2025 INSC 104
SUPREME COURT OF INDIA
(HON’BLE
VIKRAM NATH, J., HON’BLE SANJAY KAROL, J. AND HON’BLE SANDEEP MEHTA, JJ.)
HARSHIT HARISH JAIN
Petitioner
VERSUS
STATE OF MAHARASHTRA
Respondent
Civil
Appeal No. 1002 of 2025 (Arising out of SLP (C) No.21778 of 2024)-Decided on
24-01-2025
Civil, Stamp Duty
(A)
Maharashtra Stamp Act, 1958, Section 48(1) (as amended by the 24.04.2015
amendment) - Registration Act, 1908, Section 47 – Cancellation deed -
Refund of stamp duty –
Rejection of claim as time barred – Challenge as to - Whether the amended
six-month limitation, introduced by the 24.04.2015 amendment to Section
48(1) of the Act governs the Appellants’ claim for stamp duty refund,
particularly when the Cancellation Deed was executed prior to the amendment but
registered thereafter? - Although the Cancellation Deed was registered on
28.04.2015, it was executed on 17.03.2015 i.e. prior to the amendment dated
24.04.2015, which curtailed the time limit for seeking a refund from two years
to six months - Section 47 of the Registration Act, 1908, emphasize that
“a registered document shall operate from the time from which it would have
commenced to operate if no registration thereof had been required or made” - In
other words, the operative date for their right to seek refund would be
17.03.2015, placing them under the un-amended regime - High Court laid undue
emphasis on the registration date without fully appreciating that the
Appellants’ accrued right to claim a refund arose the moment the Cancellation
Deed was validly executed - The legislative scheme governing the earlier
proviso to Section 48(1) of the Act, contemplated a broader two-year
window - Constricting that window retroactively, merely because registration
happened post-amendment, unduly defeats a vested cause of action - Held that the scheme of stamp duty refund
provisions is designed to ensure fairness when the underlying transaction is
rescinded for bona fide reasons - The Appellants were compelled to cancel the
purchase due to the developer’s inability to deliver timely possession, and
were in no way remiss or at fault - Appellants are entitled to the benefit of
the un- amended proviso of Section 48(1) of the Act - Their refund
application, therefore, cannot be repelled as time-barred merely because the
deed’s registration was post-amendment – An amount of Rs.27,34,500/- had been
wrongly retained by the State from 08.01.2018 for almost seven years Appellant
would be entitled to simple interest @ 6 per cent per annum on the above amount
from the date of the first order of CCRA dated 08.01.2018 till the date it is
paid.
(Para 7, 8, 10 ,14 and
18)
(B)
Maharashtra Stamp Act, 1958, Section 48(1) (as amended by the 24.04.2015
amendment) - Cancellation deed - Refund of stamp duty order – Review of order – Jurisdiction - Appellants’
submission that the CCRA, having once granted a refund by its order dated
08.01.2018, lacked any express statutory power to review or recall that
decision - Held that a quasi- judicial
authority can only exercise such powers as the statute confers - There is no
provision in the Act enabling the CCRA to sit in review of its own orders - In
the absence of any enabling clause, the subsequent orders dated 03.03.2018,
16.04.2019, and ultimately 16.12.2022, reversing the earlier sanction of the
refund, cannot be sustained solely because the Appellants participated in the
proceedings - Unable to concur with the High Court’s reasoning that the
Appellants “submitted themselves” to the authority’s review process or somehow
acquiesced in the second decision - Jurisdiction cannot be created by consent
or waiver - The law does not permit a statutory functionary to assume powers
not conferred upon it, regardless of how the parties engage in subsequent
litigation - See clear infirmity in the High Court’s endorsement of the CCRA’s
review-like exercise - Further, its refusal to disturb the recall of the
earlier refund order, despite acknowledging the absence of statutory review
power, is difficult to sustain - Participation in an erroneous procedure
cannot confer review jurisdiction upon the CCRA where none exists in law.
