Bano Saiyed Parwaz v. Chief Controlling Revenue Authority & Ors.
Case No.: 4111 of 2020 (Civil Appeal).
Dated on: 17th May 2024.
Court: Supreme Court of India.
Quorum: Hon’ble J. B.R. Gavai, J. Prashant Kumar Mishra.
Facts of the case:
The appellant, Bano Saiyed Parwaz, agreed to purchase a property in Mumbai from Mohammed Hanif Ahmed Fitwala. A conveyance deed was prepared for the same purpose, and the appellant paid a stamp duty of Rs. 25,24,350 in May 2014. The conveyance deed was not registered as the vendor had already sold the property to a third party in 1992. The appellant tried to contact the vendor upon discovering the fraud to execute a cancellation deed, but the vendor was unavailable. This forced the appellant to lodge a police complaint. It was only after the intervention of the police that the vendor could be traced, and a cancellation deed was executed in November 2014.
In October 2014, the appellant had already applied online for a refund of the stamp duty under Section 48 of the Maharashtra Stamp Act, 1958. Subsequently, in December 2014, she filed a written application along with relevant documents, seeking a refund under Section 47 of the Act. The appellant’s demand for a refund was rejected by respondents in June 2015 and February 2016 on the ground that the application was filed beyond the limitation period prescribed under Section 48 of the Act. Aggrieved by these orders, the appellant approached the High Court of Judicature at Mumbai (Bombay) through a writ petition (No. 281 of 2019). However, the High Court dismissed the petition in August 2019, upholding the orders of the revenue authorities.
Legal issues:
Whether the appellant’s application for a refund of stamp duty was maintainable despite the cancellation deed being executed in November 2014, which was beyond the six-month limitation period prescribed under Section 48 of the Maharashtra Stamp Act, 1958?
Legal provisions:
- Maharashtra Stamp Act, 1958:
- Section 47(c) allows for the refund of stamp duty in certain circumstances, including where an instrument executed by any party to it was found to be absolutely void from the beginning [Section 47(c) (1)] or where the instrument totally failed of its intended purpose due to the refusal of any person to act under the same [Section 47(c)(5)].
- Section 48 of the Act states that the application for a refund under Section 47 must be made within six months of the date of the instrument.
- Bombay Stamp Rules, 1939
- Rules 21 and 22A provide for the procedure to be followed by the Collector in inquiring into and deciding claims for refunds, including the power to require oral depositions, affidavits, or witnesses’ evidence.
Contentions of petitioner
The learned counsel for the appellants contended that the case was squarely covered under Sections 47(c)(1) and 47(c)(5) of the Act, as the conveyance deed was found to be void from the beginning due to the fraud played by the vendor, and it totally failed of its intended purpose. The counsel further argued that Sections 47 and 48 of the Act contain two distinct stages for a refund of stamp duty:
- Making an application for a refund within six months, as required by Section 48.
- Holding an inquiry and leading evidence as per the Rules to satisfy the Collector that the case is under one of the circumstances in Section 47.
The appellant’s application, filed on October 1014, was within the time limit prescribed by Section 48, and the subsequent cancellation deed should not have rendered the application time-barred. The appellant also contended that the authorities misinterpreted Sections 47 and 48, ignoring that the circumstances of the fraud warranted a refund.
Therefore, the case falls within the provisions, and hence, the appellant is entitled to a refund.
Contentions of respondents
The learned counsel for respondents opposed the present appeal, arguing that although the appellant filed an application for a refund of stamp duty in October 2014, the cancellation deed between the appellant and the seller was executed in November 2014. This date falls beyond the six-month limitation period from the date the stamp duty was paid, which was May 2014, as prescribed by Section 48 of the Act. Consequently, the last date for applying for the refund was November 2014, making the appellant’s application beyond the period of limitation.
Analysis of the Judgement:
The Supreme Court observed that the appellant was a bona fide purchaser and was a victim of fraud played upon her by the vendor. She had paid a substantial amount of Rs. 25,34,400 to purchase the stamp duty but could not register the conveyance deed due to the vendor’s fraud. The appellant had applied online for a refund after learning about the fraud, and her efforts to contact the vendor to execute the cancellation deed were delayed due to his unavailability, leading to the police complaint. The High Court’s finding that the appellant’s application was not maintainable because it was filed before the cancellation deed was executed was misplaced in so far as while submitting the online application; there was no caution to the appellant that all of the documents and materials for the satisfaction of the Collector should be filed with the application. The Court observed that the Sections concerned envisaged only the application for relief under Section 47 to be made within six months of the instrument’s date, which the appellant had prima facie complied with. The evidence required and the inquiry to be made in terms of Section 47 of the Act is a separate process altogether. The appellant was not required to file all documents and materials for the satisfaction of the Collector along with the initial application.
The Court relied on its earlier judgment in ‘Committee-GFIL v. Libra Buildtech Private Limited & Ors., where it had held that when the state deals with a citizen, it should not ordinarily rely on technicalities, and if the citizen’s case is just, the state must act as an honest person, even if legal defences are available. The Court further reiterated the settled principle that the expiry of a limitation period may bar the remedy but not the right of a citizen. Therefore, notwithstanding the dismissal of the initial application on the ground of limitation, the appellant was entitled to claim the refund of stamp duty based on the grounds mentioned in Sectio 47 of the Act.
Accordingly, the Supreme Court allowed the appeal and set aside the High Court’s order and the orders of the revenue authorities. The Apex Court directed the state to refund the stamp duty amount of Rs. 25,34,400 to the appellant.
Conclusion
The judgment of the Supreme Court in the case of Bano Saiyed Parwaz v. Chief Controlling Revenue Authority is a decision that upholds the principles of equity, justice, and fairness. The Court’s emphasis on the state’s responsibility to act as an honest and responsible entity when dealing with its citizens is a notable step towards promoting accountability and responsiveness of the government. It encourages the courts and authorities to adopt a citizen-friendly approach when dealing with similar situations.
Judgement reviewed by Maria Therese Syriac.
Click here to read the full judgement
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