Alok Agarwal vs State Of Raj And Anr ...
2023 Latest Caselaw 5146 Raj/2

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        HIGH COURT OF JUDICATURE FOR RAJASTHAN
                    BENCH AT JAIPUR

                 D.B. Civil Writ Petition No. 5769/2014

Alok Agarwal S/o Late Shri Shyam Sundar Agarwal, 1, Anand
Vihar, Gurjar Ki Thadi, New Sanganer Road, Jaipur
                                                                       ----Petitioner
                                       Versus
1.       State Of Rajasthan Through Sub Registrar, Jaipur-4
2.       Additional Collector Stamps, Jaipur
                                                                    ----Respondents

For Petitioner(s)            :     Mr. S.S. Hora
For Respondent(s)            :     Mr. J.S. Shekhawat for Mr. R.P. Singh,
                                   AAG

HON'BLE THE CHIEF JUSTICE AUGUSTINE GEORGE MASIH HON'BLE MR. JUSTICE SAMEER JAIN

Order

21/09/2023 (ORAL)

1. By way of the present petition, a challenge is made to the

order impugned dated 31.03.2014 passed in Case No. 267/2014

titled as State (through Sub-Registrar, Jaipur-4) vs. Alok Agarwal

& Anr. whereby stamp duty of Rs. 6,15,93,340/- along with

surcharge of Rs. 61,59,340/- and penalty of Rs. 22,47,320/-

totaling Rs.7,00,00,000 (7 crores) has been raised against the

petitioner.

2. The concise and ineluctable factual matrix, necessary for

discerning the issue at hand, is noted herein-under:-

2.1. That the petitioner is the owner of agricultural land

comprising an area of 9 Bighas and 11 Biswas.

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2.2. That on 07.06.2010, qua the said land, the petitioner

entered into a 'development agreement' with a company namely,

M/s. Sunny Arcade Private Ltd.

2.3. That the said agreement was divided into two distinct parts.

The first part of the agreement provided that the developer would

furnish a security deposit of Rs. 2 crores in favour of the petitioner

by way of post-dated cheques (PDCs). Moreover, the developer

would also initiate and complete proceedings under Section 90-B

of the Rajasthan Land Revenue Act along with getting the land use

of the said property changed and thereafter, obtain the patta of

the total land within a period of 24 months from the date of

signing of the said agreement. It was only upon successfully

completing the aforementioned requisites, that the approval of

construction would be granted. In essence, the agreement

stipulated that if the preceding tasks, as noted above, were not

duly carried out within a period of 24 months, then in such an

eventuality, the agreement as entered between the parties, would

be a nullity. Whereas, if the said tasks were carried out, then the

agreement would be governed by the second part of the

agreement, providing for the development and construction on the

subject land.

3. In this background, learned counsel for the petitioner

submitted that though styled as a 'development agreement', the

subject agreement was divided into two distinct parts, as noted

above. Therefore, the said agreement in the first instance was not

a development agreement, but an agreement divided into two

parts wherein the fulfillment of the first part would effectuate or

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activate the second part, the latter wherein alone constituted the

'development agreement'. Thus, in essence, the agreement was

an agreement which was contingent and was to take effect in

future and on happening of certain contingencies as no rights were

meant to flow to the developer till the conditions of the first part

were fulfilled. Accordingly, as the first part of the said agreement

was not duly complied/completed within a period of 24 months as

required, the agreement in toto was nullified, thereby, not giving

rise to the second part, which in essence was the 'development

agreement'. The said agreement became null and void. Therefore,

there was no requirement upon the petitioner to pay stamp duty,

in the absence of any development and/or construction being

carried out on the subject land/property. In support of the said

agreement becoming a nullity, learned counsel submitted that

even the cheques (PDCs) paid as security, were returned back to

the developer, upon the lapse of the period of 24 months as

provided in the first part of the agreement.

4. Furthermore, learned counsel argued that the order

impugned dated 31.03.2014 deserves to be quashed and set

aside, as the Additional Collector (Stamps) did not consider the

nature of the document/agreement which was in fact not a

'development agreement' covered under Article 5(bbbb) or 5(e)

but an agreement otherwise covered under Article 5(c). Therefore,

the liability to pay stamp duty has been incorrectly crystallized

qua the petitioner, despite the agreement being a nullity. Lastly,

learned counsel also averred that the remedy of revision available

to the petitioner under Section 65 of the Rajasthan Stamp Act,

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1998 (hereinafter, Act of 1998) is ineffective and illusory,

especially on account of the fact that as per the said provision, a

pre-deposit is required to be made by the aggrieved party to the

tune of 25% of the total amount, for the said revision to be

entertained. In the present case, the said amount would

tantamount to Rs. 1.75 crores, which is highly excessive, thereby

frustrating the remedy in toto. In support of the contention raised

herein-above, learned counsel placed reliance upon the dictum of

the Hon'ble Apex Court as enunciated in Hardev Asnani vs.

