# 12 S.C.R. 1073 NASIRUDDIN & ANR. ETC v. THE STATE OF UTTAR PRADESH THROUGH SECRETARY & ORS

- **Citation:** [2017] 12 S.C.R. 1073
- **Court:** Supreme Court of India
- **Decided:** 2017-12-06
- **Case number:** Civil Appeal No. 3695 of2009
- **Bench:** Abhay Manohar Sapre, Navin Sinha
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/12-s-c-r-1073-nasiruddin-anr-etc-v-the-state-of-uttar-pradesh-through-secretary-31511
- **Pages:** 10

## Headnote

A
B
Stamp Act, 1899 - ss. 2(12). 2(14), 2(16) and Art.35 of
Schedule I - Respondent No.3-Corporation and appellants entered
into a formal contract - Each appellant was to carry out the work c
of collection of "Tehbazari" and "Parking Fees" in terms of contract
- Dispute arose as to the true nature of the contract and stamp duty
payable by the appellants - Corporation demanded requisite stamp
duty payable under the Stamp Act whereas as per Collector of Stamps
the appellants were liable to pay stamp duty@ Rs. 701- per thousand
on the contract amount treating the co/lfract as Lease - High Court
D
upheld the demand raised by the Collector of Stamps - Held: The
terms of the contract would show that it was meant to collect tolls
(fees) called "Tehbazari" in local parlance from squatters, vendors,
kiosks etc. and was for collecting parking fees - By awarding such
contract to the appellants. the Corporation had let their right to the
appellants to collect the fees from a class of persons and for carrying
E
on particular activity in the city- The contract satisfied the definition
of the expression "instrument" as defined in s.2(14) of the Act
because it created a right and liabili(v and lastly, it also satisfied
the definition of expression "executed" and "execution" as defined
in s.2(12) of the Act because it contained the signature of F
contracting parties - Further, it related to the right to collect the
tolls let by the Corporation to the person concerned. which square~v
attrncts s.2(16)(c) of the Act and partakes the character of a
"Lease" - Therefore, the contract in question is a "Lease" as de.fined
in s.2(16)(c) of the Stamp Act and is accordingly chargeable to
payment of stamp duly as per the rates prescribed in Art.35 of G
Schedule 1 of the Stamp Act as "Lease".
Dismissing the appeals, the Court
HELD: l.l The contract in question show that it was meant
to collect tolls (fees) called "Tehbazari" in local parlance from
1073
H
1074
SUPREME COURT REPORTS
[2017] 12 S.C.R.
A squatters, vendors, kiosks etc. and was for collecting parking
fees. Such contract is regarded as an instrument by which tolls
of any description are let. The contract was, therefore, for
recovery of tolls and created rights and liabilities in favour of
contracting parties qua each other. It cannot be disputed that
B
c
D
E
the expression "tolls of any description" in clause (c) would
include all kinds of levy, charges, fees etc. which the Corporation
is entitled to charge under its Bye-laws (41). A/ortiori, the fees in
question would also fall under Section 2(16)(c) of the Stamp Act.
(Paras 16 and 211 [1080-B; 1081-EJ
1.2 The contract in question also satisfied the definition of
the expression "Instrument" as defined in Section 2(14) of the
Stamp Act because it created a right and liability and lastly, it also
satisfied the definition of expressi!Jn "executed" and "execution"
as defined in Section 2 (12) of the Stamp Act· because it contained
the signature of contracting parties. The case at hand relates to
the right to collect the tolls let by the Corporation to the person
concerned. It squarely attracts Section 2(16)(c) of the Stamp Act
and partakes the character of a "Lease". Accordingly stamp duty
is chargeable as per the rates prescribed in Article 35 of Schedule
l of the Stamp Act as "Lease". [Paras 22, 26 and 27] (1081-F-G;
1082-D-E)
Mohammad Ali v. Board of Revenue, U.P. AIR 1987
Allahabad 348 - approved.
