# Vipin Kumar Agarwal v. Collector, Meerut & Ors

- **Citation:** (2019) 4 ILRA 1192
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2019-11-28
- **Case number:** Writ-C No. 27730 of 2003
- **Bench:** Yashwant Varma
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/vipin-kumar-agarwal-v-collector-meerut-ors-44900
- **Pages:** 7

## Headnote

A. Civil Law - Indian Stamp Act 1899 -
Article 23 - Explanation - Definition of
Conveyance - Explanation inserted at
the end of Article 23 - It is evident that
it seeks to introduce a substantive
provision in the law bringing a certain
genre of agreements to sell within the
ambit of the expression conveyance - It,
in essence, introduces and creates new
obligations and liabilities which were
otherwise not contemplated by Article

## Text

1192 INDIAN LAW REPORTS ALLAHABAD SERIES
by providing for pre-deposit of the
amount as a condition precedent.

34. It may, therefore, be inferred that
in terms of the second proviso introduced
by the Act 25 of 1984 the right to appeal
granted under sub-section (7) of Section 7
of the P.G. Act, 1972, has been qualified
with the requirement of pre-deposit as a
condition
precedent,
and
the
said
condition having been introduced in a
language which is compulsive in form the
appeal cannot be held to be competent in
the absence of fulfilment of the condition
of pre-deposit.

35. It may also be seen that the right
to appeal inheres in no one and such right
being the creature of a statute, the same
can be qualified or be made subject to
fulfilment
of
conditions
prescribed
therefor.

36. The object of the legislation is
very clear and the second proviso to subsection (7) of Section 7 of the P.G. Act,
1972 has been introduced with a view to
make pre-deposit of the gratuity amount
determined by the Controlling Authority
as a pre-requisite for preferring an appeal
and a duty has been cast on the Appellate
Authority not to admit an appeal unless it
is accompanied either by a certificate or
by a deposit, as the case may be.

37. The Appellate Authority having
been given no discretion to waive the
condition of pre-deposit there is no scope
for admitting the appeal unless at the time
of preferring the appeal the appellant
produces a certificate of the Controlling
Authority to the effect that the amount in
question has been deposited with the
authority or deposits such amount with
the Appellate Authority.

38. In view of the foregoing
discussion, the stand of the Appellate
Authority declining to grant permission
for furnishing a bank guarantee in lieu of
the requirement of pre-deposit under subsection (7) of Section 7 of the P.G. Act,
1972 stating that there is no provision for
the same, cannot be faulted with.

39. The writ petition is devoid of
merits and is accordingly dismissed.
----------

(2019)12 ILR A1192

ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 28.11.2019

BEFORE
THE HON'BLE YASHWANT VARMA, J.

Writ-C No. 27730 of 2003

Vipin Kumar Agarwal ...Petitioner
Versus
Collector, Meerut & Ors. ...Respondents

Counsel for the Petitioner:
Sri Pramod Kumar Jain

Counsel for the Respondents:
C.S.C.

A. Civil Law - Indian Stamp Act 1899 -
Article 23 - Explanation - Definition of
Conveyance - Explanation inserted at
the end of Article 23 - It is evident that
it seeks to introduce a substantive
provision in the law bringing a certain
genre of agreements to sell within the
ambit of the expression conveyance - It,
in essence, introduces and creates new
obligations and liabilities which were
otherwise not contemplated by Article
23. (Para 8 & 11)

Held - On a more fundamental plane, the
Court finds that the Explanation itself while
4 All. Vipin Kumar Agarwal Vs. Collector, Meerut & Ors.
1193
bringing agreements to sell within the ambit of
Article 23, uses the expression- "shall be
deemed to be a conveyance.....". It is thus
manifest that agreements to sell are brought
within the scope of Article 23 by virtue of a
legal fiction that is introduced.

B. Interpretation of statute - Construction
of Explanation clause - One can never
ignore that interpretation of statutes is
fundamentally concerned with substance
and not mere form - Merely because what
is introduced is titled as an explanation,
that
in
itself
would
not
necessarily
commend itself to be an exposition of the
existing law - In case the explanation
introduces a substantive law or makes
provision for matters which cannot be
viewed as being implicit and contemplated
in
the
provision
as
it
stood,
the
explanation cannot be recognised or held
to be declaratory - In case it is found that
the Explanation creates obligations or
liabilities whose attributes were nonexistent in the original provision, it cannot
be interpreted to be an elucidation of that
provision.

