund of stamp duty paid on an agreement to sell which was subsequently cancelled - The court held that the application made within six months from the date of cancellation deed is within the main provision of Section 48(1), as the cancellation deed extinguishes rights and liabilities and qualifies as an 'instrument' under Section 2(l). (Paras 8-9) B) Stamp Duty - Refund - Amendment - Mah.5 of 2010 - Section 48(1) proviso - Where the cancellation deed is on grounds of dispute or inadequate finance, the application may be made within two years from the date of registered cancellation deed - The court held that since the six-month period had not expired when the amendment came into force, the amended proviso applied, and the application was within time. (Para 9) C) Stamp Duty - Refund - Proviso - Refusal to Deliver Possession - Section 48(1) first proviso - Where the seller refuses to deliver possession due to non-payment of full consideration, the application may be made within two years from the date of instrument - The court held that the petitioner's inability to arrange finance and disputes between parties would fall within this proviso, as the seller would not deliver possession. (Para 10)
Issue of Consideration
Whether the application for refund of stamp duty was made within the time limit prescribed under Section 48 of the Bombay Stamp Act, 1958, considering the amendment by Mah.5 of 2010 and the date of cancellation deed.
Final Decision
The impugned orders dated 22 December 2010 and 2 May 2014 are quashed and set aside. Respondents are directed to refund a sum of Rs.95,100/- to the petitioner within a period of four weeks from the date of uploading the present order, with permissible deductions, if any, in accordance with law. Rule made absolute.
Law Points
- Interpretation of Section 48(1) of the Bombay Stamp Act
- 1958 (Maharashtra Stamp Act)
- time limit for refund application
- effect of amendment by Mah.5 of 2010
- definition of 'instrument' under Section 2(l)
- application of proviso for cancellation due to disputes or inadequate finance
