TaxTMI 
TaxTMI 
2023 (2) TMI 1447
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....8 (hereinafter referred to as 'the Stamp Act') by the Chief Controlling Revenue Authority, Gujarat State, Gandhinagar for the opinion of this Court. 2. Though questions of law in each of this stamp reference would overlap, the facts in each case and would differ partially and as such, the facts are narrated independently and the questions of law are dealt with collectively. RE: STAMP REFERENCE No. 1 OF 2020 3. A scheme of amalgamation between Holcim (India) Private Limited with Ambuja Cement Limited was presented before this Court for sanctioning the said scheme. The said scheme came to be sanctioned by the Company Court i.e. High Court of Gujarat on 18.3.2014 and pursuant to the same, the applicant - Ambuja Cement Limited filed an application dated 15.5.2014 before the Collector under provisions of Section 31(1) of the Stamp Act seeking opinion as to proper stamp duty leviable on the order of sanction of the scheme by the Company Court. The Collector, by order dated 26.2.2019, ordered for recovering deficit stamp duty of Rs.15 crore along with penalty of Rs.3 crore from the applicant company on the order of sanctioning the scheme dated 18.3.2014 passed by the Compan....
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....ed an order on 19.11.2019 confirming the order passed by the Collector and as such, reference has been sought by the applicant and accordingly two (2) questions have been referred to this Court for opinion. RE: STAMP REFERENCE No. 3 OF 2020 11. A composite scheme in the nature of transfer of windmill undertaking of Gopal Glass Works Limited (GGWL) into Gopal Mirror Coating Private Limited (GMCP) by way of slump sale and amalgamation of residue undertaking of GGWL - transferor into GMCP - transferee under Sections 230 to 232 of the Companies Act, 2013 came to be allowed / sanctioned by the National Company Law Tribunal vide order dated 11.8.2017. Pursuant to the said order dated 11.8.2017 passed by the NCLT, GGWL filed an application dated 8.9.2017 before the Collector & Additional Superintendent of Stamps under provisions of Section 31(1) of the Gujarat Stamps Act, 1958 seeking opinion and adjudication as to proper stamp duty leviable on the order of sanctioning the scheme passed by National Company Law Tribunal on 11.8.2017. The Collector adjudicated the same and proposed the stamp duty of Rs.1,60,83,177/- and in response to the same, the applicant - GGWL by its letter dated....
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....sion Limited (ATL) and Adani Mining Private Limited (AMPL) whereunder it was proposed that (a) the port undertaking of the applicant - AEL would be transferred to APSEZ; (b) the power undertaking of the applicant - AEL would be transferred to APL; (c) the transmission undertaking of the applicant - AEL would be transferred to ATL; (d) APML would be amalgamated with the applicant - AEL. 17. Pursuant to the sanction of the scheme by the Company Court, applicant filed an application dated 11.6.2015 before the Collector under Section 31(1) of the Stamp Act for opinion as regards the proper stamp duty payable on the scheme approved by the Company Court on 7.5.2015 and sought adjudication as to the proper stamp duty payable on the instrument viz. the order dated 7.5.2015 and is said to have produced the particulars sought for by the Collector. The Collector, by communication dated 9.9.2016, called upon the applicant - AEL to pay stamp duty of Rs.75 crore which was objected to by the applicant - AEL and overruling the same, Collector confirmed the earlier opinion expressed and also levied penalty of Rs.3 lakh by order dated 25.7.2018. 18. Being aggrieved by and dis....
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....s Act before the Chief Controlling Revenue Authority who, by order dated 5.8.2020, rejected the application and upheld the order dated 18.10.2019 passed by the Collector. Hence, this reference by raising eight (8) questions. 22. We have heard the arguments of Mr. Ashish Kumar Singh, learned advocate appearing for Mr. Bhavesh Choksi for the applicant in Stamp Reference No.1 of 2020, Mr. Mihir Joshi, learned Senior Advocate with Mr. Sandip Singhi for Singhi & Company for the applicants in Stamp Reference No.2, 4, 5 and 7 of 2020, Mr. Tushar Hemani, learned Senior Advocate with Mr. Jaimin Dave for the applicant in Stamp Reference No.4 of 2020 and Ms. Manisha Lavkumar Shah, learned Government Pleader with Mr. Chintan Dave, Mr. D.M. Devnani and Ms. Nidhi Vyas, learned Assistant Government Pleaders for the respondent. 23. Learned advocate Mr. Ashish Kumar Singh assisted by Mr. Bhavesh Chokshi appearing for the applicant has vehemently contended that since the questions of law before the reference are though several in numbers, but two questions being interwoven are required to be answered namely question no. (I) & (II). It has been contended that in relation to the scheme which is ....
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.... of aforesaid facts has no jurisdictional authority to impound any instrument by invoking Section 33 of the Act. By giving emphasis on the Appointed Date i.e. 01.04.2013 and by referring to amended notification dated 15.05.2013 and Article 20(d) of Schedule - I of the Act, he has asserted that since the High Court has sanctioned the scheme may be in March, 2014, but by virtue of said sanction the Appointed Date is determined i.e. 01.04.2013, the rate prevailing as on that date is the determinative factor and as such liability has been discharged by paying said amount by way of demand draft and as such, the stand of the authority is impermissible and it is requested to answer the reference in the aforesaid context. 24. For the purpose of substantiating his contentions, learned advocate Mr. Singh has referred to the following decisions: "* In the case of State of Gujarat v. Bio Deal Laboratories Private Limited (R/Letters Patent Appeal No, 452 of 2017 in R/Special Civil Application No. 345 of 2011). * In the case of Alembic Pharmaceuticals Limited v. Chief Controlling Revenue Authority (Stamp Reference No. 1 of 2012) reported in (2014) 3 GLR 2255. ....
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....uld contend that shares of both the transferor and the applicant company of Stamp Reference No.2 of 2020 are not listed on any stock exchange and as such the market value of the shares issued by the applicant is deemed to be its face value, irrespective of whether such shares being issued at a premium or not and on the ground that shares are issued at a premium, the authorities below have included the said premium for determining the market value of share. 27. He would further contend that fiscal statutes are construed strictly and the contention now put forth that premium is a 'consideration' other than share is clearly an afterthought and untenable as it is evident from the expression 'amount of consideration' referred to in Article 20(d)(1) is separate and distinct from the 'market value of share' and as such it cannot be treated as amount of consideration. He would also submit that stand of the Revenue that share premium is covered within the phrase 'amount of consideration' is an afterthought. 28. He would also elaborate his submission by contending that premium cannot be something distinct from the shares and it cannot exist independently apart from shares as premium is....
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....n but to give effect to the provisions contained under Gujarat Stamp Act. Hence, when both transferor and transferee companies are not listed, computation should be on the basis of face value of shares of the company. For this purpose, learned senior counsel has made certain reference to the meaning of word 'Premium' and has also made a reference to certain decisions delivered by Hon'ble Apex Court and by way of a compilation, following are the decisions referred to and relied upon: (i) Board of Revenue v. Rai Saheb Siddnath Mehrotra reported in (1965)2 SCR 269 : AIR 1965 SC 1092; (ii) District Registrar and Collector v. Canara Bank reported in (2005)1 SCC 496; (iii) CIT v. Calcutta Knitwears reported in (2014) 6 SCC 444 And as such, he has prayed that error which has crept in may be corrected by answering the reference accordingly. 32. Mr. Sandip Singhi, learned advocate appearing for the applicant has contended that scheme of arrangement is a composite scheme and as such the Collector erred in holding it comprises of separate / distinct transaction and same is covered under Section 5 of the Stamp Act by referring to the scheme approved by Na....
