Full Judgment Text
2024 INSC 539
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.8985 OF 2013
M/S REWA TOLLWAY P. LTD. …APPELLANT(S)
VERSUS
THE STATE OF MADHYA
PRADESH & ORS. …RESPONDENT(S)
WITH
CIVIL APPEAL NO.8989 OF 2013
CIVIL APPEAL NO.8986 OF 2013
CIVIL APPEAL NO.8990 OF 2013
CIVIL APPEAL NO.8988 OF 2013
CIVIL APPEAL NO.8987 OF 2013
CIVIL APPEAL NO.8991 OF 2013
CIVIL APPEAL NO.8992 OF 2013
CIVIL APPEAL NO.8993 OF 2013
CIVIL APPEAL NO.8995 OF 2013
CIVIL APPEAL NO.8996 OF 2013
CIVIL APPEAL NO.8994 OF 2013
Signature Not Verified
Digitally signed by
SONIA BHASIN
Date: 2024.07.19
17:53:27 IST
Reason:
1
J U D G M E N T
VIKRAM NATH, J.
1. By the impugned judgment and order dated
11.02.2010, the High Court of Madhya Pradesh at
Jabalpur decided a group of twelve petitions wherein the
question involved was whether a transaction where the
right to collect tolls is given in lieu of the amount spent
by the Concessionaire in the construction of roads,
bridges etc. under the Build, Operate & Transfer (BOT)
Scheme amounts to a “lease” as contemplated under
1
Section 105 of the Transfer of Property Act, 1882 and
2
Section 2(16) of the Indian Stamp Act, 1899 . Further
challenge made in the said writ petitions was with regard
to the validity of the amendment made in proviso (c) to
Clause (C) of Article 33 of Schedule 1(A) as amended by
the Indian Stamp (M.P.) Act, 2002, and a further prayer
was made to declare Section 48 and 48(B) of IS Act, 1899,
as amended by M.P. Act 24 of 1990 as ultra vires .
2. The Division Bench of the High Court, after
considering the submissions and the material on record
came to the conclusion that the writ petitions were
without any merit and accordingly dismissed the same.
1
TP Act
2
IS Act
2
Aggrieved by the same, these twelve appeals have been
preferred.
3. For the sake of convenience, we are referring to the
facts of Civil Appeal No.8985 of 2013, which are briefly
stated hereunder:
(i) Madhya Pradesh Rajya Setu Nirman Nigam
3
Ltd. , (respondent no.3) is a Company incorporated
and registered under the Companies Act, 1956. The
State of Madhya Pradesh, vide order dated
01.02.2001, authorized MPRSNN for reconstruction,
strengthening, widening and rehabilitation of a
section of road on Satna-Maihar-Parasimod-Umaria
Road Project to be executed through Concession on
Build, Operate and Transfer Scheme.
(ii) MPRSNN, vide Advertisement dated
22.04.2002, invited tenders against the aforesaid
project pursuant to which the bid of the appellant was
th
accepted. On 8 August, 2002, Letter of Acceptance
was issued by the MPRSNN to the appellant for
execution of the Concession Agreement within 30
days.
(iii) The IS Act was amended in the State of Madhya
Pradesh vide Amendment Act No.12 of 2002 and
proviso (c) to Clause(C) was inserted to Entry No.33
3
MPRSNN
3
of Schedule-1(A), which provided that there shall be
levy of stamp duty @ 2% on the amount likely to be
spent on the project, on the agreement to lease and
right to collect the toll is given. The State of Madhya
Pradesh notified the said amendment on 12.08.2002.
(iv) A Concession Agreement was signed on
15.09.2002 on a stamp paper of Rs.100 between
MPRSNN and the appellant. A show cause notice
dated 26.03.2004 was issued to the appellant
intimating that the matter between State of M.P. and
the Rewa Tollway Private Ltd. would be listed for
hearing on 29.03.2004 before the Collector of Stamps,
Bhopal and the appellant was required to produce the
original copy of the agreement dated 15.09.2002. The
appellant filed a detailed reply dated 25.04.2004
stating that the agreement executed was a
Concession Agreement and, as such, it cannot be
treated as a lease but as a license at best. The
Collector (Stamps), Bhopal vide order dated
30.04.2004 passed an order exercising power under
Section 48-B of the IS Act directing recovery of deficit
stamp duty amounting to Rs.1,08,00,000/-(Rupees
one crore eight lakhs) said to be payable on the
Concession Agreement dated 15.09.2002. Thereafter,
a recovery notice was issued on 29.05.2004 by the
Collector (Stamps), Bhopal to deposit the aforesaid
4
amount within seven days of the receipt of the said
recovery notice.
