Page 1

REPORTABLE        

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL     APPEAL     Nos.     8803-8805        OF     2012   (Arising out of SLP (C) Nos. 14177-14179 of 2010)

The State of Karnataka & Ors.                 .... Appellant (s)

Versus

Vivekananda M. Hallur & Ors.                  .... Respondent(s)

J     U     D     G     M     E     N     T      

P.     Sathasivam,     J.   

1) Leave granted.

2) These appeals are directed against the final judgment  

and order dated 19.06.2009 passed by the High Court of  

Karnataka at Bangalore in Writ Appeal Nos. 1023, 1324 and  

1325 of 2009 whereby the Division Bench of the High Court  

dismissed the appeals on the ground of delay as well as on  

merits.

1

Page 2

3) Brief facts :

(a) Respondents herein are the members of Kendriya  

Upadhyayara Sangha (R) (in short ‘the Sangha’), Bangalore  

South Taluk, registered under the Karnataka Societies  

Registration Act, 1960.  The Sangha was granted certain land  

at Jakkasandra Village, South Taluk by the State of Karnataka  

in order to provide house sites to its members.  The sole object  

of the Sangha is charitable and to protect the interest of its  

members and not to form the sites and allot to its members  

with a profit motive.   

(b) According to the appellant-State, the Sangha has allotted  

residential sites to its members including the respondents  

herein by executing Lease-cum-Sale Agreements in their  

favour after receiving the full sale consideration.  The said  

agreements were registered in the office of sub-Registrar,  

Bangalore South after paying the required stamp duty.   

(c) Under the above said Lease-cum-Sale Agreements, the  

lease was for a period of 10 years and after completion of the  

said period, respondents herein approached the Sangha and  

requested them to execute the Absolute Sale Deeds in their  

2

Page 3

favour in respect of their sites.    The Sangha agreed to execute  

the same and the Absolute Sale Deeds were presented for  

registration before the sub-Registrar, Bommanahalli.  The  

sub-Registrar, while registering the sale deeds, has collected  

the stamp duty on the market value prevailing on that day of  

execution of the same after adjusting the stamp duty paid on  

Lease-cum-Sale Agreements.  After registration of the  

documents of sale, the respondents herein approached the  

High Court by filing writ petitions seeking refund of stamp  

duty paid on the absolute Sale Deeds.

(d) Pursuant to the writ petitions filed by the respondents,  

the State Government filed a detailed statement of objections  

and contended that the Sangha is registered under the  

Registration Act, hence, the Sangha has no right to form the  

sites and allot the same to its members and, there is no  

exemption under the Karnataka Stamp Act, 1957 (hereinafter  

referred to as “the Act”) for any Lease-cum-Sale Agreement  

executed by the Sangha.  Under the Act, only a site allotted by  

a House Building Co-operative Society can claim exemption.  It  

is the claim of the State that the authorities have rightly  

3

Page 4

collected the stamp duty on the sale deed treating it as a  

principal document.

(e) Learned single Judge, by order dated 11.12.2007, in the  

writ petitions being Nos. 16777, 19358 and 19359 of 2005  

filed by respondent Nos.1-3 herein held that the stamp duty  

collected by the authorities on Lease-cum-Sale Agreement falls  

under Article 5(e)(i) of the Schedule to the Act, therefore, it is a  

sale agreement with possession, hence, the stamp duty paid is  

as per the provisions of  the Act.  Therefore, when the  

documents are placed for registration as a sale deed, they have  

to pay the stamp duty of the property on the market value as  

on that day of execution of the sale deed but they are entitled  

to claim deduction of the amount which they have already  

paid on the Lease-cum-Sale Agreement.  However, the learned  

single Judge further held that, (a) the petitioners therein are  

not liable to pay stamp duty on the amount shown as  

consideration in the absolute sale deeds; and (b) they are  

entitled to refund of the amount imposed and collected as  

stamp duty on the absolute sale deeds.

4

Page 5

(f) Aggrieved by the said directions, the State filed appeals  

being W.A. Nos. 1023, 1324 & 1325 of 2009 before the  

Division Bench of the High Court.  It was contended before the  

Division Bench that the finding given by the learned single  

Judge in the impugned order that in view of the provisions of  

Article 5(e)(i) of the Schedule to the Act, when the stamp duty  

and the registration fee had been collected on the Lease-cum-

Sale instrument treating it as the possession of the property  

which has been handed over at the time of executing Lease-

cum-Sale Deed, the question of collecting the stamp duty and  

registration charges on the absolute deeds after the expiry of  

the Lease-cum-Sale Agreement is only a supplement and could  

not arise.

