✦ High Court of India · 25 Sep 2025

Chetan Aggarwal vs Counsel for Petitioner(s)

Case Details High Court of India · 25 Sep 2025
Court
High Court of India
Decided
25 Sep 2025
Bench
PIYUSH AGRAWAL
Length
1,797 words

2. Learned counsel for the petitioner submits that petitioner was allocated plot no.137 Block No.H Sector no.63 phase 3 situated at New Okhala Industrial Development Area by New Okhala Industrial Development Authority, District Gautam Buddh Nagar on 20.03.2024, a lease deed was executed, and the possession of the plot was given to the petitioner. Thereafter, on 04.05.2006, the said plot was let out to one partnership firm namely, M/s Livelle Design at C-195, Greater Kailash Part I, New Delhi, for a period of one year. Thereafter, the proceeding under Section 47(A) of the Indian Stamp Act was initiated against the private respondent with regard to the lease executed on 04.05.2006.

3. Notices were sent to the private respondents, but despite service of notice, respondent choose not to appear in the said proceeding, therefore, the Collector passed an order dated 22.10.2008 holding deficit of Stamp duty of Rs.2,85,550/- and penalty of the equal amount as well as interest of 1.5 per cent per annum.

4. Thereafter, recovery certificate was also issued on 25.04.2009. Since, the private respondent, who took the property in question on rent left the premises, recovery could not be made from them. The respondent tried to attach the property of the petitioner in the garb of the aforesaid proceeding.

5. The petitioner moved restoration application no.823 of 2019, which was dismissed by order dated 04.05.2019 holding that no order has been passed against the petitioner, therefore, the restoration application is not maintainable. Despite the fact that no order has been passed against the petitioner, still the petitioner harassed by trying to attach the property of 2 WRIC No. 25127 of 2019 the petitioner. The petitioner, thereafter, filed a detailed application dated 25.09.2019 reiterating all facts and bringing on record the materials to show that the property of the petitioner cannot be attached. The said application of the petitioner was rejected by order dated 22.06.2019 again holding that no order has been passed against the petitioner and therefore, no recovery is made against the petitioner. There is no justification to pass a fresh order.

6. Counsel for the petitioner submits on the aforesaid compelling reasons, the present writ petition is being instituted with aforesaid prayer.

7. Counsel for the petitioner further submits that the duty to pay the stamp duty is of the vendee and not of the vendor. Any proceeding towards deficit of stamp duty can only be made against the vendee but the case in hand that coercive action has been taken against the petitioner not being the vendee but a vendor. He further submits that a specific pleading in paragraph nos.11 and 12 of the writ petition have been taken which has not been denied in paragraph nos.14 and 15 of the counter affidavit. In support of his submission, he has relied upon the judgment of this Court passed in the case of Kunwarpal Sharma and another Vs. State of U.P. and others in C.M.W.P. No.8792 of 2001 and prays for allowing the writ petition.

8. Per contra, learned Standing Counsel supports the impugned action and submits that the proceeding have rightly been initiated to recover deficit stamp duty, together with penalty and interest. The amount towards the deficit of stamp duty has not been paid in pursuance of the agreement executed between the petitioner and his tenant as such justify the proceeding.

9. After hearing the parties, the Court has perused the record.

10. It is not in dispute that the agreement was executed between the petitioner and the private respondent taking over the property in question on rent. The proceeding, in pursuance of the execution of the lease deed dated 04.03.2006, of the stamp duty was initiated under Section 47(A). The private respondent in their wisdom despite service of notice not responded and the order was passed holding deficit of stamp duty. To satisfy the deficit stamp duty, the proceeding of recovery as arrears of land revenue was pressed into service. The respondent authorities when could not recover the amount from the vendee, the proceeding against the property of the petitioner was taken up. When it came to the knowledge of the petitioner that the property of the petitioner are going to be attached, moved a recall application but the same was rejected as no order has been passed against the petitioner. Further, still the proceeding was not stopped to recover from the property of the petitioner, again a detailed application was moved, which was also dismissed on the ground of maintainability.

