IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Writ Petition (M/S) No. 2258 of 2011 M/s Tirupati Developers. … Petitioner. Versus State of Uttarakhand and two others. … Respondents. Ms. Neelima Mishra, Advocate holding brief of Mr. Ramji Srivastava, Advocate, learned counsel for the petitioner. Mr. Sudhir Kumar, Brief Holder, learned counsel for the respondents Date October 19, 2011. Hon’ble B.S.Verma, J.(Oral) By means of this writ petition, the petitioner has sought a writ in the nature of certiorari the order dated 10-3-2011 (Annexure-1 to the petition) passed by Additional Commissioner, Kumaon Mandal, Nainital in Stamp Revision No. 44 of 2008-09/ 16(2009-10) and the order dated 30-6-2009 (Annexure-2 to the writ petition) passed by Assistant Commissioner (Stamps) Udham Singh Nagar in Stamp Case No. 64 of 2007-08. Learned counsel appearing on behalf of the State has submitted that this writ petition may be disposed to today itself at the admission stage without counter version since the issue involved in the writ petition is legal in nature. Briefly stated, the facts giving rise to the present writ petition are that an agreement for sale was executed in favour of the petitioner Tirupati Developers and the stamp duty was paid in lump-sum to the tune of Rs. 10,000/-, therefore, the Sub Registrar concerned impounded and the agreement and referred the matter under Sections 33/38 of the Indian Stamps Act to the Assistant Commissioner (Stamp and Registration) for adjudication of proper stamp duty and to recover deficit stamp duty from the petitioner. Notice was issued to the petitioner and an enquiry was conducted. The petitioner filed its objection contending that no 2 notice of deficit stamp duty was given to the petitioner by the Sub Registrar concerned at the time of presentation of the instrument. The learned Assistant Commissioner (Stamp and Registration) in view of the provisions of Article 5(1)(b) of Schedule IB of the Indian Stamps Act (for short the Act), as applicable to the State of Uttarakhand, came to the conclusion that the stamp duty was to be paid on 50% of the value of consideration of the sale agreement and passed the impugned order dated 30-6- 2009 for recovery of deficit stamp duty as per rate of conveyance as provided under Article 23 of Schedule IB of the Act as well as penalty from the petitioner as mentioned therein. Aggrieved by the order dated 30-6-2009, the petitioner preferred Stamp Revision before the Additional Commissioner, Kumaun Divisioon, Nainital. The learned revisional court after hearing both the parties did not find favour with the revisionist- petitioner and dismissed the revision by order dated 10-3-2011, which gave rise to the present writ petition. It is admitted to both the parties that the petitioner is liable to pay the stamp duty, which is payable on 50% of the valuation of the sale consideration on the date of execution of the agreement for sale. In this writ petition, the learned counsel for the petitioner has contended that the learned Assistant Commissioner (Stamps) and the revisional Court both have committed a manifest error of law in not examining the rate list, which was prevailing for stamp duty at the relevant point of time when the agreement was executed. Learned counsel for the petitioner has drawn the attention of the Court that at the relevant time the stamp duty was payable at the rate of Rs. 80/- per thousand, while the stamp duty was levied by the learned Assistant Commissioner (Stamps) @ Rs. 125/- per thousand. Learned counsel for the petitioner further 3 submitted that there is no provision of payment of interest in the State of Uttarakhand and such a provision was added by U.P. Act No. 38 of 2001 w.e.f. 20-5-2002 after creation of Uttarakhand State, which is not applicable to the State of Uttarakhand. Learned counsel lastly submitted that the penalty was imposed against the petitioner in an arbitrary manner without complying the provisions of Section 40(1)(b) Proviso second of the Act. Relevant extract of Section 40 of the Act reads as under:- “40. Collector’s power to stamp instruments impounded.-(1) When the Collector impounds any instrument under Section 33, or receives any instrument sent to him under Section 38, sub-section(2), not being a receipt or a bill of exchange or promissory note, he shall adopt the following procedure: (a) if he is of opinion that such instrument is duly stamped or is not chargeable with duty, he shall certify by endorsement thereon that it is duly stamped, or that it is not so chargeable, as the case may be; (b) if he is of opinion that such instrument is chargeable with duty and is not duly stamped, he shall require the payment of the proper duty or the amount required to make up the deficiency together with a penalty of an amount not exceeding ten times the amount of proper duty or of the deficient portion thereof: Provided that when such instrument has been impounded only because it has been written in contravention of Section 13 or Section 14, the Collector, may, if he thinks fit, remit the whole penalty prescribed by this section: Provided further that no penalty shall be levied unless the party concerned has been given a reasonable opportunity of being heard.” Learned State counsel appearing for the respondents made a statement on the basis of the information received from the 4 Sub Registrar Kashipur (Udham Singh Nagar) and informed the Court that the prevailing rate of stamp duty of Article 23 of conveyance was Rs. 80/- per thousand instead of Rs. 125/- per thousand as has been levied by the learned Assistant Commissioner (Stamps) and upheld by the revisional Court in revision. Having heard the submissions of the learned counsel for the parties and having perused the material placed before this Court, I am of the view that so far as the interest part is concerned, the agreement for sale was executed in the year 2007. No amendment was made by the State of Uttarakhand to impose interest and the learned Brief Holder for the respondents could not show any such provision for imposing interest under Section 40 of the Act applicable to the State of Uttarakhand. So far as imposition of penalty is concerned, penalty was imposed against the petitioner without hearing the petitioner as has been provided in Proviso second, which was made applicable by U.P. Act No. 22 of 1998 w.e.f. 1-9-1998. Considering the peculiar facts and circumstances of the case that the agreement for sale had been cancelled within a period of two months from the date of execution of agreement for sale coupled with the fact that no opportunity of hearing was afforded to the petitioner on the point of imposition of penalty, this Court is of the opinion that to meet the ends of justice, penalty be imposed at the rate of 15% of the deficit stamp duty. This order shall not be treated as a precedent for other cases. In the case at hand, the valuation of the land under agreement has been mentioned Rs.1,11,60,000/-. A stamp duty of Rs. 10,000/- was paid in lump sum. Thus, the deficiency of stamp duty i.e. stamp duty was payable on 50% of the value of consideration of the sale agreement after adjusting the stamp duty already paid by the petitioner, comes to Rs. 4,36,400/- and not Rs. 6,87,500/-/- as held by the Assistant Commissioner Stamps. The 5 petitioner shall also be liable to pay 15% penalty on the deficiency of stamp duty, i.e. Rs. 65,460/-. For the reasons and discussion above, the writ petition deserves to be partly allowed. The impugned orders are liable to be modified accordingly. The writ petition is partly allowed. The petitioner is directed to pay the deficit stamp duty worth Rs. 4,36,400/- as well as penalty @ 15% of the deficit stamp duty i.e. Rs. 65,460/- within a period of two months from today. To the above extent, the impugned orders stand modified. The order of the Assistant Commissioner Stamp directing payment of interest as mentioned in the impugned order is quashed. (B.S.Verma, J.) RCP