C(Q 4‘90a4 \/\ IN THE HIGH COURT OF JUDICATURE AT BILASPUR (C.G.) WRIT pmITION No. {Q73 OE 2004/ BETWEEN 1. RaJesh Valshnav s/o Trlvem. Das Valshnav,aged about 41 yearsQ 2Q Smt. Jatan Bai W/o DhanraJ Parakh aged about 48 Years . 30" Smtdl Sajan Jain w/o Ashok Jain aged about 35 years ‘b: 4. smt. shanti Bai W/o Gyan Chand Ja‘in, aged about. 45 years a; /' 5o amt. Kamla Bai w/o Dulichand Jain, ageéx about 55 years o 6.» amt. Neena Jaln w/o shallendra Jam.aged about 32 years t Goverdhan Ram Ukey S/o Manahar Lal Uikey.aged abcut 36 years.‘ 8;! Vijendra Mahobiya s/o Jagdish Ram Mahobiya. aged about 26 years ¥“ 9. Pramod Mahobiya s/o Raghav Ram Mahoblya, aged about 38 years. Panch Ram Sahu s/o Late Kartik Ram sahu, aged about 45 years . All are lease holder o£ the shops o£ Nagar Panchayat Chuikhadan, all r/o Village Chhuikhadan, i Dlstrlct RaJnandgaon (CG). PE'IITIONERS ”Qo‘ The state o£ Chhattisgarh through the Secretary. Department of Revenue. Mantralay, D.K.S.Bulldz.ng Ralpur. Collector (stamw. Rajnandgaon ,Chhattiagarh . ‘ Nagar Panchayat Ckmulkhadan, through Nagar Panchayat Aohlkari. Chhulkhadan. Tehsil chhulkhadanmlstrict Rajnandgaon (CG). Board of Revenue, through its Pregldent. Ralpur, Tehsll and Distrlct Ralpur (CG). x RESPONDENTS e‘ f wan PETITION UNDER ARTxCLEs 225/22'f OF THE mms'rx'm'mom OE Q‘Qe?‘ mmA y l.‘ , Particulars of the Fetitioners : WRIT PETITION N0. 1673 0f2004 PETITIONERS Rajesh Vaishna‘v & Others VERSUS RESPONDENTS The State of Chhattisgarh & Others v M Post for pronouncement of order on .[Aday of August, 2010. Sd/— Satish K. Agnihotri 373‘ Judge A g‘ ‘V, , . ' I-HGH COURT OF CHHATTISGARH AT BILASPUR . , ~ ‘ % gIGH COURT OF CHHATTISGARH AT BILASPUR WRIT PETITION No, 1673 of 2004 PETITIONERS t Raj esh Vaishnav & Others VERSUS RESPONDENTS : The State of Chhattisgarh & Others WRIT PETITION UNDER ARTICLE 226/227 OF THE CONSTITUTION OF INDIA SB: Hon’ble Shri Satish K. Agnihotri, J. Present: Shri Awadh Tripathi, Advocate for the petitioners. Shri Shashank Thakur, Panel Lawyer for the State. O R D E R (Delivered on. . léfahy of August, 2010) By way of this petition, the petitioners seek to quash the order dated 14/07/2003 (Annexure P/6), and orders dated 26/11/2002 and 20/02/2003 (Annexure P/S). Further, a direction to the respondents to renew the agreement of the petitioners for a further period of 30 years according to the provisions of 1aw. The petitioners also seek a direction to the respondents to take nominal charges towards rent instead of Rs.250/—. v The indisputable facts, in nutshell, as projected by the petitioners, are that the Nagar Panchayat, Chhuikhadan, issued an advertisement in the year 2000 inviting applications for auction of 21 proposed constructed shops at Chhuikhadan weekly market for a period of three years. The proposed Government rate was Rs. 75,000/— or more depending on the size of the shop. The successful bidder was required to deposit 50% of the amount within three days and remaining 25% amount, thereafter and last I installment of 25% amount before delivery of the shop. In the tender form, there was a condition that after delivery of the shop the auction purchaser would enter into a lease agreements (Annexure P/3 colly). )" 1 . \\\ According to the patitioners,'the petitioners were the highest bidders in the ' auction process and accordingly, they deposited the requisite amount and executed agreement with the respondent authorities, as is evident from Annexure P/2. Thereafter, the petitioners have been paying the rent Without any default. On account of some audit objection, the Collector of Stamps, Rajnandgaon issued a notice to the petitioners, directing them to deposit the stamp duty at the rate of 71/2 % on the value of the lease deed in lieu of 4%. 2 In response to the said notice, the petitioners submitted their reply stating that the lease period was for a period of three years and according to the provisions of the Indian Stamp Act, 1899 (hereinafter referred to as ‘the Act, 1899 ’) they were required to pay stamp duty @ 4% of the value of the r deed. After receipt of the response, the Collector Without applying his mind in its rue persective passed the order dated 20/02/2003 (Annexure t p P/S) directing the etitioners to deposit the stamp uty at the rte of 7‘/2% p d a treating the aucton amount as premiu by briging the greemen withn i m n at i he framework of clause (c) under ticle No. 35 of Schedule l- of the t Ar A Act, 1899. Being aggrieved by the sad order, the petitioners preferred an appeal i before