An agreement to sell followed by registered deeds was not treated as a conveyance for stamp duty.

Arvind Brands Ltd. challenged a notice concerning an agreement to sell executed on 10 January 2000, which the stamp authorities treated as transferring immovable property and a trademark.

The company contended that the agreement had been taken and impounded without following the statutory process; separate sale deeds had subsequently been executed for the Gujarat properties, while the trademark assignment was executed and registered in Bombay.

The Single Judge allowed the writ petition and quashed the impugned notice. The State appealed, relying in particular on Section 19 of the Gujarat Stamp Act, 1958.

Whether the stamp authorities could impound the agreement to sell in the circumstances described, including where it had not been produced before them in the discharge of official duty.

Whether the notice could stand on the basis that the agreement itself effected a sale or transfer of the Gujarat properties and trademark, notwithstanding the separate instruments executed for those transfers.

Whether the State could rely on Section 19 of the Gujarat Stamp Act, raised for the first time in appeal, to sustain the notice.

The Court considered Sections 33 and 39 of the Gujarat Stamp Act, 1958, concerning examination and impounding of instruments and the Collector’s powers, and Section 68, under which the impugned action was purportedly taken.

It also considered the Act’s definition of “conveyance” in Section 2(g), and the State’s reliance on Section 19 concerning differential stamp duty.

The judgment recounts the principle that an agreement to sell does not, by itself, create an interest in immovable property; transfer is effected by the appropriate conveyance.

No precedent was cited or applied.

The appellate court noted that the State did not dispute that separate sale deeds had been executed for the properties covered by the agreement, and that the Gujarat sale deed had not itself been impounded.

It found no basis to disturb the Single Judge’s conclusion that the notice proceeded on the erroneous assumption that the agreement itself transferred the immovable property and trademark, despite the separate instruments.

The State’s Section 19 argument had not been raised before the Single Judge, and the Court did not treat it as a ground requiring interference with the order under appeal.

The Court also held that the trademark’s use in Gujarat was irrelevant to the present stamp-duty challenge.

It made no order as to costs.