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....mp Reference Nos.4/2020, 5/2020 and 6/2020 and prays for the reference being answered in favour of the applicant. 36. Per contra, Ms. Manisha Lavkumar Shah learned Government Pleader appearing on behalf of the stamp authority has vehemently opposed the stand of the applicant - company and has submitted that amendment has already been inserted by virtue of notification dated 15.05.2013 and the Hon'ble High Court has sanctioned the scheme on 18.03.2014 and as such, demand raised by the authority is justified. It has been asserted clearly that levy of stamp duty should be on the date of execution of the instrument and not on the Appointed Date mentioned therein and as such, the date of execution can be said to be the order of High Court namely 18.03.2014 which is after the date of amendment and as such, the date of execution is significant and not the Appointed Date mentioned in the scheme for the purposes of chargeability. By referring to certain provisions of the Stamp Act, it has been submitted that demand which has been raised by the authority is on the basis of the correct interpretation of the provisions applicable and as such, the total amount which is payable is Rs.25 crore....
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....ion of such instrument if is satisfied about the duty not having been fully paid as determined, in such event the collector exercises power under Section 32 of the Act by issuing certificate. At this stage it shall be noteworthy to quote proviso to Section 32 which reads as under "Provided that nothing in this section shall authorize the Collector to endorse (a) any instrument executed or first executedin the State and brought to him after the expiration of one month from the date of its execution or first execution, as the case may be (b) any instrument executed or first executedout of the State and brought to him after the expiration of three months after it has been first received in this State, or (c) any instrument chargeable with the dutyof twenty naye paise or less when brought to him, after the drawing or execution thereof on paper not duly stamped." Thus, if an instrument which is executed, is brought to the Collector after the expiration of one month, the Collector has no authority to make any endorsement thereon. However, Section 33 permits examination and impounding of instruments and the Collector is empowered under this Sec....
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....ble with duty, and (a) the Collector determines that it is already fully stamped, or (b) the duty determined by the Collector under section 31, or such a sum as with the duty already paid in respect of the instrument, is equal to the duty so determined, has been paid, the Collector shall certify by endorsement on such instrument that the full duty (stating the amount) with which it in chargeable has been paid. (2) When such instrument is, in his opinion,not chargeable with duty, the Collector shall certify in manner aforesaid that such instrument is not so chargeable. (3) Any instrument upon which anendorsement has been made under this Section, shall be deemed to be duty stamped or not chargeable with duty, as the case may be, and, if chargeable with duty shall be receivable in evidence or otherwise, and may be acted upon and registered as if it has been originally duly stamped: Provided that nothing in this section shall authorise the Collector to endorse (a) any instrument executed or first executedin the State and brought to him after the expiration of one month from the date of its execution or first execution as the case may be; ....
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.... (stating the amount of each) have been levied in respect thereof, and the name and residence of the person paying them. (2) Every instrument so endorsed shall thereupon be admissible in evidence, and may be registered and acted upon and authenticated as if it had been duly stomped, and shall be delivered on his application in this behalf to the person from whose possession it came in to the hands of the officer impounding it or as such person may direct: Provided that- (a) no instrument which has been admitted in evidence upon payment of duty and penalty under section 34, shall be so delivered before the expiration of one month from the date of such impounding or if the Collector has certified that its further detention is necessary and has not cancelled such certificate. (b) nothing in this section shall affect the provisions of Order XIII in Schedule I of the Code of the Civil Procedure, 1908 (V of 1908) Similarly, Section 17 which deals with instrument executed in State wherein it, mandates that instrument chargeable with duty and executed by any person in the State shall be stamped before or at the time of execution or immediately o....
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....date as provided in the instrument was 01.04.2013, however, the scheme was sanctioned by Hon'ble High Court on 18.03.2014 and the document was for the first time presented before the authority on 15.05.2014 The said document was therefore, not submitted for adjudication within 30 days as required under S. 17 read with S.32 and therefore, there could not have been any issuance of certificate under Section 32 of the Act. 2. As far as the applicability of the Stamp duty on appointed date is concerned, it would be appropriate to refer to Section 2(d) which defines "chargeable" and the said definition is clear as the same provides that chargeable means as applied to an instrument when such instrument was executed. Similarly Section 3 of the Act which deals with instruments chargeable with duty, the same also provides for an instrument executed in the State Section 2(d) and Section 3 quoted herein below; "Section 2(d):- (d) "chargeable mans, as applied to an instrument executed or first executed after the commencement of this Act, chargeable under this Act, and as applied to any other instruments, chargeable under the law in force in the State when such instrument w....
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....Therefore, the word "appointed date" has to correlate with the chargeability of the stamp duty which is again dependent on its execution. Therefore, the appointed date has to be construed as the date of execution of stamp duty once the scheme of amalgamation/ arrangement is approved by the competent authority/tribunal In other words, the value of share has to be taken into consideration as on appointed date and the rate of stamp duty can only be decided by the authorities as and when the instrument is executed QUESTION: 5.7. Whether in the facts and circumstances of the present case, a revised notice can be issued to expand the scope of an earlier show cause notice and introduce a completely new case altogether? (Referred m Stamp Reference No.1/2020 as Question No.III) RESPONSE TO QUESTION NO. 5.7 In so far as the facts of the present case is concerned, initially an notice dated 07.11.2016 came to be issued calling upon and intimating that the payable stamp duty under Section 20(d) would be 10 Crores however, on noticing the mistake that the stamp duty as provided under Section 20(d) which was in fact payable on the instrument was 25 Cro....
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....igh Court of Gujarat. In the case of Chief Controlling Authority v. Nutal Mills Limited, Ahmedabad reported in 1977 GLR 409. * Full Bench : Hon'ble High Court of Gujarat. In the case of President Kankaria Apartment Co-operative Housing Society Limited v. Chief Controlling Revenue Authority reported in 1984 (2) GLR 1188. * Full Bench : Hon'ble High Court of Gujarat. In the case of Alembic Pharmaceuticals Limited v. Chief Controlling Revenue Authority in Stamp Reference No. 1 of 2012 dated 26.11.2013. (citation : 2014 (3) GLR 2255). * Hon'ble Supreme Court. In the case of Alembic Pharmaceuticals Limited v. Chief Controlling Revenue Authority in Civil Appeal No. 4909 of 2018 (Arising out of Special Leave Petition (C ) No. 6174 of 2014) dated 05.04.2017). (Arising out of judgment and order dated 26.11.2013 in stamp Reference No. 1 of 2012 passed by the Hon'ble High Court of Gujarat). * In the case of H.H. Shri Vishwesha Thirtha Swaminar and others v. State of Mysore and Anr., reported in (1972) 3 SCC 246. * In the case of Commissioner of Commercial Taxes v. Bajaj Auto Limited reported in 2016 (16) SCC 83. * In the cas....