the Board of Revenu, which wa dismissd by order dated e s e 7 6) Th n 14/0/2003 (Annexure P/. us, this petitio. Sri Triathi, learned counsel appearing for the petitio, would submit h p ner that the rder pasd by the resonen authorities are illegal aitary an o se pdt rbr d s 18 h contrary to provision of the Act, 99. Before passing te impugned orders, the Collector as well as the Board of Revenue have not applied their mind in a judicious mannr and ssed the non-speaking and unreasoned e pa order. The Collector ought o have appreciated te facts that he lease t h t W7 period was only for a imriod of three years and under these circumstances, the petitioners are required to pay only 4% of the stamp duty instead of 71/2%. The stamp duty of 7V2% were required to be deposited only in a case where the lease period was more than five years. The petitioners have not paid premium on allotment of the shops. On the other hand, Shri Thakur, learned counsel appearing for the Stae, would smit that admittedly, the petitioners ha obtained shops from the reondnt No. 3 n an pen public auction on pamen of price/premium as per e terms an nditons the aution. Thereafter, agreements we entered nto twn the etitioners and the respoent No. 3 The i beee p nd . petitioners were l out the shops the resondent N. 3 on auction on payment of premium as wel as monthly rent for three years. Thus, the stam duty payable was on the instrument which was specified in claus (c) p e of Article 35 of Schedule l-A of the Act, 1899. Clause (c) of Article 5 o 3 f hedule l-A of the Act, 899 clely stipulates that the stp duty at th rate of .5% ould be chargeable on the amount of premium/advance. In addion t 7.5%, the titioners were also liable to pay a duty at te rate of it o pe h 4% under sub-clause (ii) of clause a) of Article 35. Thus, there is no ( irregularit illeglity i the order passed by the Collector of Stamps and y, a n thereader, confirmed by he Board of Reenue. t v Having cnsidered the submissions advanced by the learned cunsel for the parties, perusing the pleadings and documents appended ereto, i is viden that in e terms and coitions of auctin (Annexur P/l), the et th nd o e minium security moun was spcified to te une of s. 1,000/— for m at e h t R 5 v alifyng t articipate in the action. Thereafter, the auction amount was qui o p u to be paid % within three days from the acceptance of the offer of the 50 respondent No. 3, 25% within a erio of 5 days an reaining 25% at the pd d m t ub ve spe i o yt th d coi of c er et by p o l Sc 1 ar am e 7 w o o th t time 0f handing over of the shops. It was further stat€d that if the amount was not paid regularly, there would be a surcharge of 10%. Further, if the rent is not paid for a period of three months continuously, in the fourth month, a surcharge may be imposed at the rate of 15%. The period of agreement was for a period of three years. Each agreement executed between the allotee of the shops and the respondent No. 3 clearly mentions - the price of the shop and payment on rent on the terms and conditions of the auction. It was clearly specified that it has to be executed on payment of duty under the provisions of the Act, 1899. Thereafter, several lease deeds were executed for allotment of shops on rent wherein it was specifically mentioned that the ease agreement was for a period of three years. In the case on hand, the petitioners were required to make the payment of auction amount i.e. value of the shops and rent thereon on monthly basis and the agreement was for a period of three years. The word ‘premium’ is defined in P. Ramanatha Aiyar’s, Advanced Law Lexicon, 3rd Edition, 2005, (pg. 3686) , as under: “Premium” defined. Act 4, 1882, s. 105. The price paid or promised in consideration of a lease of immoveable property is called the premium [T.P. Act (4 of 1882), S. 105] “Premium” also includes any like sum, whether payable ‘to the intermediate or a superior landlord; and any sum (other than rent) paid on or in connection with the granting of a tenancy is presumed to have been paid by way of premium except insofar as other sufficient consideration for the payment is shown to have been given. HALSBURY, 4m Edn. Vol. 5, para‘169, p. 85. ‘PREMIUM’ means a sum of money paid as consideration for grant of lease. It represent capitalized rent in fact is the difference between the actual rent and the rent which might otherwise be obtained by the lessor. Gavind Ram v. Rajphul Singh, AIR 1973 P&H 94, 99. [Transfer of Property Act 94 of 1882), S. 60 and