High Court · 2025

1. Heard Ms. Anupama Bhadauria learned counsel for petitioner and learned State Counsel for opposite parties.

2. Petition has been filed challenging order dated 10th January, 2003 passed under Section 47-A of the Indian Stamp Act whereby deficiency has been noticed in the sale deed dated 24th October, 2001 executed in favour of petitioner and penalty and interest thereupon have been imposed. Also under challenge in the order dated 14th May, 2003 passed under Section 56 of the Act rejecting petitioner's appeal.

3. Learned counsel for petitioner submits that by means of sale deed dated 24th October, 2001, the petitioner had purchased an agricultural property recorded as gata No.784 having an area of 0.143 Air in the village in question whereafter proceedings under Section 47-A of the Act were initiated in pursuance of report dated 7th October, 2002. It is submitted that in pursuance of the report, an ex parte inspection of the plot was conducted and forms the basis of the impugned orders.

4. Learned counsel submits that a perusal of impugned order passed under section 47-A of the Act will reveal that the plot in question has been considered to be non agricultural only on the ground of future prospects of the plot considering the fact that it was in proximity to a developed area while ignoring the fact that even as per the said report, agricultural activity was ongoing on the plot in question. It is further submitted that even the appellate authority has ignored the ground taken in memorandum of appeal that an agricultural plot can not be treated to be non agricultural only on the basis of future prospects.

5. Learned counsel has placed reliance on decision rendered by Hon'ble the Supreme Court in the case of State of U.P. and others versus Ambrish Tandon and another, (2012) 5 SCC 566 and Full Bench decision of this Court rendered in the case of Pushpa Sareen versus State of U.P. and others 2015(33) LCD 1575.

6. Learned State Counsel has refuted submissions advanced by learned counsel for petitioner with submission that in terms of judgment rendered in Full Bench judgment in the case of Pushpa Sareen (supra), future prospects of a plot under transfer can very well be adjudicated upon by the authority concerned in terms of conditions indicated therein.

7. Learned counsel has adverted to the supplementary affidavit filed by petitioner himself to advert to the order dated 30th December, 2003 passed by Sub Divisional Magistrate concerned whereby the plot in question was permitted to be converted into non agricultural in terms of Section 143 of the U.P. Zamindari Abolition and Land Reforms Act. It is submitted that the plot in question was subsequently sold by petitioner to one Kashi Ram on 18th September, 2002 whereafter the application dated 5th November, 2003 was preferred for such conversion and has been allowed. It is submitted that the said fact clearly indicates future potentiality of the land as non agricultural and satisfies the conditions indicated in the Full Bench judgment.

8. Upon consideration of submissions advanced by learned counsel for parties and perusal of material on record, particularly the impugned orders, it is evident that the impugned orders particularly the one passed under Section 47-A of the Act have placed reliance on the spot inspection report dated 28th September, 2002 and the plot in question has been adjudged to be non agricultural in nature on the basis of future potential use of the said plot. The aforesaid aspect has already been considered by Supreme Court in the case of Ambrish Tandon (supra). The relevant paragraph of which is as follows:- "15. The impugned order of the High Court shows that it was not seriously disputed about the nature of user of the building, namely, residential purpose on the date of the purchase. Merely because the property is being used for commercial purpose at the later point of time may not be a relevant criterion for assessing the value for the purpose of stamp duty. The nature of user is relatable to the date of purchase and it is relevant for the purpose of calculation of stamp duty. Though the matter could have been considered by the appellate authority in view of our reasoning that there was no serious objection and in fact the said alternative remedy was not agitated seriously and in view of the factual details based on which the High Court has quashed the order dated 27-9-2004 passed by the Additional District Collector, we are not inclined to interfere at this juncture."

9. The aspect of future potentiality of a plot has been considered in the Full Bench judgment of this Court in the case of Pushpa Sareen (supra). Relevant portion of the said judgment are as follows:- "27. The true test for determination by the Collector is the market value of the property on the date of the instrument because, under the provisions of the Act, every instrument is required to be stamped before or at the time of execution. In making that determination, the Collector has to be mindful of the fact that the market value of the property may vary from location to location and is dependent upon a large number of circumstances having a bearing on the comparative advantages or disadvantages of the land as well as the use to which the land can be put on the date of the execution of the instrument." "28. Undoubtedly, the Collector is not permitted to launch upon a speculative inquiry about the prospective use to which a land may be put to use at an uncertain future date. The market value of the property has to be determined with reference to the use to which the land is capable reasonably of being put to immediately or in the proximate future. The possibility of the land becoming available in the immediate or near future for better use and enjoyment reflects upon the potentiality of the land. This potential has to be assessed with reference to the date of the execution of the instrument. In other words, the power of the Collector cannot be unduly circumscribed by ruling out the potential to which the land can be advantageously deployed at the time of the execution of the instrument or a period reasonably proximate thereto. Again the use to which land in the area had been put is a material consideration. If the land surrounding the property in question has been put to commercial use, it would be improper to hold that this is a circumstance which should not weigh with the Collector as a factor, which influences the market value of the land."

