> 10^ IN THE HIGH COURT OF DELHI AT NEW DELHI Reservedon: 19^^May, 2008 Date oforder: 2"^^ July,2008 LPA No. 374/2007 MUNICIPAL CORPORATION OF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwal& Mr. Alok Singh,Advocates versus KEY POINT Respondent ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocates for the Respondents. Ms. IramMajidand Ms. ZubedaBegum,Advocatesfor Respondent GNCTD. CORAM: HON'BLE THE CHIEF JUSTICE HON'BLE DR. JUSTICE S. MURALIDHAR ORDER I This appeal is dismissedin terms of the common judgmentof 2nd July 2008 passedin LPA No. 319 of 2007 titled ''MunicipalCorporationofDelhi v. N.K. Gupta" and connectedmatters. Registryis directedto place on recordacopy ofthe judgmentpassedin LPA No. 319 of 2007. CHIEF JUSTICE July02, 2008 MURALIDHAR,J. dn Certify that the digital file and physical file have been compared and the digital data is as per the physical file and no page is missing. Signature Not Verified IN THE HIGH COURTOF DELHI:NEW DELHI LPANo.319 of 2007 Reservedon; 19"^ May, 2008 Date ofjudgment:July 02, 2008 MUNICIPALCORPORATIONOF DELHI ..... Appellant Tlirough: Mr.H.S.Phoolka, Senior Advocate Mr. SanjeevSabharwaland Mr. Alok Singh,Advocates versus . N.K. GUPTA Respondent ThroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor the Respondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. With LPANo. 373/2007 MUNICIPALCORPOIUTION OF DELHI ..... Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh,Advocates versus VARDHMANPROPERTIES Respondent TliroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor the Respondents. Ms. Iram Majid and Ms. Zubeda Begum, Advocates for Respondent GNCTD. LPA No. 374/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwal and Ml-. Alok Singh, Advocates versus LPA N0.319/2007 Page 1 of 25 KEYPOINT Respondent ThroughMr. SanjayGoswamyand Mi*. AjayKumar, Advocatesfor the Respondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA Noo 376/2007 MUNICIPALCORPORATIONOF DELffl Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Ml-. Sanjeev Sabharwal and Mr. Alok Singh,Advocates versus K.K. ENTERPRISES Respondent TliroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor the Respondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 377/2007 MUNICIPALCORPORATIONOF DELffl Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. AlokSingh,Advocates versus VARDHMANPROPERTIES Respondent Tlu-oughMr. SanjayGoswamyand Mi*. AjayKumar, Advocatesfor the Respondents. Ms. IraillMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 378/2007 MUiNICIPALCORPORATIONOF DELffl Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh, Advocates versus LPANo.319/2007 Page2of25 \. K.K. ENTERPRISES Respondent TliroughMl". SanjayGoswamyand Mi*. AjayKumar, Advocatesfor the Respondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 380/2007 MmiCIPALCORPORATIONOF DELHI Appellant Tlirough: Mr.H.S.Plioolka,SeniorAdvocate Mr. SanjeevSabharwaland Ml". Alok Smgh, Advocates versus GARIMAAGGRAWAL Respondent ThroughMr. SanjayGosv^amyand Mr. Aja>'Kumar, Advocatesfor the Respondents. Ms. Iram Majidand Ms. ZubedaBegum,Advocates for ilespofidentGNCTD. LPA No, 381/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Ml-. SanjeevSabharwaland Mr. Alok Singh,Advocates versus VARDFIMANPROPERTIES Respondent TliroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor the Respondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 382/2007 MUNICIPALCORPORATIONOF DELITI Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Ml'. Sanjeev Sabharwaland Mr. AlokSingh,Advocates versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr, y\jayKumar, LPA No.319/2007 Page3of25 Advocatesfor the Respondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates forRespondentGNCTD. LPANo. 