Legitimate expectation – Promissory estoppel – When not applicable – Transfer of Property Act, 1882 – Indian Stamp Act, 1899 – Indian Stamp (M.P.) Act, 2002 – High Court held that the Concession Agreement was a lease as defined u/s.105 of the TP Act as also u/s.2(16) of the IS Act and also rejected the challenge made by the appellants to the validity of the amendment made in proviso (c) to Clause (C) of Article 33 of Schedule 1(A) as amended by the Indian Stamp (M.P.) Act, 2002 – Correctness:
Held: Concession Agreement was a lease – Definition of lease as given under the IS Act covers any instrument by which tolls of any description are let and also u/s.105 of the TP Act, all the ingredients of a lease are fulfilled – No infirmity in the judgment of the High Court warranting any interference – Validity of the M.P. Act No.12 of 2002 inserting the proviso (c) to Clause(C) to Entry
33 of Schedule 1-A of the IS Act, upheld – It is only a statutory provision as to what would be the rate of stamp duty payable on lease deeds of a particular type – But for the insertion of the proviso which was challenged, the stamp duty payable on the lease would be 8% of the market value as provided to be charged on the conveyance under Entry-22 of Schedule 1-A – By inserting the proviso, the stamp duty chargeable on a lease under BOT Project for tolls/bridges, construction of roads etc. would be 2% of the amount spent by the lessee – In fact, insertion of this proviso reduced the rate of stamp duty to be charged to 2% instead of 8% and that too on the amount to be spent by the lessee – Principle of promissory estoppel cannot be invoked against the exercise of legislative power – A prior executive decision does not bar the State legislature from enacting a law or framing any policy contrary to or in conflict with the previous executive decision in furtherance of larger public interest – Law laid down by the legislature would not be hit by principle of promissory estoppel or legitimate expectation because earlier the executive expressed its view differently – If the previous executive decision is withdrawn, modified or amended in exercise of legislative power in larger public interest, then the earlier promise upon which the party acts, cannot be enforced as a right and neither can the authorities be estopped from withdrawing its promise, as such an expectation does not give any enforceable right to the party – Appellants did not have any enforceable legal right in light of the previous law or policy and executive action, which was subsequently changed by the state legislature in light of larger public interest Thus, principles of legitimate expectation and promissory estoppel are not applicable – Stamp duty would be chargeable @ 2% on the amount likely to be spent under the agreement by the lessee – Lessee had no liability to pay any stamp duty on the amount not spent by the lessee but by the lessor or any other stakeholder – The amount spent by the lessee as per the agreement generally was 50% of the total cost of the project – Once, the stamp duty was payable on the amount spent by the lessee, the demand raised on the whole amount would be unjustified – Demand set aside to that extent – Revenue Officer/Collector (Stamps) to re-calculate the same and raise the demand accordingly. [Paras 18, 19, 24, 25, 27, 28, 32, 34] Legitimate expectation – Promissory estoppel – Principles of – Discussed.
As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Divya Pandey. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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