HC dismisses Bhushan plea in stamp duty case

Allahabad High Court Wednesday dismissed former law minister Shanti Bhushan's petition challenging the order of the Assistant Commissioner (Stamp) and Chief Controller Revenue Board (CCRB) penalising him for allegedly evading stamp duty on the purchase of a bungalow in Civil Lines.

However, the court waived the Rs 27-lakh penalty which Shanti Bhushan and his children, including sons Prashant Bhushan and Jayant Bhushan, who were petitioners in the case, were supposed to pay. The court ruled there was no evidence that the petitioners had willfully undervalued their property to evade stamp duty.

The two official orders against the Bhushans were passed on January 6, 2012 and October 8, 2012. The court said the calculation of stamp duty by authorities was not faulty, as the duty must be based on market value on the date of execution of the sale deed.

The sale deed in this case was executed in November 2010. Therefore, the Bhushans would have to pay Rs 1.33 crore, along with 1.5 per cent monthly interest from the date of registration of the sale deed. The petitioners have already paid around Rs 1 crore. As per norms, they were required to pay a portion of the amount to be deposited in order to be able to go in appeal against the order of the Assistant Commissioner (Stamp), and then the order of the CCRB.

Anurag Khanna, counsel for the petitioners, said, "We will be filing a special leave petition before the Supreme Court against the order."

Passing the order, the single judge bench of Justice Sunil Hali said, "I am of the view that the penalty imposed against the petitioners is arbitrary and uncalled for." The court also said that Section 47 of the Indian Stamp Act clearly established that stamp duty is to be calculated on the date on which the sale deed is executed. The Bhushans, in their appeal, had argued that since the agreement to purchase the bungalow was finalised in 1966, the stamp duty should be calculated on the basis of the then existing market rates, and not on basis of the date on which the sale deed was registered.

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