East Punjab Urban Rent Restriction Act, 1949 S. 7(1)] V N In stock broking, premium is the value above ihe original cost or price, as of shares or stock, as opposed ‘ to cost.” discount, which is the value below the original Further, in the Law Lexicon, Edition: 2005, Volume 2, (pg. 2056) the word ‘premium and rent’ has been defined as under: “PREMIUM AND RENT. — The difference between a premium and a rent, in the context, lies in the fact that premium is a sum paid in consideration of the conveyance implied-in the lease and is quantified in lump, whether it is paid outright or by installments over a period told to be paid at a certain time. But, a rent, while it is also in consideration of lease, is in lieu of the enjoyment which the lessee has and particularly as consideration therefore. The another feature of rent is, it is payable as and when it accrues unlike a premium the liability for which arises at the time the contract is entered into vide Transfer of Property Act,1882, Section 108, Stamp Act, 1899, Section 16.” In section 105 of the Transfer of Property Act, 1882 (for short ‘the T.P. Act ’), the word ‘premium’ has been defined as under: 105. Lease deflned. A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a pricepaid or promised, or of money, a share of crops, service or any other thing of value, to" be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. Lessor, lessee, premium and rent defined—The L transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent. The Supreme Court, in Commissioner oflncome Tax, Assam, Tripura and Manipur v. Panbari Tea Co. Ltd], defined the Word ‘premium’ under the provisions of section 105 ofthe Act, 1882 as under: “5. Under Section 105 of the Transfer of Property Act, a lease of immovable property is a transfer of a right to enjoy or implie thefroperty or in perpetuity, made for in a price consi eration aid time, of express a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered 1 A1Rd965 sc 1871 eriodically or on specified occasions _ to the transfer who accepts the transfer on such ee, feror is ca11€d the lessor, the transferee the price is called the premium, serVice or other thing to be so a price paid for a perty When and the the interest rent to of the price paid is eriodical payments ma e of the benefits under the . The former is a capital by the transfer terms. The trans is called the lessee, and the money, share, rendered brings out is the called distinction the rent. between The section, therefore, ' right to enjoy the pro dically to the lessor 1s parted with for a price, l mi. But the p transfer of a be paid perio remium or sa a for lease the are continuous in the nature of rent income and the l ' Where the p of the hraseology. circumstances real nature m fact for advance rent and price. . transaction that not be decrsrye having regar some cases, In d to or concluSive but it the intention of the parties. A Full Bench of the High Court of Andhra Pradesh in Vinay Constructoin and Development Company, A.Pi, Registration & Stamps, word ‘premium’ as under: is called erty Act is The d in the construction of a the lease is, therefore, not Art. 3l(c) of the definitions and provisions of the T.P. Act, the value of shops which was determined on au the petitioners were allotte said amount, paymen essful bidder in auction corn Thus, the contention of the pet “I premium and the shops were allotted on rent for a perio payment of stamp duty comes not correct. Thus, the the Schedule l—A of the Act, 1899. / 2 AIR 1967 A? 90 “l3. As can be seen from thes the pronouncemen and not any valuable consideration. amount agreed to be investe High Court, “premium” in money only building as consrderation of premium Within Having considered Stamp Act.” the above ction and on payment of the d the shops on lease, subject to t of rent on monthly basis. The price of the shop payable by the SuCC the lessor. enjoyment atter a revenue receipt. There may e transaction the so-called by using premium clever is in others rent is deferred but the substance of the The ‘ nomenclature helps used the court, may to ascertain matters. . the other Circumstances, ‘ $3 Hyderabad V. Inspector General 0f Hyderabad & another 2, has considered the e decisions, particularly f the Madras ts of the Full Benches-o the word “price”, which S. 105 of the Transfer of Prop the meaning o es within the definition of ‘premium’. itioners that the petitioners had not paid any d 0f three years, is under Article 35(0) of / /// ea rds f Schedu1e 1—A éhhe Act, 