11. The record shows that the petitioner was not a vendee but a vendor. The liability to pay stamp duty or deficit of the same in pursuance of the agreement is that of the vendee. Any recovery can be initiated towards the deficit of stamp duty of instrument can always be done against the vendee and not from the vendor as prescribed under Section 29(c) of the Stamp Act. 3 WRIC No. 25127 of 2019

12. The Division Bench of this Court in the case of Kunwarpal Sharma (supra) has held as under : "6. Section 29(c) clearly lays down that in the case of a conveyance in absence of any agreement to the contrary, the expenses for providing proper stamps shall be borne by the grantee. The language used in the section is very clear and this provision makes it obligatory upon the vendee to pay the stamp duty. This section casts no obligation upon the vendor to pay the stamp duty. Section 48 empowers the Collector to recover the duties, penalties and other sums required to be paid under the Act by distress and sale of the movable property of the person from whom the same are due or by any other process for the time being in force for the recovery of the arrears of land revenue. This provision clearly provides that deficiency in stamp duty can be recovered only from the person from whom it is due and not from every person who may be a party to the deed. For finding out the person from whom the duty is due, one will have to refer to Section 29 of the Act. It, therefore, follows as a corollary that in the case of a sale deed of immovable property the deficiency in the stamp duty can be recovered from the vendee only and not from the vendor. Section 44 contemplates a situation where any duty or penalty has been paid under Sections 35, 37, 40 or 41 by any person in respect of an instrument and by agreement or under the provisions of Section 29 some other person was bound to bear the expenses of providing the proper stamp for such instrument. In such a case that person is entitled to recover the amount from the person who was bound to bear the expenses of providing the proper stamp for such instrument in accordance with Section 29. This provision again shows that the liability to pay stamp duty has to be ascertained in accordance with Section 29 of the Act and the person who has paid the amount under Sections 35, 37, 40 or 41 of the Act is entitled to recover the amount from the said person. These provisions show in unequivocal terms that in case of a sale deed of immovable property, the liability to pay stamp duty is that of the vendee and not that of the vendor.

11. With profound respects, we are unable to accept the view taken in the decisions cited by learned standing counsel that Sections 29 and 44 of the Act only regulate the liabilities as between the parties inter se. Section 54 of Transfer of Property Act de-fines a sale and it provides that sale is a transfer of ownership in exchange for a price paid or promised or part paid and part promised. The consideration for sale of an immovable property is a matter of agreement between the vendor and vendee. They can also enter into an agreement regarding the expenses of providing the proper stamp duty, There was no requirement of making a legislation which may deal with expenses for providing proper stamp duty as between a vendor and vendee of immovable property as such a matter can always be settled by mutual agreement. If in a case of a conveyance the stamp duty is paid by the grantor, the deed would not be rendered invalid nor it would violate any provision of law. Under the scheme of the Act, the Collector has been empowered to recover any deficiency in stamp duty. The purpose of enacting Section 29(c) is that he may recover the amount from the grantee and not from the grantor. This also appears to be logical as the vendee who acquires title over the property by the deed of conveyance should be held liable to pay the requisite stamp duty.

12. We are, therefore, clearly of the opinion that in the case of a sale deed of immovable property, the liability to pay the stamp duty is that of the 4 WRIC No. 25127 of 2019 vendee. Therefore, the proceedings initiated against the petitioners, who are the vendors and not vendees of the sale deed dated 2-5-1996 is wholly illegal and has to be set-aside."

13. In the said judgment, the Court has categorically held the liability to pay stamp duty is that of vendee. No recovery proceeding can be initiated against the vendor. The case in hand is squarely covered by the Division Bench Judgment referred hereinabove.

14. In view of the peculiar facts and circumstances as stated above and the law laid down by the Division Bench of this Court, the proceeding initiated against the petitioner to recover any amount in pursuance of order dated 22.10.2008 or recovery certificate dated 25.04.2009 from the immovable asset of the petitioner, the respondent authorities are at liberty to recover the amount from the vendee of the instalment in question.