New Bus-Stand Shop Owners Association v. Corporation
of Kozhikode & Anr. (2009) (10) SCC 455 : (2009) 14
F
SCR 793 - distinguished.
Munindra Nath Upadhaya v. State of U.P. & Ors. (1995)
2 UPLBEC 1789 - referred to.
Case Law Reference
G (1995) 2 UPLBEC 1789
AIR 1987 Allahabad 348
(2009) 14 SCR 793
referred to
approved
distinguished
Para 10
Par:a 10
Para 24
H

## Text

[2017) 12 S.C.R. 1073
NASIRUDDIN & ANR. ETC.
v.
THE STATE OF UTTAR PRADESH THROUGH SECRETARY
& ORS.
(Civil Appeal No. 3695 of2009)
DECEMBER 06, 2017
[ABHAY MANOHAR SAPRE AND NAVIN SINHA, JJ.]
A
B
Stamp Act, 1899 - ss. 2(12). 2(14), 2(16) and Art.35 of
Schedule I - Respondent No.3-Corporation and appellants entered
into a formal contract - Each appellant was to carry out the work c
of collection of "Tehbazari" and "Parking Fees" in terms of contract
- Dispute arose as to the true nature of the contract and stamp duty
payable by the appellants - Corporation demanded requisite stamp
duty payable under the Stamp Act whereas as per Collector of Stamps
the appellants were liable to pay stamp duty@ Rs. 701- per thousand
on the contract amount treating the co/lfract as Lease - High Court
D
upheld the demand raised by the Collector of Stamps - Held: The
terms of the contract would show that it was meant to collect tolls
(fees) called "Tehbazari" in local parlance from squatters, vendors,
kiosks etc. and was for collecting parking fees - By awarding such
contract to the appellants. the Corporation had let their right to the
appellants to collect the fees from a class of persons and for carrying
E
on particular activity in the city- The contract satisfied the definition
of the expression "instrument" as defined in s.2(14) of the Act
because it created a right and liabili(v and lastly, it also satisfied
the definition of expression "executed" and "execution" as defined
in s.2(12) of the Act because it contained the signature of F
contracting parties - Further, it related to the right to collect the
tolls let by the Corporation to the person concerned. which square~v
attrncts s.2(16)(c) of the Act and partakes the character of a
"Lease" - Therefore, the contract in question is a "Lease" as de.fined
in s.2(16)(c) of the Stamp Act and is accordingly chargeable to
payment of stamp duly as per the rates prescribed in Art.35 of G
Schedule 1 of the Stamp Act as "Lease".
Dismissing the appeals, the Court
HELD: l.l The contract in question show that it was meant
to collect tolls (fees) called "Tehbazari" in local parlance from
1073
H
1074
SUPREME COURT REPORTS
[2017] 12 S.C.R.
A squatters, vendors, kiosks etc. and was for collecting parking
fees. Such contract is regarded as an instrument by which tolls
of any description are let. The contract was, therefore, for
recovery of tolls and created rights and liabilities in favour of
contracting parties qua each other. It cannot be disputed that
B
c
D
E
the expression "tolls of any description" in clause (c) would
include all kinds of levy, charges, fees etc. which the Corporation
is entitled to charge under its Bye-laws (41). A/ortiori, the fees in
question would also fall under Section 2(16)(c) of the Stamp Act.
(Paras 16 and 211 [1080-B; 1081-EJ
1.2 The contract in question also satisfied the definition of
the expression "Instrument" as defined in Section 2(14) of the
Stamp Act because it created a right and liability and lastly, it also
satisfied the definition of expressi!Jn "executed" and "execution"
as defined in Section 2 (12) of the Stamp Act· because it contained
the signature of contracting parties. The case at hand relates to
the right to collect the tolls let by the Corporation to the person
concerned. It squarely attracts Section 2(16)(c) of the Stamp Act
and partakes the character of a "Lease". Accordingly stamp duty
is chargeable as per the rates prescribed in Article 35 of Schedule
l of the Stamp Act as "Lease". [Paras 22, 26 and 27] (1081-F-G;
1082-D-E)
Mohammad Ali v. Board of Revenue, U.P. AIR 1987
Allahabad 348 - approved.