1899,“as per State amgfldme Artic1e 35 1 o as under “35. Lease, including an lease and any agreeme let# 16. under-lease or sub- nt to let or sub— (a) where by such lease the rent is fixed and (i) term no less ' where premium than the one is lease year; paid purports or delivered—e to be for a The payable 15) same for or duty the deliverable as whole a Bond amount under (No. such lease. ‘ (ii) Where the lease purports to be but for not a The 15) for same the duty amount as a or Bond value (No. of term more of than not five less years; than one year the average annual rent (iii) where the lease purports to be for a The o. same 23) duty for as a a market Conveyance value reserved. y ding five years but not e ual to the amount or value of one and half times the average annual rent reserved. (iv) where the lease purports to but be for not a The (No. same 23) duty for as a a market Conveyance value ,4 term exceeding exceeding twenty years; ten years equal or value to three of the times average the amount annual rent reserved. The same duty as a Conveyance (No. 23) for a market value equal to five times the amount or value of the average annual rent reserved. The same duty as a Conveyance (No. 23) for a market value equal to eight times the amount or value of the average annual rent reserved. The‘same duty as a Conveyance (No. 23) for a market value- equal to one fourth of the whole amount of rent which would be paid or delivered in respect of the first fifty years of the lease. Sub clauses (vi) from and 1-8-2000 (vii) of vide clause MP. (a) Act of Article ll of 2000'.— 35 stood as under terrn excee exceeding ten years; ") (v) term exceeding where the lease twenty purports years to but be for not a exceeding thirty years. (vi) term where exceeding the lease thirty purports years, but to does be for not a exceed one hundred years; (Vii) term where exceeding the lease one hundred purports years to be or for in a perpetuality; duty as a Conveyance for a market value ght times the amount f the annual market “(vi) where the lease purports but to does be for not a The (No. same 23) term exceed exceeding one hundred thirty years; years, equal or value to ei o rent. h (vi) where the lease is purpoxts to be for a term exceeding one hundred years 0r in perpetuity. (vii) where the lease does not purport to be for any definite term; (b) where the lease is granted for a fine or premium, 0r for money advanced and where no ren is reserved; [Provided that, where the lease purports to be for a term exceeding 30 years or in perpetuality the duty on such lease shall be chargeable as a conveyance (No. 23) on the market value of the property leased] (c) Where the lease is granted for a fine or premium, or for money advanced in addition to rent reserved. Exemption Lease - executed in the case of a cultivator and for the purposes of cultivation (including a lease of trees for the production of food or drink) without the payment or delivery of any fine or premium, when a definite term is expressed and such term does not exceed one year, or when the average annual rent reserved does not exceed one hundred rupees. The same duty as a Conveyance (No 23) for a market value to market rent payable in twelve and a half years of the lease.” The same duty as a Conveyance (No; 23) for a market value equal to three times the amount or value of the average annual rent which would be paid or delivered for the first ten years if the lease continued so long. The same duty as a Conveyance (No. 23) for a market value equal to the amount or value of such fine or premium, as advanced as set forth in the lease. The same duty as a Conveyance (No. 23) for a market value equal to the amount or value of such fine 0r premium, or advance as set forth in the lease, in addition to the duty which would have been payable on such lease, if no fine or premium or advance has been paid or delivered: Provided that, in any case, when an agreement to Ilease is stamped with the advalorem stamp required for a leas and a lease in pursuance 0f such. agreement . is subsequently executed, the duty on such lease shall not exceed ten rupees. t 9L» ‘ to Explanation. pay any ~ r When ’ a Ieasee undertakes deemed to be part ofthe rent. " The Supreme Court, I7. While considering the term ‘ under the context of real estate, defined the word ‘preniiuin’ as price paid ‘PJ v.s Q W V. 4:7?“ 18. ’ Thus As regards relief seeking a direction to the au agreement for a further period of thirty thorities to renew the direction can be isued s f