th
(v) On 6 June, 2004, the appellant challenged
the order dated 30.04.2004 by way of a writ petition
under Article 226 of the Constitution which was
registered as Writ Petition No.2219 of 2004. The High
Court vide order dated 03.08.2004 granted interim
stay of recovery of any amount pursuant to the
impugned order dated 30.04.2004. The High Court,
vide judgment and order dated 11.02.2010,
dismissed the said writ petition along with eleven
other matters and upheld the demand raised by the
Collector of Stamps by the order dated 30.04.2004.
(vi) Aggrieved by the impugned judgment of the
High Court, the appellant preferred the instant
appeal with connected matters before this Court on
rd th
3 May, 2010, in which notices were issued on 14
May, 2010 and, thereafter, interim order was passed
th
on 7 January, 2011. Later on, vide order dated
13.09.2013, this Court granted leave and further
directed the interim stay granted earlier to continue.
4. We have heard Shri Dushyant Dave, learned Senior
Counsel appearing for the appellants in nine (9) appeals
and other learned counsels appearing for the appellants
in the other three (3) appeals and Shri Saurabh Mishra,
learned Additional Advocate General for the State of
5
Madhya Pradesh on behalf of the respondents.
5. Before we proceed further with the submissions, it
would be relevant to refer to three other dates which have
been referred to by Shri Dave in support of his
submissions on legitimate expectation and promissory
estoppel. According to Shri Dave, after the tender was
nd
invited vide Advertisement dated 22 April, 2002, the
Chief Secretary issued a Clarification dated 01.07.2002
with respect to the agreements executed under BOT
Scheme stating that stamp duty would not be payable on
such agreements in the State of Madhya Pradesh also and
further reiterating that in order to avoid any doubts to be
raised in future, it is necessary to clarify that no stamp
duty shall be payable on the agreements being executed
under BOT Scheme. A further clarification was issued
vide letter dated 21.07.2002 by the Chief Secretary of the
State with respect to the Resolution dated 01.07.2002,
that no stamp duty would be levied on BOT Projects in
future and such agreements would be signed on stamp
paper of Rs.100/-. Shri Dave further referred to the
th
Notification of the State Government dated 10 March,
2008 whereby the stamp duty on toll was reduced from 2%
to Rs.100 i.e. the position which existed prior to the
Amendment of 2002 and as clarified in the notification
st st
and the letters of 1 July of 2002 and 21 July, 2002. It
was, thus, submitted that the charge of 2% stamp duty
6
was only applicable in the State of Madhya Pradesh
between August, 2002 till March, 2008 and, thereafter,
again all such Concession Agreements under BOT
Scheme are to be executed on stamp paper of Rs.100. It
was throughout the intention of the State of Madhya
Pradesh to not charge stamp duty @ 2% and treat the
Concession Agreement under BOT Scheme to be a license
but unfortunately for the period referred to above, it was
treated as a lease and the appellants are the victims of
this period, whereas all subsequent Concession
th
Agreements under BOT Scheme executed after 10 March,
2008 are exempt from such stamp duty.
6. Further continuing his submissions Mr. Dave,
learned Senior Counsel submitted that in view of the
Clarification dated 01.07.2002 and subsequent
circulation vide letter dated 21.07.2002 throughout the
State, once it was clarified that the Concession
Agreements under the BOT Projects would be executed on
stamp paper of Rs.100/-, the appellants entered into the
agreement with the same impression and having
calculated their project cost and also their tenders
without factoring in 2% stamp duty, had legitimate
expectation that the agreement would not require stamp
duty @ 2% of the value, but was to be executed only on
stamp paper of Rs.100/-. The subsequent demand was
contrary to the legitimate expectations of the appellants
7
and, therefore, liable to be set aside.
