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Monday, December 10, 2012

the delay of 449 days in filing the appeals before the Division Bench = Considering the issues raised and the positive direction given by the learned single Judge, we are of the view that the Division Bench of the High Court ought to have condoned the delay and gone into the merits of the matter in the light of the provisions of the Karnataka Stamp Act, 1957. Though the High Court concentrated only on narrating the pleadings of the parties, reasoning of the learned single Judge and cause shown for condoning the delay, but has not considered the substantial grounds urged by the State. As rightly pointed out by learned senior counsel for the State that though in the last paragraph there is some reference about the reasoning of the learned single Judge, not much attention was given on the merits of the claim made by the State.



                                                                  REPORTABLE


                        IN THE SUPREME COURT OF INDIA

                         CIVIL APPELLATE JURISDICTION

                                      1


                  2 CIVIL APPEAL Nos. 8803-8805    OF 2012


             3 (Arising out of SLP (C) Nos. 14177-14179 of 2010)





The State of Karnataka & Ors.                           .... Appellant (s)

            Versus

Vivekananda M. Hallur & Ors.                  .... Respondent(s)






                               J U D G M E N T

P. Sathasivam, J.
1)    Leave granted.
2)    These appeals are directed against the final judgment and order  dated
19.06.2009 passed by the High  Court  of  Karnataka  at  Bangalore  in  Writ
Appeal Nos. 1023, 1324 and 1325 of 2009 whereby the Division  Bench  of  the
High Court dismissed the appeals on the  ground  of  delay  as  well  as  on
merits.
3)    Brief facts :
(a)   Respondents herein are the members of Kendriya Upadhyayara Sangha  (R)
(in short  ‘the  Sangha’),  Bangalore  South  Taluk,  registered  under  the
Karnataka Societies Registration Act, 1960.
The Sangha was granted  certain
land at Jakkasandra Village, South Taluk by the State of Karnataka in  order
to provide house sites to its members.
The sole object  of  the  Sangha  is
charitable and to protect the interest of its members and not  to  form  the
sites and allot to its members with a profit motive.
(b)   According to the appellant-State, the Sangha has allotted  residential
sites to its members including the respondents herein  by  executing  Lease-
cum-Sale  Agreements  in  their  favour  after  receiving  the   full   sale
consideration.  The said agreements were registered in the  office  of  sub-
Registrar, Bangalore South after paying the required stamp duty.
(c)   Under the above said Lease-cum-Sale Agreements, the lease  was  for  a
period of 10 years and after completion  of  the  said  period,  respondents
herein approached the Sangha and requested  them  to  execute  the  Absolute
Sale Deeds in their favour in respect of their sites.  
The  Sangha  agreed
to execute  the  same  and  the  Absolute  Sale  Deeds  were  presented  for
registration before the  sub-Registrar,  Bommanahalli.
  The  sub-Registrar,
while registering the sale deeds,  has  collected  the  stamp  duty  on  the
market value  prevailing  on  that  day  of  execution  of  the  same  after
adjusting  the  stamp  duty  paid  on  Lease-cum-Sale   Agreements.  
After
registration of the documents of sale,  the  respondents  herein  approached
the High Court by filing writ petitions seeking refund of  stamp  duty  paid
on the absolute Sale Deeds.
(d)   Pursuant to the writ petitions filed by  the  respondents,  the  State
Government filed a detailed statement of objections and contended  that  the
Sangha is registered under the Registration Act, hence, the  Sangha  has  no
right to form the sites and allot the same to its members and, there  is  no
exemption under the Karnataka Stamp Act, 1957 (hereinafter  referred  to  as
“the Act”) for any Lease-cum-Sale Agreement executed by the  Sangha.  
Under
the Act, only a site allotted by a House Building Co-operative  Society  can
claim exemption.  It is the claim of the State  that  the  authorities  have
rightly collected the  stamp  duty  on  the  sale  deed  treating  it  as  a
principal document.
(e)    Learned  single  Judge,  by  order  dated  11.12.2007,  in  the  writ
petitions being Nos. 16777, 19358 and 19359  of  2005  filed  by  respondent
Nos.1-3 herein held that the stamp duty  collected  by  the  authorities  on
Lease-cum-Sale Agreement falls under Article 5(e)(i) of the Schedule to  the
Act, therefore, it is a sale agreement with  possession,  hence,  the  stamp
duty paid is as per  the  provisions  of   the  Act.   Therefore,  when  the
documents are placed for registration as a sale deed, they have to  pay  the
stamp duty of the property on the market value as on that day  of  execution
of the sale deed but they are entitled to  claim  deduction  of  the  amount
which they have already paid on the Lease-cum-Sale Agreement.
However,  the
learned single Judge further held that, (a) the petitioners therein are  not
liable to pay stamp duty  on  the  amount  shown  as  consideration  in  the
absolute sale deeds; and (b) they are  entitled  to  refund  of  the  amount
imposed and collected as stamp duty on the absolute sale deeds.