New Bus-Stand Shop Owners Association v. Corporation
of Kozhikode & Anr. (2009) (10) SCC 455 : (2009) 14
F
SCR 793 - distinguished.
Munindra Nath Upadhaya v. State of U.P. & Ors. (1995)
2 UPLBEC 1789 - referred to.
Case Law Reference
G (1995) 2 UPLBEC 1789
AIR 1987 Allahabad 348
(2009) 14 SCR 793
referred to
approved
distinguished
Para 10
Par:a 10
Para 24
H
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3695
of2009
NASIRUDDIN & ANR. ETC. v. THE STATE OF UTTAR
1075
PRADESH THR. SEC. & ORS.
From the Judgment and Order dated 22.05.2006 of the High Court
A
of Judicature at Allahabad in Civil Misc. Writ Petition No. 9661 of2005
WITH
C. A. Nos. 3714, 3709, 3705, 3699, 37! i and 3702 of2009.
J itendra Mohan Sharma, Sr. Adv., Anupam Lal Das, Anirudh Singh,
B
Ashok Kumar Sharma, Ms. Bandana Singh, Deepak Jyoti Ghildiyal, Vikal
Mudgal, Pravcen Chaturvedi, Advs. for the Appellants.
M. R. Shamshad, Sanjay Kumar Tyagi, Aviral Saxena, Dhawal
Uniyal Vinay Garg, Kamlendra Mishra, Vishwa Pal Singh, Ravi Prakash
Mehrotra, K. L. Janjani, Adarsh Upadhyay, P. K. Chakravarty, Gunnam c
Venkateswara Rao, Advs. for the Respondents.
The Judgment of the Court was delivered by
ABHAY MANOHAR SAPRE, J. I. These appeals arc filed
against the judgment and order dated 22.05.2006 passed by the High
Court of Judicature at Allahabad in Civil Misc. Writ Petition Nos. 9661/ D
2005, 21327 /2006, 13249/2003, 12958/2004, 26755/2004, 31238/2005,
44533/2005, 31058/2003, 22817/2006, 12957/2004 and 44532/2005
whereby the High Court dismissed the writ petitions filed by the appellants
herein.
2. In order to appreciate the short issue arising in this bunch of E
appeals, it is necessary to set out few relevant facts hereinbclow.
3. Respondent No.3 is a "Nagar Nigam Mccrut" also called
"Municipal Corporation Meerut" in the State ofU.P. (hereinafter referred
to as "the Corporation"). The Corporation is constituted and governed
by the provisions of the Uttar Pradesh Municipal Corporation Act, 1959 . F
(for short "the Act"). Its area of operation is in the city of Meerut.
4. In exercise of powers conferred by Section 541 ( 4 I) of the
Act, the Corporation has framed Bye-laws for implementing the
provisions of the Act and for regulating various activities meant essentially
for the benefit of the residents/public ofMeerut city. Clause 41 of the
G
Bye-laws empowers the Corporation to fix any fees for grant of any
license, sanction or permission to person(s) by and under the Act.
5. In March 2004, the Corporation issued an advertisement inviting
bids from public at large for letting out the right of collection of ( 1)
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SUPREME COURT REPORTS
[2017] 12 S.C.R.
A
realization ofTehbazari Fee from squatters, vendors, kiosks and (2) for
· collecting parking fees.
6. So far as the connecting appeals are concerned, they pertain to
other cities of U.P. but relate to the same aforementioned activities.
The appellants participated in the public auction held by the Corporation.
B
Their bids were finally accepted.
7. The Corporation accordingly informed to the appellants
individually about acceptance of their bids and entered into a formal
contract with each appellant to enable them to carry out the work of
collection of what is called as "Tehbazari" and "Parking Fees" in terms
c of the contract. One such contract is (Annexure P-10). The period of
contract was up to 31.03 .2005.