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.... more than the market value of shares and therefore, amount of stamp duty payable being 1% comes to Rs.1,49,73,840/- (1% of Rs.1,49,73,84,000/-). As a result of same, authority has rightly treated it as part of consideration. 40. Learned Government Pleader has further submitted that there is no misconception nor misreading of provisions of the Stamp Act. Hence, applicant is liable to pay stamp duty as determined by the authority. The judgments which have been relied upon are not of any assistance to the applicant. 41. It has been emphatically submitted that term 'consideration' for transfer refers clearly and naturally to that, which passed on the transferor company 'for' transferred property. To give true meaning to the word 'consideration', a reference is made to Law Lexicon and after referring to same, it has been contended that consideration for sale in the hands of the shareholders is the premium of shares. Once shareholder received consideration, it would be deemed as if owner has received consideration and in the hands of each shareholder, this consideration is determined as 'premium' or 'share' and as such, by referring to few decisions, a contention is canvassed that....
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....es of India 12. AIR 1966 SC 1342 - The Commissioner of Income-Tax, Patiala v/s. M/s. Shahzada Nand and Sons and others 13. (2000) 6 SCC 550 - Federation of A.P. Chambers of Commerce & Industry and others v/s State of A.P. and others 14. (2005) 1 SCC 496 - District Registrar and Collector, Hyderabad and another v/s Canara Bank and others 15. AIR 1961 MADRAS 504 (FB) - Board of Revenue, Madras Chief vs. N. Narsimhan and another 16. AIR 1933 ALLAHABAD 321 (FB) - Ram Swarup vs. Joti and another 44. Hence, he has prayed for the reference being answered in favour of the applicants. 44A. Having heard the learned advocates appearing for the parties, we proceed to answer the questions referred to this Court as under. PREAMBLE 45. In S.R.Nos.4, 5 and 6 of 2020, the question of law Nos.I and IV raised therein for being answered and opined by this Court reads as under: "Whether an order of the High Court under Section 394 of the Companies Act, 2013/Section 232 of the Companies Act, 2013, sanctioning a single composite scheme of arrangement, is not a single indivisible instrument that is not comprising or relati....
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....t with. Likewise, question No.3 in S.R.No.3 of 2020, question No.7 in S.R.No.7 of 2020, question No.1 in S.R.No.6 of 2020, question No.3 in S.R.No.6 of 2020, question No.2 in S.R.No.6 of 2020 and question No.4 in S.R.No.7 of 2020 are being independently dealt with and accordingly, they are dealt with. DISCUSSIONS AND FINDING 50. The taxing statutes are required to be strictly interpreted especially when the language used by the Legislature is plain and unambiguous. It is well-settled principles of law that, the intention of the Legislature while enacting a taxing provision would be taken into consideration while interpreting the relevant provisions. In Cape Brandy Syndicate vs. IRC, reported in (1921) 1 KB Page 64, it is observed : "In a taxing statute one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption about a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used." 51. The Hon'ble Apex Court in the case of Member Secretary, Andhra Pradesh State Board for Prevention and Control of Water Pollution vs. Andhra Pradesh Rayons Ltd an....
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....la) vs. M/s. Shahzada nand and Sons and Others reported in AIR 1966 SC 1342, has held to the following effect : "8. Before we advert to the said arguments, it will be convenient to notice the relevant rules of construction. The classic statement of Rowlatt, J., in Cape Brandy Syndicate v. I.R.C. (3). still holds the field. It reads : "In a Taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used." To this may be added a rider': in a case of reasonable doubt, the construction most beneficial to the subject is to be adopted. But even so, the fundamental rule of construction is the same for all statutes, whether fiscal or otherwise. "The underlying principle is that the meaning and intention of a statute must be collected from the plain and unambiguous expression used therein rather than from any notions which may be entertained by the court as to what is just or expedient." The expressed intention must guide the court. Another rule of construction whi....
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....nder section 44A of the Banking Regulation Act 1949 (10 of 1949) in respect of amalgamation or dissolution of Banking companies, or;] [(v) any writing or letter of allotment in respect of the premises, given to its members or allottee by a co-operative society registered or deemed to have been registered under the Gujarat Co-operative Societies Act, 1961 (Gujarat X of 1962),or a corporation or an association formed and registered under the Bombay Non-Trading Corporation Act, 1959 (Bombay XXVI of 1959) or the Gujarat Ownership Flat Act, 1973 (Gujarat 13 of 1973) as the case may be.] by which property, whether movable or immovable, or any estate or interest in any property is transferred to, or vested in, any other person, inter vivos, and which is not otherwise specifically provided for by Schedule I; Explanation- For the purposes of this clause, an instrument whereby a co-owner of any property transfers his interest to another coowner of the property and which is not an instrument of partition shall be deemed to be an instrument by which property is transferred inter vivos',]" (h) to (k) xxxx (l) "instrument" includes every document ....
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....ses" means any land or building or part of a building including any flat, apartment, tenement, shop or warehouse therein and includes:- (i) gardens, grounds and out houses, if any, appertaining to such building or part of a building, and (ii) any fittings affixed to such building or part of a building for the more beneficial enjoyment thereof] [Explanation III - for the purpose of clause (d), the market value of share- (a) in relation of the transferee company whose shares are listed and quoted for trading on a stock exchange, means the market value of share as on the appointed date mentioned in the scheme of amalgamation or when appointed date is not so fixed, the date of [order of the National Company Law Tribunal or, as the case may be, the order of the Reserve Bank of India]. (b) In relation to the transferee company, whose shares are not listed or listed but not quoted for trading on a stock exchange means the market value of the share issued or allotted with reference to the market value of share of the transferor company. (c) Where the transferee company and transferor company, whose shares are not listed or listed but not quoted for trading on stock ....
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.... "premises" means any land or building or part of a building including any flat, apartment, tenement, shop or warehouse therein and includes:- (i) gardens, grounds and out houses, if any, appertaining to such building or part of a building, and (ii) any fittings affixed to such building or part of a building for the more beneficial enjoyment thereof] [Explanation III - for the purpose of clause (d), the market value of share- (a) in relation of the transferee company whose shares are listed and quoted for trading on a stock exchange, means the market value of share as on the appointed date mentioned in the scheme of amalgamation or when appointed date is not so fixed, the date of [order of the National Company Law Tribunal or, as the case may be, the order of the Reserve Bank of India]. (b) In relation to the transferee company, whose shares are not listed or listed but not quoted for trading on a stock exchange means the market value of the share issued or allotted with reference to the market value of share of the transferor company. (c) Where the transferee company and transferor company, whose shares are not listed or listed but not quoted for trading on stock....
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.... be sanctioned by the Company Court on 09.03.2016 would partake the character of instrument which is covered under Section 5 of the Stamp Act since it relates to transfer of windmill unit of transferor company to the applicant company and entire business of residual transferor company was amalgamated with the applicant, consideration of which was Rs.1.40 Crores and thereby the stamp duty payable would be Rs.1,40,000/namely 1%. Insofar as amalgamation of residuary units and properties of transferor which was with the applicant namely TEPL was for consideration of the equity shares and preference shares as under : "(a)6,25,43,220 equity shares having face value of Rs.10/- have been issued by Applicant at premium of Rs.67. Thus, value of each share is Rs.77. Aggregate value of shares is Rs.481,58,27,940/ -. (b) 6,29,700 preference shares having value of Rs.10/- each have been issued by Applicant. Thus, aggregate value of said preference shares is Rs.62,97,000. (c) 38,88,000 preference shares having value of Rs.10/- each have been issued by Applicant. Thus, aggregate value of said preference shares is Rs.3,88,80,000. Thus, total value of shares issue....
