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Issues: (i) Whether the period of one year under section 40 of the Gujarat Stamp Act, 1958 was to be reckoned from the date of the Company Court's amalgamation order or from the date on which the Board for Industrial and Financial Reconstruction granted sanction; (ii) Whether the orders demanding deficit stamp duty and penalty were sustainable.
Issue (i): Whether the period of one year under section 40 of the Gujarat Stamp Act, 1958 was to be reckoned from the date of the Company Court's amalgamation order or from the date on which the Board for Industrial and Financial Reconstruction granted sanction.
Analysis: The amalgamation order expressly remained subject to approval by the Board for Industrial and Financial Reconstruction. The transfer of assets and properties under the scheme could operate only when that approval was obtained. In such a situation, the instrument attracting stamp duty became effective on the date when the condition was fulfilled, because the conveyance within the meaning of the stamp law was created only then. The statutory period for presenting the instrument could not therefore be computed from the earlier conditional order of the Company Court.
Conclusion: The one-year period had to be reckoned from the date of sanction by the Board for Industrial and Financial Reconstruction, not from the date of the Company Court's order.
Issue (ii): Whether the orders demanding deficit stamp duty and penalty were sustainable.
Analysis: Since the instrument was presented within one year from the date on which the scheme became operative upon sanction by the Board for Industrial and Financial Reconstruction, the foundation for invoking the consequences under sections 39 and 40 of the stamp law failed. The demand for deficit duty and penalty was therefore based on an erroneous computation of time and could not stand.
Conclusion: The demand for deficit stamp duty and penalty was unsustainable and was set aside in favour of the petitioner.
Final Conclusion: The impugned stamp demands were quashed, and the petitioner was entitled to consequential refund of the amount paid under protest.
Ratio Decidendi: Where an amalgamation order is expressly made subject to further statutory approval, the period for presenting the resulting conveyance for stamp purposes runs from the date on which the condition is satisfied and the transfer becomes operative.
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