8. The execution of contract led to the disputes among the
appellants, Corporation and the Collector of Stamps, namely, what is the
true nature of the contract and how much stamp duty is payable by the
D
appellants on the contract under the Indian Stamp Act, 1899 (for short
· "the Stamp Act").
E
F
G
H
9. The Corporation, vidc their letter (Annexure P-8), requested
the appellants to deposit the requisite stamp duty payable under the Stamp
Act whereas the Collector of Stamps requested the appellants to pay
stamp duty@ Rs.70/- per thousand on the contract amount treating the
contract as Lease.
I 0. The appellants felt aggrieved of the demand raised by the
Collector of Stamps and filed writ petitions in the Allahabad High Court.
The Allahabad High Court placing reliance on its previous decisions in
Munindra Nath Upadhaya vs. State of U.P. & Ors. (W.P. No.4978
of 1994) (1995) 2 UPLBEC 1789 and Mohammad Ali vs. Board of
Rc\'cnuc, U.P. (AIR 1987 Allahabad 348) upheld the demands raised
by the Collector of Stamps and finding no fault therein dismissed the
writ petitions which has given rise to filing of these appeals by special
leave by the unsuccessful writ petitioners in this Court.
l l. Having heard the learned counsel for the parties and on perusal
of the record of the case, we find no merit in these appeals. In our
opinion, the conclusion arrived at by the High Com1 in the case of
Mohammad Ali vs. Board of Revenue, U.P. (supra) is just and proper
calling for no interference for the reasons given by us hereinbelow.
NASIRUDDIN & ANR. ETC. v. THE STATE OF UTTAR
1077
PRADESH THR. SEC. & ORS. [ABHAY MANOHAR SAPRE, J.]
12. Sections 2(12), 2(14), 2(16) and Article 35 of Schedule I to
A
the Stamp Act arc relevant for deciding the question arising in the case.
They read as under:
"2(12) "Executed" and "execution", used with reference
to instruments, mean "signed" and "signature".
2(14) "Instrument" includes every document by which any
B
right or liability is, or purports to be, created, transferred,
limited, extended, extinguished or recorded.
2(16) "Lease" means a lease of immovable property, and
includes also -
(a) a pattu;
(b) a Ka/J11liyat or other undertaking in writing, not being a
counterpart of a lease, to cultivate, occupy, or pay or deliver
rent for, immovable property;
c
(c) any instrument by which tolls of any description arc let;
D
(d) any writing on an application for a lease intended to
signify that the application is granted;
Article 35 of Schedule 1.
Description of Instrument
Proper Stamp-duty
E
LEASE,
including
an
under-lease
or sub-lease
and any agreement to let or
sub-let
F
(a) where by such lease the
rent
is
fixed
and
110
premium
is
paid
or
deliveredThe same duty as a Bond
(i)
where the lease
(No.IS) for the whole
purports to be
amount
payable
or
G
for a term of
deliverable under such
less than one
lease.
year;
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1078
A
B.
c
D
E.
F
G
SUPREME COURT REPORTS
(2017] 12 S.C.R.
(ii)
where the lease purports
to be for a term of not
less than one year but
not more than three
years;
(iii) where the lease purports
to be for a term in
excess of three years;
(iv) where the lease does not
purport to be for any
definite term;
(v)
where the lease purports
to be in perpetuity.
(b) where the lease is granted
for a fine or premium or for
money advanced and where no
rent is reserved.
( c) where the lease is granted
for a fine or premium or for
money advanced in addition to
rent reserved.
The same duty as Bond (No.
15) for the amount or value of
the
average
annual
rent
reserved.
The
same
duty
as
a
Conveyance (No. 23) for a
consideration equal
to
the
amount or value of the average
annual rent reserved.
