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TMI Blog2025 (3) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... e property in New Delhi. For that purpose, they purchased the e-stamp paper dated 06.07.2016 valued at Rs. 28,10,000/- (Rupees Twenty Eight Lakh Ten Thousand Only). The money for that purpose was paid from the joint bank account of the appellants being husband and wife respectively. The e-stamp paper which came to be purchased was dated 06.07.2016. 5. We borrow the other relevant facts from the judgment and order passed by the learned Single Judge dated 20th August, 2018 more particularly, from paragraph 4.3 therein:- "4.3 Pertinently, the e-stamp paper dated 06.07.2016 purchased by the petitioners, sets down the following details: (i) Particulars of the property, which was proposed to be purchased; (ii) the names of the parties, who intended to execute the sale deed; (iii) the consideration to be paid for consummating the sale transaction; and (iv) the value of e-stamp paper. 4.4 According to the petitioners, though initially, the intention was to execute the sale deed concerning subject property in July,2016, since, there was some delay in closing the loan transaction via which the transaction was to be funded, the execution of the sale deed was delayed. 4.5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stamp paper. It was emphasized that given that fact that via a fresh e-stamp paper dated 6.8.2016, transaction qua the stamp paper dated 6.7.2016 had been consummated, the lost e-stamp paper had lost its legal efficacy and thus, could not be misused by anyone else. 5.4 As is evidence that both these assertions were made by the petitioners to allay the apprehensions of respondent No. 2. 5.5 However, the petitioners' plea for refund of stamp duty did not cut much ice with the respondents and, consequently, vide order dated 21.10.2018, the Collector of Stamps (HQ) rejected the petitioners' application dated 11.8.2016 maintained for refund of stamp duty. 6. Aggrieved by the impugned order dated 21.10.2016, the petitioners have preferred by the instant writ petition." 6. The learned Single Judge adjudicated the writ petition and ultimately thought fit to partly allow the same. The learned Single Judge issued a writ of mandamus to the respondents herein to refund a sum of Rs. 28,10,000/- within a period of two weeks from the date of pronouncement of the judgment. 7. It appears that the petition was partly allowed as only the principal amount was ordered to be refunded whereas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law. Therefore, emphasis is not only on no tax being levied without the authority of law, but is also on collection of tax without authority of law. 22. Therefore, in my view, the continued retention of amount paid towards anticipated stamp duty in the hands of the respondents is illegal. The apprehension expressed by the respondents that there was a possibility of the lost e-stamp paper being misutilized seems to be tenuous for the following reasons: (i) First, the particulars of the transaction, parties and the consideration have already been incorporated in the lost e-stamp paper. (ii) Second, with the technological innovation in place, the said information would be available and anyone trying to use the lost e-stamp paper can easily be found out. In any event, the fact the lost e-stamp paper dated 06.07.2016 adverts to the same property qua which sale transaction stands effected via the new stamp paper dated 06.08.2016, the possibility of misuse of the old e-stamp paper dated 06.07.2016, to my mind, does not arise. (iii) The lost e-stamp paper dated 06.07.2016 having been locked and cancelled, there is, to my mind, given the technology in place, no possibility of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n as the date which would determine as to what would be the admissible stamp duty that had to be levied on the instrument (i.e. the conveyance) then, the petitioner's case would fall within the ambit of the provisions of Section 52 of the Act, as excess duty had been, inadvertently, paid by the petitioners since the notification reducing the rate of stamp duty and transfer duly stood published prior to the execution of the instrument in that case. 23.5 This apart, the Court observed that even if it is assumed that Section 52 of the Act was not applicable, the petitioners would be entitled to refund of stamp duty as the State could not retain the stamp duty in view of the provision of Article 265 of the Constitution. The relevant observations made by the Court are as follow: "....11. Even as regards applicability of Section 52 of the Act, the matter can be looked at in another perspective. The "chargeable event" being the date of execution of the document and if on that date higher than the admissible stamp duty is levied or collected, it would fall within the ambit of excess payment being "inadvertently" collected on the said date from the petitioner. Thus, it could even be u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... however, be governed by the provision of the Constitution. There being no prohibition in the Act for grant of refund for lost stamp paper, surely the Collector of Stamps cannot collect or retain what lawfully does not belong to the State. 24. Interestingly, our neighbouring country i.e. Pakistan, which has a somewhat similar Statute, dealing with the levy collection and refund of stamp duty, is beset with difficulties which are akin those faced by applicant(s), in our country, seeking refund of stamp duty on account of loss of stamp paper. This aspect, I came across upon a judgment dated 23.02.2016, delivered by the Lahore High Court, in Writ Petition No. 27935 of 2012, titled: Aziz Ullah Khan Vs. Government of the Punjab etc., being brought to my notice. 