Writ Petition allowed. (E-1)

List of cases cited: -

1. Keshavji Ravji & Co. v. CIT, (1990) 2 SCC
231

2. Union of India Vs. Martin Lottery Agency
Ltd. (2009)12 SCC 209

(Delivered by Hon'ble Yashwant Varma, J.)

1. Heard learned counsel for the
petitioner and the learned Standing
Counsel.

2. The instant writ petition assails
the orders passed by the respondents in
proceedings initiated against the petitioner
under Section 47-A of the Indian Stamp
Act 18991. The issue itself arises
consequent to the execution of an
agreement to sell on 31 May 1993 in
favour of the petitioner. The aforesaid
agreement to sell was followed by a sale
deed being executed on 31 January 1994.
The
respondents,
however,
drew
proceedings under Section 47-A of the
Act holding the petitioner liable to pay
additional stamp duty on the original
agreement to sell which had been
executed. Article 23 as appearing in
Schedule 1-B prescribes the stamp duty
payable on conveyances. It appears that
the respondents proceeded in the matter
on the basis of of Article 23 as it stood in
its amended form after the promulgation
of U.P. Act No. 22 of 1998 and more
particularly the Explanation which came
to be introduced pursuant thereto. Article
23, as it existed on the date of execution
of the agreement to sell, namely 31 May
1993, carried no Explanation. This
position
is
not
disputed
by
the
respondents.

3. By virtue of U.P. Act No. 22 of
1998 an Explanation came to be appended
to Article 23 which reads thus:-

"For
the
purposes
of
this
Article, in the case of an agreement to sell
an immovable property, where possession
is delivered before the execution or at the
time of execution, or is agreed to be
delivered
without
executing
the
conveyance, the agreement shall be
deemed to be a conveyance and stamp
duty thereon shall be payable accordingly:

Provided that the provisions of
Section 47-A shall mutatis mutandis
apply to such agreement:

Provided further that when
conveyance
in
pursuance
of
such
agreement is executed, the stamp duty
1194 INDIAN LAW REPORTS ALLAHABAD SERIES
paid on the agreement shall be adjusted
towards the total duty payable on the
conveyance."

4. According to the respondents
since the agreement to sell also evidenced
possession having been delivered, it was
liable to be deemed to be a conveyance
and stamp duty liable to be paid
accordingly. Prior to the insertion of the
said Explanation, Article 23 read thus:-

"23.
CONVEYANCE
as
defined by Section 2(10) not being a
TRANSFER charged or exempted under
No. 62."

5. The petitioner contends that the
agreement to sell would be exigible to
duty in accordance with the provisions
made in Article 23 as it stood on the date
of
execution
of
that
instrument.
According to the petitioner since Article
23
at
that
time
only
covered
"Conveyance" as defined in Section
2(10) of the Act, an agreement to sell,
with or without possession, could not
have been taxed as a conveyance.
According to the petitioner Section 2(10)
of the Act brought within its ambit only
actual conveyances and sales by which
movable or immovable property may
have been transferred. They would
contend that an agreement to sell was
neither contemplated nor covered in the
definition of "conveyance" as embodied
in Section 2(10). A
more serious
challenge is raised to the impugned orders
on
the
ground
that
although
the
Explanation came to be added for the first
time by virtue of U.P. Act No. 22 of 1998,
the instrument in question has been taxed
as
if
that
amendment
applied
retrospectively. It was in that backdrop
that it was submitted that the Explanation
clearly introduced a new liability in
respect of an agreement to sell and that
consequently it could not be interpreted as
having retroactive operation.

6. The Court at the outset notes that
the petitioners appear to be correct in their
submission that the amended Article 23
could have had no application since it
came to be introduced after the execution
of the instrument in question. It must be
borne in mind that while the agreement to
sell came to be executed on 31 May 1993,
U.P. Act No. 22 of 1998 came to be
promulgated on 1 September 1998 and
therefore evidently after the execution of
the instrument forming subject matter of
the proceeding. Since an instrument
becomes exigible to duty under the Act
the moment it is executed, it necessarily
must be taxed in accordance with the
provisions made in Schedule 1-B as
existing at that time. An amendment to
Schedule 1-B which is introduced much
after the execution of the instrument
cannot be held to apply.

