Stamp Duty Refund for Excess Payment: Rejection Order Set Aside for Lack of Reasoning.

Issue:

Whether an application for refund of excess stamp duty paid on the registration of a plot of land can be rejected by the revenue authorities in a cryptic manner, without assigning any reasons, especially when the payment resulted from a discrepancy with a relaxation granted by the development authority.

Facts:

The petitioner purchased a plot of land from the Raipur Development Authority (RDA). A decision had been taken by the Board of Directors of RDA to provide a 30% relaxation on the sale consideration of such plots. The petitioner contended that they executed a registered sale-deed and paid stamp duty of Rs. 5,33,500, whereas the actual registration fee, after accounting for the 30% relaxation, should have been Rs. 4,22,386. This meant an excess payment of Rs. 1,81,023.

The petitioner made a representation for a refund of this excess registration fee to respondent No. 3 (the concerned authority). However, this application was rejected in a “cryptic manner,” meaning without any clear or detailed explanation for the denial. The petitioner argued that the authority concerned had not assigned any reason while rejecting the application.

Decision:

In favor of the assessee: Taking into consideration the fact that the application moved by the petitioner for a refund of excess registration fee had been rejected by respondent No. 2 (likely the same authority as respondent No. 3, or a related one) in a cryptic manner without assigning any reason, the impugned rejection order was set aside. The authority concerned was directed to decide the application moved by the petitioner afresh, strictly in accordance with law, meaning they must provide a reasoned decision.

Key Takeaways:

Requirement for Reasoned Orders: A fundamental principle of administrative law and natural justice is that any order passed by a quasi-judicial or administrative authority that affects the rights of a party must be a “speaking order.” This means it must contain clear reasons for the decision, allowing the affected party to understand why their request was granted or denied and to challenge it effectively if they choose to do so. A “cryptic” order is inherently flawed.
Refund of Excess Stamp Duty: If stamp duty is paid in excess of the legally required amount, the taxpayer has a right to claim a refund. The basis for determining the correct stamp duty includes consideration of any genuine relaxations or discounts offered by the selling authority (like RDA in this case).
Procedural Fairness: The court emphasized procedural fairness. By rejecting the application without reasons, the authority denied the petitioner the ability to understand the basis of the rejection or to properly pursue further remedies.
Remand for Fresh Consideration: When an order is quashed due to a lack of reasoning, the matter is typically remanded back to the original authority with a direction to pass a fresh, reasoned order, ensuring that the issue is decided on its merits after proper application of mind.
GST Act Irrelevance (Likely Erroneous Citation): The mention of “Central Goods and Services Tax Act, 2017/ Chhattisgarh Goods and Services Tax Act, 2017” in the “Section” field of the provided text seems erroneous. Stamp duty and registration fees fall under state revenue laws (e.g., Indian Stamp Act, Registration Act) and are distinct from GST. The principle of reasoned orders, however, applies broadly across all administrative actions.

HIGH COURT OF CHHATTISGARH

Anand Jain

State of Chhattisgarh

Rakesh Mohan Pandey, J.

WPC No. 2881 of 2019

APRIL 23, 2025

Ratnesh Kumar Agrawal, Adv. for the Petitioner. Prateek Tiwari, P.L., Animesh Tiwari, Adv. for the Respondent.

JUDGMENT

1) By way of this petition, petitioner has sought following relief(s):-

10. 1 That, this Hon’ble Court may kindly be pleased to call for entire records of the case, from the authorities.

10. 2 That, this Hon’ble Court may kindly be pleased to set-aside the order dated 25.04.2019 passed by respondent no. 2 (Annexure-P/1) and further be pleased to directed-to-the respondent no. 2 to return the excess registration and stamp fees tune of Rs. 1,81,023/- to the petitioner.

10. 3 That, any other relief/order which may deem fit and just in the facts and circumstances of the case including award of the costs of the petition may be given.

2) Learned counsel for the petitioner submits that petitioner purchased Plot No. A-84 ad-measuring 3172 sq.ft. situated at Nagar Vikas Yojna No. 4 (Kamal Vihar), Raipur from respondent No. 5-RDA. He further submits that a decision was taken by its Board of Directors to provide 30% relaxation on the sale consideration. He contends that petitioner executed the registered sale-deed and paid stamp duty of Rs. 5,33,500/- whereas actual registration fee would have been Rs. 4,22,386/-. He further contends that petitioner made a representation for refund of the excess registration fee of Rs. 1,81,023/- before respondent No. 3 and it was rejected in cryptic manner vide order dated 25.04.2019. He argues that the authority concerned has not assigned any reason while rejecting the application. He prays to setaside the order dated 25.04.2019.

3) On the other hand, learned State counsel opposes.

4) Learned counsel appearing on behalf of respondent No. 5-RDA submits that there is a dispute between Petitioner and State.

5) Heard.

6) Taking into consideration the fact that application moved by the petitioner for refund of excess registration fee has been rejected by the Inspector General Of Registration -cum- Superintendent Of Stamp Commercial Tax, Chhattisgarh i.e. respondent No. 2 in a cryptic manner without assigning any reason, therefore, the order impugned is not sustainable in the eyes of law and is hereby quashed. The authority concerned is directed to decide the application so moved by the petitioner afresh strictly in accordance with law.

7) With the aforesaid direction(s), instant writ petition stands disposed of.