24.1 The Court in that case was faced with a question as to whether refund of stamp duty ought to be ordered in a case where the petitioners had misplaced i.e. lost the stamp papers. 24.2 The Additional Advocate General resisted the writ petition, broadly, on the ground that there was no provision for grant of refund of stamp paper, in cases where it was lost and that if such a relief was granted, it would result in loss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the country, in H.R.C. No.40927-S of 2012 Application by Abdul Rehman Farooq Pirzada (PLD 2013 SC 829) while highlighting the principles of interpretation of statutes by the superior Courts has inter-alia held as under:- "The interpretation cannot be narrow and pedantic but the Courts' efforts should be to construe the same broadly, so that it may be able to meet the requirements of an ever changing society. The general words cannot be construed in isolation but the same are to be construed in the context in which they are employed. In other words, their colour and contents are derived from the context." Further, a Full Bench of this Court in the case of Rub Nawaz Dhadwana Advocate etc. v. Rana Muhammad Akram Advocate etc. (W.P. No. 16793 of 2014) while dealing with the powers of the superior Courts to abridge the distance between the legislator and the public-at-large has inter-alia observed as under: "The judge must reflect these fundamental values in the interpretation of legislation. The judge should not narrow interpretation to the exclusive search for subjective legislative intent. He must also consider the "intention" of the legal system, for the statute is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, to the extent of criteria explained by him regarding refund of currency notes I have contrary view for the reason that in case of currency notes its custodian is always considered its lawful owner and it cannot be proved as to which specific currency note was in possession of a particular person whereas in the case of Stamp Papers entitlement of a person can be certified firstly from the National Exchequer where price of the Stamp Papers has been deposited, secondly from the register of Stamp Vendor and thirdly from the authorities before whom the same was presented. Insofar as the case in hand is concerned, all the authorities have admitted that the Misplaced Stamp Papers were issued to the petitioner after payment of consideration and those were never utilized for any other purpose. In this view of the matter, the objection posed by the learned Law Officer is hereby spurned. 13. Now taking up plea of learned Additional Advocate General that in case refund is allowed in absence of original Stamp Papers not only scrupulous persons would be able to use them for any other purpose but they would also succeed to get refund while causing colossal loss to the National Exchequer. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est has been turned down mainly on the ground that original Stamp Papers have not been produced. At the cost of repetition it is observed that when the legislator itself has held that Collector can refer matter of refund against unused stamp papers even without producing the original one the stubbornness on the part of competent authority in this regard is not understandable. Public functionaries are supposed to eliminate difficulties of public-at-large but when they themselves try to impede their way to have their legitimate right the entire threadbare of our society would be devastated. 17. Now taking up plea of learned Additional Advocate General that if refund is allowed even in cases where the original Stamp Papers are not produced the National Exchequer would suffer badly, I am of the view that the respondents are not going to pay anything either from their own pockets or from the National Exchequer either they have to repay the amount twice deposited by the petitioner. Had the petitioner claimed anything in addition to that he deposited at the time of issuance of Stamp Papers then the said contention would have some substance. Considering from another angle in the cases w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainment tax at rate of 45% during the period when it was either not liable to pay such tax or was required to pay tax at a concessional rate i.e., 25%. The State attempted to reclaim the benefit, which had accrued to the respondent company as they had recovered excess entertainment tax from the cinema goers. Consequently, demand notices were issued by the State in that behalf. The demand notices issued were challenged. The High Court allowed the writ petition. The Supreme Court reversed the decision of the High Court. 26.3 While doing so, the Supreme Court made an interesting distinction between the doctrine of unjust enrichment as opposed to doctrine of retention. While drawing a distinction between the two concepts, the Supreme Court noticed several judgments, including the judgment rendered by the Court in Mafatlal Industries Ltd. case. Pertinently, the Court, while allowing the appeal of the State, directed the State to remit undue benefit obtained by the respondent company to a voluntary or charitable organization, since, the State during that period, could not have levied or collected the tax from the respondent company. This aspect of the matter is reflected in Paragraphs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble the Chief Minister of the State to take up the responsibility in this behalf so that full, proper and effective utilisation of the amount in question is ensured..." (Emphasis is mine) 26.4 Insofar as Mafatlal Industries Ltd. case is concerned, the Supreme Court was considering the scope, ambit and extent to which doctrine of unjust enrichment would apply, the Court laid down various propositions of law, which I need not advert to as none of them, in my opinion, would help the cause of the respondent. 