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.... in the present proceedings. 'Conveyance' as defined under the Stamp Act insofar as it relates to the scheme for reconstruction of the company or companies involving merger or the amalgamation of any work or more companies by an order of the National Company Law Tribunal under Section 232 of the Act, 2013 or under Section 394 of the Old Companies Act, 1956 or for amalgamation or dissolution of banking companies by an order of Reserve Bank of India under Section 44A of the Banking Regulations Act, 1949 would take within its sweep such instrument also for being defined as conveyance. For such type of instrument, the proper stamp duty which is prescribed is subject to maximum Rs.25 crore - sub-paragraph (i) an amount equal to 1% of aggregate amount comprising of market value of shares issued or allotted in exchange of or otherwise or the face value of such shares whichever is higher and the amount of consideration, if any paid for such amalgamation. Explanation III to clause (d) would indicate that for the purpose of clause (d), the market value of share is to be calculated on the basis of explanation given thereunder. It is a settled position of law that explanation added....
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....d not be used or construed so as to widen the ambit of the section. 66. It is now well settled that explanation added to a statutory provision is not a substantive provision in any sense of the term but as a plain reading of the word itself shows it is merely entertained to explain or clarify certain ambiguities which may have crept in the statutory provision. Sarathi on Interpretation of Statute while dwelling on the various aspects of the explanation observes as follows: (a) The object of an explanation is to understand the Act in the light of the explanation; (b) It does not ordinarily enlarge the scope of the original section which it explains, but only makes the meaning clear beyond dispute (page 329). 67. Pindra in Interpretation of Statute (5th Edition) at page 67 states thus: "An explanation does not enlarge the scope of the original section that it is supposed to explain. It is axiomatic that explanation only explains and does not expand or add to the scope of original section. The purpose of an explanation is, however, not to limit the scope of the main provision ....." 68. The construction of the explanation must depend upon its ....
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....g about any change in the law, but was intended to be a mere legislative exposition of what the law has always been. An 'Explanation', generally speaking, is intended to explain the meaning of certain phrases and expressions contained in a statutory provision. There is no general theory as to the effect and intendment of an Explanation except that the purposes and intendment of the 'Explanation' are determined by its own words. An Explanation, depending on its language, might supply or take away something from the contents of a provision. It is also true that an Explanation may - this is what Sri Ramachandran suggests in this case - be introduced by way of abundant caution in order to clear any mental cobwebs surrounding the meaning of a statutory provision spun by interpretative errors and to place what the legislature considers to be the true meaning beyond controversy or doubt. Hypothetically, that such can be the possible purpose of an 'Explanation' cannot be doubted. But the question is whether in the present case, Explanation I inserted into Section 40(b) in the year 1984 has had that effect. 38. The notes on clauses appe....
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....ules of interpretation which ought to be applied to the combination of Act and Schedule. If the Act says that the Schedule is to be used for a certain purpose and the heading of the part of the Schedule in question shows that it is prima facie at any rate devoted to that purpose, then you must read the Act and the Schedule as though the Schedule were operating for the purpose, and if you can satisfy the language of the section without extending it beyond that purpose you ought to do it. But if in spite of that you find in the language of the Schedule words and terms that go clearly outside that purpose, then you must give effect to them and you must not consider them as limited by the heading of that part of the Schedule or by the purpose mentioned in the Act for which the Schedule is prima facie to be used. You cannot refuse to give effect to clear words simply because prima facie they seem to be limited by the heading of the Schedule and the definition of the purpose of the Schedule contained in the Act." 71. It is a trite law that explanation cannot operate as 'exception' or 'proviso' it may only explain and may not expand or add to the scope of the orig....
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....#39;ble Apex Court in the case of Board of Revenue, Uttar Pradesh vs. Rai Saheb Sidhnath Mehrotra [AIR 1965 SC 1092] can be looked into whereunder it has been held: "9. Before we considered the facts of this case, we may mention that it is plain from the explanation that it is only the unpaid mortgage money that is deemed to be part of the consideration. If the mortgage money has been paid off by the date of the conveyance the explanation does not require it to be added to the consideration. If the mortgage money has been paid off by the vendee before the date of the sale, as part of the consideration, it would be included in the amount leviable with stamp duty under Art. 23, but not under the explanation. The conveyance deed would, in the above eventuality, recite the fact that so much money has been paid to the mortgagee and it would be the consideration expressed in the deed." 77. We need to hardly say that the Stamp Act is a taxation statute and must be construed strictly and the two impact are equally possible, the meaning in favour of the subject must be given effect too. 78. The Hon'le Apex Court in the case of Commissioner of Income Tax-III vs. M/s. Calcu....
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....stand of the Revenue that in common business parlance the expression 'face value' is the value of assigned to a share when it is issued to be treated as on par with market value for the purpose of computation of one part of the aggregate cannot be astute for reasons more than one. The principle of ejusdem generis to invoking applicability of its rules, there must be genes category, specific words and same would be applied not to object but to something which can be called as a class or kind of object where this is lacking rule will not apply and mention of single species will not constitute genes. This proposition gets its support from the authoritative principles of the Hon'ble Apex Court in the case of Union of India vs. Manraj Enterprises [(2022) 2 SCC 331] whereunder it has been held: "12.2 Insofar as argument based on the principle of ejusdem generis is concerned, the Division Bench has held that that is not applicable in the present case. We find that it is rightly so held. Ejusdem generis is the rule of construction. The High Court has negated this argument in the following manner: (Jaiprakash Associates Ld. V. Tehri Hydro Development Corpn., 2012 SCC On....
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....pany Court viz. the composite scheme of arrangement pursuant to the sanction of the said scheme it transpired as under: (i) Windmill division of the transferor was transferred and vested in the applicant as an ongoing concern; (ii) Entire business of residual transferor was amalgamated with the applicant; (iii) Applicant was converted into a public limited company; and (iv) Applicant was renamed as Troikaa Pharmaceuticals Limited. 81. As far as amalgamation of residuary units and properties of transferor to the applicant is concerned, (a) 6,25,43,220 equity shares having face value of Rs.10 have been issued by the applicant at premium of Rs.67, 6,29,700 preferential shares having face value of Rs.10 have been issued by the applicant; and 38,88,000 preferential shares having face value of Rs.10 each have been issued by the applicant. On the basis of the aggregate value of shares which includes face value and the premium value the amount of stamp duty payable has been arrived at Rs.4,86,10,049/-, whereas on the face of shares and further stamp duty on transfer of windmill unit to the transferee company for which consideration of Rs.1....
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....III viz. the face value of shares issued alone is required to be considered as its market value. In that view of the matter, the arguments now put forth by the learned Government Pleader to contend that the words 'aggregate' is to be considered as 'consideration' for such amalgamation cannot be accepted. Further contention that premium has to be construed as consideration for the purpose of Article 20(d) though at first blush looks attractive, it is not so, inasmuch as the intent of the legislature as is evident from the Explanation III depicting the mode, method and manner in which it requires to be calculated has been delineated. The word 'premium' has been defined in Law Lexicon, 6th Edition as under: "Share premium - The amount by which the issue price of a share exceeds the nominal value. This normally occurs when a fresh issue of shares is made some time after the first issue. Under the Companies Act, 1985, the value of the share premium must be credited to a share premium account. The excess of the issue price of shares over their face value. On a new issue of shares, a premium charged on the nominal value ....