7. It was next submitted that the Circular of the Chief
st
Secretary dated 1 July, 2002 and its subsequent
st
circulation vide letter dated 21 July, 2002, estopped the
State Government from amending the IS Act and, further
raising the demand @ 2% treating the Concession
Agreement to be a lease, the same would be hit by
principle of promissory estoppel. The State was estopped
from demanding such stamp duty by treating the
Concession Agreement to be a lease.
8. In support of his submissions, Shri Dave has placed
reliance upon the following judgments:
(1) Navjyoti Co-op. Group Housing Society
4
Vs. Union of India;
(2) Food Corporation of India Vs.
5
Kamdhenu Cattle Feed Industries ;
(3) The State of Jharkhand and Ors. Vs.
Brahmputra Metallies Ltd. Ranchi and
6
Anr .;
(4) State of Bihar and Ors. Vs. Shyama
7
Nandan Mishra ;
(5) M/S Hero Moto Corp Ltd. Vs. Union of
4
(1992) Supp.1 SCR 709
5
(1992) Supp.2 SCR 322
6
(2020) 14 SCR 45
7
(2022) 11 SCR 1136
8
8
India and Ors. ;
9. Shri Dave, learned Senior Counsel next submitted
that the insertion of proviso (c) to Clause(C) under Article
33 of Schedule 1-A by the 2002 Amendment Act was ultra
vires as it violates the mandate of Article 14 of the
Constitution of India. It was submitted that the said
amendment was illegal, arbitrary and bad in law as it
nullified the promise made by the Chief Secretary, vide
Circular dated 01.07.2002, and has taken away the
vested right of the appellants of not factoring in 2% stamp
duty and ultimately resulting into a demand of a huge
amount of Rs.1,08,00,000/- (Rupees one crore eight
lakhs) approximately. In support of his submission, he
has relied upon the following two judgments:
(1) State of Gujarat and another Vs. Raman
9
Lal Keshav Lal Soni and Ors. ;
(2) B.S. Yadav and Ors. etc. Vs. State of
10
Haryana and Ors. Etc. ;
10. The next point raised by Shri Dave is that the
aforesaid amendment was ultra vires , inasmuch as, the
State had no legislative competence to bring in this
amendment. Further, it was submitted that it was a
colourable and excessive legislation and was a fraud on
8
(2022) 13 SCR 592
9
(1983) 2 SCR 287
10
(1981) 1 SCR 1024
9
the Constitution of India, inasmuch as, the State itself in
2008 withdrew the Amendment of 2002. In support of his
submission, he has relied upon the following judgment:
(1) Kunnathat Thathunni Moopil Nair Vs.
11
The State of Kerala and another ;
11. The next submission of Shri Dave is that the
Concession Agreement dated 15.09.2002 is not an
instrument of lease and, as such, the demand of 2%
stamp duty was totally uncalled for and illegal. According
to him, the ownership of the project land has not been
transferred by the State to the MPRSNN and, as such,
MPRSNN could not transfer any ownership or interest to
the appellants. The Concession Agreement was on the
concept of public, profit, partnership (PPP mode). He has
further elaborated his submissions by referring to Section
105 of the TP Act. According to him, in a lease, the
following three ingredients must pre-exist:
(1) There is a transfer of a right to enjoy such property.
(2) It is made for a fixed time, express or implied or in
perpetuity.
(3) There has to be consideration of a price paid or
promised.
12. According to Shri Dave, learned Senior Counsel for
11
(1961) 3 SCR 77
10
the appellants, lease means transfer of interest in the
property to enjoy the property whereas, license means
transfer of property but no interest in the property.
According to him, in the present case, there was no
transfer of interest in the property, as such, it would not
fall within the definition of lease. He has further referred
to various clauses of the Concession Agreement in
support of his submission.
13. It was next submitted that MPRSNN is a 50%
partner in the construction of the project which indicates
that the Concession Agreement is a mutual contract and,
as such, would not levy 2% stamp duty as imposed by the
impugned orders. According to him, out of a total project
cost, 50% was to be paid by the MPRSNN. According to
him, respondent no.3, MPRSNN being a 50% partner in
the entire road project meant that the appellant and
respondent no.3 are equal stake holders and, as such, the
unilateral imposition of 2% stamp duty of the entire
project cost on the appellant was illegal and unwarranted.
