Strict construction of fiscal levies bars stamp duty demand on increase in authorised share capital without express statutory authority.

Stamp duty could not be demanded on an increase in authorised share capital under the Delhi amendment to the Indian Stamp Act because the charging provisions covered incorporation documents and contained no express levy for such increase. As stamp duty is a fiscal charge, it must rest on clear statutory authority and be construed strictly; the demand could not be sustained by implication, analogy, prior payment by the company, or administrative practice. The filing therefore could not be withheld on the basis of an unsupported stamp duty demand.

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Issues: Whether stamp duty was leviable on the increase in the authorized share capital of a company under the Delhi amendment to the Indian Stamp Act, and whether the authorities could insist on such payment before accepting the statutory filing.

Analysis: The relevant stamp provisions dealt with the memorandum and articles of association at the stage of incorporation, but contained no express provision imposing stamp duty on an increase in authorized share capital. As the levy of stamp duty is a fiscal charge, it must be supported by clear statutory authority and construed strictly. In the absence of words extending the charge to increased authorized capital, the demand could not be sustained by implication, analogy, past payment by the company, or administrative practice reflected on the ROC website. The contrary provisions relied on from other States only showed that a specific amendment was required where such levy was intended.

Conclusion: The demand for stamp duty on the increase in authorized share capital was unsustainable, and the company could not be required to pay such duty before its filing was accepted.

Ratio Decidendi: A fiscal levy cannot be imposed unless the charging provision expressly authorizes it, and in the absence of a specific statutory provision, stamp duty cannot be demanded on increase in authorized share capital by implication.

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