J&K High Court Seeks State Response On Status Of Stamp Duty Exemptions Given To Companies Engaged In Power Development Projects

A bench of Justice Rahul Bharti was hearing a writ petition filed by the petitioner, a company engaged in power project development, seeking registration of a mortgage deed without paying stamp duty as per the J&K Hydro Power Policy, 2022. The court sought a response from the competent authorities, as no notification had been issued by the government enforcing the said policy.

The above directions were passed when the court noticed an apparent confusion, as on one hand, the government had introduced a policy providing incentives to power development projects, while on the other hand, the registration of required documents for the same was being stalled by authorities due to non-payment of stamp duty.

The court took note of the fact that earlier, the government, through notifications, had granted exemptions to power developers from paying stamp duty on mortgage deeds executed for securing loans. This exemption was further extended in 2017 to cover power projects up to 10 MW, and under the draft Hydro Power Policy, 2022, it was extended to projects up to 25 MW.

The court directed the authority to provide the status of the stamp duty exemption by the 3rd of March.

BACKGROUND

The petitioner is a company engaged in power project development. The petitioner executed a mortgage deed with J&K Bank to secure a loan amount of ₹27.92 crore, but the Sub-Registrar, Pulwama, refused to register it, citing the lack of stamp duty payment. The petitioner then filed a writ petition before the court, seeking a direction to the concerned authority to register the deed.

The court, after noting that while the Hydro Power Policy, 2022, provided certain exemptions concerning the payment of stamp duty, there was no explicit government notification to support the said draft policy. Therefore, it directed the concerned authorities to apprise the court regarding the stamp duty exemption status.

The court also ordered that Payment of stamp duty if any by the mortgagers on the mortgaged deed in reference shall be without prejudice to their right to seek recovery of the money paid for the stamp duty on the mortgaged deed

APPEARANCE:

Hilal Ahmad Bhat, Advocate FOR petitioners

Satinder Singh Kala, AAG for respondents

Case-Title: Kashmir Valley Energy Private Limited & Anr Vs Mr.Bashir Ahmad Bhat, 2025

Citation: 2025 LiveLaw (JKL) 52