He has further criticised the judgment of the Collector
(Stamps), Bhopal whereby he held that the total project
cost was Rs.110 crores whereas actually it was 54 crores,
out of which, MPRSNN (respondent no.3) had granted
subsidy and invested Rs.29.10 crores and the remaining
Rs.24.90 crores, was invested by the appellant. As such,
even if he was liable to pay 2% stamp duty, the amount
11
would be much less, approximately Rs.48 lakhs and odd
and not Rs.1.08 crores, which was 2% stamp duty on the
entire project cost.
14. The last argument raised is that once the IS Act had
been re-amended on 10th March, 2008, the earlier
Amendment of 2002 should be held to be illegal and
arbitrary. On such submissions, Shri Dave, learned
senior counsel urged the Court to allow the appeal and
set aside the impugned orders imposing deficiency in
stamp duty of Rs.1.08 crores.
15. On the other hand, Shri Saurabh Mishra, learned
Additional Advocate General for the State of Madhya
Pradesh representing all the three respondents including
'MPRSNN' submitted that the High Court had dealt with
all the above arguments in great detail and had rejected
them for good reasons based on statutory provisions as
also the law on the point. It did not suffer from any
infirmity, much less any perversity warranting
interference by this Court.
16. According to Shri Mishra, all the ingredients of a
document constituting a lease as defined under the TP Act
were existing in the Concession Agreements under the
BOT Scheme. He has also referred to various clauses of
the Concession Agreement to show that possession was
actually transferred to the appellants in order to recover
the toll, the period of such possession was defined to be
12
fifteen years. It was for a consideration which was also
mentioned in the agreement. Therefore, all the three
ingredients were fulfilled and, as such, the Collector
(Stamps), Bhopal and the High Court rightly held the
Concession Agreements to be a lease. He also referred to
definition of ‘lease’ under the IS Act, as laid down in
Section 2(16), which includes any instrument by which
tolls of any description are let. He also referred to the
definition of ‘immovable property’ as defined under
Section 3(26) of the General Clauses Act, 1897, which
would include land, benefits to arise out of land, and
things attached to the earth, or permanently fastened to
anything attached to the earth. He further referred to
various findings recorded by the High Court. He further
placed reliance upon three judgments of this Court:-
(1) Associated Hotels of India Ltd. Vs. R.N.
12
Kapoor ;
(2) State of Uttarakhand and Ors. Vs.
13
Harpal Singh Rawat ;
(3) Nasiruddin and another Vs. State of
14
Uttar Pradesh Thr. Secretary and Ors .;
17. Shri Mishra, further referred to the various
provisions of the Indian Tolls (MP) Amendment Act, 1972.
Insofar as to the challenge of the amendments as being
12
AIR 1959 SC 1262
13
(2011) 4 SCC 575
14
(2018) 1 SCC 754
13
ultra vires is concerned, Shri Mishra submitted that the
insertion of proviso (c) to Clause(C) to Entry-33, is only for
determining the rate of charging stamp duty and, as such,
the challenge was totally irrelevant. The Concession
Agreement is a lease as defined under Section 105 of the
TP Act as also under Section 2(16) of the IS Act and,
therefore, would be chargeable to stamp duty, for which
rate is provided under Schedule 1-A. It was further
submitted that the submission relating to Promissory
Estoppel and Legitimate Expectation are unwarranted
and without any merit, inasmuch as, prior to the
execution of the concession agreement, the amendment
had been brought in. The communication by the Chief
Secretary cannot have any overriding effect over the
statutory amendments brought in by the State legislature.
It is also submitted that there can be no Legitimate
Expectation or application of Promissory Estoppel against
statute. It is also submitted that the State was fully
competent to carry out the amendments. It was next
submitted that as the 2002 amendment had been
reversed in 2008, cannot by itself draw any kind of
presumption that 2002 amendment was illegal. It was
submitted that the appeals lack merit and are liable to be
dismissed.
