STATE OF GUJARAT vs SAHAJANAND TECHNOLOGIES PVT.LTD.

C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/LETTERS PATENT APPEAL NO. 554 of 2014
In R/SPECIAL CIVIL APPLICATION/5775/2004
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STATE OF GUJARAT & ORS.
Versus
SAHAJANAND TECHNOLOGIES PVT.LTD. & ORS.
=============================================
Appearance:
MS.HETAL PATEL, ASST.GOVERNMENT PLEADER for the
Appellant(s) No. 1,2,3
Mr.PARAM SHAH WITH MR ABHISHEK M MEHTA(3469) for the
Respondent(s) No. 2
MR. DERICK RAJAN THOMAS(15499) for the Respondent(s) No. 1
RULE SERVED for the Respondent(s) No. 3,4
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CORAM: HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE
SUNITA AGARWAL
and
HONOURABLE MR.JUSTICE D.N.RAY

Date : 02/09/2026

ORAL JUDGMENT
(PER : HONOURABLE THE CHIEF JUSTICE
MRS. JUSTICE SUNITA AGARWAL)
1. Heard Ms. Hetal Patel, learned Assistant Government
Pleader for the appellant State, Mr. Abhishek M. Mehta for
the respondent No.2 and Mr. Derick Rajan Thomas for the
respondent No.1.
2. This intra-court appeal is directed against the judgment
and order dated 15.07.2013 passed by the learned Single
Judge in allowing the writ petition directing the respondents
to refund the stamp duty and registration fee paid by the
petitioners on the lease deed dated 04.12.2003 without
interest within a period of four weeks from the date of the
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
order. The writ petition has been filed with the prayers as
under :-
“10. In the premises aforesaid, the petitioner prays as under:-
A. You Lordship be pleased to issue a writ of mandamus or a
writ in nature of mandamus or any other appropriate writ,
order or direction declaring the collection of the stamp duty
on the land-lease transaction between the petitioner and the
respondent no. 3 being illegal, arbitrary and without any
authority of law.
B. You Lordship be pleased to issue a writ of mandamus or a
writ in mature of mandamus or a by other appropriate writ,
order or direction Commanding the respondent to refund the
stamp duty and the registration fees paid by the petitioner on
the land lease deed with the respondent no. 3 forthwith along
with interest the reopen.
c. Pending notice, admission and final herein of this petition
You lordship be pleased to direct the respondent no. 1 to
refund the stamp duty and the registration fees paid by the
petitioner on the land lease deed with the respondent No.3
on appropriate conditions/security as fit to Your lordship.
D. Ex part ad interim relief in terms of prayer C granted.
E. Such other relive (s) as deemed fit may be granted to the
petitioner.”
3. Ms. Hetal Patel, learned Assistant Government Pleader
appearing for the State appellant would submit that the
learned Single Judge has committed an error of law in
proceeding to allow the writ petition on two principles of
promissory estoppel and legitimate expectation which cannot
be invoked in a case which is governed by the statute. The
submission is that there was no exemption of stamp duty and
registration fee on a lease deed executed prior to 10.02.2004.
An Ordinance to provide the operation, maintenance,
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
management and administration of a Special Economic Zone
(SEZ) in the State of Gujarat and to constitute an authority
and for matters connected therewith or incidental thereto was
brought into force only with the notification in the Official
Gazette on 10.02.2004. With the establishment of the Special
Economic Zone Development Authority constituted under
Section 4 of the said Ordinance, namely Gujarat Special
Economic Zone Ordinance, 2004 (Gujarat Ordinance No.1 of
2004), the fiscal benefits incorporated in Chapter VIII Clause
21 of the Ordinance would prescribe for exemption of all
taxes, cess, duties, etc. including stamp duty and registration
fee payable on transfer of land for approved units in the SEZ
(Special Economic Zone).
4. The submission is that the lease deed in question having
been executed on 04.12.2003, prior to the promulgation of the
Ordinance on 10.02.2004, cannot be said to be covered by the
provisions of Clause 21 as contained in Chapter VIII of the
said Ordinance. There was no question, as such, of refund of
stamp duty and registration fee as paid by the petitioners at
the time of the registration of the sale deed. For this reason
alone, the judgment impugned cannot be sustained.