383/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mf. Alok Singh,Advocates versus VARDHMANPROPERTIES Respondent TliroughMl-. SanjayGoswamyand Mr. Ajay Kumar, Advocatesfor theRespondents. Ms. ItafflMajidand Ms. ZubedaBegum,Advocates forRespondentONCTD. PA No. 384/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh,Advocates versus VARDHMANPROPERTIES Respondent TliroughMl-. SanjayGoswamyand Mr. Ajay Kumar, AdvocatesfortheRespondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 385/2007 MUNICIPALCOi^ORATlONOF DELHI Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh,Advocates versus HARI SINGHBUILDER&PROMOTRS Respondent ThroughMi-. SanjayGoswamyand Mr. Ajay Kumar, LPA No.319/2007 Page4of25 Advocatesfor the Respondents. Ms. IramMajidandMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 386/2007 MUNICIPALCORPORATIONOF t)ELHl Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. AlokSingh,Advocates versus ICAMALlaSHORfiAGGRAWAL Respondent TliroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesforthe Respondents. Ms. IramMajidandMs. ZubedaBegum,Advocates forRespondentGNCTD. LPA No. 387/2007 MUNICIPALCORPORATIONOP DELm Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwaland Mr. Alok Singh, Advocates versus VARDHMANPROPERTIES Respondent ThroughMi-. SanjayGoswamyand Mr. AjayKumar, Advocatesfor the Respondents. Ms. Iram Majid andMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 388/2007 MUNICIPALCORPORATIONOP DELHI Appellant Tlirough: Mr.H.S.Phoolka, SeniorAdvocate Mr. Sanjeev Sabharwal and iVIr. Alok Singh, Advocates versus BASANTPROJECTSLTD Respondent ThroughMr. SanjayGoswamyandMr. AjayKumar, LPANo.319/2007 Page 5of25 % ff f Advocates for the Respondents. Ms. Iram Majid and Ms. Zubeda Begum, Advocates forRespondentGNCTD. LPANOc 389/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough: Mr.H.S.Phoolka, Senior Advocate Mr. Sanjeev Sabharvvaland Mr. Alok Singh, Advocates versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor the Respondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPANo. 391/2007 MUNICIPALCORPORATIONOFDELPH Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh,Advocates versus VARDUfMANPROPERTIES Respondent TliroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor theRespondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates forRespondentGNCTD. LPANo. 394/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwal and Mr. Alok Singli, Advocates versus LPANo.319/2007 Page6 of 25 • -.f V \0V VARDHMANproperties . Respondent I ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, .}| Advocatesfor theRespondents. Ms. Irani Majid andMs. ZubedaBegum,Advocates for RespondentGNCTt). LPA No. 395/2007 MUNICIPALCORPORATIONOFDELHI Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh, Advocates versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesforthe Respondents. Ms. Irani Majid andMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 396/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka, Senior Advocate Ml-. SanjeevSabharwaland ]VIi-. Alok Singh, Advocates versus v.. MANISHAGGRAWAL Respondent ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocates for the Respondents. Ms. Irani Majid andMs. ZubedaBegum,Advocates forRespondentGNCTD. LPA No. 400/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh, Advocates versus LPA No.319/2007 Page 7 of 25 VAIIDHMANproperties Respondent TliroughMr. SanjayGoswamyandMr. Ajay Kumar, Advocatesfor the Respondents. Ms. IralnMajidandMs. ZubedaBegum,Advocates for RespondentGnCTD. LPA No. 401/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough; Mr.H.S.Phoolka,SeniorAdvocate SanjeevSabharwaland Ml-. Alok Singh,Advocates versus VARDHMANPROPERTIES Respondent ThroughMl'. SanjayGoswamyand Mr. Ajay Kumar, Advocatesfor the Respondents. Ms. IramMajidandMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 402/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough; Mr.H.S.Phoolka,SeniorAdvocate Ml*. SanjeevSabharwaland Mr. Alok Singh, Advocates versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesfor the Respondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 403/2007 MUNICIPAL CORPORATION OF DELHI Appellant Through; Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwaland Mr. Alok Singh, Advocates LPANo.319/2007 Page8 of 25 %V versus VARDJMAN PROPERTIES Respondent ThroughMr. SanjayGoswamyandMr. AjayKumar, Advocatesfor theRespondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 405/2007 MUNICIPAL CORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka, SeniorAdvocate Mr. Sanjeev Sabharvvaland Ml-. Alok Singh,Advocates versus