18. Having considered the submissions advanced and
having perused the material on record, we have no
14
hesitation in holding that the judgment of the High Court
impugned in these appeals does not require any
interference. We do not find any infirmity, much less any
perversity warranting any interference by this Court. The
High Court has dealt with all aspects of the matter
considering not only the stipulations in the Concession
Agreement but has also dealt with in detail with the
respective arguments advanced by the petitioners before
the High Court (the appellants herein) at the same time
referring to the statutory provisions, the constitutional
provisions as also the case-laws relied upon by the
counsel for the parties. However, there is one aspect of
the matter which requires clarification which we shall
deal with at the end of this judgment.
19. The arguments made on behalf of the appellants
relating to the vires of inserting the proviso (c) to Clause
(C) to Entry 33 of Schedule 1-A of the IS Act, 1899 by the
M.P. Amendment of 2002 have no merits as it neither
defines the word 'lease' nor does it in any way interfere
with the definition of 'lease' in any manner, either by
expanding or restricting its interpretation. It is only a
statutory provision as to what would be the rate of stamp
duty payable on lease deeds of a particular type. But for
the insertion of the proviso which is sought to be
challenged, the stamp duty payable on the lease would be
8% of the market value as provided to be charged on the
15
conveyance under Entry-22 of Schedule 1-A. By inserting
the proviso, the stamp duty chargeable on a lease under
BOT Project for tolls/bridges, construction of roads etc.
would be 2% of the amount spent by the lessee. In fact,
insertion of this proviso reduced the rate of stamp duty to
be charged to 2% instead of 8% and that too on the
amount to be spent by the lessee.
20. The doctrine of legitimate expectation has been
discussed and elucidated upon in several judgment by
this Court. The doctrine provides a framework for judicial
review of executive actions, policy changes, and legislative
decisions. In Union of India & Ors. v. Hindustan
15
Development Corporation & Ors. , this Court
emphasized that legitimate expectation primarily grants
an applicant the right to a fair hearing before a decision
that negates a promise or withdraws an undertaking from
which an expectation of certain outcome or treatment
arises. It does not, however, create an absolute right to
the expected outcome. The protection of legitimate
expectation is subject to overriding public interest, which
means that even if an individual’s expectation is
reasonable and based on a past practice or representation
by the executive or legislature, it can be denied if justified
by a significant public necessity. The Court also
highlighted that in matters of policy change, the judiciary
15
(1993) 3 SCC 499
16
typically refrains from interfering, unless the decision is
arbitrary, unreasonable, or not in public interest.
21. The judgment in Ram Pravesh Singh & Ors. v.
16
State of Bihar & Ors . defines legitimate expectation as
an expectation of a benefit, relief, or remedy that arises
from a promise or established practice through
administrative, executive or legislative action. This
expectation must be reasonable, logical, and valid; but it
in no way vests any enforceable legal right. The doctrine
does not elevate legitimate expectation to the level of a
right enforceable by law. Instead, it is a procedural
concept that demands fairness in administrative action.
When an expectation is deemed legitimate, it may entitle
the individual to a chance to show cause before the
expectation is denied or to receive an explanation for the
denial. However, legitimate expectation does not always
result in relief, particularly when public interest, policy
changes, or other valid reasons justify the deviation from
the expected course of action.
22. The decision in P.T.R. Exports (Madras) Pvt. Ltd.
17
v. Union of India & Ors . further clarifies the limited
role of legitimate expectation in the context of policy
changes and legislative actions. This Court observed that
the government retains the authority to revise policies in
16
(2006) 8 SCC 381
17
(1996) 5 SCC 268
17
response to changing circumstances, such as potential
foreign markets and the need to earn foreign exchange.
Thus, the doctrine of legitimate expectation does not
constrain the government from altering its policies,
provided the changes are made in public interest and not
through an abuse of power. The judiciary affords
considerable leeway to the executive and legislature in
matters of economic policy, recognizing their prerogative
to prioritize different economic factors. Consequently,
previous policies do not bind the government indefinitely;
new policies can be adopted, if deemed necessary, for the
public good. This underscores the principle that while
legitimate expectation warrants fair treatment, it does not
preclude the government’s flexibility in policy-making.
