R.S.CHAUHAN, J. - (1.) THE petitioner has challenged the order dated 8 -11 -2004, passed by Deputy Inspector General (Stamps) and Collector Stamps, Kota whereby the learned Collector held that an order passed by a High Court under Section 394 of the Companies Act, 1959, ('the Companies Act' for short) permitting amalgamation of two companies is covered under the definition of word 'conveyance', contained in Section 2(xi) of Rajasthan Stamps Act,1998 ('the Act' for short). Therefore, the petitioner company is liable to pay the stamp duty. The Learned Collector had also directed the Sub -Registrar (Stamps) to calculate the extent of stamp duty payable. He further directed the Sub -Registrar to recover the stamp duty in case the petitioner company does not deposit the requisite stamp duty. The petitioner company has also challenged the order dated 21 -6 -2006, passed by Rajasthan Tax Board, Ajmer ('the Board' for short), whereby the learned Board has upheld the order dated 8 -11 -2004.
(2.) THE factual matrix of the case in a short compass is that the petitioner company wanted to amalgamate with its sister concern, M/s. Kusum Products Ltd. Therefore, the petitioner company moved an application before the Hon'ble Calcutta High Court under Section 391(2) read with Section 394 of the Companies Act. Vide order dated 16 -6 -1999 the Hon'ble Calcutta High Court approved the scheme for amalgamation. Therefore, the assets and liabilities of the transferring company i.e. the petitioner company stood transferred to M/s. Kusum Product Ltd. The petitioner company owned certain land in Khasra Nos. 217 and 235 in village Tather, Tehsil Ladpura, admeasuring 4.96 hectare, where the petitioner company had established its factory. Since the said immovable assets was also being transferred to M/s. Kusum Product Ltd., on 12 -10 -1999 the petitioner company informed the Additional District Magistrate City Kota ('the ADM' for short) about the merger of two companies. It further informed the ADM that, henceforth, the petitioner company will be known as M/s. Kusum Product Ltd. After a lapse of two years on 29 -11 -2001, the petitioner company received a notice from the District Collector (Stamps) Kota asking the Company to show cause as to why the stamp duty may not be levied on the transfer of aforementioned land to M/s. Kusum Product Ltd. pursuant to the order dated 16 -6 -1999, passed by the Hon'ble Calcutta High Court. On 7 -1 -2002, the petitioner company filed its reply. However, vide letter dated 14 -2 -2002, the learned District Collector referred the case to the learned Collector Stamps. Vide order dated 8 -11 -2004, the learned Collector Stamps held as aforementioned. Since, the petitioner was aggrieved by the said order, it filed a revision petition before the Revenue Appellate Authority. But subsequently, the revision petition was transferred to the learned Board. After hearing the petitioner as well as the State, vide order dated 21 -6 -2006, the learned Board confirmed the order dated 8 -11 -2004 and dismissed the revision petition filed by the petitioner. Hence, this petition before this Court. Mr. Sunil Nath, the learned Counsel for the petitioner, has vehemently raised a plethora of contentions before this Court: firstly, the Hon'ble Calcutta High Court passed the order of amalgamation under Section 394 of the Companies Act on 16 -6 -1999. Secondly, at that relevant time, the definition of the word 'conveyance' as contained in Section 2(xi) of the Rajasthan Stamps Act did not include an order passed by a High Court under Section 394 of the Companies Act. Thirdly, the definition was amended on 27 -5 -2004 and by way of amendment, the definition of the word 'conveyance' was enlarged to include 'every order made by the High Court under Section 394 of the Companies Act, 1956, in respect of amalgamation of the companies'. Since, the amendment came into force on 27 -5 -2004, the said amendment could not be given a retrospective effect so as to include an order passed by the High Court in 1999. Fourthly, relying on the case of Mathuram Agrawal v. State of M.P. : AIR2000SC109 , a Constitutional Bench decision, the learned Counsel has contended that before a lax liability can be imposed three criteria need to be specified; a) subject of the tax needs to be defined; b) the person who is liable to pay the tax needs to be identified; c) the rate at which the tax is payable needs to be prescribed. In the pre -amended definition of the word 'conveyance' an order passed by the High Court under Section 394 of the Companies Act was not defined as a subject of the stamp duty. Moreover, the person by whom the said stamp duty was payable was also not identified. Lastly, the rate at which stamp duty was payable was also not prescribed. In fact, these three elements were included for the first time in the definition of the word 'conveyance', and in the Schedule -I of the Act only on 27 -5 -2004. Therefore, prior to 27 -5 - 2004, the liability to pay the stamp duty does not exists. Such a liability can not be imposed upon the petitioner company. For, it is a settled principle of law that any law which adversely affects the vested rights or imposes a duty is not a given retrospective effect. In order to buttress this contention, the learned Counsel has relied upon the case of Mithlesh Kumar v. Prem Bihari Khare : [1989]177ITR97(SC) . Moreover, according to Mr. Nath, while interpreting a fiscal statute, the statute should be construed narrowly and that, too, in favour of the assessee. Fifthly, Section 3 of the Act, which is the charging