The
same
duty
as
a
Conveyance (No.23) for a
consideration equal
to
the
amount or value of the average
annual rent which would be
paid or delivered for the first
ten years if the lease continued
so long.
The
same
duty
as
a
Conveyance (No. 23) for a
consideration equal to one-fifth
of the whole amount of rents
which would
be
paid or
deli vcrcd in respect of the first
fifty years of the lease.
The
same
duty
as
a
Conveyance (No. 23) for a
consideration equal
to the
amount or value of such fine or
premium or advance as set
forth in the lease.
The
same
duty
as
a
Conveyance (No. 23) for a
consideration
equal
to
the
amount or value of such fine or
premium or advance as set
forth in the lease, in addition to
NASIRUDDIN & ANR. ETC. v. THE STATE OF UTTAR
PRADESH THR. SEC. & ORS. [ABHAY MANOHAR SAPRE, J.]
Exemptions
(a) Lease, executed in the
case of a cultivator and for
the purposes of cultivation
(including a lease of trees for
the production of food or
drink) without the payment
or delivery of any fine or
premium, when. a definite
term is expressed and such
term does not exceed one
year, or when the average
annual rent reserved does not
exceed one hundred rupees.
the duty which would have
been payable on such lease
if no fine or premium or
advance had been paid or
delivered:
Provided that, in any case
when
an agreement to
lease is stamped with the
ad valorem stamp required
for a lease, and a lease in
pursuance
of
such
agreement is subsequently
executed, the duty on such
lease shall not exceed eight
annas.
13. The expression "Lease" defined in Section 2(16) clause (c)
shows that it also includes therein "any instrument by which tolls of
any description are let".
1079
A
B
c
D
E
F
G
14. Similarly the expression "executed" and "execution" with
reference to any instrument, as defined in Section 2( 12) of the Stamp
Act, means "signecf' and "signature".
15. Likewise the expression "Instrument" defined in Section
2( 14) shows that it includes therein every document by which any right
H
1080
A
B
c·
D
E
F
G
H
SUPREME COURT REPORTS
[2017] 12 S.C.R.
or liability is, or purports to be created, transferred, limited, extended,
extinguished or recorded.
16. In our considered opinion, reading of the contract in question
would show that it was meant to collect tolls (fees) called "Tehbazari"
in local parlance from squatters, venders, kiosks etc. and was for
collecting parking fees. Such contract, in our view, is regarded as an
instrument by which tolls of any description are let. In other words, by
awarding such contract to the appellants, the Corporation had let their
right to the appellants to collect the fees from a class of persons and for
carrying on particular activity in the city. .
17. The expression "Lease" under the Stamp Act has a wider
meaning as compared to its original meaning contained in Section 105 of
Transfer of Property Act (for short "the T.P. Act"). If "Lease" under
Section 2(16) of the Stamp Act includes therein four specified category
of documents set out in clauses (a) to (d), we do not find any such
inclusion in Section l 05 of the Transfer of Property Act. It is for this
reason, we are of the view that the definition of"Lease" for the purpose
of Stamp Act is extensive in nature. It is also clear from the use of the
expression "and includes also" in Section 2 (16) of the Stamp Act.
18. So by fiction, "any instrument by which tolfs of any
description are let" is considered as "Lease" for the purpose of payment
of stamp duty under the Stamp Act.
I 9. Justice G.P. Singh, the learned author in his book "Principles
of Statutory Interpretation" in 13th edition - at pages 179 and 180 has
dealt with this subject under the heading "Definition sections or
interpretation clause".
In its sub-heading (a) "Restrictive and
extensive definition", the author has explained as to where the words
"mean", "include", "includes", and "means and includes" arc used in
any definition clause in the Act then how such definition should be
interpreted. The following passage is apposite to quote.
"(a) Restrictive and extensive definitions
The Legislature has power to define a word even artificially.