(Para
12 to 14)
JUDGMENT
Vikram Nath, J. :- Leave granted.
2.
The present appeal assails the final judgment and order dated 18.04.2024,
rendered by the High Court of Judicature at Bombay in Writ Petition (C) No.
2018 of 2024, whereby the writ petition preferred by the Appellants stood
dismissed. The gravamen of the dispute concerns the rejection of the
Appellants’ claim for refund of stamp duty under the provisions of
the Maharashtra Stamp Act, 1958 (hereinafter “the Act”).
3.
The brief facts leading to the present appeal are as follows:
3.1. The Appellants
entered into an Agreement to Sell dated 30.08.2014 with a real estate
developer, M/s. Krona Realties Pvt. Ltd. (hereinafter, “the Developer”), for
the purchase of a residential flat (Flat No. 5102) in the “Lodha Venezia”
project at Mumbai. The total consideration agreed was ₹5.46 crores, against which an
advance payment of ₹1.08 crores was made
to the Developer.
3.2. Pursuant to the
execution of the Agreement to Sell, the Appellants paid stamp duty of ₹27,34,500, as mandated
under the Act. The said Agreement was registered on 18.09.2014, upon payment of
an additional registration charge of ₹30,000.
3.3. Sometime
thereafter, on 05.11.2014, the Developer informed the Appellants of unavoidable
delays tied to issues involving adjacent slums, thereby making it impossible to
hand over possession of the flat by 31.03.2017, the date earlier envisaged. The
Developer offered three options to the Appellants:
(i) transfer the
booking to another project,
(ii) opt for
cancellation with a refund along with interest at 12% per annum, or
(iii)
continue with the present booking but with a revised possession timeline.
3.4. Constrained by
the uncertainty over timely possession, the Appellants chose to cancel the
booking. Consequently, a Deed of Cancellation was executed on 17.03.2015.
However, the said Cancellation Deed came to be registered only on 28.04.2015
before the Sub-Registrar of Assurances, Mumbai City. Subsequently, on
23.05.2016, a Deed of Rectification was also executed, clarifying the refund
details and other particulars of the cancellation.
3.5. Meanwhile, by an
amendment dated 24.04.2015 to Section 48(1) of the Act, the time
limit for seeking a refund of stamp duty on a registered cancellation deed was
curtailed from two years to six months (counted from the date of registration
of such deed). On 06.08.2016, the Appellants filed an application for refund of
the stamp duty amounting to ₹27,34,500, contending
that they were governed by the earlier (pre- amendment) statutory regime, since
their Cancellation Deed was executed before 24.04.2015.
3.6. The refund application was initially
allowed by the Chief Controlling Revenue Authority, Maharashtra State, Pune
(CCRA), vide its Order dated 08.01.2018. Soon thereafter, however, the same
authority, by a subsequent Order dated 03.03.2018, recalled its earlier
decision and rejected the refund request as time- barred, citing the amended
limitation period.
3.7. Aggrieved by the
03.03.2018 order recalling the earlier sanction of refund, the Appellants first
attempted to challenge it before the Chief Controlling Revenue Authority (CCRA)
by way of an appeal under Section 53 of the Act. The CCRA dismissed
the appeal on 16.04.2019, prompting the Appellants to file Writ Petition No.
8276 of 2019 before the High Court of Judicature at Bombay. In its judgment
dated 04.10.2022, the High Court set aside the orders dated 03.03.2018 and 16.04.2019,
noting that the Appellants had not been accorded proper opportunity of hearing.
The matter was remanded to the CCRA for fresh consideration, particularly on
the question of whether the original (unamended) or the amended provision
under Section 48(1) of the Act would apply to the cancellation.
Pursuant to that remand, the CCRA passed a fresh order on 16.12.2022,
again rejecting the refund claim on the ground that the amended six-month
limitation governed the Appellants’ case.