UNITYPROJECTSLIMITED Respondent TliroughMr. SanjayGoswamyandMr. Ajay Kumar, Advocatesfor theRespondents. Ms. Iram Majid andMs. ZubedaBegum,Advocates forRespondentGNCTD. LPA No. 406/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwal and Mr. Alok Smgh, Advocates versus ICEY POINT Respondent TliroughMl*. SanjayGoswamyand Mr. Ajay Kumar, Advocatesforthe Respondents. Ms. Iram Majid andMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 407/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka, SeniorAdvocate Mr. Sanjeev Sabharwaland Mr. Alok Singh, Advocates LPA No.319/2007 Page 9 of 25 versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswaniyand Mr. Ajay Kumar, Advocatesforthe Respondents. Ms. Iram Majid andMs. Zubeda Begum, Advocates for RespondentGNCTt). LPA No. 408/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwaland Mr. Alok Smgh, Advocates versus M.M. DEVELOPERS Respondent tliroughMl*. SanjayGoswamyand Mr. Ajay Kumar, AdvocatesfortheRespondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 1051/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough: Mr.H.S.Phoolka, SeniorAdvocate Mr. Sanjeev Sabharwaland Mr. Alok Singh,Advocates versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr. AjayKumar, Advocates for the Respondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates forRespondentGNCTD. LPA No. 1057/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwal and Ml-. Alok Singh,Advocates LPA No.319/2007 Page 10 of 25 versus VARDHMANPROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr. AjayKumar, Advocatesfor theRespondents. Ms. IraniMajidand Ms. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 1058/2007 MUNICIPAL CORPORATION OF DELffi Appellant Through; Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland Mr. Alok Singh, Advocates versus VARDliMAN PROPERTIES Respondent ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesforthe Respondents. Ms. IramMajidandMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 1059/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Ml-. SanjeevSabharwaland Mr. Alok Singh, Advocates versus SUNDERCONSTRUCTIONCO. Respondent TliroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesfor the Respondents. Ms. IramMajidandMs. ZubedaBegum,Advocates for RespondentGNCTD. LPA No. 1060/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough; Mr.H.S.Phoolka,SeniorAdvocate Mr. SanjeevSabharwaland LPA No.319/2007 Page 11 of 25 Mr. AlokSingh,Advocates versus VARDEGMANPROPERTIES Respondent TliroughMr. SanjayGoswamyand Mi*. AjayKumar, Advocatesfor theRespondents. Ms. IramMajidandMs. ZubedaBegum,Advocates for RespondentGNCTD. LPANo. 1061/2007 MUNICIPALCORPORATIONOF DELHI Appellant Tlirough: Mr.H.S.Phoolka,SeniorAdvocate Mr. Sanjeev Sabharwal and Mr. Alok Singh,Advocates versus VARDHMANPROPERTIES Respondent TliroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesfor the Respondents. Ms. IramMajidand Ms. ZubedaBegum,Advocates for Respondent(jNCTt). A^t> LPANo. 1285/2007 MUNICIPALCORPORATIONOF DELHI Appellant Through: IVIr.H.S.Phoolka, SeniorAdvocate Mr. Sanjeev Sabharwal and Mr. Alok Singh, Advocates versus SURYABUILDWELLLIMITED Respondent ThroughMr. SanjayGoswamyand Mr. Ajay Kumar, Advocatesfor theRespondents. Ms. Iram Majid andMs. Zubeda Begum, Advocates forRespondentGNCTD. Coram: HON'BLfi THE CHIEF JUSTICE LPA No.319/2007 Page 12 of 25 HON'BLE DR. JUSTICE S. MURALIDHAR 1. WhetherReportersoflocalpapersmay be • allowed to see the judgment? 2. To be referred to the Reporter or not? 3. Whetherthejudgmentshouldbe reported 'U, in Digest? JUDGMENT Dr. S. Muralidhar. J. 1. These appeals are directed against the commonjudgmentdated 13^ March, 2007 passed by the learned Single Judge of this Court in Writ Petition(Civil) No. 8161 of 2005 and Batch. The writ petitions challengedthe validityofthe noticesissued by the CollectorofStamps under Section 40 of the Indian Stamp Act, 1899 ('Stamp Act') demandingtransfer duty as well as deficient stamp duty and penalty equalto ten times of the deficientduty. 