State of Rajasthan reported in 2011 (11) SCR 599.

5. Per contra, learned counsel for the respondents has raised a

preliminary objection regarding the maintainability of the instant

petition. It is submitted that the petitioner has filed the present

petition challenging the order impugned dated 31.03.2014

whereby a stamp duty has been raised against the petitioner.

However, against the said order, a remedy of revision under

Section 65 of the Rajasthan Stamp Act, 1998 before the Rajasthan

Tax Board is available to the petitioner. Furthermore, learned

counsel argued that for the maintainability of the said revision

petition, it is necessary to deposit 25% amount of the

demanded/raised stamp duty and thus, it appears that to save the

said stamp duty and cause revenue loss to the State Government,

the petitioner has attempted to bypass the said payment and

accordingly, filed the present petition invoking the extraordinary

and supervisory jurisdiction of this Court, without exhausting the

statutory remedy. In this regard, learned counsel argued that

when statutory and alternative remedy of revision is available, the

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petitioner cannot be allowed to invoke the extraordinary and

supervisory jurisdiction of this Court, without exhausting such

remedy. In addition to the submissions made herein-above,

learned counsel also submitted that the instant petition also

involves several disputes questions of fact, which cannot be

resolved by the writ court while exercising supervisory jurisdiction,

especially qua the determination of the nature of the agreement

dated 07.06.2010 i.e. whether the same encapsulated a

'development agreement' or not and/or qua the nature of the land

etc. Therefore, on account of the said counts alone, learned

counsel prayed for the dismissal of the instant petition. In support

of the arguments so raised, learned counsel placed reliance upon

the dictum of this Court as rendered in D.B. Civil Writ Petition

No. 3256/2022 titled as M/s Cosmos India Engineering Pvt.

Ltd. vs. State of Rajasthan & Ors.

6. Heard learned counsel for the parties, scanned the record of

the writ petition and perused the judgments cited at Bar.

7. At the outset, this Court deems it fit to re-iterate the settled

position of the law insofar as it relates to the discretion ought to

be exercised by the writ courts under Article 226 of the

Constitution of India, whilst entertaining a lis, for the redressal of

which, a statutory and alternative remedy is available to the

petitioner. In essence, while exercising jurisdiction under Article

226, this Court, whilst having regard to the totality of facts, has a

discretion to entertain or not to entertain a writ petition. While

doing the latter, the Courts have imposed upon themselves certain

restrictions, one of which is, that if an alternative and efficacious

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remedy is available to the petitioner, the Courts would not

exercise their supervisory jurisdiction. In this regard, reliance can

be placed upon the dictum of the Hon'ble Apex Court as

enunciated in Whirlpool Corporation vs. Registrar of

Trademarks, Mumbai reported in (1998) 8 SCC 1.

8. Upon a considered perusal of the record of the instant

petition, the following pertinent facts emerge:-

8.1. That the order impugned dated 31.03.2014 was passed by

the Additional Collector (Stamps), after duly taking into

consideration, the agreement dated 07.06.2010 as well as the

stipulations incorporated therein, read with the corresponding

provisions of the Act of 1998.

8.2. That against the order impugned, a

statutory/effective/efficacious and alternative remedy is available

to the petitioner under Section 65 of the Act of 1998. In order for

a revision petition to be entertained by the Rajasthan Tax Board

under the said provision, the petitioner would have to fulfill the

condition of pre-depositing 25% of the raised/demanded stamp

duty. Upon doing so, the petitioner can duly raise his grievance

before the learned Tax Board.

8.3. That the present petition involves adjudication upon certain

disputed questions of fact, especially qua certain instrumental

stipulations necessary for discerning the nature of the agreement

dated 07.06.2010 i.e. whether the said agreement as entered

between the petitioner and the developer was a 'development

agreement' or not, or whether the land/property in question was

agricultural in nature and if the penalty imposed and/or the

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amount raised was duly compliant of the provisions of the Act of

1998 etc. In this regard, it is noted that it is a settled position of

law that a High Court exercising its extraordinary writ jurisdiction

under Article 226 of the Constitution of India, does not adjudicate

upon disputed and/or wholly antithetical questions of fact, which

may warrant considerable assessment of detailed evidence by the

concerned adjudicatory authorities below. In this regard, reliance

can be placed upon the dictum of the Hon'ble Apex Court as

enunciated in Civil Appeal No. 2848/2021 titled as Shubhas

Jain vs. Rajeshwari Shivam & Ors.

8.4. That the judgment cited by the learned counsel for the

petitioner in Hardevi Asnani (Supra) is distinguishable in the

facts and circumstances of the present case, especially for the

following reasons, namely:

8.4.1. At the relevant time, the stipulation of pre-deposit was

as high as 50% as opposed to the present requirement of 25%,

which has been substantially reduced in terms of the Act of 1998 .