3.8. Aggrieved by the
CCRA’s stance, the Appellants filed Writ Petition (C) No. 2018 of 2024 before
the High Court of Judicature at Bombay, urging, inter alia, that (i) the right
to seek refund accrued on the date of execution (17.03.2015), thus invoking the
unamended two-year window, and (ii) the CCRA had no statutory power of review
to recall its initial order granting refund.
3.9. By the impugned
judgment dated 18.04.2024, the High Court dismissed the writ petition, holding,
in essence, that the date of registration (28.04.2015) triggered the
Appellants’ claim, which fell under the amended provision stipulating a
six-month limitation. The High Court further opined that, in the specific
facts, the CCRA’s recall could not be struck down solely on the ground of no
express power of review.
4.
Aggrieved with the dismissal of their writ petition, the Appellants have now
approached this Court by way of the present appeal.
5.
Having heard the learned counsel for the Appellants and the Respondents, the
primary issue for consideration before us is whether the amended six-month
limitation, introduced by the 24.04.2015 amendment to Section
48(1) of the Act governs the Appellants’ claim for stamp duty refund,
particularly when the Cancellation Deed was executed prior to the amendment but
registered thereafter.
6. Section
48(1) of the Act reads as follows:
“48. The application
for relief under section 47 shall be made within the following
period, that is to say,— (1) in the cases mentioned in clause (c)(5), within [six
months] of the date of the instruments:
Provided that where an
Agreement to sale immovable property, on which stamp duty is paid
under Article 25 of the Schedule I, is presented for registration
under the provisions of the Registration Act, 1908 and if the seller
refuses to deliver possession of the immovable property which is the subject
matter of such agreement the application may be made within two years of the
date of the Instrument [or where such agreement is cancelled by a registered
cancellation deed on the grounds of, dispute regarding the premises concerned,
inadequate finance, financial dispute in terms of agreed consideration, or
afterwards found to be illegal construction or suppression of any other
material fact, the application may be made within two years from the date of
such registered cancellation deed.]” Through the amendment on 24.04.2015, the
two-year period was curtailed to six months from the date of registration of
the cancellation deed, thus altering the time frame under which a party could
claim a refund.
7.
The Appellants assert that, although the Cancellation Deed was registered on
28.04.2015, it was executed on 17.03.2015 — prior to the amendment dated
24.04.2015, which curtailed the time limit for seeking a refund from two years
to six months. They rely upon Section 47 of the Registration Act,
1908, emphasizing that “a registered document shall operate from the time from
which it would have commenced to operate if no registration thereof had been
required or made.” In other words, the operative date for their right to seek
refund would be 17.03.2015, placing them under the un-amended regime.
8.
In our view, this contention carries substantial weight. The High Court laid
undue emphasis on the
registration
date without fully appreciating that the Appellants’ accrued right to claim a
refund arose the moment the Cancellation Deed was validly executed. The
legislative scheme governing the earlier proviso to Section 48(1) of
the Act, contemplated a broader two-year window. Constricting that window
retroactively, merely because registration happened post-amendment, unduly
defeats a vested cause of action.
9.
Moreover, in M.P. Steel Corporation v. Commissioner of Central Excise[(2015)7 SCC 58] , this Court has
held that amendment to provision as to limitation is inapplicable to accrued
cause of action where the amendment has reduced the period earlier provided.
The relevant paras of this judgement have been extracted hereunder:
“53. Shri A.K. Sanghi,
learned Senior Counsel appearing on behalf of the Revenue, has strongly
contended before us that the present appeal must attract the limitation period
as on the date of its filing. That being so, it is clear that the present
appeal having been filed before Cestat only on 23-5-2003, it is Section 128
post amendment that would apply and therefore the maximum period available to
the appellant would be 60 plus 30 days. Even if time taken in the abortive
proceedings is to be excluded, the appeal filed will be out of time being
beyond the aforesaid period.