23. Therefore, the doctrine of legitimate expectation
serves only as a procedural safeguard ensuring fairness
in administrative decisions and policy changes. It grants
the expectant party the right to a fair hearing and an
explanation but does not guarantee the realization of the
expected benefit. The government’s authority to revise
policies in public interest remains paramount, with the
judiciary intervening only in cases of arbitrariness,
unreasonableness, or lack of public interest. This
balanced approach ensures that while individuals can
expect consistent treatment based on past practices or
promises, the government retains the flexibility to
18
respond to evolving needs and priorities.
24. On the doctrine of promissory estoppel, since it is an
equitable doctrine, it only comes into play when equity
requires a party be estopped from withdrawing its
promise. It has been well settled by this Court in several
judgments that the principle of promissory estoppel
cannot be invoked against the exercise of legislative power.
In order to avoid burden on the present judgment, we are
relying on the observations made by this Court in a recent
judgment dealing with the doctrine of promissory estoppel.
18
Hero Motocorp Ltd vs Union of India ,
The Bench in
while relying upon other judgments of this Court in this
regard, observed thus (SCC pp. 414-415, para 68)
“68. A common thread in all these judgments that
could be noticed is that all these judgments
consistently hold that there can be no estoppel against
the legislature in the exercise of its legislative
functions. The Constitution Bench in the case of M.
Ramanatha Pillai (supra) has approved the view in
American Jurisprudence that the doctrine of estoppel
will not be applied against the State in its
governmental, public or sovereign capacity. It further
held that the only exception with regard to
applicability of the doctrine of estoppel is where it is
necessary to prevent fraud or manifest injustice. The
analysis of all the judgments of this Court on the issue
18
(2023) 1 SCC 386
19
would reveal that it is a consistent view of this Court,
reiterated again in Godfrey Philips India Ltd. (supra),
that there can be no promissory estoppel against the
legislature in the exercise of its legislative functions.”
25. In light of the observations made by this Court in the
above cited judgments and several others, it is an evident
position of law that a prior executive decision does not bar
the State legislature from enacting a law or framing any
policy contrary to or in conflict with the previous executive
decision in furtherance of larger public interest. Nor can
it be canvassed that the law laid down by the legislature
would be hit by principle of promissory estoppel or
legitimate expectation because earlier the executive had
expressed its view differently.
26. Promissory estoppel or legitimate expectation can be
dealt with on the same status of the executive decision
when the prior as well as the subsequent decisions are
both taken by the same or similarly placed authorities.
Where the executive takes a decision based upon which a
party acts and, later on, the executive withdraws that
decision to the detriment of the party acting upon the
earlier decision, it can be said to be estopped from
withdrawing its promise or depriving the party from its
legitimate expectation of what had been promised.
27. In situations, such as the one before us, if the
previous executive decision is withdrawn, modified or
20
amended in any manner in exercise of legislative power in
larger public interest, then the earlier promise upon
which the party acts, cannot be enforced as a right and
neither can the authorities be estopped from withdrawing
its promise, as such an expectation does not give any
enforceable right to the party. Applying the above
discussion to the present facts, it is evident that the
principles of legitimate expectation and promissory
estoppel would not apply here, as the appellants cannot
be said to have any enforceable legal right in light of the
previous law or policy and executive action, which was
subsequently changed by the state legislature in light of
larger public interest. Thus, the submissions advanced on
behalf of the appellants relating to the challenge to the
M.P. Act No.12 of 2002 inserting the proviso (c) to
Clause(C) to Entry 33 of Schedule 1-A of the IS Act has to
be rejected. None of the case-laws relied upon on behalf
of the appellants come to the rescue of the appellants and
have no application in the facts and circumstances of the
present case.
28. Now coming to the next submission on behalf of the
appellants with regard to the question as to whether the
Concession Agreement is a lease or a bond or a license.
The definition of lease as given under the IS Act clearly
covers any instrument by which tolls of any description
are let and also under Section 105 of the TP Act, all the
21
ingredients of a lease are fulfilled. In the present case, we
need not reiterate and repeat the same reasoning and
findings as given by the High Court in great detail after
considering the various clauses of the Concession
Agreement. We uphold the finding of the High Court to be
clearly justified and based upon a clear understanding of
the terms of the concession agreement. We do not find
any perversity at all in the reasoning given by the High
Court to uphold the Concession Agreement to be a lease.
