Bombay High Court
Mohindersingh Amarjeetsingh Wahi vs Deputy Inspector General Of ... on 4 October, 2025
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IN THE HIGH COURT OF JUDICATURE OF BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO. 8315 OF 2016
Mohindersingh Amarjeetsingh Wahi .. Petitioner
versus
Deputy Inspector General of registration
& deputy Collector of Stamps, & another .. Respondents
WITH
WRIT PETITION NO. 8282 OF 2016
Smt. Ravinder w/o Pritpalsingh Uppal .. Petitioner
versus
Deputy Inspector General of registration
& deputy Collector of Stamps, & another .. Respondents
Mr. P. S. Agrawal, Advocate for the Petitioner.
Mrs. M. L. Sangeet, AGP for the State.
CORAM : R. M. JOSHI, J.
RESERVED ON : 23rd SEPTEMBER, 2025.
PRONOUNCED ON : 4th OCTOBER, 2015.
ORDER :
1. By consent of both sides, heard finally at the stage of
admission.
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2. These Petitions involve similar questions of law and fact.
Hence, by consent of both sides, heard and decided together by a
common judgment.
3. These Petitions take exception to the order passed by the
Deputy Inspector General of registration & Deputy Controller of
Stamps, Nashik Region, Nashik, confirming the orders dated
17.04.2025 and 15.04.2025 respectively passed by the Sub Registrar
Class 1 and Collector of Stamps, calling upon the Petitioners to pay
deficit stamp duty in respect of the sale-deed registered in their
favour.
4. In Writ Petition No. 8315/2016, Mohindersingh
Amarjeetsingh Wahi, proprietor of Sana Trade Links, purchased plot
bearing No. 26 admeasuring 358 sq. mtrs. situated at Survey no.
351/1, Bhingar, Ahmednagar from its owner Smt. Darshankaur
Amarjeetsingh Wahi, who is the mother of the Petitioner. The
property shall be referred to as 'subject property' for the sake of
convenience. Mohindersingh had obtained loan from Indian Banks
and the subject property was given as a collateral security towards
repayment of the said loan of Rs. 33,00,000/-. The sale-deed came
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to be executed vide Serial No. 4505/2013 on 04.12.2013. The stamp
duty and registration charges were paid in accordance with the
market value of the property. Later on, Indian Bank was taken over
by the Bank of Baroda and as such the loan obtained by M/s Sana
Trade Link was to be repaid to the Bank of Baroda on the same
conditions. The subject property remained to be collateral security for
repayment of loan of Rs. 1,00,00,000/-.
5. Petitioner in Writ Petition No. 8282/2016, Smt. Ravinder
w/o Pritpalsingh Uppal, purchased the subject property from
Mohindersingh on 21.04.2014 vide registered sale-deed at Serial No.
1671-2014 and stamp duty and registration charges were paid on the
basis of market value of the subject property.
6. Ravindersingh Wahi, real brother of Mohindersingh filed
complaint with the authorities under the Stamps Act claiming that in
respect of registration of sale-deed between Mohindersingh and
Darshan Kaur, proper stamp duty has not been paid. Pursuant to
the said complaint, notice was issued to the Petitioners calling upon
them to explain as to why deficit stamp duty along with penalty
should not be recovered from them. Said show cause notice was duly
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responded by the Petitioners claiming that no deficit stamp duty is
payable and the adequate/proper stamp duty has been paid by the
Petitioners on sale-deed. The authority granted hearing to the
Petitioners and proceeded to pass order holding that valuation of the
sale-deed in favour of Mohindersingh should be Rs. 39,00,000/- in
view of the fact that there was a loan to the extent of Rs. 33,00,000/-
and the same was secured by collateral security of subject matter.
Similarly, Smt. Ravinder Uppal was asked to pay deficit stamp duty
with observation that when the subject property was purchased, it
was mortgaged with the Bank of Baroda against loan to the extent of
value of Rs. 1,00,00,000/-. These orders came to be challenged by
Petitioners before the Deputy Inspector General of Registration &
Deputy Controller of Stamps unsuccessfully. Hence, these Petitions.
7. Learned counsel for Petitioners submits that
Mohindersingh, proprietor of Sana Trade Link, though had obtained
loan however, the said loan was secured by hypothication of
equipments, stocks, furniture and fixtures and other movable assets
of the firm whereas the subject property was only a collateral
security. It is his submission that the subject land was provided as
collateral security and hence cannot become part of consideration.
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According to him, the authority has wrongly invoked provisions of
Section 25 of the Maharashtra Stamp Act in order to consider
valuation of the property at the rate of market value plus the loan
against which the subject property was given as a security.
8. In respect of Writ Petition No. 8282/2016, it is his
contention that in any case, the purchaser had not agreed to repay
the loan and therefore, there was no question of the amount of loan
being included in the valuation of the property. It is his further
submission that later on, the loan has been repaid and therefore,
there is no question of sustainment of the orders impugned.
9. Learned AGP supported the orders impugned by referring
to the document on record more particularly, document indicating
overdraft facility allowed to Mohindersingh and his firm Sana Trade
Link. It is submitted that at the first instance, the subject property
was additionally given as security for repayment of loan of Rs.
33,00,000/- whereas during the second transaction, the said loan
was Rs. 1,00,00,000/-. It is her submission having regard to the
provisions of Section 25 of the Act that no fault can be found with
the orders passed by the authorities.