54. It is settled law
that periods of limitation are procedural in nature and would ordinarily be
applied retrospectively. This, however, is subject to a rider. In New
India Insurance Co. Ltd. v. Shanti Misra [(1975) 2 SCC 840 : (1976) 2 SCR
266] , this Court held : (SCC p. 844, para 5)
5. “On the plain
language of Sections 110-A and 110-F there should be no difficulty in taking
the view that the change in law was merely a change of forum i.e. a change of
adjectival or procedural law and not of substantive law. It is a
well-established proposition that such a change of law operates retrospectively
and the person has to go to the new forum even if his cause of action or right
of action accrued prior to the change of forum. He will have a vested right of
action but not a vested right of forum. If by express words the new forum is
made available only to causes of action arising after the creation of the
forum, then the retrospective operation of the law is taken away. Otherwise,
the general rule is to make it retrospective.”
55. In answering
a question which arose under Section 110-A of the Motor Vehicles Act,
this Court held : (Shanti Misra case [(1975) 2 SCC 840 : (1976) 2 SCR
266] , SCC p. 846, para 7)
7. “… ‘(1) Time for
the purpose of filing the application under Section 110-A did not start running
before the constitution of the tribunal. Time had started running for the
filing of the suit but before it had expired the forum was changed. And for the
purpose of the changed forum, time could not be deemed to have started running
before a remedy of going to the new forum is made available.
(2) Even though by and
large the law of limitation has been held to be a procedural law, there are
exceptions to this principle. Generally the law of limitation which is in vogue
on the date of the commencement of the action governs it. But there are certain
exceptions to this principle. The new law of limitation providing a longer
period cannot revive a dead remedy. Nor can it suddenly extinguish a vested
right of action by providing for a shorter period of limitation.’”
56. This statement of
the law was referred to with approval in Vinod Gurudas Raikar v. National
Insurance Co. Ltd. [(1991) 4 SCC 333] as follows : (SCC p. 337, para 7).
7. “It is true that
the appellant earlier could file an application even more than six months after
the expiry of the period of limitation, but can this be treated to be a right
which the appellant had acquired. The answer is in the negative. The claim
to compensation which the appellant was entitled to, by reason of the accident
was certainly enforceable as a right. So far the period of limitation for
commencing a legal proceeding is concerned, it is adjectival in nature, and has
to be governed by the new Act—subject to two conditions. If under the repealing
Act the remedy suddenly stands barred as a result of a shorter period of
limitation, the same cannot be held to govern the case, otherwise the result
will be to deprive the suitor of an accrued right. The second exception is
where the new enactment leaves the claimant with such a short period for
commencing the legal proceeding so as to make it unpractical for him to avail of
the remedy. This principle has been followed by this Court in many cases and by
way of illustration we would like to mention New India Insurance Co. Ltd.
v. Shanti Misra [(1975) 2 SCC 840 : (1976) 2 SCR 266] . The husband of the
respondent in that case died in an accident in 1966. A period of two
years was available to the respondent for instituting a suit for recovery of
damages. In March 1967 the Claims Tribunal under Section 110 of the
Motor Vehicles Act, 1939 was constituted, barring the jurisdiction of the civil
court and prescribed 60 days as the period of limitation. The respondent filed
the application in July 1967. It was held that not having filed a suit before
March 1967 the only remedy of the respondent was by way of an application
before the Tribunal. So far the period of limitation was concerned, it was
observed that a new law of limitation providing for a shorter period cannot
certainly extinguish a vested right of action. In view of the change of
the law it was held that the application could be filed within a reasonable
time after the constitution of the Tribunal; and, that the time of about four
months taken by the respondent in approaching the Tribunal after its
constitution, could be held to be either reasonable time or the delay of about
two months could be condoned under the proviso to Section 110-A(3).”
Both these judgments were referred to and
followed in Union of India v. Harnam Singh [(1993) 2 SCC 162 : 1993
SCC (L&S) 375 :(1993) 24 ATC 92] , see para 12.