7. The Court additionally finds that
while
an
agreement
to
sell
with
possession was brought within the ambit
of a conveyance by virtue of the
Explanation which came to be added to
Article 23, that would still require the
Court to answer the question whether that
Explanation could be construed as being
declaratory,
having
been
added
ex
abundanti cautela or did it introduce a
new liability which was otherwise not
contemplated in the provision.

8. An Explanation when added to a
statutory
provision
is
generally
understood as being aimed at ironing out
the creases or expounding and clarifying
the true intent of the statute. However,
4 All. Vipin Kumar Agarwal Vs. Collector, Meerut & Ors.
1195
one can never ignore that interpretation of
statutes is fundamentally concerned with
substance and not mere form. Merely
because what is introduced is titled as an
explanation, that in itself would not
necessarily commend itself to be an
exposition of the existing law. At least
such a conclusion cannot be held to be
inevitable or one which brooks no
exception.
In
case
the
explanation
introduces a substantive law or makes
provision for matters which cannot be
viewed
as
being
implicit
and
contemplated in the provision as it stood,
the explanation cannot be recognised or
held to be declaratory. In case it is found
that the Explanation creates obligations or
liabilities whose attributes were non
existent in the original provision, it cannot
be interpreted to be an elucidation of that
provision.

9. In Keshavji Ravji & Co. v.
CIT,2 the Supreme Court pertinently
held:-

37. Sri Ramachandran urged
that the introduction, in the year 1984, of
Explanation I to Section 40(b) was not to
effect or bring about any change in the
law, but was intended to be a mere
legislative exposition of what the law has
always been. An 'Explanation', generally
speaking, is intended to explain the
meaning
of
certain
phrases
and
expressions contained in a statutory
provision. There is no general theory as to
the
effect
and
intendment
of
an
Explanation except that the purposes and
intendment of the 'Explanation' are
determined
by
own
words.
An
Explanation, depending on its language,
might supply or take away something
from the contents of a provision. It is also
true that an Explanation may-this is what
Sri Ramachandran suggests in this casebe introduced by way of abundant--
caution in order to clear any mental
cobwebs surrounding the meaning of a
statutory provision spun by interpretative
errors and to place what the legislature
considers to be the true meaning beyond
controversy or doubt. Hypothetically, that
such can be the possible purpose of an
'Explanation' cannot be doubted. But the
question is whether in the present case,
Explanation I inserted into Section 40(b)
in the year 1984 has had that effect.

38. The
notes
on
clauses
appended
to
the
Taxation
Laws
(Amendment) Bill, 1984, say that Clause
10 which seeks to amend Section 40 will
take effect from 1st April, 1985 and will,
accordingly, apply in relation to the
assessment year 1985-86 and subsequent
years. The express prospective operation
and effectuation of the 'Explanation'
might, perhaps, be a factor necessarily
detracting from any evincement of the
intent on the part of the legislature that the
Explanation was intended more as a
legislative exposition or clarification of
the existing law than as a change in the
law as it then obtained............"

10. Dealing with the characteristics
of
a
declaration
or
clarificatory
legislation, the Supreme Court in Union
of India Vs. Martin Lottery Agency
Ltd.3 held as under:-

43. The question as to whether a
Subordinate
Legislation
or
a
Parliamentary Statute would be held to be
clarificatory or declaratory or not would
indisputably depend upon the nature
thereof as also the object it seeks to
achieve. What we intend to say is that if
two views are not possible, resort to
clarification and/or declaration may not
be permissible.
1196 INDIAN LAW REPORTS ALLAHABAD SERIES

44. This aspect of the matter has
been considered by this Court in Virtual
Soft Systems Ltd. v. CIT [(2007) 9 SCC
665], holding :

"50. It may be noted that the
amendment made to Section 271 by the
Finance Act, 2002 only stated that the
amended provision would come into force
with effect from 1.4.2003. The statute
nowhere stated that the said amendment
was either clarificatory or declaratory. On
the contrary, the statue stated that the said
amendment would come into effect on
1.4.2003 and therefore, would apply to
only to future periods and not to any
period prior to 1.4.2003 or to any
assessment year prior to assessment year
2004-2005. It is the well settled legal
position that an amendment can be
considered
to
be
declaratory
and
clarificatory only if the statue itself
expressly and unequivocally states that it
is
a
declaratory
and
clarificatory
provision. If there is no such clear
statement in the statute itself, the
amendment will not be considered to be
merely declaratory or clarificatory.