(f)   Aggrieved by the said directions, the State filed appeals  being  W.A.
Nos. 1023, 1324 & 1325 of 2009 before the Division Bench of the High  Court.
 It was contended before the Division Bench that the finding  given  by  the
learned single Judge in the impugned order that 
in view  of  the  provisions
of Article 5(e)(i) of the Schedule to the Act, when the stamp duty  and  the
registration  fee  had  been  collected  on  the  Lease-cum-Sale  instrument
treating it as the possession of the property which has been handed over  at
the time of executing Lease-cum-Sale Deed, the question  of  collecting  the
stamp duty and registration charges on the absolute deeds after  the  expiry
of the Lease-cum-Sale Agreement is only a supplement and could not arise.
(g)   The Division Bench, by impugned order dated 19.06.2009, dismissed  the
writ appeals filed by the State both on the ground of delay as  well  as  on
merits.
(h)   Against the said order, the State has filed  the  present  appeals  by
way of special leave petitions.
4)     This  Court,  after  issuance  of  notice  on  the  applications  for
impleadment (I.A.Nos. 4-6), by order dated 18.02.2011  impleaded  respondent
Nos. 4-32.
 5)   Heard Mr. Basava Prabhu S.  Patil,  learned  senior  counsel  for  the
appellant-State, Mr. Chandra Sekhar, learned counsel for respondent  Nos.  1
& 3 and Mr. P.P. Rao, learned senior counsel for newly impleaded  respondent
Nos. 4-32.
6)    The  following  questions  which  arise  for  consideration  in  these
appeals are:
(i)   Whether the State has shown sufficient cause for condoning  the  delay
of 449 days in filing writ appeals against the order of the  learned  single
Judge, who allowed the writ petitions?
(ii)  Whether the Division Bench  was  justified  in  simply  affirming  the
order of the learned single Judge  in  directing  the  State  to  repay  the
amount collected as stamp duty when Article 5(e) Explanation (ii)  has  held
that the amount collected on  the  sale  or  Lease-cum-Sale  Deed  shall  be
adjusted towards the total duty leviable on the conveyance?  And
(iii) Whether the order of the High Court is contrary to the  provisions  of
Article 5(e)(i) and Explanation (ii) of the Karnataka Stamp Act, 1957?
7)    First of all, we were taken through the reasons stated for  the  delay
of 449 days in filing the appeals before  the  Division  Bench  against  the
order of the learned single  Judge.   The  application  for  condonation  of
delay in filing appeals was supported  by  an  affidavit  of  sub-Registrar,
Peenya, Bangalore North  Taluk.   A  perusal  of  the  application  and  the
reasons stated therein show that how the  delay  has  occurred.   But  after
going through the reasons stated therein and in the light of the  issues  to
be considered by the Division Bench as well as the financial implication  on
the State Exchequer, we are of the view that  the  reasons  stated  for  the
delay cannot be rejected as unacceptable.
8)    Considering the issues raised and the positive direction given by  the
learned single Judge, we are of the view that  the  Division  Bench  of  the
High Court ought to have condoned the delay and gone into the merits of  the
matter in the light of the provisions of  the  Karnataka  Stamp  Act,  1957.
Though the High Court concentrated only on narrating the  pleadings  of  the
parties,  reasoning  of  the  learned  single  Judge  and  cause  shown  for
condoning the delay, but has not considered the  substantial  grounds  urged
by the State.  As rightly pointed out by  learned  senior  counsel  for  the
State that though in the last paragraph there is some  reference  about  the
reasoning of the learned single Judge, not much attention was given  on  the
merits of the claim made by the State.
9)    On these grounds, without expressing anything on merits of  the  claim
of either party, we condone the delay in filing the writ appeals and in  the
light of our conclusion that the Division Bench  has  not  adverted  to  any
substantial grounds urged by the State, particularly with reference  to  the
provisions of Article 5(e)(i) and Explanation (ii) of  the  Karnataka  Stamp
Act, 1957, we set aside the order of the Division Bench  impugned  in  these
appeals and remit the same to the High Court for  fresh  consideration.   We
request the High Court to restore W.A. Nos. 1023, 1324 and 1325 on its  file
and dispose of the same on merits in accordance with  law,  after  affording
opportunity to all the parties  including  the  newly  impleaded  respondent
Nos. 4-32 herein as well as the connected writ petitions pending before  the
High Court, preferably within a period  of  six  months  from  the  date  of
receipt of copy of this judgment.  Once again, we make it clear that  except
adverting to the stand of the State, we have not expressed our views on  any
of the claims and it is  for  the  Division  Bench  of  the  High  Court  to
consider their respective claims in accordance with law as observed supra.
10)   The appeals are allowed.  There shall be no order as to costs.

                             ...…………….…………………………J.


                                 (P. SATHASIVAM)






                             .…....…………………………………J.


                              (RANJAN GOGOI)



NEW DELHI;
DECEMBER 07, 2012.
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