DIGAMBAR WARTY Vs. DISTRICT REGISTRAR BANGALORE

JUDGEMENT

(1.) In both these batch of writ appeals as common questions of law are involved, they are taken up for consideration together and disposed of by this common Judgment. For the purpose of convenience, the parties are referred to as they are referred to in the writ petition.

(2.) In W.P. No. 14231/2005 and other connected matters, the petitioners are all members of Sri Chitrapur Co-operative Housing Society Limited [for short hereinafter referred to as 'Society']. The Society was registered in the year 1980 under the provisions of the Karnataka Co-operative Societies Act, 1959. The Society is a tenant Co-partnership society. The Society took on long lease for 99 years, the land belonging to Chitrapur Mutt. After taking the lease, they built 96 flats. The lease-hold rights and the ownership of the building vests in the Society. Each tenant member is allotted apartment on the basis of holding distinctive shares and loan stock subscribed by the member. The members jointly hold the property through the Society during the lease period. The land together with the buildings will revert back to the lessor on expiry of the lease period. The Society has not executed any conveyance, instrument of transfer or lease deed in favour of its members. It has issued share certificates, loan stock certificates and possession certificates. Possession Certificates were issued to facilitate the members in the matter of filing IT return and other such benefits.

(3.) The revenue authorities i.e., the Chief Controlling Revenue Authority and the Commissioner of Stamps initiated proceedings against the petitioners under Sections 67 & 67-B of the Karnataka Stamp Act, 1957 ['Stamp Act' for short]. Show cause notice was issued alleging that possession certificates issued to the members enable them to enjoy possession of lands amounted to conveyance and as such attracted stamp duty under Section 20(2) of the Stamp Act. They were directed to show cause as to why the stamp duty should not be collected from them. The petitioners sent a reply to the show cause notices. Overruling their objections, the second respondent passed identical orders on different dates holding that possession certificates issued by the Society to its members attracted stamp duty under Section 20(2) of the Stamp Act and directed recovery of stamp duty as well as penalty from the petitioners. Further, a direction was issued to impound the xerox copies of the possession certificate produced by the members. Writ petitioners challenged the said orders in this Court.