Buyer Paid Stamp Duty Twice For One Deal; Bombay HC Says Lost ESBTR Alone Can’t Bar Refund, Orders Checks Before Repayment

In W.P. No. 5964 of 2019, Anita Jayant Oswal paid stamp duty for an agreement for sale on 29 March 2017, but the ESBTR was lost before use. She paid stamp duty again on 4 July 2017 and registered the agreement; her refund application for the first payment was rejected by the Collector and the appellate authority.

In W.P. No. 6199 of 2018, Vineet Kumar Yadav paid stamp duty and registration fees for a proposed flat agreement, cancelled the booking, and later lost the original ESBTR. He applied for a refund, asserting that the agreement was never executed and the ESBTR remained unused; the refund authority and appellate authority rejected his claim.

Both petitioners challenged the rejections, which were based on the absence of the original ESBTR.

Section 47 of the Maharashtra Stamp Act permits an allowance for stamps spoiled in specified circumstances, subject to the Collector’s satisfaction and the evidence and enquiry rules; loss of an ESBTR does not automatically satisfy Section 47(c)(5).

Section 52 addresses stamps not spoiled but no longer required for use and contemplates surrender for cancellation; Section 48 prescribes the applicable limitation period.

Rules 21, 22 and 22A of the Bombay Stamp Rules, 1939 provide for evidentiary enquiry and ordinarily require surrender and cancellation of the stamp, with applicable deductions.

The Maharashtra e-payment Rules apply the impressed-stamp refund procedure to ESBTR payments, while official electronic records may be used to verify payment and use.

Article 265 of the Constitution prohibits retention of tax without authority of law.

Dr. Poornima Advani v. Government of NCT supports examination of a lost-stamp refund claim through an enquiry and safeguards, but does not establish automatic entitlement under the Maharashtra Act.

The Court held that the original ESBTR is an important safeguard against double use, but its absence is not conclusive where reliable evidence can establish the relevant facts.

In Oswal’s case, the second payment and completed registration supported her claim, subject to verification that the first ESBTR was unused and the second was used for registration.

In Yadav’s case, cancellation of the booking and non-execution of the agreement required verification, along with proof that the ESBTR was not used for another instrument; Section 52 might apply depending on the facts.

The Court therefore found that the authorities erred by rejecting the claims solely because the originals were missing, without examining available records and evidence.

The authorities must verify the payment and non-use of each ESBTR, and the relevant transaction facts, through official records and other evidence; they may require reasonable affidavits, indemnity bonds and undertakings.

If the claims and other statutory requirements are established, stamp duty must be refunded, subject to lawful deductions, and the refund cannot be refused solely because the original ESBTR was lost.

Verification and consequential action must be completed within eight weeks after the petitioners provide the required documents.

Any registration-fee refund is to be considered separately; no interest or costs were awarded.