10. Upon applicability of the aforesaid judgments in the present facts and circumstances of the case, it is no doubt evident that future potential use of a property can be a consideration for passing orders under Section 47-A of the Stamp Act but subject to the conditions indicated in the Full Bench judgments which particularly refers to the aspects of exemplars to be considered by the authority for considering future potential use of the plot as on the date of execution of the sale deed.

11. In the present facts and circumstance, the order passed under Section 47-A does not at all refer to any exemplar of adjoining plots. The potential use of the plot in question has been taken only on the basis of its proximity to a developed area.

12. The aspect of future use of plot on the basis of its proximity to a developed area has been considered by Supreme Court in the case of Smt. Prakashwati versus Chief Controlling Revenue Authority, Board of Revenue, Allahabad & others, (1996) 4 SCC 657 as follows:- " Secondly, its being situated in an area which is close to Samrat Vikram Colony, said to be a decent locality, where people of high income group reside, does not by itself make it a part thereof. We are doubtful whether the said factum of closeness by itself would cast any reflection on the price of property in question."

13. In the considered opinion of this Court, the same could not have been a basis for particularly future potential use of property in view of judgment rendered in the case of Ambrish Tandon (supra) and Prakashwati (supra).

14. Although the plot in question has subsequently been permitted to be converted into non agricultural use in terms of Section 143 of the U.P. Zamindari Abolition and Land Reforms Act, the same would also be inconsequential in view of the fact that application for such conversion was filed by subsequent purchaser almost after two years of the present sale deed and therefore would not be relevant for purposes of future potential use of the property as on the date of execution of the present sale deed. Although in paragraph 5 of the counter affidavit, the plea with regard to Article 23 of Schedule 1-B of the Stamp Act has been taken but a perusal of the aforesaid provision clearly indicates that it pertains to conveyance, and would therefore obviously be applicable in the present case.

15. Considering aforesaid facts and circumstances and discussion made, the impugned orders dated 10th January, 2003 and 14th May, 2003 being unsustainable are hereby quashed by issuance of writ in the nature of certiorari.

16. Resultantly the petition succeeds and is allowed. Parties to bear their own cost. Order Date :- 6.3.2025 prabhat PRABHAT KUMAR PRABHAT KUMAR High Court of Judicature at Allahabad, High Court of Judicature at Allahabad, Lucknow Bench Lucknow Bench

1. Heard Ms. Anupama Bhadauria learned counsel for petitioner and learned State Counsel for opposite parties.

2. Petition has been filed challenging order dated 10th January, 2003 passed under Section 47-A of the Indian Stamp Act whereby deficiency has been noticed in the sale deed dated 24th October, 2001 executed in favour of petitioner and penalty and interest thereupon have been imposed. Also under challenge in the order dated 14th May, 2003 passed under Section 56 of the Act rejecting petitioner's appeal.

3. Learned counsel for petitioner submits that by means of sale deed dated 24th October, 2001, the petitioner had purchased an agricultural property recorded as gata No.784 having an area of 0.143 Air in the village in question whereafter proceedings under Section 47-A of the Act were initiated in pursuance of report dated 7th October, 2002. It is submitted that in pursuance of the report, an ex parte inspection of the plot was conducted and forms the basis of the impugned orders.

4. Learned counsel submits that a perusal of impugned order passed under section 47-A of the Act will reveal that the plot in question has been considered to be non agricultural only on the ground of future prospects of the plot considering the fact that it was in proximity to a developed area while ignoring the fact that even as per the said report, agricultural activity was ongoing on the plot in question. It is further submitted that even the appellate authority has ignored the ground taken in memorandum of appeal that an agricultural plot can not be treated to be non agricultural only on the basis of future prospects.

5. Learned counsel has placed reliance on decision rendered by Hon'ble the Supreme Court in the case of State of U.P. and others versus Ambrish Tandon and another, (2012) 5 SCC 566 and Full Bench decision of this Court rendered in the case of Pushpa Sareen versus State of U.P. and others 2015(33) LCD 1575.

6. Learned State Counsel has refuted submissions advanced by learned counsel for petitioner with submission that in terms of judgment rendered in Full Bench judgment in the case of Pushpa Sareen (supra), future prospects of a plot under transfer can very well be adjudicated upon by the authority concerned in terms of conditions indicated therein.

7. Learned counsel has adverted to the supplementary affidavit filed by petitioner himself to advert to the order dated 30th December, 2003 passed by Sub Divisional Magistrate concerned whereby the plot in question was permitted to be converted into non agricultural in terms of Section 143 of the U.P. Zamindari Abolition and Land Reforms Act. It is submitted that the plot in question was subsequently sold by petitioner to one Kashi Ram on 18th September, 2002 whereafter the application dated 5th November, 2003 was preferred for such conversion and has been allowed. It is submitted that the said fact clearly indicates future potentiality of the land as non agricultural and satisfies the conditions indicated in the Full Bench judgment.