57. The aforesaid principle is also contained
in Section 30(a) of the Limitation Act, 1963:
30. “Provision for
suits, etc., for which the prescribed period is shorter than the period
prescribed by the Indian Limitation Act, 1908.—Notwithstanding anything contained
in this Act—
(a) any suit for which
the period of limitation is shorter than the period of limitation prescribed by
the Indian Limitation Act, 1908, may be instituted within a period of seven
years next after the commencement of this Act or within the period prescribed
for such suit by the Indian Limitation Act, 1908, whichever period expires
earlier:”
58. The reason for the
said principle is not far to seek. Though periods of limitation, being
procedural law, are to be applied retrospectively, yet if a shorter period of
limitation is provided by a later amendment to a statute, such period would
render the vested right of action contained in the statute nugatory as such
right of action would now become time- barred under the amended provision.”
10.
Even if one were to hold that the Appellants’ claim is examined under the
amended six-month period, we are of the considered opinion that a mere
technical delay should not, by itself, extinguish an otherwise valid claim. The
scheme of stamp duty refund provisions is designed to ensure fairness when the
underlying transaction is rescinded for bona fide reasons. The Appellants were
compelled to cancel the purchase due to the developer’s inability to deliver
timely possession, and were in no way remiss or at fault.
11.
Denying a legitimate refund solely on technical grounds of limitation,
especially when the timing of registration fell close to the legislative
amendment, fails to strike the equitable balance ordinarily
expected
in fiscal or quasi-judicial determinations. A measure of discretion or
consideration for good faith conduct is not alien to statutory processes that
safeguard citizens from unjust enrichment by the State. It has been laid
down by this Court in Bano Saiyed Parwaz v. Chief Controlling Revenue
Authority & Inspector General of Registration & Controller of Stamps[2024 SCC OnLine SC 979] that the
limitation provision in stamp law (to seek refund of stamp duty) should not be
enforced so as to oust the remedy when the applicant is otherwise not
blameworthy. The relevant paras of the same have been reproduced hereunder:
“14. In Committee-GFIL
v. Libra Buildtech Private Limited3, wherein the issue of refund of stamp duty
under the same Act was in question, this Court has observed and held inter alia
as under:
“29. This case reminds
us of the observations made by M.C. Chagla, C.J. in Firm Kaluram Sitaram
v. Dominion of India [1953 SCC OnLine Bom 39: AIR 1954 Bom 50]. The
learned Chief Justice in his distinctive style of writing observed as under in
para 19: (Firm Kaluram case, SCC OnLine Bom)
“19. … we have often had occasion to say that
when the State deals with a citizen it should not ordinarily rely on
technicalities, and if the State is satisfied that the case of the citizen is a
just one, even though legal defences may be open to it, it must act, as has
been said by eminent Judges, as an honest person.” We are in respectful
agreement with the aforementioned observations, as in our considered opinion
these observations apply fully to the case in hand against the State because
except the plea of limitation, the State has no case to defend their action.
Xxxxxxxxx
32. In our considered
opinion, even if we find that applications for claiming refund of stamp duty
amount were rightly dismissed by the SDM on the ground of limitation prescribed
under Section 50 of the Act yet keeping in view the settled principle
of law that the expiry of period of limitation prescribed under any law may bar
the remedy but not the right, the applicants are still held entitled to claim
the refund of stamp duty amount on the basis of the grounds mentioned above. In
other words, notwithstanding dismissal of the applications on the ground of
limitation, we are of the view that the applicants are entitled to claim the
refund of stamp duty amount from the State in the light of the grounds
mentioned above.”
15. The legal position
is thus settled in Libra Buildtech (supra) that when the State deals
with a citizen it should not ordinarily rely on technicalities, even though
such defences may be open to it.