51. Even if the statute does
contain a statement to the effect that the
amendment is declaratory or clarificatory,
that is not the end of the matter. The
Court will not regard itself as being bound
by the said statement made in the statute
but will proceed to analyse the nature of
the
amendment
and
then
conclude
whether it is in reality a clarificatory or
declaratory provision or whether it is an
amendment which is intended to change
the law and which applies to future
periods."

48. The Gujarat High Court in
CIT v. S.G. Pgnatal [(1980) 124 ITR 391
(Guj)] held that words "earned in India"
occurring
in
clause
(ii)
must
be
interpreted as "arising or accruing in
India" and not "from service rendered in
India". Opining that the High Court
proceeded on an incorrect hypothesis, it
was held : (Sedco case[Sunrise Associates
v. Govt. of NCT of Delhi, (2006) 5 SCC
603] [(2008) 5 SCC 176], SCC p. 723,
para 9)

"9. The High Court did not refer
to the 1999 Explanation in upholding the
inclusion of
 salary for the field break periods in the
assessable income of the employees of the
appellant. However the respondents have
urged the point before us.

10. In our view the 1999
Explanation
could
not
apply
to
assessment years for the simple reason
that it had not come into effect then. Prior
to introducing the 1999 Explanation, the
decision in CIT v. S.G. Pgnatale (supra)
was followed in 1989 by a Division
Bench of the Gauhati High Court in
Commissioner of Income Tax v. Goslino
Mario reported in [(2002) 10 SCC 165]. It
found that the 1983 Explanation had been
given effect from 1.4.1979 whereas the
year in question in that case was 1976-77
and said : (ITR p.318)

". . . it is settled law that
assessment has to be made with reference
to the law which is in existence at the
relevant time. The mere fact that the
assessments
in
question
has
(sic)
somehow remained pending on April 1,
1979, cannot be cogent reason to make
the Explanation applicable to the cases of
the present assessees. This fortuitous
circumstance cannot take away the vested
rights of the assessees at hand"."

49. Reverting to the decision of
a Kerala High Court in CIT v. S.R. Patton
[(1992) 193 ITR 49 (Ker)] wherein
Gujarat High Court's judgment was
followed,
this
Court
noticed
that
4 All. Vipin Kumar Agarwal Vs. Collector, Meerut & Ors.
1197
explanation was not held to be a
declaratory one but thereby the scope of
Section 9(1)(ii) of the Act was widened.
The law in the aforementioned premise
was laid down as under : (Sedco case
[2005) 12 SCC 717], SCC pp. 724-25,
paras 17-19)

"17. As was affirmed by this
Court in Goslino Mario (supra), a cardinal
principle of the tax law is that the law to
be applied is that which is in force in the
relevant assessment year unless otherwise
provided expressly or by necessary
implication. [See also: Reliance Jute and
Industries. v. CIT [(1980) 1 SCC 139]. An
Explanation to a statutory provision may
fulfil the purpose of clearing up an
ambiguity in the main provision or an
Explanation can add to and widen the
scope of the main section (See: Sonia
Bhatia v. State of U.P. [(1981) 2 SCC 585
at 598]. If it is in its nature clarificatory
then the Explanation must be read into the
main provision with effect from the time
that the main provision came into force
(See: Shyam Sunder v. Ram Kumar
[(2001) 8 SCC 24 (para 44)]; Brij Mohan
Laxman Das v. CIT[(1997) 1 SCC 352 at
354], CIT v. Podar Cement [(1997) 5
SCC 482 at 506]. But if it changes the law
it is not presumed to be retrospective
irrespective of the fact that the phrase
used are 'it is declared' or 'for the removal
of doubts'.

18. There was and is no
ambiguity in the main provision of
Section 9(1)(ii). It includes salaries in the
total income of an assessee if the assessee
has earned it in India. The word "earned"
had been judicially defined in S.G.
Pgnatale (supra) by the High Court of
Gujarat, in our view, correctly, to mean as
income "arising or accruing in India". The
amendment to the section by way of an
Explanation in 1983 effected a change in
the scope of that judicial definition so as
to include with effect from 1979, "income
payable for service rendered in India".

19. When the Explanation seeks
to give an artificial meaning 'earned in
India'
and
bring
about
a
change
effectively in the existing law and in
addition is stated to come into force with
effect from a future date, there is no
principle of interpretation which would
justify
reading
the
Explanation
as
operating retrospectively."