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10. At the outset, this Court needs to take into consideration
certain admitted facts such as Mohindersingh, proprietor of Sana
Trade Link, had obtained loan from Indian Bank to the extent of
Rs.33,00,000/- and along with other securities subject property was
given as a collateral security by way of equitable mortgage. The said
security was towards repayment of loan of Rs. 33,00,000/-. Later on,
Bank of Baroda took over the said loan and when the second
transaction i.e. transaction with Smt. Ravinder Uppal was entered
into, the loan amount was Rs. 1,00,00,000/- and the subject
property was collateral security for repayment of said loan.
11. It would be relevant to take note of provisions of Section
25 of the Act which read thus :-
25. How transfers in consideration of debt or subject
to future payments, etc. to be charged :
Where any property is transferred to any person;
(a) in consideration, wholly or in part, of any debt due
to him; or
(b) subject either certainly or contingently to the
payment or transfer (to him or any other person) of any
money or stock, whether being or constituting a charge
or encumbrance upon the property or not,
such debt, money or stock, shall be deemed to be the
whole or part, as the case may be, of the consideration
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in respect whereof the transfer is chargeable with ad
volorem duty :
Provided that, nothing in this section shall apply
to any such certificate of sale as is mentioned in Article
16 of Schedule I.
Explanation : Where property is sold and sale is
subject to a mortgage or other encumbrance, any
unpaid mortgage-money or money charged, together
with the interest (if any) due on the same, shall be
deemed to be part of the consideration for the sale,
whether or not the purchaser expressly undertakes
with the seller to pay the same or indemnify the seller if
the seller has to pay the same:
Provided that, where any property subject to a
mortgage is transferred to the mortgagee, he shall be
entitled to deduct from the duty payable on the transfer
the amount of any duty already paid in respect of the
mortgage.
12. The said provisions clearly indicate that for the purpose
of valuation of the property for the purpose of registration of
document of sale where the property has been mortgaged against
repayment of loan, the amount of loan would be in addition to the
market value of the subject property. Thus, in case the property is
mortgaged, over and above the market value, the loan amount
against which the property is mortgaged would be added for the
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purpose of calculation of value of the property for the purpose of
imposing stamp duty.
13. Needless to state that strict rule of interpretation would
be applicable in this case if being taxation statute. When the
terminology of the provision which enables the Government to
impose stamp duty is clear, the Court is bound to follow the same.
Here in this case, provision of Section 25 is unambiguous and
therefore must be given its plain meaning. The only exception as
provided thereto is not application thereof to certificate of sale as
mentioned in Article 16 of Schedule I.
14. Coming to the facts of the case, there is no dispute that
at the time of the first transaction with Mohindersingh, there was
loan of Rs. 33,00,000/- obtained by him and subject land owned by
his mother was collateral security for its repayment. Moreover, there
is specific recital in the sale-deed that the purchaser i.e.
Mohindersingh would repay the loan in respect of which the subject
property is held as a collateral security by Indian Bank. Here in this
case, thus the purchaser has not only accepted the property as
security but further admitted the liability of repayment of loan and
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irrespective of the fact that the loan was obtained by the purchaser
himself for the purpose calculation of valuation of the property,
Section 25 of the Act would certainly apply.
15. Though it is sought to be argued on behalf of the
Petitioner in Writ Petition No. 8282/2016 that in the recitals of the
sale-deed there is no liability of repayment of loan accepted by the
purchaser and therefore question of applying Section 25 of the Act
does not arise. This argument of the Petitioner does not stand to the
scrutiny of Section 25. Proviso to Section 25 as quoted above clearly
shows that such valuation would be irrespective of the fact that the
purchaser agrees to repay the loan or not. Thus, in view of such
deeming provision, even if the purchaser herein has not accepted
liability of repayment of loan, for the purpose of
computation/calculation of the valuation of the suit property, the
loan amount ought to have been included therein.
16. It is pertinent to note that no dispute has been made by
the Petitioners with regard to the fact that at the time of first
transaction loan amount was Rs. 33,00,000/- whereas during the
second transaction the loan amount was Rs. 1,00,00,000/- and the
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subject property was provided as a collateral security by equitable
mortgage. The Petitioners have neither sought to make out the case
nor made out the case that the said security was not towards entire
loan repayment of the loan but any part thereof. In absence of any
such case being made out, this Court is not required to go into the
issue as to what extent of the loan the collateral security was given in
the form of subject property and it needs to be accepted that
collateral security was towards repayment of entire loan.
17. Here in this case, perusal of Section 25 of the Act leaves
no room of doubt that in case of security of property towards
repayment of loan, the amount of loan would be included in the
valuation of such property.
18. It is also sought to be argued that the complaint made by
the brother of Mohindersingh was not bonafide but out of grudge
against him. It is immaterial as to at whose instance it is brought to
the notice of the authorities regarding payment of deficit stamp duty.
Moreover, it is not the case of the Petitioners that the assessment
done is barred by limitation or beyond the jurisdiction of the
authority.
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19. Having regard to the above discussion, this Court finds
no substance in the Petitions. Consequently, both the Petitions
stand dismissed.
( R. M. JOSHI)
Judge
dyb
LATER ON :
1. Learned counsel for the Petitioner seeks stay of the order
passed by this Court for a period of four weeks.
2. Learned AGP opposes the same.
3. There is interim relief granted by this Court which is
running since 03.03.2025. In view of this, interim relief stands
extended for a period of four weeks from today.
( R. M. JOSHI)
Judge
dyb