16. We draw weight
from the aforesaid judgment and are of the opinion that the case of the appellant
is fit for refund of stamp duty in so far as it is settled law that the period
of expiry of limitation prescribed under any law may bar the remedy but not the
right and the appellant is held entitled to claim the refund of stamp duty
amount on the basis of the fact that the appellant has been pursuing her case
as per remedies available to her in law and she should not be denied the said
refund merely on technicalities as the case of the appellant is a just one
wherein she had in bonafide paid the stamp duty for registration but fraud was
played on her by the Vendor which led to the cancellation of the conveyance
deed.”
12.
We also find merit in the Appellants’ submission that the CCRA, having once
granted a refund by its order dated 08.01.2018, lacked any express statutory
power to review or recall that decision. A quasi- judicial authority can only
exercise such powers as the statute confers. There is no provision in the Act
enabling the CCRA to sit in review of its own orders. In the absence of any
enabling clause, thesubsequent orders dated 03.03.2018, 16.04.2019, and
ultimately 16.12.2022, reversing the earlier sanction of the refund, cannot be
sustained solely because the Appellants participated in the proceedings.
13.
We are unable to concur with the High Court’s reasoning that the Appellants
“submitted themselves” to the authority’s review process or somehow acquiesced
in the second decision. Jurisdiction cannot be created by consent or waiver.
The law does not permit a statutory functionary to assume powers not conferred
upon it, regardless of how the parties engage in subsequent litigation. Hence,
we see clear infirmity in the High Court’s endorsement of the CCRA’s
review-like exercise.
14.
In light of the above, the findings recorded by the High Court in the impugned
judgment warrant interference. The High Court’s focus on the date of
registration as determinative of the applicable legal regime under Section
48(1) of the Act overlooks the accrued right crystallizing at the time of
execution of the Cancellation Deed. Further, its refusal to disturb the recall
of the earlier refund order, despite acknowledging the absence of statutory
review power, is difficult to sustain. Participation in an erroneous
procedure cannot, in our considered view, confer review jurisdiction upon the
CCRA where none exists in law.
15.
For the reasons discussed, we conclude that the Appellants are entitled to the
benefit of the un- amended proviso of Section 48(1) of the Act. Their
refund application, therefore, cannot be repelled as time-barred merely because
the deed’s registration was post-amendment. Equally, the subsequent orders
recalling the already sanctioned refund stand vitiated, given the CCRA’s lack
of statutory mandate to review its own final orders.
16.
In view of the foregoing, we hold that the Appellants’ claim for refund falls
under the un- amended proviso to Section 48(1) of the Maharashtra
Stamp Act, 1958. Consequently, the impugned judgment dated 18.04.2024 of the
High Court of Judicature at Bombay, in W.P. No. 2018 of 2024, is hereby set
aside and the writ petition stands allowed.
17.
The subsequent orders of the Chief Controlling Revenue Authority (CCRA)
recalling the earlier sanction of refund, including the Order dated 16.12.2022,
are accordingly quashed. The Order dated 08.01.2018, which allowed the
Appellants’ refund, shall stand restored.
18.
The appellant had applied for refund of the stamp duty on 6th August, 2016. The
same had been allowed by the CCRA vide order dated 08.01.2018. Instead of
refunding the amount, the CCRA, by a subsequent order dated 03.03.2018
illegally recalled its earlier decision of 08.01.2018 and rejected the request
for refund. We have already held above that the subsequent order dated
03.03.2018 was vitiated in law and secondly that the appellant was entitled to
refund. In such circumstances, we find that the amount of Rs.27,34,500/- had
been wrongly retained by the State from 08.01.2018 for almost seven years. As
such, we are of the view that the appellant would be entitled to simple
interest @ 6 per cent per annum on the above amount from the date of the first
order of CCRA dated 08.01.2018 till the date it is paid.
19.
The Respondents are directed to process and disburse the refund of stamp duty,
already paid by the Appellants along with accrued interest as directed above
within a period of four weeks from today, in accordance with law. Any further
delay will entail further interest component @ 12% p.a.
20.
The appeal stands allowed.
21.
There shall be no order as to costs.
21.
Pending applications, if any, shall stand disposed of.
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