29. After the judgment of the High Court which is of the
year 2010, two further judgments have been delivered by
this Court regarding interpretation of a lease, which have
been relied upon by Shri Mishra on behalf of the
respondents. Out of the three judgments relied upon by
Shri Mishra, the judgment in the case of Associated
Hotels of India Ltd. (supra) has already been considered
by the High Court. Further, the judgments in the case of
State of Uttarakhand and others (supra) and in the case
of Nasiruddin and another (supra) further reiterated the
view taken by Associated Hotel of India Ltd. (supra) .
Paragraph 17 in the case of Nasiruddin and another
(supra) is reproduced hereunder:
“17. The expression “lease” under the Stamp Act
has a wider meaning as compared to its original
meaning contained in Section 105 of the Transfer of
Property Act (for short “the TP Act”). If “lease” under
22
Section 2(16) of the Stamp Act includes therein four
specified categories of documents set out in sub-
clauses (a) to (d), we do not find any such inclusion
in Section 105 of the Transfer of Property Act. It is
for this reason, we are of the view that the definition
of “lease” for the purpose of the Stamp Act is
extensive in nature. It is also clear from the use of
the expression and includes also “in Section 2(16) of
the Stamp Act. So by fiction, “any instrument by
which tolls of any description are let “is considered
as “lease” for the purpose of payment of stamp duty
under the Stamp Act.”
30. Thus, the view taken by the High Court further
stands fortified by the above two judgments and the view
that we are taking.
31. The only issue which requires to be considered
afresh is with respect to determination of the amount
spent under the agreement by the lessee. For the said
purpose, we reproduce proviso(c) to Clause(C) of the
proviso inserted in 2002:
“(c) an agreement to lease where the right to
collect tolls is given in lieu of the amount
spent by the lesse e in construction of roads,
bridge etc. under the Build, Operate and
Transfer (B.O.T.) scheme, shall be chargeable at
the rate of two percent on the amount likely
23
to be spent under the agreement by the
lessee. ”
32. From a clear reading of the above proviso (c) to
Clause(C), the stamp duty would be chargeable @ 2% on
the amount likely to be spent under the agreement by the
lessee. Thus, the lessee has no liability to pay any stamp
duty on the amount not spent by the lessee but by the
lessor or any other stake-holder. The amount spent by the
lessee as per the agreement generally was 50% of the total
cost of the project.
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33. In the case of Rewa Tollway , the total cost of the
project was Rs.54 crores, out of which, approximately 50 %
would be that of the lessee and 50% to be funded by the
lessor i.e. MPRSNN, respondent no.3. However, further
reading of the Concession Agreement reflects that the
amount to be spent by the lessee was not exactly 50% but
is slightly different figure. At some places, it is mentioned
as Rs.24.10 crores and in other places a different amount
is mentioned. We are not entering into this issue of what
is the amount spent but we require that this be
determined by the Collector (Stamps) / Revenue Officer of
the concerned district.
34. Once, the stamp duty is payable on the amount
spent by the lessee, the demand raised on the whole
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Civil Appeal No.8985 of 2013
24
amount would be unjustified, as such, to the above extent,
the demand needs to be set aside with a further direction
to the Revenue Officer/Collector (Stamps) of the district
concerned to re-calculate the same as observed above and,
accordingly, raise the demand. In case, the appellants
have deposited the demand raised on the entire project
cost then the amount lying in excess with the State would
be refunded to them. However, in case of any deficit in
stamp duty having not been deposited, the appellants
would deposit the same within two months of the fresh
demand being raised by the Revenue Officer/Collector
(Stamps) of the district concerned. The Collector
(Stamps)/Revenue Officer is further directed to calculate
the said amount in each of the cases individually and
communicate the same to the appellants within a period
of two months from today and where the amount is lying
in excess with the State, the same shall be refunded
within a period of two months of such determination.
35. The appeals stand partly allowed as above. No costs.
……………………………………J.
(VIKRAM NATH)
……………………………………J.
(AHSANUDDIN AMANULLAH)
NEW DELHI
JULY 19, 2024
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