1. The demand for transfer duty was made in respect of the conveyanceofplotsof land in favourofthe appellantswho successfully bid for tliem in auctions held by the Delhi DevelopmentAuthority ('DDA')/ Municipal Corporation of Delhi ('MCD'). Consequently, perpetuallease deeds were executedand registeredin their favour. The writ petitionershad also paid the appropriatestamp duty and transfer duty intermsofthe certificateissuedby the CollectorofStampsin each of the cases. 3. On 29^' August2004 ageneralorderwas issuedby the Divisional LPANo.319/2007 Page 13 of 25 Commissioner,Delhi stating that the Collectorsof Stamp of different districtshad adoptedvaryingmethodsof calculationof dutyin respectof perpetualleases which had resultedin the duty being short levied and collected.This conclusionwas reachedon an interpretationof Article35 of Schedule1 (A) to the Stamp Act as applicableto Delhi and Section 147 to the Delhi Municipal Corporation Act, 1957 ('DMC Act'). Consequently,the impugned notices were issued in Februaty 2005 to eachofthe appellantscallinguponthem to pay the deficientduty as well as tlie penalty equaling ten times of the deficient duty. In respect of Vardliman Properties, for instance, the auction purchaser had paid Rs.12,42,215as stamp duty. This was now recomputedas Rs.13,30,604 being tlie aggregate of Rs.10,79,772as stamp duty and Rs.2,00,832as transfer duty. In re-worldng the duty, the total consideration for the perpetual lease was taken as the aggregate of the premium amount of Rs.1,91,11,000and the annual rent calculated as a percentage of the premium amount. In additiona penaltyof Rs.8,88,389(beingten times of the deficient duty) was also demanded. 4. Before tlie learned Single Judge the respondents contended that they were not challenging the re^workingof the stamp duty since the question of interpretation of Article 35 of Schedule 1(A) of the Stamp Act was debatable. Their challenge was, therefore, confined to the penalty imposed under the Stamp Act as well as the DMC Act with regard to the stamp duty and transfer duty respectively as well as the LPANo.319/2007 Page 14of 25 dues in the transferduty as demandedin the impugnednotices. 5. On the questionofpenalty,the learnedSingleJudge came to the conclusionthat in terms of Section40 of the Stamp Act, the power to impose a penalty was consequential upon the Collector of Stamps impoundinganinstrument.Sinceno instrumenthad yet been impounded by the Collector,the questionofimpositionofany penaltydid not arise. To the extent, therefore, that the impugned notices sought to levy penalty, they were held to be unsustainable in law. 6. The next questionbeforethe learnedSingle Judge concernedthe interpretationof the relevant entry in Section 147 (2) (b) (v) DMC Act. After referringto the decisionof the learnedSingle Judge of this Court inNiagara Hotels &Builders (P)Ltd. v. UnionofIndia 65 (1997)DLT 826, the learned Single Judge concluded tliat the words 'amount' and 'value' in Section147 (2) (b) (v)DMC Act didnotreferto the premium collectedfor the grant of the lease.The learnedSingleJudgerejectedthe contentionof the MCD that the word 'amount' referredto premiumand the word 'value' referred to the rent. It was held that they referred to the quantum of the rent for the first fifty years of the lease. Consequently, transfer duty would be leviable on one-sixth of the rent for the first fifty years of the lease. Although the lease referred to only the first thirty years, the learned Single Judge held tliat "the transfer duty has to be computedon the basis of 1/6^ ofthe rent payableat presentfor the first LPANo.319/2007 Pagel5of25 30 year period but computedforthe first fiftyyears". 7. ' The petitions were accordingly partly allowed holding that no penalty could be imposed in respect of the transfer duty under the DMC Act since that was a debatable issue. A direction was issued to re-work the transfer duty in terms of the judgment of the learned Single Judge. It was fiirther held that no further stamp duty in addition to the amounts already paid was payable nor was any penalty chargeable. 8. Aggrievedby the judgmentof the learnedSingleJudge,the MCD has filed the present appeals. 