8. Upon consideration of submissions advanced by learned counsel for parties and perusal of material on record, particularly the impugned orders, it is evident that the impugned orders particularly the one passed under Section 47-A of the Act have placed reliance on the spot inspection report dated 28th September, 2002 and the plot in question has been adjudged to be non agricultural in nature on the basis of future potential use of the said plot. The aforesaid aspect has already been considered by Supreme Court in the case of Ambrish Tandon (supra). The relevant paragraph of which is as follows:- "15. The impugned order of the High Court shows that it was not seriously disputed about the nature of user of the building, namely, residential purpose on the date of the purchase. Merely because the property is being used for commercial purpose at the later point of time may not be a relevant criterion for assessing the value for the purpose of stamp duty. The nature of user is relatable to the date of purchase and it is relevant for the purpose of calculation of stamp duty. Though the matter could have been considered by the appellate authority in view of our reasoning that there was no serious objection and in fact the said alternative remedy was not agitated seriously and in view of the factual details based on which the High Court has quashed the order dated 27-9-2004 passed by the Additional District Collector, we are not inclined to interfere at this juncture."

9. The aspect of future potentiality of a plot has been considered in the Full Bench judgment of this Court in the case of Pushpa Sareen (supra). Relevant portion of the said judgment are as follows:- "27. The true test for determination by the Collector is the market value of the property on the date of the instrument because, under the provisions of the Act, every instrument is required to be stamped before or at the time of execution. In making that determination, the Collector has to be mindful of the fact that the market value of the property may vary from location to location and is dependent upon a large number of circumstances having a bearing on the comparative advantages or disadvantages of the land as well as the use to which the land can be put on the date of the execution of the instrument." "28. Undoubtedly, the Collector is not permitted to launch upon a speculative inquiry about the prospective use to which a land may be put to use at an uncertain future date. The market value of the property has to be determined with reference to the use to which the land is capable reasonably of being put to immediately or in the proximate future. The possibility of the land becoming available in the immediate or near future for better use and enjoyment reflects upon the potentiality of the land. This potential has to be assessed with reference to the date of the execution of the instrument. In other words, the power of the Collector cannot be unduly circumscribed by ruling out the potential to which the land can be advantageously deployed at the time of the execution of the instrument or a period reasonably proximate thereto. Again the use to which land in the area had been put is a material consideration. If the land surrounding the property in question has been put to commercial use, it would be improper to hold that this is a circumstance which should not weigh with the Collector as a factor, which influences the market value of the land."

10. Upon applicability of the aforesaid judgments in the present facts and circumstances of the case, it is no doubt evident that future potential use of a property can be a consideration for passing orders under Section 47-A of the Stamp Act but subject to the conditions indicated in the Full Bench judgments which particularly refers to the aspects of exemplars to be considered by the authority for considering future potential use of the plot as on the date of execution of the sale deed.

11. In the present facts and circumstance, the order passed under Section 47-A does not at all refer to any exemplar of adjoining plots. The potential use of the plot in question has been taken only on the basis of its proximity to a developed area.

12. The aspect of future use of plot on the basis of its proximity to a developed area has been considered by Supreme Court in the case of Smt. Prakashwati versus Chief Controlling Revenue Authority, Board of Revenue, Allahabad & others, (1996) 4 SCC 657 as follows:- " Secondly, its being situated in an area which is close to Samrat Vikram Colony, said to be a decent locality, where people of high income group reside, does not by itself make it a part thereof. We are doubtful whether the said factum of closeness by itself would cast any reflection on the price of property in question."

13. In the considered opinion of this Court, the same could not have been a basis for particularly future potential use of property in view of judgment rendered in the case of Ambrish Tandon (supra) and Prakashwati (supra).

14. Although the plot in question has subsequently been permitted to be converted into non agricultural use in terms of Section 143 of the U.P. Zamindari Abolition and Land Reforms Act, the same would also be inconsequential in view of the fact that application for such conversion was filed by subsequent purchaser almost after two years of the present sale deed and therefore would not be relevant for purposes of future potential use of the property as on the date of execution of the present sale deed. Although in paragraph 5 of the counter affidavit, the plea with regard to Article 23 of Schedule 1-B of the Stamp Act has been taken but a perusal of the aforesaid provision clearly indicates that it pertains to conveyance, and would therefore obviously be applicable in the present case.

15. Considering aforesaid facts and circumstances and discussion made, the impugned orders dated 10th January, 2003 and 14th May, 2003 being unsustainable are hereby quashed by issuance of writ in the nature of certiorari.

16. Resultantly the petition succeeds and is allowed. Parties to bear their own cost. Order Date :- 6.3.2025 prabhat PRABHAT KUMAR PRABHAT KUMAR High Court of Judicature at Allahabad, High Court of Judicature at Allahabad, Lucknow Bench Lucknow Bench