Recovery of deficit stamp duty beyond the ten-year statutory limitation is without jurisdiction and ex-facie illegal.

In brief

The question

1. Whether the existence of an alternative statutory remedy acts as an absolute bar to writ jurisdiction when the underlying action is challenged as being without jurisdiction

The court held

The court answered the issues in favor of the petitioner, holding that the exhaustion of alternative remedies is not required when an action is demonstrably without jurisdiction

It also directed

It ruled that any notice issued beyond the maximum ten-year statutory period is functus officio and void

Consequently, the court allowed the petition and quashed the demand notice dated March 20, 2025, and the revenue entry dated April 17, 2025

01Facts

The petitioner is a subsequent purchaser of property (CTS No. 6455, Belagavi), which her vendor had originally acquired via a registered sale deed dated May 15, 1993

p. 7

On March 20, 2025, and April 17, 2025, the respondents issued a demand notice and made a revenue entry seeking to recover alleged deficit stamp duty relating to the 1993 transaction—nearly 32 years after its execution

pp. 7–10

The petitioner challenged these actions, while the State raised a preliminary objection regarding the maintainability of the writ petition, arguing the existence of an alternative statutory remedy under the Karnataka Stamp Act

p. 3

02Issues

i.1. Whether the existence of an alternative statutory remedy acts as an absolute bar to writ jurisdiction when the underlying action is challenged as being without jurisdiction

p. 3 · ¶ 2

ii.2. Whether the authorities can initiate recovery proceedings for deficit stamp duty after the expiry of the limitation period prescribed under Section 46A of the Karnataka Stamp Act, 1957

p. 4 · ¶ 4

03Law Applied

The court primarily applied Section 46A(1) of the Karnataka Stamp Act, 1957, which mandates that proceedings for the recovery of short-levied stamp duty must be initiated within five years from the date the duty became payable

pp. 4-5

The proviso to Section 46A(1) extends this period to ten years in cases involving fraud, collusion, or wilful misstatement

p. 5

The court applied the principle that an alternative remedy does not bar writ jurisdiction under Article 226 of the Constitution where the impugned action is ex-facie without jurisdiction or barred by limitation

p. 3, 9

Provisions in the judgment · 1

Karnataka Stamp Act, 1957 Section 46A

04Reasoning

The court rejected the State's preliminary objection, reasoning that the challenge pertained to the very competence of the authority to act after the statutory limitation period had lapsed

p. 3

Upon interpreting Section 46A(1), the court found the power to recover duty is not "unbridled" and the limitation is not merely procedural but jurisdictional

p. 6

Even if the extended ten-year limitation for fraud were applied, the proceedings initiated in 2025 for a 1993 deed (a 32-year gap) remained "hopelessly barred"

pp. 7-8

The court further observed that the petitioner, as a subsequent bona fide purchaser, cannot be held liable for the alleged defaults of a vendor from three decades ago, as such actions undermine the sanctity of registered transactions and legislative intent

pp. 8-9

05Holding

The court answered the issues in favor of the petitioner, holding that the exhaustion of alternative remedies is not required when an action is demonstrably without jurisdiction

pp. 9-10

It ruled that any notice issued beyond the maximum ten-year statutory period is functus officio and void

p. 6

Consequently, the court allowed the petition and quashed the demand notice dated March 20, 2025, and the revenue entry dated April 17, 2025

pp. 10-11

LawLens.Karnataka High Court

Original Court PDF