5. Dealing with these contentions of the learned advocate
for the appellant, we may note the reasoning given by the
learned Single Judge in the judgment impugned as under:-
“11. Therefore first contention which is sought to be raised
by the respondent State that it is not a transfer since it is a
lease agreement and therefore there is no transfer of land
and therefore it is not leviable for the benefit of exemption is
required to be considered. The Transfer of Property Act
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
refers to the transfer of property and manner in which the
right, title and interest in the property could be transferred.
Section 5 of the Transfer of Property Act provides that
“Transfer of property” defined. “transfer of property” means
an act by which a living person conveys property, in present
or in future, to another. Further the mortgaged which
referred to transfer of an interest in an immoveable property
is also provided and, therefore, lease by which the right, title
or interest in the land is sought to be transferred would also
amount to a transfer but may not be a sell as provided in
Section 54. However, Section 105 of the Transfer of Property
Act refers to ‘a lease of immoveable property is a transfer of
a right to enjoy such property, made for a certain time,
express or implied, or in perpetuity, in consideration of a
price paid or promised, or of money, a share of crops, service
or any other thing of value, to be rendered periodically or on
specified occasions to the transferor by the transferee, who
accepts the transfer on such terms’. Therefore any such
agreement between the parties with regard to the intention
to create interest in favour of the grantee or licensee is
entitled to an interest for enjoyment of the property. The
Legislature has provided that the lease of immoveable
property for a period of more than one year should be made
by the registered sale deed suggesting that the interest in the
property is created. It is in this background, the provisions of
the Ordinance dated 10.02.2004 are required to be
considered visavis the policy of the Government at
AnnexureH dated 10.02.2004. Thus it appears that the policy
has been made by the Government earlier which culminated
into Ordinance subsequently and, therefore, when there is a
specific provision to give benefit, can such benefit be denied
on the ground that there is no transfer of land. As stated
above, the transfer of land does not necessarily mean by
transfer of sale only and it can have a different form or there
could be a transfer of interest for a long term, which can be
termed as transfer of interest in the land. Therefore, the
submission made by learned AGP Shri Vyas that since it is a
lease deed, it is not a transfer of land cannot be accepted.
The interpretation of the clause in the Ordinance or the
policy has to be made with reference to the ultimate object
for which it is created. Therefore when the policy is made and
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
the Ordinance for the Special Economic Zone has been made
for giving a boost to the industries and invite the people for
setting up the industries holding out to give the benefit
including the fiscal benefit as stated above, same cannot be
denied by such narrow interpretation that the transfer of land
by way of lease is not covered as there is no transfer of land.
As discussed above, the transfer of land does not necessarily
mean that it should be by way of sell only and such a transfer
of sell could be by other mode including the lease of
agreement, by which, the interest in the land is transferred
for the purpose of enjoyment for a duration. Therefore while
interpreting the provision of the Ordinance visavis the policy
and underlying object, submission with regard to narrow
interpretation that it is not a transfer and lease is not a
transfer of land cannot be accepted. By way of lease
agreement, there is a transfer of an interest in the land for a
duration. It is well accepted that even institution like GIDC
which have been set up for the purpose of permitting the
industrialization, encouraging and facilitating an
entrepreneur to put up and set up the industries,
plots/shades are given by such Government Corporation by
GIDC by way of lease. It is on the basis of such allotment of
the plot by way of lease, the industrial units get necessary
power connection as well as finance from the financial
institution like banks. Further it is well accepted rule of
interpretation that there has to be purposive interpretation
which has consonance with the purpose and which is sought
to be achieved by the Legislature or the Ordinance or the
policy. Therefore once it is accepted that the submission that
it is not a transfer of land as provided in the Ordinance and,
therefore, the lease agreement is covered cannot be
accepted.
12. Therefore once it is accepted that even limited transfer of
interest in the land by way of lease agreement would also
amount to transfer of land for the purpose of fiscal benefits as
provided in the Ordinance, which would make the units like
the petitioner for the entitle for the benefit.