(g) The Division Bench, by impugned order dated  

19.06.2009, dismissed the writ appeals filed by the State both  

on the ground of delay as well as on merits.  

(h) Against the said order, the State has filed the present  

appeals by way of special leave petitions.

5

Page 6

4) This Court, after issuance of notice on the applications  

for impleadment (I.A.Nos. 4-6), by order dated 18.02.2011  

impleaded respondent Nos. 4-32.

5) Heard Mr. Basava Prabhu S. Patil, learned senior counsel  

for the appellant-State, Mr. Chandra Sekhar, learned counsel  

for respondent Nos. 1 & 3 and Mr. P.P. Rao, learned senior  

counsel for newly impleaded respondent Nos. 4-32.

6) The following questions which arise for consideration in  

these appeals are:

(i) Whether the State has shown sufficient cause for  

condoning the delay of 449 days in filing writ appeals against  

the order of the learned single Judge, who allowed the writ  

petitions?

(ii) Whether the Division Bench was justified in simply  

affirming the order of the learned single Judge in directing the  

State to repay the amount collected as stamp duty when  

Article 5(e) Explanation (ii) has held that the amount collected  

on the sale or Lease-cum-Sale Deed shall be adjusted towards  

the total duty leviable on the conveyance?  And

6

Page 7

(iii) Whether the order of the High Court is contrary to the  

provisions of Article 5(e)(i) and Explanation (ii) of the  

Karnataka Stamp Act, 1957?

7) First of all, we were taken through the reasons stated for  

the delay of 449 days in filing the appeals before the Division  

Bench against the order of the learned single Judge.  The  

application for condonation of delay in filing appeals was  

supported by an affidavit of sub-Registrar, Peenya, Bangalore  

North Taluk.  A perusal of the application and the reasons  

stated therein show that how the delay has occurred.  But  

after going through the reasons stated therein and in the light  

of the issues to be considered by the Division Bench as well as  

the financial implication on the State Exchequer, we are of the  

view that the reasons stated for the delay cannot be rejected  

as unacceptable.   

8) Considering the issues raised and the positive direction  

given by the learned single Judge, we are of the view that the  

Division Bench of the High Court ought to have condoned the  

delay and gone into the merits of the matter in the light of the  

provisions of the Karnataka Stamp Act, 1957.  Though the  

7

Page 8

High Court concentrated only on narrating the pleadings of  

the parties, reasoning of the learned single Judge and cause  

shown for condoning the delay, but has not considered the  

substantial grounds urged by the State.  As rightly pointed out  

by learned senior counsel for the State that though in the last  

paragraph there is some reference about the reasoning of the  

learned single Judge, not much attention was given on the  

merits of the claim made by the State.   

9) On these grounds, without expressing anything on merits  

of the claim of either party, we condone the delay in filing the  

writ appeals and in the light of our conclusion that the  

Division Bench has not adverted to any substantial grounds  

urged by the State, particularly with reference to the  

provisions of Article 5(e)(i) and Explanation (ii) of the  

Karnataka Stamp Act, 1957, we set aside the order of the  

Division Bench impugned in these appeals and remit the same  

to the High Court for fresh consideration.  We request the High  

Court to restore W.A. Nos. 1023, 1324 and 1325 on its file and  

dispose of the same on merits in accordance with law, after  

affording opportunity to all the parties including the newly  

8

Page 9

impleaded respondent Nos. 4-32 herein as well as the  

connected writ petitions pending before the High Court,  

preferably within a period of six months from the date of  

receipt of copy of this judgment.  Once again, we make it clear  

that except adverting to the stand of the State, we have not  

expressed our views on any of the claims and it is for the  

Division Bench of the High Court to consider their respective  

claims in accordance with law as observed supra.

10) The appeals are allowed.  There shall be no order as to  

costs.

...…………….…………………………J.            (P. SATHASIVAM)                                  

.…....…………………………………J.    (RANJAN GOGOI)  

NEW DELHI; DECEMBER 07, 2012.  

9