- (1.)By way of this petition, the petitioner has prayed for the following reliefs :
(a) Be pleased to issue a writ of certiorari and/or any other appropriate writ, order or direction quashing and setting aside the order dated 20.08.2010 passed by the respondent No. 2;

(b) Pending admission and final hearing of this petition, be pleased to stay operation, implementation and execution of the order dated 20.08.2010 passed by the respondent No. 2;

(c) Be pleased to grant such other and further reliefs as the Hon'ble Court may deem fit in the facts and circumstances of the case.

(2.)The case made out by the petitioner in his petition may be summed up thus:
Petitioner seeks to challenge the order dated 20th August, 2010 passed by respondent No. 2 in purported exercise of powers conferred by Section 39 of the Bombay Stamp Act, 1958. The petitioner had to approach this Court as the impugned order passed by respondent No. 2 is violative of the petitioner's fundamental rights guaranteed by Part-III of the Constitution of India. The impugned order has been passed without affording any opportunity of hearing to the petitioner and is also a non-speaking order. The impugned order is ex-facie without jurisdiction and authority.

2.1. It is the case of the petitioner that Multiple Entertainment Private Limited availed finance from the Ahmedabad People's Cooperative Bank Limited and against the finance availed, the finance amount was secured/mortgaged by deposit of title deeds of the properties mentioned in the Memorandum dated 14.03.2000 executed with the Ahmedabad People's Cooperative Bank Limited.

2.2. The petitioner along with five others and the Private Limited Company had executed the said Deed of Mortgage which, inter alia, provides that against the borrowing of Rs. 1 Crore, the borrowers have agreed to and have in fact deposited title deeds of properties, more particularly, described in the agreement.

2.3. It is indisputable that the document in question created mortgage by deposit of title deeds. The said document was stamped on stamp paper of Rs. 1 lac and was presented for registration. The duly registered document was in possession of the Co-operative Bank.

2.4. The amount financed by the Bank was thereafter repaid on 13.12.2007, and thereafter the Co-operative Bank executed the Deed of Release of mortgaged property.

2.5. The petitioner was served with the impugned order dated 20.08.2010 which, inter alia, records that the document of 13.07.2001 registered at Sr. No. 1784 in the office of Sub-Registrar, Ahmedabad-3, Memnagar was scrutinized during audit and on the basis of the opinion of the Auditor General and on reading of the document, the document seems to be a Deed of Mortgage.

2.6. The said order further records that the notice was issued on 28.12.2005 under Section 39 (1)(b) of the Stamp Act; that the petitioner did not remain present and as such, orders in terms of the objections raised by the Auditor General are required to be passed. It was ordered that the petitioner is required to pay stamp duty of Rs. 8 lac and penalty of Rs. 500/-, thus aggregating to Rs. 8,00,500/-. The order does not explain as to how the deed in question attracts stamp duty of Rs. 8 Lac and as to under which article of the Bombay Stamp Act would the Deed be liable to stamp duty of Rs. 8 Lac. The impugned order is also silent about the precise objection raised by the Auditor General and the rationale behind the objection.

2.7. The order also does not describe the petitioner's name correctly. The order is issued to one Premal Jayantibhai Patel, whereas the petitioner is Premal Sanjaybhai Patel and the address in the order also makes reference to Ranip area of Ahmedabad.

2.8. Though the Deed of mortgage which is subject matter of the proceedings under Section 39 is executed by the Company as well as five others, the impugned order is issued against the petitioner alone. Though the order records that the notice dated 28.12.2005 was served upon the petitioner, the petitioner, in fact, has not come across any such notice. It is stated that had the petitioner been aware about the notice and the proceedings under Section 39, the petitioner would have certainly appeared and objected to the proceedings. The impugned order, inter alia, records that the respondent No. 2 has the acknowledgment of service of notice.

2.9. The Deed of mortgage, after its registration was with the Co-operative Bank. Upon repayment of the amount, the deed has been returned by the Bank to the Company and the Deed is in possession of the Company and the petitioner. The Deed was never impounded and the initiation of proceedings under Section 39 does not satisfy the condition precedent for exercise of powers under Section 39 inasmuch as respondent No. 2 has proceeded under Section 39 in absence of the document and without impounding the same.

2.10. The Deed of Mortgage was on a stamp paper of Rs. 1 Lac and as such, is adequately stamped in accordance with the provisions of the Bombay Stamp Act read with the relevant Articles of the Stamp Act. The deed in question does not fall within the definition of conveyance and does not attract stamp duty which is otherwise payable while executing a Deed of Conveyance of property. The impugned order does not indicate the relevant provisions of the Stamp Act under which the stamp duty would attract duty of Rs. 8 Lac. The impugned order is a non-reasoned, non-speaking order, and the same has been passed without hearing the petitioner and/or without giving adequate opportunity to show-cause against imposition of additional duty or penalty.

2.11. Powers under Section 39 can be exercised in respect of documents which are impounded under Section 33 or issued under sub-section (2) of Section 37. In the facts of the present case, the document was not impounded when presented for registration nor was it referred to the respondent No. 2 under sub-section (2) of Section 37. That Respondent No. 2 did not derive jurisdiction to proceed under Section 39 to adjudicate proper duty and therefore, the impugned order is without jurisdiction and/or authority.

2.12. The impugned order suffers from total non-application of mind. It is apparent that such objection was raised during the audit by the Auditor General. It also seems that the impugned order bears two crucial corrections. Respondent No. 2 has mechanically issued the impugned order in view of objections raised during audit. The order has been issued obviously to avoid any responsibility in pursuance of the audit objection and is as such issued in mechanical and colourable exercise of powers without application of mind to the document or the relevant provisions of the Stamp Act.

2.13. According to the petitioner, he is entitled to approach the Chief Controlling Revenue Authority under Section 53 of the Stamp Act, however, such remedy is an onerous remedy as the petitioner would be obliged to pay 25% of the ordered amount. Considering the fact that the impugned order is ex-facie, arbitrary, unsustainable and in breach of principles of natural justice, the petitioner has to approach this Hon'ble Court Article 226 of the Constitution of India.

(3.)Notice was issued on the respondents and respondent No. 2, in response to the notice have appeared and opposed this petition by filing an affidavit-in-reply.