13. Another facet of argument that the Ordinance was issued
on 10.02.2004 and the policy has been made in 2007 and the
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
lease agreement is dated 04.12.2003 and, therefore, the
agreement is prior to date of Ordinance and the benefit under
the Ordinance could be availed from the date on which
Ordinance is brought into force is required to be considered
on principles of promissory estoppel. It is well accepted that
normally when such policies are drawn which is suggestive of
the probable road map or broad guidelines for the proposed
development and such policy then, it can shape in the form of
notification, Ordinance or the registration. However the moot
question which is required to be considered is whether there
was any such policy floated by the Government for the
purpose of attracting the investment for the purpose of
industrial development. If such policy has been made for
establishment of Special Economic Zone in Gujarat with an
object of attracting investment and development of the
industries and pursuant thereto subsequently, it has been
culminated into an Ordinance dated 10.02.2004, it is like
giving the final shape to the policy. The broad preamble of
the Ordinance referred to these aspects and, therefore, such
argument made that lease agreement is prior to the date of
Ordinance and, therefore, is not covered also cannot be
accepted on the ground of promissory estoppel. It is on the
basis of the promise as per the policy of the Government at
AnnexureA dated 19.07.2002, person like the petitioner has
moved in that direction seeking to establish the industrial
unit, for which, as stated in letter dated 19.04.2004 at
AnnexureJ by Special Economic Zone clearly suggesting that
such a policy decision for the SEZ was taken on 19.07.2002
and the actual Ordinance came to be issued on 10.02.2004
which took time in processing of the papers and getting
clearance. However the intention and promise of the
Government which has led to such establishment of Special
Economic Zone and the investment in such economic zone
would certainly have a bearing. It is required to be stated
that the Rules or the Bylaws for observations of the allottees
and the preamble state that they were framed in the year
2003. All these would lead to establish that the policy and the
promise of the Government for attracting the investment for
the purpose of industries in such Special Economic Zone to
be set up was already there. Therefore merely because such a
policy culminated into an Ordinance in the year 2004 by itself
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
may not be a ground to deny the benefits under the
Ordinance to the investors like the petitioner on the ground
of promissory estoppel. Law regarding promissory estoppel is
well settled and useful reference can be made to the
judgment of the Hon’ble Apex Court in case of Mahabir
Vegetable Oils (P) Ltd. & Anr. Vs. State of Haryana &
Ors., reported in (2006) 3 SCC 620 . Therefore, when the
promise has been held out on the ground of policy to provide
fiscal benefit and the purposes were altered by making their
investment, it cannot be declined on the ground of
promissory estoppel. Further in case of Bannari Amman
Sugars Ltd. Vs. Commercial Tax Officer & Ors., reported in
(2005) 1 SCC 625, the Hon’ble Apex Court has made
observation as under :
“In order to invoke the doctrine of promissory estoppel
clear, sound and positive foundation must be laid in the
petition itself by the party invoking and doctrine the
bald expressions without any supporting material to the
effect that the doctrine is attracted because the party
invoking the doctrine has altered its position relying on
the assurance of the Government would not be
sufficient to press into aid the doctrine. The Courts are
bound to consider all aspects including the results
sought to be achieved and the public good at large,
because while considering the applicability of the
doctrine, the Courts have to do equity and the
fundamental principles of equity must for ever be
present in the mind of the Court.”
14. Therefore even considering these aspects that promissory
estoppel mere assertion or claim itself would not be a ground
but it has to be considered with reference to the
circumstances, which are the basis for the equal and fair
play. Therefore considering the aforesaid broad observations
and the facts, the present petition deserves to be allowed.
6. It may be seen that the learned Single Judge has taken
note of the fact that the policy of the State Government
framed by the Industries and Mines Department Resolution
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
No. SEZ-2001-1456-G dated 19.07.2002 regarding
establishment of SEZ in the State of Gujarat has been
culminated into Ordinance promulgated on 10.02.2004. The
said policy has been announced by the Government of India
for setting up Special Economic Zone with a view to
augmenting infrastructure facilities for export protection. The
policy states that a concept of SEZ is expected to bring large
dividends to the State in terms of economic and industrial
development and the generation of new employment
opportunities. The SEZs are expected to be engines for
economic growth and the State of Gujarat remained in the
forefront of industrial development. The establishment of first
SEZ in the country, thus, has been approved in the State of
Gujarat under the SEZ policy of the Government of India.