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....ompanies Act also places no restriction upon a company issuing shares for a consideration which exceeds the par value of the shares, and there is no evidence on the record that in the State of Delaware there is such a restriction. A share is not a sum of money : it represents an interest measured by a sum of money and made up of diverse rights contained in the contract evidenced by the articles of association of the Company. In the absence of any restriction in the law of Delaware against the issue of shares otherwise than for cash, when shares are issued for consideration other than cash the value of the assets transferred in excess of the par value of shares issued would be regarded as premium for purposes of our system of law. No serious argument has been advanced before us on behalf of the Commissioner controverting this part of the case." 87. Turning our attention back to the article in issue viz. Article 20 of the Gujarat Stamp Act, we are unable to accept the stand of the Revenue that stamp duty is required to be calculated on the aggregate face value and additional consideration received by the transferor company for transfer of its shares in favour of the transferee com....
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....pex Court in the case of Ebix Singapore Pte Ltd vs. Committee of Creditors of Educomp Solution Limited and others [(2022) 2 SCC 401] whereunder the Hon'ble Apex Court has enunciated of judicial restraint in the matter of interpretation of economic statute and the observation made therein would be a benefit to be noted which reads: "158. Judicial restraint must not only be exercised while adjudicating upon the constitutionality of the statute relating to economic policy but also in matters of interpretation of economic statutes, where the interpretative maneuvers of the Court have an effect of transgressing into the lawmaking power of the legislature and disturbing the delicate balance of separation of powers between the legislature and the judiciary. Judicial restraint must be exercised in such cases as a matter of prudence, since the court neither has the necessary expertise nor the power to hold consultations with stakeholders or experts to decide the direction of economic policy. A court may be inept in laying down a detailed procedure for exercise of the power of withdrawal or modification by a successful Resolution Applicant without impacting the other procedural ....
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....tes relevant under sub-clauses(i) and (ii) of Clause(b) of the explanation extracted above. The term 'long term borrowing' has been defined in clause (c) to the explanation. It is nobody's else that the premium collected by the Company on the issue of shares was a long term borrowing either in fact or by a fiction of law. It is also nobody's case that the premium collected by the Company was anywhere near or akin to a debenture. What was all the same argued by the counsel for the appellant was that premium was a part of the share capital and had therefore to be reckoned as 'capital employed in the business of the company'. There is, in our view, no merit in that contention. The Tribunal has pointed out that the share capital of the Company as borne out by its audited accounts is limited to Rs.7,88,19679/-. The company's accounts do not show the reserve and surplus of Rs.19,66,36,734/- as a part of its issued, subscribed and paid up capital. It is true that the surplus amount of Rs.19,66,36,734/- is taken as part of share holders fund but the same was not a part of the issued, subscribed and paid up capital of the Company. Explanation to Section 35D(3) of the Act does not include th....
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....planation held that "share premium account" was liable to be included in the paid up capital for the purposes of computing rebate. One of the reasons to allow such inclusion with the paid up capital was that such inclusion was permitted by the specific words in the Explanation. Such was, however, not the case here." 91. In the aforesaid analysis, we are of the considered view that the word 'premium' attached to the share cannot be read as part and parcel of Article 20(d)(i) as sought to be canvassed since it would be doing violence to the provisions of the Act and reading something into the provision which is not to be found in the statute and as the legislature has not contemplated of including the expression 'premium' and has restricted to the 'face value' alone as indicated in clause (c) to Explanation III of sub-article (d) of Article 20 of the Gujarat Stamp Act. 92. In view of the aforestated discussions and finding recorded by us, we proceed to answer the questions referred as under : Sr. No Stamp Reference No. Question referred for adjudication Answer 1 2/2020&1/2021 Que. No.1 In view of explanation III (c) to Article 20(....
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....ction 394 of the Companies Act, 1956, sanctioning a single composite scheme of arrangement, is not a single indivisible instrument that is not comprising or relating to several distinct matters or distinct transactions as contemplated by Section 5 of the Stamp Act and not subject to levy as such, considering the fact that the instrument covered under Article 20(d) of Schedule-I to the Stamp Act would be the order of the High Court and not the scheme sanctioned by such order? 94. Brief facts of each case are narrated hereinbelow for the purpose of convenience. RE : STAMP REFERENCE NO.4 OF 2020 : 95. A composite scheme of arrangement between Adani Gas Holdings Limited (AGHL), Adani Gas Limited (AGL) and Adani Enterprises Limited (AEL) was sanctioned by NCLT on 03.08.2018. Pursuant to the said scheme being sanctioned AGHL stood amalgamated with AGL and the gas sourcing and distribution business of AEL was demerged and vested into AGL. The Collector held that pursuant to the composite scheme approved by NCLT demerging has taken place and as such the instrument is covered under Section 5 of the Stamp Act. It is the stand of the applicant that the instrument is an order sanction....
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....t at Rs.27,80,50,000/- on the ground that the instrument is covered under Section 5 of the Gujarat Stamp Act and an order came to be passed on 25.07.2018 demanding stamp duty of Rs.27,80,50,000/- and penalty of Rs.1,00,000/-. 98. Since there are common questions framed in Stamp Reference Nos.4 to 7 of 2020, those questions are required to be answered as tabulated hereinbelow : Sr. No. Stamp Reference No. Question of law Answer 1 4/2020 Whether an order of the High Court under Section 394 of the Companies Act, 1956, sanctioning a single composite scheme of arrangement is not a single indivisible instrument that is not comprising or relating to several distinct matters or distinct transactions as contemplated by Section 5 of the Stamp Act and not subject to levy as such, considering the fact that the instrument covered under Article 20(d) of the Schedule-I to the Stamp Act would be the order of the High Court and not the scheme sanctioned by such order? In S.R.No.5 of 2020, the records would disclose that by a common order dated 07.05.2015, the composite scheme of arrangement under Section 391 to 394 of the Companies Act, 1956, came to be sanctioned whereun....
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....e manner under the same composite instrument the transfer of power undertaking of AEL to APL, transmission undertaking of AEL being transferred to ATL and AMPL getting amalgamated with AEL are treated as separate entities and according to Mr.Mihir Joshi, learned Senior Counsel, the Collector committed an error in treating such transaction as separate and distinct transaction and raising the demand of Rs.75 Crores in all in S.R.No.5 of 2020. 101. Mr.Mihir Joshi, learned Senior Counsel would also contend that every order passed by the High Court under Section 394 of the Companies Act would be considered as an instrument in view of Section 2(g)(iv) of the Stamp Act and it is a conveyance and the sanctioned scheme is one and separate and distinct orders have not been passed, such instrument cannot be treated as separate transactions for the purpose of calculation of stamp duty. The applicant accordingly is required to pay one stamp duty to the extent of Rs.25 Crores in view of Article 20(d) of Schedule-I of the Stamp Act. 102. He would submit that mere reconstruction having taken place of the entities which are substantially managed by the same management, though are separate leg....