9. It is contended by Mr. H.S. Phoolka, the learned senior counsel appearingfor the MCD that in the sense and in the contextin which the word 'rent' is used in Section 147 (2) (b) (v) DMC Act, it had to connote the total consideration payable under the lease deed. His submission was that unless the total consideration as shown on the lease deed was paid by the lessee, the executionof the peipetual lease deed could not have takenplace. Therefore,the word 'rent' would includethe premium paid by the auctionpurchaserfor obtainingthe lease. In otherwords,the expression 'rent' meant 'rent + premium' and not the rent alone. Referencewas made to the definitionof the word 'premium' in Black's Lav/ Dictionary,6"^ Edition (page 1181). Mr. Phoolkathen submitted that everyword occurringm Section147 (2) (b) (v) DMC Act hadto be LPA No.319/2007 Page 16 of25 givefi full effect to keeping in view the context in which the word occurs. Therefore the disjunctive 'or' had to be read as a conjunctive 'and'. Since the lease could not have been executed without the premium beingpaid, the legislativeintentwas to le\7 transferduty on the amount equal to one-sixthof the entire considerationpayable in respect of the lease which, in any event, has been set forth in the instrument. Mr.Phoolka contended that since the annual rent payable is calculated as a percentageof the premiumpaid, it is a measureof the premiumitself Consequently,there it was logicalto includethe premium amount as part of the rent for the purposes of computing the transfer duty. 10. In support of Ms contentionthat all words in the statutehave to be given full effect Mr.Phoolkareferredto the judgments of the Supreme Court in Shin-Etsii Chemical Co. Ltd. v. Alish OptijibreLtd. (2005) 7 see 234, Manohar Lai v/ VineshAnand (2001) 5 SCC 407, Noorie Manure Mill v. Commissioner Trade Tax (2007) 10 SCC 478, Associated Cement Co. Ltd. v. State of MP (2004) 9 SCC 727 and Indcon Structurals (P) Ltd. v. Commissioner of Central Excise (2006) 6 SCC 786.. 11. Mr.Sanjay Goswamy, learned counsel appearing on behalf of the respondents submitted that a taxing statute admits of only strict interpretation. If the intention of the legislature was to tax the premium paid for the obtainingof a perpetuallease, then certainlythe wordingof LPANo.319/2007 Page 17of 25 0^ 'y tlieprovisionsliouldexpresslyindicateit. Relianceis placedon Section 105 of the Transferof PropertyAct, 1882 ('TP Act') where the words 'premium' and 'rent' have been separatelydefined. Relying on the judgmentof the Supreme Court in CommissionerofIncome Tax v. Panbari Tea Company AIl^ 1965 SC 1871, it is submitted that the expression'premium'and 'rent' have to be separatelyunderstoodand one cannotincludethe otherinthe contextin whichit is used.inthe deed of perpetuallease in the instantcase. Tlie word 'rent' can only refer to the actual rent indicated in the lease deed and not the premium. Reference is also made to the decisions in Govind Ram v. Rajphul SinghAIR 1973, Punjab <& Haryana94 ond S. VenkataramanSwami V. S. Abdul Wahab AIR 1969 Madras 473. 12. In order to appreciatethe respectivecontentions,a referencemay be made first to Section 147 (2) (b) (v) of the DMC Act which reads: "147. Duty on transfer of property and method of assessment thereto,- (1) Save as otherwise provided in this Act, the Coiporation shall levy a duty on transfers of immovable property situated within the limitsof £)elhi in accordancewiththe provisionshereafterin this section contained. (2) The said duty shall be levied- (a) in the fomi of a surcharge on the duty imposed by the Indian Stamp Act, 1899 (2 of 1899) as in force for the time being in the Union Territory of Delhi, on every instrument of the description specified below, and (b) at such rate as may be detennined by the Corporation not exceeding five per cent, on the amount specified below against such instruments - LPANo.319/2007 Pagel8of25 Description of instrument Amount on which duty should leyied (i) Sale of immovableproperty The amount or value of consideration for the sale, as. set forth in instrument. (ii) Exchangeof immovable property The value of the propertyof the greate value, as set forth,in the instrument. (iii)Giftof immovablepropert; The valueoftheproperty,assetforth the instrument. (iv) Mortgage with possession immovable property The amount secured by the mortgage ; set forth in the instrument. (v) Lease in perpetuity immovable property The amountequalto one-sixthof the whole amount or value of the rent which would be paid or deliveredin respectofthe firstfiftyyearsofthe le; as set forth in the instrument, (emphasis supplied). (v) Contract for transfer of immovable property Ninety per cent of the value of the consideration for the transfer as set out in the contract." 