8.4.2. That no disputed questions of facts warranting

assessment of evidence were involved in the said case.

9. In this regard, the reliance placed by the learned counsel for

the respondent on the judgment of the Division Bench of this

Court in M/s Cosmos India Engineering (Supra) is squarely

applicable. The relevant extract is reproduced herein-under:-

"7. In the case in hand, the reliance placed by the petitioner upon the judgment of Hardevi Asnani (supra) is not tenable because the law was amended w.e.f. 2012and the requirement of pre-deposit has been reduced from50% to 50%. Further, the case of Hardevi Asnani (supra) was with regard to an individual not a corporation entity, i.e. builder, who

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can pass on the cost/taxes upon the purchaser of the flat. Further, nowhere in the writ petition it has been explained by the petitioner that how there is an undue hardship, on account of financial reasons or otherwise, to deposit a sum of 25% of the tax amount when it is statutory mandate. Rather, the Apex Court judgment of M/s Commercial Steel Ltd. (supra), relied upon by the respondents, is fairly applicable in the present case. The Hon'ble Apex Court, in the above mentioned case, granted liberty to the respondent to avail alternative statutory remedy under Section 107 of Central Goods & Services Tax Act, 2017 even when there was a condition of pre-deposit of part of demand duty.

8. Further, the petitioner has also not filed the writ petition in the name of M/s Innovative Colonisers Pvt. Ltd. who were having substantial portion of land in their name, nor have they been impleaded as necessary parties. Such practice adopted by the petitioner reflects misrepresentation.

9. Considering the fact that alternative remedy is available in terms of Section 65 of the Rajasthan Stamp Act, 1998 and that there is no ground/argument of undue hardship or exorbitant demand reflected in the body of writ petition, this Court is of the view that the alternate remedy specified in the statute has to be availed before invoking writ jurisdiction, especially when petitioner has failed to establish that alternative remedy is not efficacious. Rather in the given case, looking to the disputed question of facts, issues like whether MOU was rightly treated as development agreement or not; where there was concealment or not; whether penalty was rightly imposed or not etc. are to be decided by the appellate authority as per the record.

10. In light of above observations and discussions, this Court is of the view that the writ petition is liable to be disposed. Liberty is granted to the petitioner to avail alternative statutory remedy, under Section 65 of Rajasthan Stamp Act, 1998, within a period of 15 days. If the petitioner chooses to avail the alternative remedy, the appellate authority/revision authority is directed to dispose of the matter within a period of three months from filing. It is made clear that the petitioner will have to deposit 25% of demand in question, as required in law, when filing revision application under Section 65 of Rajasthan Stamps Act, 1998."

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10. Furthermore, the Hon'ble Apex Court has through a series of

judgments, time and again held that once a statute has fixed the

condition of pre-deposit before filing an appeal, such a condition

must be satisfied. In this regard, reliance can be placed on the

judgment of the Hon'ble Apex Court as enunciated in Civil

Appeal No. 3464/2022 titled as The Director, Employees

State Insurance Health Care & Ors. vs. Maruti Suzuki India

Limited & Ors.

11. Therefore, considering the observations made herein-above

and especially considering the fact that an alternative remedy is

available in terms of Section 65 of the Rajasthan Stamp Act, 1998

and that the instant petition involves several disputed questions of

fact, this Court is of the view that the alternate remedy specified

in the statute has to be availed before invoking writ jurisdiction,

especially when the petitioner has failed to establish that the

alternative remedy is not efficacious. Rather, in the facts and

circumstances of the given case, looking to the disputed facts

especially qua the determination of the nature of the agreement

between the petitioner and the developer as well as the nature of

the land/property which constituted the subject matter of the said

agreement, are to be decided by the appellate authority, as per

the record/evidence.

12. In light of the preceding observations and discussions, this

Court is of the view that the writ petition is liable to be disposed

of. Liberty is granted to the petitioner to avail the alternative

statutory remedy, under Section 65 of the Rajasthan Stamp Act,

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1998, within a period of six weeks. If the petitioner chooses to

avail the alternative remedy, the appellate authority/revision

authority is directed to dispose of the matter within a period of

three months from filing. It is made clear that the petitioner will

have to deposit 25% of the demand in question, as required in

law, when filing the revision application under Section 65 of the

Rajasthan Stamps Act, 1998.

13. It is made clear that during the pendency of the appeal

before the authorities below, the petitioner will not be entitled to

alienate with the immovable property to give surety/personal bond

for meeting out the liability, if the same arises in the future, in

accordance with law.

14. With the observations made herein-above, the writ petition is

disposed of. Pending applications, if any, stand disposed of.

(SAMEER JAIN),J (AUGUSTINE GEORGE MASIH),CJ

ANIL SHARMA /45

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