Bombay High Court Directs State to Refund excessive Stamp Duty

Bombay High Court Directs State to Refund excessive Stamp Duty

The Bombay High Court (HC) in the case titled Macrotech Developers Ltd. & Palava Dwellers Private Ltd. (Petitioners) v. State of Maharashtra & Ors. (Respondents), on 22 February 2021, directed the State Government to refund the excess stamp duty within four weeks from the date of receipt of the application, failing which they will have to pay interest at the rate of 12% per annum.

The division bench of Justices R.I. Chagla and K.K. Tated held that "The Petitioners are entitled to the benefits of Order bearing No.Mudrank-2020/ C.R.No.136/ M-1(Policy) dated 29.08.2020 issued by the State of Maharashtra under the Maharashtra Stamp Act."

The factual matrix of the case is that the petitioners have been engaged in the business of real estate and carry out the development of various projects at Mumbai, Thane, Kalyan, and Bhiwandi including the lands that have been notified as the Integrated Township Projects (ITPs) situated at Kalyan and Bhiwandi.

An order was issued by the State of Maharashtra wherein the stamp duty for agreements and conveyances were reduced by 50 percent in Special Township Projects (STP).

It was claimed by the petitioners that they had registered their project "Kunal Espiree Phase III" under the Real Estate (Regulation and Development) Act, 2016 on 1 August 2017.

The petitioners contended that their project fell under the ambit of the ITP Regulations. Accordingly, the Petitioners claimed concession of 50 percent of stamp duty under Regulation 13.3 of the said ITP Regulations.

The Petitioners had been informed by the respondent State that they were not entitled to get the benefit of the Order dated 29 August 2020 together with the said ITP Regulations.

The petitioners challenged the said order before the HC. The Court granted concession in payment of stamp duty on the instrument of conveyance or agreement to sell of any immovable property in addition to the benefits already granted as per the Notification dated 8 March 2019 issued by the respondent State, Urban Development Department, Mantralaya Mumbai, for Integrated Township Project.

The HC further directed in its order that "If any excess stamp duty is levied by the Respondent and recovered from the Petitioner or their purchasers without giving the benefit of Order issued by the State of Maharashtra and benefit of Integrated Township project, the Petitioner shall provide to the Respondents a statement of their claim of excess stamp duty within four weeks."

It added, "If such claim is made, the Respondents to refund the said excess stamp duty within four weeks from the date of receipt of the application, failing which they will have to pay interest of 12 percent p.a."