13. InNiagara Hotels&Builders(P) Limiteda learnedSingleJudge of this Court held that the word 'or' in Section 147 (2) (b) (v) DMC Act could not be read in a manlier so as to enable MCD to levy the transfer duty on an aggregateboth the premiumamountas well as the rent. In the impugnedorder in the instant cases, the learned Single Judge has heldthatthe expression"amount'or 'value'bothqualified"rentand rent alone" and, therefore,the rent,(and not the premium)could alone form the basisfor calculatingthe transferduty. 14. Dependingon the context,the word 'premium' can have both a broad as well as a narrow meaning. The definitionof premium in the Law Lexiconby P. RamanathaAiyar,SecondEditionreadsas under: LPANo.319/2007 Page 19 of 25 a sum of money paid as coBsid^iatiGfifor grantoflease.Itrepresents rent which in fact is the diltefMie^between the actual rent and the rerite^M^il-lni^totherwisebe obtainedby thel^ori other Like Sums", "are sums pai# la ^^Gess of the agreed rent in considsFgliQii of grant, continuance or renewai>dMetenancy" In Black's Law Dictionayy, Sixth Edition, premium is defined as capitalizedrent"paidinlumpsum at thetimeofleaseis granted." 15. The question whether the 'rent' payable under the deeds of perpetuallease in the mstant cases includes the 'premium' paid will depend on the context in which the word is used. This distinctionis adcnowledgedin the definitionsof the terms 'premium' and 'rent' in Section105 oftheTPActaswell. 16. The decision of tlie Supreme Court in Panbari Tea Company supports the contentionof the respondentthat, given the context, the word 'rent' in Section 147 (2) (b) (v) DMC Act has to have a narrow meaning. The question that arose in the said case was "whetherthe premium collected as a lump sum (although payable in instalments) could also be consideredto be arevenuereceiptin the same mamieras tlie rent collected"? In the said case a registeredlease deed had been executedby the AssesseeCompanyby whichtwo tea estateswere leased out to a firm. The considerationfor the lease was a combinationof LPANo.319/2007 # premium in the sum of Rs.2,25,000of the annual rent of Rs.54,000. The premium was to be paid in the following manner; Rs.45,000 as lump sum at the time of execution of the lease deed and the balance of Rs.1,18,000 in sixteen half yearly instalmentsof Rs.11,250 before the 31®' January and 31®' July of each year. The annual rent of Rs.54,000 was payablein the followingmanner:Rs.1,000 per monthto be paid on or before last date of eachmonth,thus, makingin all Rs.12,000per year and the balanceof Rs.42,000to be paid on or before 31®' Decemberof each year.. In the assessmentyear for 1952-53,the income tax officer treated the instalmentof Rs. 11,250paid towards premium as a revenue receipt. This assessment was upheld by the Appellant Assistant Commissioneras well as the Tribunal. The High Court reversed the Tribunalandheldthatthe sum of Rs.l 1,250was a capitalreceiptand not a revenue receipt. The Departmentthen appealedthe Supreme Court. The Supreme Court referred to the decisions in Kamakshya Narain Singh V. CommissionerofIncomeTax (1943)IIITR 513, Memberfor the Board of Agriculture v. Commissionerof Income Tax (1957) 32 ITR 169 and Chintamani Saran Nath Sah v. Commissioner of Income Tax AIR 1961 SC 732 to underscore the distinction between the premiumand rent. It pointedout that a one-timepaymentofpremium for the grantof a leasewas Iciiownas 'salami' whichis inthe natureofa capital receipt in the hands of the lessor. The Supreme Court then refenred to Section 105 TP Act and observed as under; "The section, therefore, brings out the distinction LPANo.319/2007 Page 21 of 25 betweena pricepaid for atransferofarightto enjoythe