provision, clearly states that 'every instrument mentioned in the Schedule (Schedule -I) on or after the date of commencement of the Act, would be chargeable to stamp duty'. An order passed by the High Court under Section 394 of the Companies Act was not inserted as an instrument in the said Schedule till 27 -5 -2004. Such an order was included under Article 21 Schedule I only on 27 -5 -2004. Therefore, even under the charging Section, Section 3 of the Act, an order passed in 1999 was not chargeable. Thus, the order passed by the Hon'ble Calcutta High Court could not be subjected to payment of stamp duty. Sixthly, according to Notification 14/ 2004, the State Government declared that 'insertion of Article 21 in the Schedule I - dealing with an order passed by the High Court under Section 394 of the Companies Act -should be taken as a new source of revenue for the Government'. Thus, even the Government intended to give Article 21 of Schedule I and amended definition under Section 2(xi) of Act of 1998 a prospective effect and not a retrospective one. Seventhly, no instrument needs to be created after an order is passed by the High Court under Section 394 of the Companies Act. For, according to Section 394(2) of the Companies Act, the assets of the transferor company stand automatically transferred to the transferee company. Thus, the order passed by the High Court does not amount to an instrument. Moreover, the property is being transferred not because of the intention of the parties, but because of operation of law. Therefore, the transfer does not come within the definition of word 'conveyance'. Hence, the order of the Hon'ble Calcutta High Court is not subject to stamp duty. In order to buttress this contention, the learned Counsel has relied upon Madhu Intra Ltd. and Anr. v. Registrar of companies and Ors. (2006) 130 Comp. Cases 510 (Cal.). Eighthly, the learned Collector has erred in relying upon the notification No. 6/2004 for imposing the stamp duty. For, a notification issued in 2004 can not be applied retrospectively to include an order passed by the Hon'ble Calcutta High Court in 1999. Lastly, the learned Collector has committed an error while relying on certain judgments of Hon'ble Supreme Court namely, Ruby Sales and Service Pvt Ltd. v. State of Maharashtra and Ors. : (1994)1SCC531 , to conclude that the amendment brought in the definition of word 'conveyance' was by way of abundant caution. Moreover, the learned Collector has ignored the fact that an amendment which adversely affects the rights of the people or imposes a liability upon them cannot be given a retrospective effect. Furthermore, he has ignored the fact that there is not an iota of evidence to suggest that the Legislature wanted to give a retrospective effect to the amendment. Therefore, the approach of both the learned Collector Stamps and of the learned Board is highly misplaced.
(3.) ON the other hand, Mr. S. N. Kumawat, the learned Additional Advocate General for the State, has opposed the contentions raised by the learned Counsel for the petitioner. He claims that the amendment dated 27 -5 -2004 was merely clarificatory in nature. According to him even the original definition of word 'conveyance' included an order passed by a Hon'ble High Court under Section 394 of the Companies Act. For, according to him the original definition dealt with transfer of properties 'inter -vivos' i.e. the transfer of property between two living persons. Since, the Company is deemed to be a juristic person, therefore, the transfer of property from one company to another is, ipso facto, covered within the definition of word 'conveyance'. Moreover, Section 2 (xix) of the Act defines the word 'instrument' meaning as 'every document by which any right is purported to be transferred'. Since, the order passed by the Hon'ble Calcutta High Court under Section 394 of the Companies Act transferred the property from one company to another, the said order falls within the definition of the word 'instrument'. Therefore, according to the learned Counsel, both, the learned Collector Stamps as well as the learned Board were justified in holding that an order passed by a High Court under Section 394 of the Companies Act does fall within the definition of word 'conveyance'. Hence, the petitioner is liable to pay the stamp duty. Secondly, relying on the case of Ruby Sales and Service Pvt Ltd. (supra), the learned Counsel has contended that the order passed by Hon'ble Calcutta High Court was a 'consent decree'. According to the Apex Court, as observed in the case of Ruby Sales and Service Pvt Ltd. (supra), a consent decree does fall within the definition of word 'conveyance'. Therefore, the order dated 26 -6 - 1999 is subject to payment of stamp duty. Thirdly, an instrument dealing with immovable property, worth more than Rs. 100/ -, is compulsorily registrable under Section 17 of the Registration Act, 1908. But, before the instrument can be registered, the requisite stamp duty needs to be paid. Therefore, the petitioner company has no other option, but to get the instrument registered. Thus, it is liable to pay the stamp duty. Lastly, a stamp duty is payable on the date when the instrument is presented for registration. In order to buttress this contention the learned Counsel has relied on the case of State of Rajasthan and Ors. v. Khandaka Jain Jewellers (2007) 14 SCC 339. Therefore the learned Collector Stamps as well as the learned Board were justified in directing the petitioner to pay the stamp duty on the date when the instrument was presented for registration. ;