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....s such stamp duty of Rs.25 Crores on each transaction being demanded is contrary to the statutory provisions namely to Article 20(d) of the Stamp Act. He would submit that Section 394(1)(a) of the Companies Act refers to arrangement for reconstruction and in all these cases, the transaction involved being reconstruction. He would contend that though companies are separate legal entities, but substantially they are one and the same. He would contend that the word used "companies" in Section 2(g)(iv) is plural and one common order is passed in all these cases. He would submit that the statutory definition of the expression 'instrument' as defined under Section 2(l) it is only the order of the Court sanctioning the scheme it becomes an instrument and partakes the character of conveyance as defined under Section 2(g). he would submit that the order of Company Court - NCLT cannot be separated or segregated and said orders are inseperable and he would contend that Section 394 of the Companies Act would come to his rescue as the words of reconstruction of companies is used in plural. He would submit that it is on account of this reconstruction of companies covering more than one companies....
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....extract certain provisions of the Gujarat Stamp Act, 1958 and the provisions of the Companies Act, 1956 and also the provisions of the Companies Act, 2013. They are as follows : The Companies Act, 1956 : "391. POWER TO COMPROMISE OR MAKE ARRANGEMENTS WITH CREDITORS AND MEMBERS - (1) Where a compromise or arrangement isproposed - (a) between a company and its creditors or any class of them ; or (b) between a company and its members or any class of them ; the [Tribunal] may, on the application of the company or of any creditor or member of the company, or, in the case of a company which is being wound up, of the liquidator, order a meeting of the creditors or class of creditors, or of the members or class of members, as the case may be, to be called, held and conducted in such manner as the[Tribunal] directs. (2) If a majority in number representing threefourths in value of the creditors, or class of creditors, or members, or class of members, as the case may be, present and voting either in person or, where proxies are allowed under the rules made under section 643, by proxy, at the meeting, agree to any compromise or arrangement, the compromise or arrangemen....
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....r arrangement as it may consider necessary for the proper working of the compromise or arrangement. (2) If the Tribunal aforesaid is satisfied that acompromise or an arrangement sanctioned under section 391 cannot be worked satisfactorily with or without modifications, it may, either on its own motion or on the application of any person interested in the affairs of the company, make an order winding up the company, and such an order shall be deemed to be an order made under section 433 of this Act. (3) The provisions of this section shall, so far asmay be, also apply to a company in respect of which an order has been made before the commencement the companies (Amendment) Act, 2001 sanctioning a compromise or an arrangement.] 393. INFORMATION AS TO COMPROMISES OR ARRANGEMENTS WITH CREDITORS AND MEMBERS - (1) Where a meeting of creditors or any class ofcreditors, or of members or any class of members, is called under section 391, - (a) with every notice calling the meeting which is sent to a creditor or member, there shall be sent also a statement setting forth the terms of the compromise or arrangement and explaining its effect ; and in particular....
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....f this section ; and if he fails to do so, he shall be punishable with fine which may extend to [five thousand] rupees. 394. PROVISIONS FOR FACILITATING RECONSTRUCTION AND AMALGAMATION OF COMPANIES (1) Where an application is made to the[Tribunal] under section 391 for the sanctioning of a compromise or arrangement proposed between a company and any such persons as are mentioned in that section, and it is shown to the [Tribunal] - (a) that the compromise or arrangement has been proposed for the purposes of, or in connection with, a scheme for the reconstruction of any company or companies, or the amalgamation of any two or more companies ; and (b) that under the scheme the whole or any part of the undertaking, property or liabilities of any company concerned in the scheme (in this section referred to as a "transferor-company") is to be transferred to another company (in this section referred to as "the transfereecompany") ; the 1 [Tribunal] may, either by the order sanctioning the compromise or arrangement or by a subsequent order, make provision for all or any of the following matters : (i) the transfer to the transferee-company of the whole or any part of ....
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....plying with this sub-section, the company, and every officer of the company who is in default, shall be punishable with fine which may extend to [five hundred] rupees. (4) In this section - (a) "property" includesproperty rights and powers of every description ; and "liabilities" includes duties of every description ; and (b) "transfereecompany" does not include any company other than a company within the meaning of this Act ; but "transferor-company" includes any body corporate, whether a company within the meaning of this Act or not." 106. A perusal of Section 2(g) would indicate that for Article 20(d) being attracted, the instrument will have to satisfy the definition of the word conveyance. Clause (iv) of Section 2(g) would indicate that every order made by the NCLT under Section 232 of the Companies Act in respect of a scheme for reconstruction of the companies or companies involving merger or amalgamation of any 2 or more companies, it would be a deed of conveyance. A plain reading of Section 5 of the Stamp Act would indicate that if the single instrument is giving rise to multiple and distinct transactions, then on such distinct transactions or distinct mat....
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....at the expression 'distinct matters' in section 5 should be understood not in its popular sense but narrowly as meaning different categories in the Schedule, nothing would have been easier than to say so. When two words of different import are used in a statute in two consecutive provisions, it would be difficult to maintain that they are used in the same sense, and the conclusion must follow that the expression "distinct mat- ters" in section 5 and "descriptions" in section 6 have different connotations. 5. It is urged against this conclusion that if the word "matters" in section 5 is construed as meaning anything other than "categories" or in the phraseology of section 6, "descriptions" mentioned in the Schedule, then there could be no conflict between the two sections, and the clause in section 6 that it is "subject to the provision of the last preceding section" would be meaningless and useless. We see no force in this contention. Though the topics covered by sections 5 and 6 are different, it is not difficult to conceive of instruments which might raise questions falling to be determined under both the sections. Thus, if a partnership carried on by members of ....
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....ompleted in several instruments, and section 6 with a single transaction which might be viewed as falling under more than one category, whereas section 5 applies only when the instrument comprises more than one transaction, and it is immaterial for this purpose whether those transactions are of the same category or of different categories. The topics dealt with in the three sections being thus different, no useful purpose will be served by referring to section 4 or section 6 for determining the scope of section 5 or for construing its terms. It is not without significance that the legislature has used three different words in relation to the three sections, 'transaction' in section 4, matter' in section 5, and 'description' in section 6. 12. There is no provision in the statute law of this country similar to the above, and it is significant that it assumes that a power of attorney might consist of distinct matters by reason of the fact that there are several donors or donees mentioned in it, or that it relates to more than one matter." 108. The Hon'ble Apex Court in the case of Government of Uttar Pradesh vs. Raja Mohammad Amir Ahmed Khan, reported i....
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....uence will follow and an executed document is in the same position as an instrument which is unexecuted and unstamped and after the determination of the duty the Collector becomes functus officio and the provisions of s. 33 have no application. The provisions of that section are a subsequent stage when something more than mere asking of the opinion of the Collector is to be done." 109. The Hon'ble Apex Court in the case of Chief Controlling Revenue Authority vs. Coastal Gujarat Power Limited and others, reported in (2015) 10 SCC 700, has held as under : "28. From the facts discussed and narrated hereinabove, it is manifest that the instrument of mortgage came into existence only after separate loan agreements were executed by the borrower with the lenders with regard to separate loan advanced by those lenders to the respondent borrower. The mortgage deed which recites at length as to how and under what circumstances property was mortgaged with the security trustee for and on behalf of lender bank. 29. When several matters are contained inone instrument, what stamp is payable thereon in England has been dealt with and Halsbury's Law of England 4th Ed....