propertyand the rent to be paidperiodicallyto the lessor. When the interestofthe lessoris partedwith for a price, the price paid is premium or salami. But the periodical payments made for the continuous enjoyment of the benefits under the lease are in the nature of rent. The fonner is a capital income and the latter a revenue receipt, there may be circumstanceswhere the parties may camouflage tlie real nature of the transactionby using clever phraseology. In some cases, the so-called premium is in fact advance rent and in others rent is deferredprice. It is not the form but the substanceof the transaction that matters. The nomenclature used mav not be decisiveor conclusivebut it helps the Court, having regard to the other circumstances, to ascertain the intentionof the parties." On an analysisof the relevantclausesin the lease deed, it was held that the amount paid as premiumcould not be construedas rent and, such premiumwas a capitalreceiptinthe handsof the lessor. 17. In HotelKings v. Sara Farhan Lukmani(2007) 1 SCO 202, the SupremeCourtemphasizedthe importanceofacontextualintei-pretation and heldthatwhilethe permittedincreasein rent can serveas ayardstick for the landlord to increase the rents it did not make such permitted increase"apartofthe rentthoughitmay be aconsiderationfor the grant of lease." 18. The lease deed in the instant cases a makes reference to the annual rent that wouldbe payablein future. This is not a pre-determinedfigure but is to be workedout as a percentageofthe premiumamount. This is set out in the lease deed. For instance in the lease deed dated 1^' LPANo.319/2007 Page 22 of25 December,2003 in favour ofM/s N.K. Gupta, the fourth paragraphof the preamble reads: "NOW THIS INDENTURE WITNESSETH that, in consideration of the amount of Rs. 1,31,04,000/-(RupeesOne CroreThirtyOne lacs and Four thousandonly) paid towards premiuiii before the execution of these presents (the receipt where of the Lessor hereby aclaiowledges) and of the rent hereinafter reserved and of the covenants on the part of the lessee hereinafter contained, the Lessor doth hereby demise unto the Lessee, all that plot of land being the Commercial Plot No. 09 Block No. X in the lay out plan of New Friends Colony District Centre" 19. In the later portion of the same paragraphof the lease deed, the annual rent is stated as being two and a half per cent of Rs.1,31,04,000 and the first annual rent instalmentis to be paid on 15^'^ January,2008. The relevantportionreadsasunder: "TO HOLD the premisesunto the lessee in pei-petuity from 24^ day of January two thousand and three iTlELDlNG AND PAYING thereforeyearly rent payable in advance of.Rs. 5/- (Rupees Five only) up to the 23'^'' day ofJanuary two thousand and Eight and thereafter at the rate of two and a half per cent of the premium (the sums already paid and such other sum or sums hereafter to be paid towards premium under the covenants and conditions hereinafter contained) or such other enhancedrent as may hereafterbe assessed under the covenants and conditions hereinafter contained clear of all deductions by equal half yearly payments on the 15'^ day ofJanuaiyand 15* day ofJuly in each year at the Reserve Bank of Inia, New Delhi." LPANo.319/2007 Page23of25 20. A reading of the aforementionedportions of the perpetual lease deed brings out the distinction between 'premium' on the one hand and 'rent' on the other. The word 'premium' carries more than one definition; it has to be understood in the context in which it is used in a lease deed. The question whether the word 'premium' is also subsumed in the words "whole amount or value of the rent" occurring in Section 147 (2) (b) (v) DMC Act has to be answered with reference to the context in which the word is used in the lease deeds in question. A careful examination of the above clauses of the lease deed, leads to the conclusion that the 'premium' paid for the lease is distinct from the 'rent' payable thereunder. In other words, 'rent' in Section 147 (2) (b) (v) DMC Act cannotbe saidto includethe premiumpaid forthe lease. ® 21. It is also not possibleto construethe premium paid as advance rent sincethe annualrent in is not indicatedas a