26.5 I may, however, indicate that the Court, inter alia, ruled that where the provisions of a statute provided for refund, the refund, if any, would be granted in accordance with the statute. The Court was, amongst others, considering the provisions of Section 11B of Central Excises Act and Section 27 of the Customs Act. 26.6 Likewise, Sri Maganti Suryanarayana case cited for the proposition, that there is no inherent jurisdiction vested in the Collector of Stamps to grant refund as he is a creature of the statute or the judgment rendered in Govt. of A.P. & Ors. vs. P. Laxmi Devi (Smt.) case, cited for the proposition that there is no equity in tax are proposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shek Puri, the learned counsel appearing for the appellants and Ms. Jyoti Mehandiratta, the learned counsel appearing for the respondents. 14. The short point that falls for our consideration is whether in the facts and circumstances of the case, the appellants herein are entitled to claim interest on the refunded amount of Rs. 28,10,000/- referred to above. 15. The submission of the learned counsel appearing for the respondents that there is no provision in the statute for the payment of interest on refund of the amount of the e-stamp paper that was lost by the appellants herein, is without any merit. The subject General Mandamus is a salutary advancement of the law, calculated to insulate and protect a citizen from unfair treatment by the State. 16. The concept of awarding interest on delayed payment has been explained by this Court in the case of Authorised Officer Karnataka Bank v. M/s R.M.S. Granites Pvt. Ltd. & Ors. in Civil Appeal No. 12294 of 2024, we quote the following observations:- "It may be mentioned that there is misconception about interest. Interest is not a penalty or punishment at all, but it is the normal accretion on capital. For example if A had to pay B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under:- "The words 'interest' and 'compensation' are sometimes used interchangeably and on other occasions they have distinct connotation. "Interest" in general terms is the return or compensation for the use or retention by one person of a sum of money belonging to or owed to another. In its narrow sense, 'interest' is understood to mean the amount which one has contracted to pay for use of borrowed money. ......... In whatever category "interest" in a particular case may be put, it is a consideration paid either for the use of money or for forbearance in demanding it, after it has fallen due, and thus, it is a charge for the use or forbearance of money. In this sense, it is a compensation allowed by law or fixed by parties, or permitted by custom or usage, for use of money belonging to another, or for the delay in paying money after it has become payable." (Emphasis supplied) 23. The appeal filed against aforesaid decision was dismissed by this Court in Sham Lal Narula Dr. v. CIT, AIR 1964 SC 1878. 24. In the case of Hello Minerals Water (P) Ltd. v. Union of India, (2004) 174 ELT 422, (paras 15 and 16), a Division Bench of the Allahabad High Court explained the concept ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of U.P., 2012 (1) AWC 316, the Allahabad High Court dealing with similar controversy in a stamp matter held that the payment of interest is a necessary corollary to the retention of the money to be returned under order of the appellate or revisional authority. The High Court directed the State to pay interest @ 8% for the period, the money was so retained i.e. from the date of deposit till the date of actual repayment/refund. 27. In the case of O.N.G.C. Ltd. v. Commissioner of Customs Mumbai, JT 2007 (10) SC 76, (para 6), the facts were that the assessment orders passed in the Customs Act creating huge demands were ultimately set aside by this Court. However, during pendency of appeals, a sum of Rs. 54,72,87,536/- was realized by way of custom duties and interest thereon. In such circumstances, an application was filed before this Court to direct the respondent to pay interest on the aforesaid amount w.e.f. the date of recovery till the date of payment. The appellants relied upon the judgment in the case of South Eastern Coal Field Ltd. v. State of M.P., (2003) 8 SCC 648. This Court explained the principles of restitution in the case of O.N.G.C. Ltd. (supra) as under:- "Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... express statutory provision for payment of interest on the refund of excess amount/tax collected by the Revenue, the Government cannot shrug off its apparent obligation to reimburse the deductors lawful monies with accrued interest for the period of undue retention of such monies. Obligation to refund money received and retained without right implies and carries with in the right to interest. The relevant observations are as under:- "Providing for payment of interest in case of refund of amounts paid as tax or deemed tax or advance tax is a method now statutorily adopted by fiscal legislation to ensure that the aforesaid amount of tax which has been duly paid in prescribed time and provisions in that behalf form part of the recovery machinery provided in a taxing Statute. Refund due and payable to the assessee is debt-owed and payable by the Revenue. The Government, there being no express statutory provision for payment of interest on the refund of excess amount/tax collected by the Revenue, cannot shrug off its apparent obligation to reimburse the deductors lawful monies with the accrued interest for the period of undue retention of such monies. The State having received the mo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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