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Issues: Whether the impugned demand of differential stamp duty and penalty under the Indian Stamp Act, 1899 could be sustained when the property was treated as commercial by the revenue though it was being used as a residential house on the date of execution of the sale deed.
Analysis: The rateable value for stamp duty depends on the nature and user of the property at the time of purchase, not on a later change in its use. The material on record showed that the property was used for residential purposes on the date of the sale deed, and there was no convincing record to dislodge that position. In these circumstances, the valuation adopted by the authorities on the basis of later or different user was not a proper foundation for demanding additional stamp duty and penalty. The Court also noted the factual infirmities in the manner in which the revenue order had been made.
Conclusion: The demand of differential stamp duty and penalty was not sustainable, and the relief granted by the High Court was upheld in favour of the respondents.
Final Conclusion: The appeal failed and the order quashing the revenue demand was left undisturbed.
Ratio Decidendi: For assessment of stamp duty, the relevant user and nature of the property are those existing on the date of execution of the conveyance, and a later commercial use cannot justify reassessment on a higher basis.
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