Maharashtra Stamp Act | Refund Of Stamp Duty Can't Be Denied On Ground That Application Was Made Before Execution Of Cancellation Deed : Supreme Court

In a recent decision concerning the refund of the stamp duty under the Maharashtra Stamp Act, 1958, the Supreme Court held that the refund of the stamp duty paid towards the unexecuted conveyance could not be denied on mere technicality that the application seeking refund of the stamp duty was preferred before the execution of the cancellation deed. The court clarified that if the application seeking a refund was filed within six months of the date of payment of stamp duty, then the refund could not be denied to the applicant.

The bench comprising Justices BR Gavai and Prashant Kumar Mishra heard a matter where the applicant had filed an application for the refund of the stamp duty under the Maharashtra Stamp Act, 1958 on the ground that the stamp duty paid towards the execution of the conveyance deed remains unexecuted, thus, the refund of the stamp duty was sought by the applicant.

As per the mandate of Section 48 of the Maharashtra Stamp Act, the application seeking a refund of the stamp duty needs to be preferred within six months from the date of the instrument.

In the present case, as soon as the applicant came to know that the fraud was played upon him by the vendor, the applicant filed an application seeking a refund of the stamp duty paid for the conveyance of the deed.

However, it was contended by the respondent/stamp authority that the application seeking refund of the stamp duty wasn't preferred within the limitation period as such an application of refund would be deemed to have effect from the date of cancellation of the conveyance deed. Since the cancellation deed was executed beyond the limitation period for refund, application seeking such refund was not maintainable, the authorities contended.

Here, the conveyance deed was executed on 13.05.2014. The application for refund was made on 22.10.2014. The cancellation deed was executed on 13.10.2014. The appellant had paid Rs.25,34,400/- towards stamp duty.

The Judgment authored by Justice Prashant Kumar Mishra observed that the respondent's contention that the appellant's application for refund is not maintainable as it has been filed before the cancellation of the conveyance deed is misplaced as the application seeking a refund of the stamp duty was preferred by the applicant within six months from the date of payment of the stamp duty i.e., 13.05.2014.

"The finding returned by the High Court in the impugned order that the appellant's application for refund dated 22.10.2014 is not maintainable in law as it has been filed before the cancellation of the conveyance deed dated 13.11.2014 is misplaced.."

Disagreeing with the High Court's view, the Supreme Court said :

“the finding of the learned single judge is contrary to the requirements stipulated by Sections 47 & 48 which envisages only the application for relief under Section 47 of the Act to be made within six months of the date of the instrument which prima facie is appeared to have been done by the appellant in the present case.”

Expiry of Limitation Period May Bar Remedy But Not Right To Seek Refund Of Stamp Duty

Drawing reference from the Judgment of Committee-GFIL v. Libra Buildtech Private Limited & Ors. (2015) 16 SCC 31, the court held that even if the respondent's contention is accepted that the application seeking a refund of stamp duty was preferred beyond the limitation period then also the applicant could not be denied the benefit of refund of the stamp duty because it is settled law that the period of expiry of limitation prescribed under any law may bar the remedy but not the right and the appellant is held entitled to claim the refund of stamp duty amount based on the fact that the appellant has been pursuing her case as per remedies available to her in law.

“she should not be denied the said refund merely on technicalities as the case of the appellant is a just one wherein she had in bonafide paid the stamp duty for registration but fraud was played on her by the Vendor which led to the cancellation of the conveyance deed.”, the court added.

Conclusion

Accordingly, the court concluded that the applicant should be entitled to receive the stamp duty paid towards the unexecuted conveyance deed. The appeal was allowed.

Counsels For Petitioner(s) Mr. Subodh Markandeya, Sr. Adv. Mr. Sahil, Adv. Mr. Rahul Aggarwal, Adv. Mr. Amit Pratap Singh, Adv. Mr. Narender Kumar Verma, AOR

Counsels For Respondent(s) Mr. Aaditya Aniruddha Pande, AOR Mr. Siddharth Dharmadhikari, Adv. Mr. Bharat Bagla, Adv. Mr. Sourav Singh, Adv. Mr. Aditya Krishna, Adv. Ms. Preet S. Phanse, Adv. Mr. Adarsh Dubey, Adv.

Case Title: BANO SAIYED PARWAZ VS. CHIEF CONTROLLING REVENUE AUTHORITY AND INSPECTOR GENERAL OF REGISTRATION AND CONTROLLER OF STAMPS

Citation : 2024 LiveLaw (SC) 426

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