15. Petition is allowed.

16. No order as to costs. September 25, 2025 Priya (Piyush Agrawal,J.) PRIYA KUSHWAHA High Court of Judicature at Allahabad

2. Learned counsel for the petitioner submits that petitioner was allocated plot no.137 Block No.H Sector no.63 phase 3 situated at New Okhala Industrial Development Area by New Okhala Industrial Development Authority, District Gautam Buddh Nagar on 20.03.2024, a lease deed was executed, and the possession of the plot was given to the petitioner. Thereafter, on 04.05.2006, the said plot was let out to one partnership firm namely, M/s Livelle Design at C-195, Greater Kailash Part I, New Delhi, for a period of one year. Thereafter, the proceeding under Section 47(A) of the Indian Stamp Act was initiated against the private respondent with regard to the lease executed on 04.05.2006.

3. Notices were sent to the private respondents, but despite service of notice, respondent choose not to appear in the said proceeding, therefore, the Collector passed an order dated 22.10.2008 holding deficit of Stamp duty of Rs.2,85,550/- and penalty of the equal amount as well as interest of 1.5 per cent per annum.

4. Thereafter, recovery certificate was also issued on 25.04.2009. Since, the private respondent, who took the property in question on rent left the premises, recovery could not be made from them. The respondent tried to attach the property of the petitioner in the garb of the aforesaid proceeding.

5. The petitioner moved restoration application no.823 of 2019, which was dismissed by order dated 04.05.2019 holding that no order has been passed against the petitioner, therefore, the restoration application is not maintainable. Despite the fact that no order has been passed against the petitioner, still the petitioner harassed by trying to attach the property of 2 WRIC No. 25127 of 2019 the petitioner. The petitioner, thereafter, filed a detailed application dated 25.09.2019 reiterating all facts and bringing on record the materials to show that the property of the petitioner cannot be attached. The said application of the petitioner was rejected by order dated 22.06.2019 again holding that no order has been passed against the petitioner and therefore, no recovery is made against the petitioner. There is no justification to pass a fresh order.

6. Counsel for the petitioner submits on the aforesaid compelling reasons, the present writ petition is being instituted with aforesaid prayer.

7. Counsel for the petitioner further submits that the duty to pay the stamp duty is of the vendee and not of the vendor. Any proceeding towards deficit of stamp duty can only be made against the vendee but the case in hand that coercive action has been taken against the petitioner not being the vendee but a vendor. He further submits that a specific pleading in paragraph nos.11 and 12 of the writ petition have been taken which has not been denied in paragraph nos.14 and 15 of the counter affidavit. In support of his submission, he has relied upon the judgment of this Court passed in the case of Kunwarpal Sharma and another Vs. State of U.P. and others in C.M.W.P. No.8792 of 2001 and prays for allowing the writ petition.

8. Per contra, learned Standing Counsel supports the impugned action and submits that the proceeding have rightly been initiated to recover deficit stamp duty, together with penalty and interest. The amount towards the deficit of stamp duty has not been paid in pursuance of the agreement executed between the petitioner and his tenant as such justify the proceeding.

9. After hearing the parties, the Court has perused the record.

10. It is not in dispute that the agreement was executed between the petitioner and the private respondent taking over the property in question on rent. The proceeding, in pursuance of the execution of the lease deed dated 04.03.2006, of the stamp duty was initiated under Section 47(A). The private respondent in their wisdom despite service of notice not responded and the order was passed holding deficit of stamp duty. To satisfy the deficit stamp duty, the proceeding of recovery as arrears of land revenue was pressed into service. The respondent authorities when could not recover the amount from the vendee, the proceeding against the property of the petitioner was taken up. When it came to the knowledge of the petitioner that the property of the petitioner are going to be attached, moved a recall application but the same was rejected as no order has been passed against the petitioner. Further, still the proceeding was not stopped to recover from the property of the petitioner, again a detailed application was moved, which was also dismissed on the ground of maintainability.