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....s chargeable thereunder are different, be chargeable only with the highest of such duties: Provided that nothing in this Act contained shall render chargeable with duty exceeding one rupee a counterpart or duplicate of any instrument chargeable with duty and in respect of which the proper duty has-been paid." From bare reading of these provisions, it is clear that Section 4 deals with single transaction completed in several instruments, whereas Section 5 deals only with the instrument which comprises more than one transaction and it is immaterial for the purpose whether those transactions are of the same category or of different categories. 31. It appears from the trustee document thataltogether 13 banks lent money to the mortgagor, details of which have been described in the schedule and for the repayment of money, the borrower entered into separate loan agreements with 13 financial institutions. Had this borrower entered into a separate mortgage deed with these financial institutions in order to secure the loan there would have been a separate document for distinct transactions. On proper construction of this indenture of mortgage it can safely be regar....
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....lls Black-acre to X and mortgages White-acre to Y, the transactions fall under different categories, and they are also distinct matters. But if A mortgages Black-acre to X and White-acre to Y, the two transactions fall under the same category, but they would certainly be distinct matters. If the intention of the legislature was that the expression 'distinct matter' in section5 should be understood not in its popular sense but narrowly as meaning different categories in the Schedule, nothing would have been easier than to say so. When two words of different import are used in a statute in two consecutive provisions, it would be difficult to maintain that they are used in the same sense, and the conclusion must follow that the expression "distinct matters" in section 5 and "description" in section 6 have different connotations." 34. Their Lordships further held that: (Benthall case, AIR p.41, para 13) "13.... When a person possesses both a personal capacity and a representative capacity, such as trustee, and there is a delegation of power by him in both those capacities, the position in law is exactly the same as if different persons join in executi....
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....might be of the same description, but all the same, they might be distinct. If A sells Black-acre to X and mortgages Whiteacre to Y, the transactions fall under different categories, and they are also distinct matters. But if A mortgages Black-acre to X and mortgages Whiteacre to Y, the two transactions fall under the same category, but they would certainly be distinct matters. If the intention of the legislature was that the expression 'distinct matters' in section 5 should be understood not in its popular sense but narrowly as meaning different categories in the Schedule, nothing would have been easier than to say so. When two words of different import are used in a statute in two consecutive provisions, it would be difficult to maintain that they are used in the same sense, and the conclusion must follow that the expression "distinct mat- ters" in section 5 and "descriptions" in section 6 have different connotations. 7. The error in this argument lies in thinking that the object and scope of sections 4 to 6 are the same, which in fact they are not. Section 4 deals with a single transaction completed in several instruments, and secti....
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.... which the instrument dealt with properties which fell under' two categories, and the decision was that they were distinct matters. There is nothing either in the deci- sion or the observations quoted above to support the contention of the respondent that if the instrument comprises matters falling within the same description, it is not to be construed as comprising distinct matters. Reliance was also placed on the observations in Reversionary Interest Society v. Commissioners of Inland Revenue(1), in which it was held that a statutory declaration for the purpose of carrying through a transaction was liable for a single stamp duty. There, the declaration was made by husband and wife, and in view of the purpose for which it had to be used, it was construed as one declaration. This is a decision on the facts, and is not of much assistance. 10. We are unable to agree with the respondent 'that when a person executes a power-of-attorney in respect of all the matters in which he could act, it should be held, as a matter of law and without regard to the contents of the instrument, to comprise a single matter. Whether it relates to a single ma....
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....ecided in Reference under Stamp Act, 8. 46(3). Thus, the question whether a power-of attorney relates to distinct matters is one that will have to be decided on a consideration of the terms of the instrument and the nature and the extent of the authority conferred thereby." 111. As noticed by the Hon'ble Apex Court therein, it has been clearly held vide paragraph No. 10 that if a number or persons joined in executing one instrument, and there is community of interest between them in the subject matter comprised therein, it will be chargeable with a single duty. Halsbury's Laws of England, Volume 44(I), Fourth Edition Reissue has defined instrument relating to several matters as under : - "1015. Instrument relating to several matters. Except where there is statutory provision to the contrary, an instrument containing or relating to several distinct matters is to be separately charged, as if it were a separate instrument, with stamp duty in respect of each of the matters, and in instrument made for any consideration in respect of which it is chargeable with ad valorem duty, and also for any further or other valuable consideration or considerations, is separately chargeabl....
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....d and managed substantially under the same management by same persons and such reconstruction inter se cannot be segregated, particularly, when the said arrangement and/ or reconstruction was pursuant to single composite order / instruments. Infact the sanction of the scheme of amalgamation / reconstruction was by single order only. As such treating the said transaction as distinct transaction and thereby demand separate stamp duty appears to be in conflict with the true import and meaning of Section 5 of the Stamp Act. A conjoint reading of the principals enunciated in the aforementioned cases by the Hon'ble Apex Court, we are of the opinion that neither the scheme of amalgamation or reconstruction sanction by Company Court in exercise of the powers vested under section 394 of the Companies Act, 1956 or Section 232 (2013 Act) can be brought within the sweep of Section 5. if such interpretation were to be accepted, it would run counter to the literal meaning of fiscal statute and as such reference will have to be answered against the Revenue and in favour of the Subject. 113. The next issue which arises for our consideration is whether in a proceedings initiated unde....
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....ny part of the property is situate, for determining, in accordance with the procedure laid down in section 32A, the true market value of such property and the proper duty payable on the instrument.] 33. Examination and impounding of instruments. - (1) [Subject to the provision of section 32A, every person] having by law or consent of parties authority to receive evidence, and every person in charge of a public office except an officer of police, before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance of his functions shall if it appears to him that such instrument is not duly stamped, impound the same. (2) For that purpose every such person shall examine every instrument so chargeable and so produced or coming before him in order to ascertain whether it is stamped with a stamp of the value and description required by the law for the time being in force in the State when such instrument was executed or first executed: Provided that- (a) nothing herein contained shall be deemed torequire any Magistrate or Judge of a Criminal Court to examine or impound, if he does not think fit so....
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....vidence of any fact to be proved and secondly refer to other officers who have to perform any function in regard to those instruments when they come before them e.g. registration. They do not extend to the determination of the question as to what the duty payable is. They do not cover the acts which fall within the scope of s. 31, because that section is complete by itself and it ends by saying that the Collector shall determine the duty with which, in his judgment, the instrument is chargeable, if it is chargeable at all. Section 31 does not postulate anything further to be done by the Collector. It was conceded that if the instrument is unexecuted i.e. not signed, and the opinion of the Collector is sought, he has to give his opinion and return it with his opinion to the person seeking his opinion. The language in regard to exe- cuted and unstamped documents is no different and the powers and duties of the Collector in regard to those instruments are the same, that is, when he is asked to give his opinion, he has to determine the duty with which, in his judgment, the instrument is chargeable and there his duties and powers in regard to that matter end. Then follows s. 32. Under t....
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.... have to be necessarily held against the Revenue. 117. In Stamp Reference No. 7 of 2020, question No. 4 and 6 referred to (supra) has been referred for being adjudicated. In the instant case, the National Company Law Tribunal, Principal Bench, New Delhi passed an order dated 24.11.2017, sanctioned scheme of arrangement amongst : (i) Inter Globe Enterprises Ltd. - transferor Company (ii) Inter Globe Real Estate Venture Private Ltd. relating to subsidiary No. 1 - applicant (iii) Inter Globe Business Solution Private Limited - relating to subsidiary No. 2 (iv) Acquired Services Private Ltd. - transferee Company. 118. On such scheme being sanctioned, it resulted in following : (A) Real Estate Undertaking of transferor company stood de-merged into applicant's company (B) I.T. Supports Company undertaking of transferor Company stood de-merged into resulting company. (C) the Residual transferor company was amalgamated with the transferee company. 119. The immovable properties of transferor company situated in Gujarat stood transferor to the applicant pursuant to the sanction of the scheme, applicant was made bef....
