WP/24577/2005 of P. Venkata Rao, Vs Govt. of Andhra Pradesh, on 26 December 2005

ORDER:

The petitioner was granted lease of maintaining and running a Tollgate across theKommamuru canal on Tenali-Narakoduru road in Guntur District from 01.04.2004 to31.03.2006. The corresponding lease deed was executed on 31.03.2004 and wasregistered with the fifth respondent. The lease deed is said to have been released,on being satisfied that proper stamp duty and necessary registration charges werepaid.

The audit party of the registration department had verified the records of the fifthrespondent and found that there is a deficit of Rs.2,18,784/- towards stamp duty anda sum of Rs.14,640/- towards registration charges on the lease deed dated31.03.2004. On receiving the report of the audit party, the fifth respondent addresseda letter, dated 29.09.2005, to the parties to the document, namely, the petitioner andthe first respondent, requiring them to pay a sum of Rs.2,33,474/- within the timestipulated therein. Consequently, the first respondent addressed a letter, dated07.11.2005, requiring the petitioner to deposit the said amount by 20.11.2005, with awarning that in case the amount is not paid within that time, the Tollgate would betaken over. The petitioner challenges the said proceedings.

It is contended that the respondents did not follow the procedure prescribed underthe Indian Stamp Act (for short ‘the Act’), particularly, the one prescribed underSection 41-A of the Act.

The first respondent filed a counter-affidavit. It narrated the facts that led to theissuance of the impugned order. It contends that being a party to the document, thepetitioner is under obligation to pay the stamp duty and the impugned order waspassed on the basis of the findings recorded by the audit party of the registrationdepartment.

Heard the learned counsel for the petitioner and the learned Government Pleader forR & B.

The lease deed executed by the first respondent in favour of the petitioner on31.03.2004 was registered and released by the fifth respondent. Section 41-A of theAct prescribes the procedure to be followed in the event of any deficiency of stampduty or registration charges being noticed, after a document is registered andreleased. In such cases, the Collector is under obligation to issue notice to theparties concerned, directing them to show cause as to why the deficit amount shallnot be collected. A reasoned order is required to be passed on consideration of theexplanation. Sub-section 2 thereof provides for an appeal to the Chief ControllingRevenue Authority. The Registrar, with whom the document is registered, has hardlyany role to play in the matter.

In the instant case, the entire procedure prescribed under Section 41-A of the Actwas given a goby. The Collector, the fourth respondent herein, did not serve anynotice, as contemplated under that provision, upon the petitioner or the firstrespondent. The fifth respondent has taken upon himself, the task of collecting theamount, without there being any adjudication by the fourth respondent, much less, ashow cause notice preceding it. When the petitioner was compelled to make thedeposit, this Court passed an interim order. In the light of the same, the fifthrespondent is said to have refunded the demand draft collected from the petitioner.However, the same is now said to be lying with the first respondent.

The obligation of the petitioner to pay any amount towards deficit stamp duty orregistration charges would arise, if only the fourth respondent has initiatedproceedings contemplated under Section 41-A of the Act. Inasmuch as suchproceedings have not been initiated, neither the first respondent nor the fifthrespondent is entitled to require the petitioner to pay any amount.

In that view of the matter, the writ petition is allowed and the impugned order, dated

Conclusion

07.11.2005, is set aside. The first respondent is directed to refund the demand draftsubmitted by the petitioner for a sum of Rs.2,33,474/- forthwith. It shall be open to thefourth respondent to take necessary steps in accordance with Section 41-A of theAct and the liability of the petitioner would arise only on culmination of suchproceedings. No costs.

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26.12.2005

Note: Issue C.C. in three days

(B/o)

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