7. It was resolved that the existing Free Trade Zones
namely Kandla Free Trade Zone and Surat Export Processing
Zone have to be converted into Special Economic Zones as
these are/were in operation in the State besides the new
proposal to establish SEZs in the State. The State Government
has offered various incentives to both the developer as well as
industrial unit coming in the SEZ. All kinds of units namely
manufacturing, trading or service activities are permitted in
SEZ. The State Government was called upon under the
Scheme to offer specialized facilities and concessions for
establishment of units in SEZ. The Central Government has
given guidelines for establishment of SEZ and in the matter of
formulating a policy regarding the dispensations which the
State Government will accord to promote the development of
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
SEZ.
8. It was decided that the Policy will apply to all SEZ in the
State including the existing ones, subject to framework of SEZ
determined by the Government of India from time to time.
Clause 6 of the policy dated 19.07.2002 as per the Resolution
of Industries and Mines Department of the State provides for
complete exemption of stamp duty and registration fee
including sales tax, VAT, etc.
9. The reasoning given by the learned Single Judge that
when the policy was made and the Ordinance for Special
Economic Zone has been promulgated for giving a boost to
the industries and invite the people for setting up the
industries holding out to give the benefits including the fiscal
benefits as stated above, same cannot be denied on the
contention of the respondent no.2 that the transfer of land by
way of lease is not covered as there was no transfer of land.
10. Dealing with the argument of the learned counsel for the
respondent that the lease agreement is prior to the date of
Ordinance and the benefit under the Ordinance could be
availed only from the date on which the Ordinance was
brought into force, it was noted that the moot question which
was required to be considered was whether there was any
such policy floated by the Government for the purpose of
attracting the investment for the purpose of industrial
development. If such policy has been made for establishment
of SEZ in Gujarat with an object of attracting investment and
development of industries and pursuant thereto, subsequently
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
it has been culminated into an Ordinance dated 10.02.2004, it
is like giving the final shape to the policy.
11. Looking to the broad preamble of the Ordinance as well
as the provisions contained therein, it was opined that it is on
the basis of the promise as per the policy of the State
Government dated 19.07.2002, persons like the petitioners
had moved in that direction seeking to establish the industrial
unit. The learned Single Judge has also taken note of the
letter dated 19.04.2004 filed as Annexure ‘J’, which clearly
suggest that such a policy decision for SEZ was taken on
19.07.2002 and the actual Ordinance came to be issued on
10.02.2004 which took time in processing of papers and
getting clearance.
12. Looking to the intention and promise of the Government
which has led to establishment of Special Economic Zone and
the investment in the SEZ area, it was opined that merely
because a policy framed by the Government culminated into
an Ordinance in the year 2004, that by itself cannot be a
ground to deny the benefits under the Ordinance to the
investors like the petitioners. The fiscal benefits as promised
in the policy are, thus, to be accorded to the petitioners.
13. Taking note of the content of the policy of Industries and
Mines Department vide Resolution No. SEZ-2001-1456-G
dated 19.07.2002 regarding establishment of SEZ in the State
of Gujarat and the fact that the said policy was given shape by
way of the Gujarat Ordinance No. 1 of 2004 dated 10.02.2004,
we do not find any substance in the submission of the learned
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C/LPA/554/2014 (GJHC240414542014) JUDGMENT DATED: 02/09/2026
counsel for the appellant to attach any illegality to the
judgment impugned on the premise that the lease deed was
executed prior to promulgation of the Ordinance.
14. There is one more aspect of the matter and that is if we
accept the contentions of the learned counsel for the
appellant about the strict implementation of the date for grant
of exemption being the date of promulgation of the ordinance,
it would result in a hostile discrimination between two sets of
persons who had proceeded to establish their units in a
Special Economic Zone even a day prior to 10.02.2004 and
those who executed deeds on or after 10.02.2004. Looking to
the laudable object of growth of Indian economy for which the
SEZ policy has been promulgated by the State Government in
the year 2002, we do not find any error in the reasoning given
by the learned Single Judge.
15. The refund as directed in the judgment impugned shall
be processed and paid within a further period of six weeks
from today.
16. The present appeal is found devoid of merit and is
dismissed, accordingly. No order as to cost.

(SUNITA AGARWAL, CJ )
(D.N.RAY,J)
SAHIL S. RANGER
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