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....b-section (3) of section 32 shall apply to such instrument as if such were an instrument executed or first executed out of this State and first received in this State when it became chargeable to the higher duty aforesaid, but the provisions contained in clause (a) of the said proviso shall not apply thereto" 121. Only in the event of stamp duty being higher in the State of Gujarat and in the event of stamp duty having been paid in other state being lessor then the duty prescribed by the State of Gujarat, difference in duty would be required to be paid. 122. In the instant case, the Chief Controlling Revenue Authority as well as Collector empowered in holding that surcharge levied on the instrument under section 3(a) and 3(b) of the Rajasthan Stamp Act are not ""amount of duty" as contemplated under section 19 of the Act. Infact the total stamp duty chargeable on the instrument was Rs. 30,18,38,002/- and Rs. 5,18,38,002/- surcharge. In any case, the stamp duty that has been paid is on the same instrument in the State of Rajasthan being Rs. 25 crores, the same ought to have been given set off as per Section 19 of the Stamp Act at the time of computation of th....
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.... It has been the stand of the revenue that Section 2(ja) stipulates and considers inter alia things permanently fastened to anything attached to earth as an 'immovable property' and it also explains 'plant and machinery' of a factory to be an immovable property. In the instant case the records would disclose that the applicant in the communication dated 10.07.2015 addressed to the Collector and Superintendent of Stamps as well as the Additional Superintendent of Stamps has furnished the details of immovable property of the transfer undertaking - I of Adani Power Limited situated in the State of Gujarat whereunder the plant and machinery as well as transmission line, inter alia, consisting of conductors and towers has been furnished. Based on the same, Collector passed an order on 25.07.2008 demanding the stamp duty of Rs.27,80,50,000/- by quantifying the price of plant and machinery, price of land and building and price of capital work in progress as under : Price of Land Building Rs.7,62,06,00,000.00 Price of Plant and Machinery Rs.19,07,69,00,000.00 Price of Capital Work in Progress Rs.1,46,40,00,000.00 Total Rs.28,16,15,00,000.00 126. Challenging the s....
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.... 25. It is evident from the above that the expression "attached to the earth" has three distinct dimensions, viz. (a) rooted in the earth as in the case of trees and shrubs (b) imbedded in the earth as in the case of walls or buildings or (c) attached to what is imbedded for the permanent beneficial enjoyment of that to which it is attached. Attachment of the plant in question with the help of nuts and bolts to a foundation not more than 1= feet deep intended to provide stability to the working of the plant and prevent vibration/wobble free operation does not qualify for being described as attached to the earth under any one of the three clauses extracted above. That is because attachment of the plant to the foundation is not comparable or synonymous to trees and shrubs rooted in earth. It is also not synonymous to imbedding in earth of the plant as in the case of walls and buildings, for the obvious reason that a building imbedded in the earth is permanent and cannot be detached without demolition. Imbedding of a wall in the earth is also in no way comparable to attachment of a plant to a foundation meant only to provide stability to the plant especia....
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....plants in question do not constitute annexation hence cannot be termed as immovable property for the following reasons: (i) The plants in question are not per se immovable property. (ii) Such plants cannot be said to be "attached to the earth" within the meaning of that expression as defined in Section 3 of the Transfer of Property Act. (iii) The fixing of the plants to a foundation is meant only to give stability to the plant and keep its operation vibration free. (iv) The setting up of the plant itself is not intended to be permanent at a given place. The plant can be moved and is indeed moved after the road construction or repair project for which it is set up is completed. 127. Keeping the aforesaid principles enunciated in mind, when the facts on hand are looked into it would detain us for two long to accept the plea of the revenue insofar as two items under the definition of 'immovable property' namely Item No.1 and 2 noted hereinabove in the tabular column. However, with regard to the capital work in progress is concerned, even the Chief Controlling Revenue Authority in order dated 30.12.2019 at paragraph 5.2 has observed thus : ....
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....e order dated 21.10.2021. Accordingly, affidavit has been filed and on perusal of the same, it would clearly indicate that transfer fee of Rs.5.00 lakhs is paid to Maharashtra Industrial Development Corporation by the petitioner on 14.11.2003 and the receipt of payment to MIDC is annexed to the affidavit at Annexure-B. Thus, duty that has been paid on the approval of the Scheme of Merger of petitioner company is in consonance with the provisions of the Act of both the States namely State of Gujarat and State of Maharashtra. 130. Hence, we are of the considered view that demand of stamp duty in respect of 'work in progress' by the Collector as indicated at Sr. No.3 in the tabular column hereinabove cannot be sustained or it is held that same is contrary to Section 2(ja) and accordingly, the question is answered partly in favour of the Revenue viz. to the extent of the land and building, plant and machinery and in favour of the applicant in S.R. No.6 of 2020 for the capital work in progress. 131. The next question which would arise for our consideration would be a reference to the levy of penalty viz. question No.3 in S.R. No.6 of 2020 which is also relatable to question No.5 i....
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....he order dated 26.9.2014 on 8.10.2014 and a note for speaking to minutes also having been filed on the same day viz. on 8.10.2014 having resulted in the said application being allowed on 25.11.2014, the Chief Controlling Revenue Authority could not have resorted to Section 32(a) inasmuch as Section 17 enables the applicant to submit the same within two months from the date of its execution and the effective date as per the sanction made by this Court would operate from the date of order which came to be passed on 25.11.2014 and consequently, the effective date having occurred from 12.1.2015 and the application in question having been filed on 7.3.2015, the levy of penalty was not warranted and it was contrary to law. Incidentally question which would arise as framed as question No.1 in S.R. No.7 of 2020 is being answered by directing the authorities to pass appropriate orders in the light of the references to the questions referred to hereinabove having answered by this Court. 133. Thus, the references are answered as follows: S.R. No. Questions of Law Question No. Answer 1/2020 6/2020 2/2020 7/2020 Whether in the facts and circumstances of the present....
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.... the entry which is expressly not mentioned otherwise by the legislature in its wisdom? 2 YES 3/2020 Whether respondents erred in law and in adjudication stamp duty at Rs.1,60,83,177/- Act on the order of the Hon'ble National Company Law Tribunal, Ahmedabad Bench pertaining to the transfer of Windmill undertaking by way of slump sale and amalgamation of residue undertaking with Gopal Mirror Coating Pvt. Ltd. 3 YES 4/2020 7/2020 Whether an order of the High Court under Section 232 of the Companies Act, 2013, sanctioning a single composite scheme of arrangement, albeit between multiple companies, is not a single instrument, which is not covered by Section 5 of the Stamp Act, considering the settled position of law that the instrument covered under Article 20(d) of Schedule I to the Stamp Act is an order of the High Court, and not the scheme sanctioned by such order? 1 1 It is a single composite scheme and not covered by Section 5. 4/2020 5/2020 6/2020 7/2020 Whether an order of the High Court under Section 294 of theCompanies Act, 1956, sanctioning a single composite scheme of arrangement, is not a single indivisible instrument....