High Court answers: Company not being party to proceedings before the Collector (Stamps), it is in the interest of justice that re-adjudication proceedings be made, strictly in accordance with law

In a recent case, the Single Judge Bench of Hon’ble Rajasthan High Court has remanded the matter to Collector (Stamps) on the ground that the Company was not a party to the proceedings initiated by Collector (Stamps).

Brief facts of the present case, were that the two petitioners, namely Sh. Hari Chand Girdhar (Petitioner No. 1/ P1) and Sh. Purushottam Lal Soni (Petitioner No. 2/ P2) filed writ petition in Rajasthan High Court at Jodhpur assailing inter-alia the proceedings initiated by Collector (Stamps) in the name of P1 and P2 and the impugned order passed in the name of P1 and P2. It was the case of Petitioners that Petitioner No. 1 was neither the buyer nor the seller of the property but was merely a signatory to the sale deed executed by the Company that had purchased the property along with Petitioner No. 2. It was thus their submission that impugned proceedings and the final order of Collector (Stamps) are liable to be quashed in view of the fact that Company was not party to the proceedings.

Order of the Court:

The Court was inclined to accept the Petitioner’s plea that since the Company was not before the concerned authority, hence it would be in the interest of justice that re-adjudication be made by the concerned authority, strictly in accordance with law. Thus, the Court, directed that concerned authorities shall take up the complete issues comprehensively, and after giving proper opportunity of hearing to the Company as well as individuals, and pass an appropriate order, strictly in accordance with law. It is however made clear by the Hon’ble Court that while undertaking such an exercise, the concerned authority shall be required to adhere to the complete statutory process.

The Petitioners were represented by Adv. Puneet Agrawal and Adv. Gaurav Gupta, at ALA Legal, Advocates and Solicitors.

Case citation: SB CWP 478/2020: Harichand Girdhar & ors. v. State of Rajasthan & Anr., Court: High Court of Judicature for Rajasthan at Jodhpur, Order dated 07.04.2021.

Our view

The Hon’ble Court has granted a huge relief to the Petitioners and the Company in the instant matter by remanding the matter for de novo consideration by the concerned authority.
In the impugned order, the Collector (Stamps) had simply adopted the rates prescribed by District Level Committee for commercial properties, without conducting any enquiry concerning the nature of property, its use, location, comparable sales, or other such factors. The Petitioners’ plea was that in the absence of any enquiry, the Collector (Stamps) cannot adopt the DLC rates and surrender its authority to the rates adopted by District level Committee by disregarding clear statutory Rule 65 read with Section 51 of the Rajasthan Stamp Act. It may be noted that the function of the Collector (Stamps) is to determine the true market value of the property. Further, this issue has been settled in favour of the Assessee by various High Courts and on many occasions by Supreme Court.

Copy of final order is attached herewith.22_92_478_2020_07_04_2021

Gaurav is an advocate by profession and has done his B.Com(H) from Hansraj College and LL.B(H) from Faculty of Law, Banaras Hindu University. He has represented clients from Diverse sectors, providing services in Litigation involving Indirect Taxes, IBC, Commercial laws, Direct Taxes, RBI matters. He is active beforewrit Courts, Tribunals and Quasi-Judicial Authorities.