11. The record shows that the petitioner was not a vendee but a vendor. The liability to pay stamp duty or deficit of the same in pursuance of the agreement is that of the vendee. Any recovery can be initiated towards the deficit of stamp duty of instrument can always be done against the vendee and not from the vendor as prescribed under Section 29(c) of the Stamp Act. 3 WRIC No. 25127 of 2019

12. The Division Bench of this Court in the case of Kunwarpal Sharma (supra) has held as under : "6. Section 29(c) clearly lays down that in the case of a conveyance in absence of any agreement to the contrary, the expenses for providing proper stamps shall be borne by the grantee. The language used in the section is very clear and this provision makes it obligatory upon the vendee to pay the stamp duty. This section casts no obligation upon the vendor to pay the stamp duty. Section 48 empowers the Collector to recover the duties, penalties and other sums required to be paid under the Act by distress and sale of the movable property of the person from whom the same are due or by any other process for the time being in force for the recovery of the arrears of land revenue. This provision clearly provides that deficiency in stamp duty can be recovered only from the person from whom it is due and not from every person who may be a party to the deed. For finding out the person from whom the duty is due, one will have to refer to Section 29 of the Act. It, therefore, follows as a corollary that in the case of a sale deed of immovable property the deficiency in the stamp duty can be recovered from the vendee only and not from the vendor. Section 44 contemplates a situation where any duty or penalty has been paid under Sections 35, 37, 40 or 41 by any person in respect of an instrument and by agreement or under the provisions of Section 29 some other person was bound to bear the expenses of providing the proper stamp for such instrument. In such a case that person is entitled to recover the amount from the person who was bound to bear the expenses of providing the proper stamp for such instrument in accordance with Section 29. This provision again shows that the liability to pay stamp duty has to be ascertained in accordance with Section 29 of the Act and the person who has paid the amount under Sections 35, 37, 40 or 41 of the Act is entitled to recover the amount from the said person. These provisions show in unequivocal terms that in case of a sale deed of immovable property, the liability to pay stamp duty is that of the vendee and not that of the vendor.

11. With profound respects, we are unable to accept the view taken in the decisions cited by learned standing counsel that Sections 29 and 44 of the Act only regulate the liabilities as between the parties inter se. Section 54 of Transfer of Property Act de-fines a sale and it provides that sale is a transfer of ownership in exchange for a price paid or promised or part paid and part promised. The consideration for sale of an immovable property is a matter of agreement between the vendor and vendee. They can also enter into an agreement regarding the expenses of providing the proper stamp duty, There was no requirement of making a legislation which may deal with expenses for providing proper stamp duty as between a vendor and vendee of immovable property as such a matter can always be settled by mutual agreement. If in a case of a conveyance the stamp duty is paid by the grantor, the deed would not be rendered invalid nor it would violate any provision of law. Under the scheme of the Act, the Collector has been empowered to recover any deficiency in stamp duty. The purpose of enacting Section 29(c) is that he may recover the amount from the grantee and not from the grantor. This also appears to be logical as the vendee who acquires title over the property by the deed of conveyance should be held liable to pay the requisite stamp duty.

12. We are, therefore, clearly of the opinion that in the case of a sale deed of immovable property, the liability to pay the stamp duty is that of the 4 WRIC No. 25127 of 2019 vendee. Therefore, the proceedings initiated against the petitioners, who are the vendors and not vendees of the sale deed dated 2-5-1996 is wholly illegal and has to be set-aside."

13. In the said judgment, the Court has categorically held the liability to pay stamp duty is that of vendee. No recovery proceeding can be initiated against the vendor. The case in hand is squarely covered by the Division Bench Judgment referred hereinabove.

14. In view of the peculiar facts and circumstances as stated above and the law laid down by the Division Bench of this Court, the proceeding initiated against the petitioner to recover any amount in pursuance of order dated 22.10.2008 or recovery certificate dated 25.04.2009 from the immovable asset of the petitioner, the respondent authorities are at liberty to recover the amount from the vendee of the instalment in question.

15. Petition is allowed.

16. No order as to costs. September 25, 2025 Priya (Piyush Agrawal,J.) PRIYA KUSHWAHA High Court of Judicature at Allahabad

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