MANTHAN CORPORATION Vs. STATE OF GUJARAT

JUDGEMENT

(1.) Learned AGP Mr.Meet Thakkar waives service of Rule on behalf of the respondents.

(2.) This petition under Article 226 of the Constitution of India is filed for setting aside orders dated 18.05.2012 and 13.04.2016 passed by respondent Nos.3 and 2 respectively. The issue pertains to payment of stamp duty on a document, which is a sale deed executed by the partners of a partnership firm in favour of the petitioner-partnership firm. The Department had come to conclusion that as only part of the land belonging to the partnership firm was conveyed under the sale deed by three out of four partners of the partnership firm to the petitioner, the sale deed itself is also a document of dissolution of partnership firm and therefore, under Article 44(3), considering such dissolution also to be a conveyance, additional stamp duty was ordered to be paid.

(3.) Learned Advocate for the petitioner submitted that the partnership was not dissolved on the date on which the document of sale was executed. It is submitted that out of the four partners, three partners had conveyed their shares in the land belonging to the partnership firm to the petitioner. Therefore, the partnership, which cannot be treated to be a separate entity than the partners, the document of sale deed cannot be construed to be a deed of dissolution. It is submitted that the impugned decision is based on audit objection and the said objection is based on Article 44(3) of the Bombay Stamp Act and which has been read in light of certain recitals in the deed of conveyance. It is submitted that the recitals in the conveyance deed only refer to notice of dissolution issued by a partner. However, there was no actual dissolution. Moreover, after the proceedings pursuant to audit objection, the petitioner had brought on record of the authorities that a suit also came to be filed for dissolution of partnership firm. However, such suit was thereafter disposed of and there was no dissolution of partnership firm. Moreover, the fourth partner has also conveyed his portion of share by a separate conveyance deed and that too after the order by the Civil Court. It is submitted that as a matter of fact, after the document of sale was executed, later on deed of dissolution has been executed and the authority, without taking this development into consideration, has passed the impugned order. 3.1 Learned Advocate for the petitioner relied upon judgment of Full Bench of this Court in case of Chief Controller Revenue Authority Vs. Chaturbhuj And Bachubhai Tribhovandas Thakkar, reported in 1976 GLR, 898, where, in identical set of circumstances, the Court has construed that dissolution between the partners is not deed or instrument of partition and therefore, not chargeable under Article 46 of the Bombay Stamp Act.