So the definition of a word in the definition section may
either l>e restrictive of its ordinary meaning or it may l>e
extensive of the same. When a word is defined to 'mean'
such and such, the definition is prima facie restrictive and
NASIRUDDIN & ANR. ETC. v. THE STATE OF UTTAR
1081
PRADESH THR. SEC. & ORS. [ABHAY MANOHAR SAPRE, J.]
exhaustive; whereas, where the word defined is declared
A
to 'include' such and such, the definition is prima facie
extensive. When by an amending Act,_ the word 'includes'
was substituted for the word 'means' in a definition section,
it was held that the intention was to make it more
extensive. Further, a definition may be in the form of 'means
B
and includes', where again the definition is exhaustive, on ·
the other hand, if a word is defined 'to apply to and include',
the definition is understood as extensive. These meanings
of the expressions 'means', 'includes' and 'means and
includes' have been reiterated in Delhi Development
Authority vs. Bhola Nath Sharma, (2011) 2 SCC 54. The
C
use of word 'any' e.g. any building also connotes extension
for 'any' is a word of very wide meaning and prima facie the
use of it excludes limitation."
20. In our opinion, the aforesaid rule of interpretation applies while
interpreting the definition of Lease under Section 2( 16) of the Stamp
D
Act.
21. As mentioned above, the Corporation in these cases awarded
the contract to the appellants to recover the tolls (fees) from squatters,
vendors, kiosks etc. and for parking the vehicles in specified places.
The contract was, therefore, for recovery of tolls and created rights and
E
liabilities in favour of contracting parties qua each other. It cannot be
disputed that the expression "tolls of any description" in clause ( e) would
include all kinds of levy, charges, fees etc. which the Corporation is
entitled to charge under its Bye-laws ( 41 ). A fortiori, the fees in question
would also fall under Section 2(16)(c) of the Stamp Act.
22. In our opinion, the contract in question also satisfied the
definition of the expression "Instrument" as defined in Section 2(14) of
the Stamp Act because it created a right and liability and lastly, it also
satisfied the definition of expression "executed" and "execution" as
defined in Section 2 (12) of the Stamp Act because it contained the
F
signature of contracting parties.
G
23. Learned counsel for the appellants, however, placed reliance
on the decision of this Court
in New Bus-Stand Shop Owners
Association vs. Corooraton of Kozhikode & Anr. [2009 (10) SCC
455] and contended that in the light of the law laid down in the case of
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SUPREME COURT REPORTS
[2017) 12 S.C.R.
A
New Bus-stand Shop Owners Association (supra), the contract in
question has characteristics of a "license" but not of a "lease" and,
therefore, the contract would attract a stamp duty payable on a License
Deed under the Stamp Act.
24. In our view, the law laid down in the case of New Bus-stand
B
Shop Owners Association (supra) is not applicable to the case at hand
and is distinguishable on facts.
25. In the case of New Bus-stand Shop Owners Association
(supra), the Corporation ofKozhikode had let out their shops to several
persons and executed agreement in their favour. The question, however,
c arose as to the true nature of the agreement, whether it is a "license
agreement" or a "lease agreement". Their Lordships on construction
of the terms of agreement held that the agreement was a license and
accordingly chargeable to stamp duty as "License" under the Kerala
Stamp Act.
D
26. Such is not the case here. The case at hand relates to the
E
F
right to collect the tolls let by the Corporation to the person concerned.
It squarely attracts Section 2(16)(c) of the Stamp Act and partakes the
character of a "Lease".
27. In the light of foregoing discussion, we are of the considered
opinion that the contract in question is a "Lease" as defined in Section
2( 16)( c) of the Stamp Act and is accordingly chargeable to payment of
stamp duty as per the rates prescribed in Article 35 of Schedule I of the
Stamp Act as "Lease". The conclusion arrived at by the Single Judge
in Mohammad Ali vs. Board of Revenue, U.P. (supra) is, therefore,
correct which we support with our reasoning given supra.
28. In view of foregoing discussion, the appeals arc found to be
devoid of any merit. They are accordingly dismissed.
. Ankit Gyan
Appeals dismissed .