IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE ELEVENTH DAY OF SEPTEMBER TWO THOUSAND AND NINE PRESENT THE HON'BLE SRI JUSTICE C.V.RAMULU WRIT PETITION NO : 17907 of 2008 Between: S. Balaswamy, S/o. Late S. Venkataswamy, R/o. Kothakota Village and Mandal, Mahabubnagar District. ..... PETITIONER AND The District Collector, Mahabubnagar District at Mahabubnagar. .....RESPONDENT Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to issue a Writ of Mandamus or any other appropriate Writ or Order or Direction, declaring the Proceedings dt. 22-4-2008 in NO. F3/687/08 and the Order dt. 21-6-2008 in NO. F3/687/08 on the file of the Respondent herein, as illegal, and arbitrary, by directing the respondent to consider the matter afresh and treat the document in question under Art 6(1)(d) of schedule I-A of the Indian Stamp Act, 1889, or in the alternative, quash the impugned orders dt. 22-4-2008 and 21-6-2008 iin No. F3/687/08 on the file of the Respondent to the extent of imposing penalty of 10 times value of deficit stamp duty i.e., Rs. 4,66,500/- Award costs. Counsel for the Petitioner:MR.N.SRIDHAR REDDY Counsel for the Respondent: GP FOR REVENUE The Court made the following : THE HON’BLE SRI JUSTICE C.V.RAMULU W.P.No. 17907 of 2008 O R D E R: It appears, the petitioner has purchased the land to an extent of Ac.6-00 in Sy.Nos.547/AA and 546/AA of Kothakota village and Mandal, Mahaboobnagar District, under an agreement of sale dated 11.3.2005. When the vendors have gone back, he has filed a suit for specific performance in O.S. No. 8 of 2007 on the file of learned Senior Civil Judge, Wanaparthy. During the course of trial, when the agreement dated 11.3.2005, under which possession was delivered to the petitioner, was sought to be marked, the defendants have taken objection stating that it was not properly stamped and there was deficiency of stamp duty. Therefore, under Section 33 of the Stamp Act the learned Senior Civil Judge referred the matter to the District Collector to decide as to the deficiency of the stamp duty under Section 40 of the Act for impounding the document and fixing penalty, if any. On such reference, the District Collector impounded the document and passed an order dated 22.4.2008 to that effect by fixing deficit stamp duty at Rs.46,650/-. However, the District Collector also imposed a penalty at the rate of 10 times of the said deficit stamp duty i.e. Rs.4,66,500/-. Aggrieved thereby, the present writ petition is filed. Learned counsel for the petitioner strenuously contended that though the District Collector is the authority to fix the proper stamp duty and impound the document, imposing 10 times penalty of the deficit stamp duty is unwarranted and no reasons were furnished for coming to such conclusion. Whereas, the learned Government Pleader appearing for the respondent contended that once under the document possession is delivered, proper stamp duty must be paid and the document must be registered. In this case, both were not done. Therefore, the District Collector has rightly come to the conclusion that the petitioner has to pay deficit stamp duty of Rs.46,650/- and 10 times penalty of the said deficit stamp duty at Rs.4,66,500/-, totaling to Rs.5,13,150/-. The order passed by the respondent – District Collector is purely a discretionary order under Section 40 of the Act. Therefore, no interference can be made by this Court into the order passed by the respondent. I have given my earnest consideration to the respective submissions made by the learned counsel on either side and perused the impugned order and other material made available on record. No doubt, the District Collector has the authority under Section 40 of the Stamp Act to impound the document by fixing deficit stamp duty and imposing penalty, if necessary. But, when an extreme decision is taken in the guise of exercising discretionary powers vested in him i.e. imposing 10 times penalty which is maximum under the Act, it cannot be appreciated in the absence of any reasons furnished thereof. Therefore, while upholding the order passed by the respondent under Section 40 of the Act insofar as fixing the deficit stamp duty is concerned, this Court is of the considered view that the other part of the order i.e. imposing penalty at the rate of 10 times of the deficit stamp duty, is nothing but a pedantic approach of it. Generally speaking, the matter requires to be sent back for reconsideration of the District Collector insofar as the penalty is concerned. But, in a case of this nature, I feel that it can be given a quietus at this stage itself by imposing an appropriate penalty. For fixing appropriate penalty, it may be necessary to notice that the agreement was entered into on 11.3.2005 and immediately thereafter disputes arose between the parties and they exchanged notices and thereafter O.S. 8 of 2007 was filed. Under those circumstances, I am of the opinion, imposing of 10 times penalty is arbitrary and imposing penalty of one time of the deficit stamp duty would be just and proper. Under those circumstances, the impugned order is modified to be read as fixing of deficit stamp duty at Rs.46,650/- and one time penalty of the said deficit stamp duty at Rs.46,650/-, making a total of Rs.93,300/-. The writ petition is accordingly disposed of. No order as to costs. JUSTICE C.V. RAMULU. Date: 11-9-2009. MVB.