11. As this Court views the
Explanation inserted at the end of Article
23, it is evident that it seeks to introduce a
substantive provision in the law bringing
a certain genre of agreements to sell
within the ambit of the expression
conveyance. It, in essence, introduces and
creates new obligations and liabilities
which were otherwise not contemplated
by Article 23. Regards must also be had
to the fact that the Act while defining the
word
conveyance
did
not
include
agreements to sell nor can the language
employed in Section 2 (10) be understood
as envisioning an agreement to sell.

12. On a more fundamental plane,
the Court finds that the Explanation itself
while bringing agreements to sell within
the ambit of Article 23, uses the
expression- "shall be deemed to be a
conveyance.....". It is thus manifest that
agreements to sell are brought within the
scope of Article 23 by virtue of a legal
fiction
that
is
introduced.
This
additionally convinces the Court that the
Explanation is neither clarificatory nor
declaratory and in any case cannot be
viewed as being a mere exposition of the
statutory position that existed. For these
reasons also, the Court finds itself unable
to sustain the impugned orders.
1198 INDIAN LAW REPORTS ALLAHABAD SERIES

13. The writ petition is consequently
allowed. The impugned orders dated 30
April 2001, passed by the respondent No.
3 and 31 March 2003, passed by the
respondent No. 2 are hereby quashed. All
moneys deposited or recovered from the
petitioner pursuant to the impugned order
shall consequently be refunded forthwith.
----------
(2019)12 ILR A1198

ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 01.11.2019

BEFORE
THE HON'BLE ANJANI KUMAR MISHRA, J.

Writ-C No. 27953 of 2018
connected with Writ-C cases 27278 of 2019 &
31241 of 2019

Baba Sukkhu Maa Prabhudevi Inter
College & Anr. ...Petitioners
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioners:
Sri Bhola Nath Yadav, Sri Abhishek Kumar
Yadav

Counsel for the Respondents:
C.S.C., Sri Manoj Kumar Yadav, Sri
Ravindra Nath Yadav

A. Civil Law - U.P. Revenue Code, 2006 -
Section 67 - Gao Sabha Property - Eviction -
Resolution of the Gaon Sabha - Gaon Sabha
cannot gift any land to anyone. It can, at
best, grant a lease of agricultural land - Such
lease is to be in accordance with the
provisions contained in Section 198 of the
U.P. Zamindari Abolition and Land Reforms
Act, after following the order of preference
prescribed for grant of such lease -
Moreover, such resolution requires approval
of the Sub Divisional Officer - In absence of
approval the resolution, for all practical
purposes, it is a piece of waste paper. (Para
21)
B. Civil Law - U.P. Revenue Code, 2006 -
Section 101 - Proviso to Section 101(2)
- Exchange of the Gao Sabha land with
bhumidhari
land
-
Requirement
of
reference by the Sub Divisional Officer to
State Govt. - No reference - Application
of exchange has been rejected, against
which
revision
is
pending
-
Held,
pendency of revision against an order
rejecting application for exchange is no
ground for interference because no
rights can accrue in favour of any person
over land which is land of public utility.
(Para 26 & 27)

C. Civil Law - U.P. Revenue Rules, 2016 -
Rule 102 - Exchange of land of public
utility - Effect of absence of necessary
rules - Since the Rules do not provide
the
manner
in
which
the
State
Government is required to deal with an
application for exchange referred to it by
the Sub Divisional Officer, the power
conferred by the proviso to Section
101(2) cannot be exercised - Direction
issued to State Govt. to desist from
exercising the power conferred by the
proviso to Section 101(2) till such time
the U.P. Revenue Code Rules, 2016 are
suitably modified/amended, prescribing
the
conditions
and
procedure
for
exercise of power conferred by proviso
to Section 101(2). (Para 28, 37 & 39)

Writ Petition dismissed. (E-1)

List of cases cited: -

1. Writ Petition No.26070 of 2019 Amar Nath
Singh Vs St. of U.P. & others decided on
20.08.2019

(Delivered by Hon'ble Anjani Kumar Mishra,J.)

1. Heard learned counsel for the
parties.

2. Writ petition No.27953 of 2018
arises out of proceedings under Section 67
of the U.P. Revenue Code, 2006 and seeks
a writ of certiorari for quashing the order