M/S. VTP HOMEE LANDMARK (LLP) THROUGH DESIGNATED PARTNERversusSTATE OF MAHARASHTRA THROUGH MINISTRY OF REVENUE AND ORS

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                      Shabnoor
                                 IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                         CIVIL APPELLATE JURISDICTION

                                      WRIT PETITION NO. 10120 OF 2019

                      M/S. VTP Homee Landmark (LLP)
SHABNOOR
AYUB                  Through Designated Partner                  … Petitioner
PATHAN                            V/s.
Digitally signed by
SHABNOOR AYUB
                      State of Maharashtra Through
PATHAN                Ministry of Revenue And Ors.                … Respondents
Date: 2026.08.28
12:08:09 +0530


                      Ms. Manjiri Parasnis, for the Petitioner.
                      Ms. Mamta S. Srivastava, AGP, for the State –
                      Respondent.


                                       CORAM                 : AMIT BORKAR, J.

                                       RESERVED ON           : AUGUST 24, 2026

                                       PRONOUNCED ON         : AUGUST 28, 2026

                      JUDGMENT:

                      1.    By filing the present Petition, the Petitioner challenges the
                      validity, legality and propriety of the Order dated 26 August 2019
                      passed by Respondent No. 2 in Appeal No. 42 of 2018. The
                      Petitioner challenges the Order dated 4 November 2015 passed by
                      Respondent No. 1 in Case No. JK/SJL/PS/MLP/ S-9/PR /No.
                      08_13/Instrument No.3986_13 /1784 /2016.

                      2.    The facts which have led to the filing of the present Petition
                      are as follows. The dispute relates to land bearing Survey
                      No.10/3A, admeasuring 0 H 89.5 R, that is, about 8,950 sq.
                      metres, and land bearing Survey No.26/2/1+2/3, admeasuring 0




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H 3.7174 R, that is, about 392 sq. metres. Both the properties are
situated at Village Kharadi, Taluka Haveli, District Pune. On 2
November 2012, Articles of Agreement were executed in favour of
VTP Home Landmark and Girdhar Creations in respect of the
above properties. Under the said Agreement, the parties agreed to
share the revenue in the ratio of 50% : 50% in respect of the
residential area. In respect of the commercial area, the agreed
ratio was 55% : 45%. Subsequently, on 16 January 2017, a
Supplementary Agreement was executed. By this Supplementary
Agreement, the earlier arrangement was changed, and it was
agreed that the revenue sharing would be only in respect of the
residential area.

3.    On 9 November 2015, Respondent No. 3 issued a notice to
the Petitioner demanding balance stamp duty of Rs.43,84,100/-.
The Petitioner, by its letter dated 3 December 2015, disputed this
demand. The Petitioner stated that it did not accept the amount of
stamp duty demanded from it. Thereafter, another notice was
issued on 1 May 2016. The Petitioner submitted its reply in Appeal
No.42 of 2018 on 3 July 2018.

4.    The Petitioner thereafter approached this Court by filing Writ
Petition No. (ST) 18484 of 2018. In that Petition, this Court
directed that the matter be decided within a period of six weeks.
Respondent No. 1, by the impugned Order dated 4 November
2015, valued the property at Rs.15,51,41,600/- by applying Clause
5(g-a) of Schedule I. Stamp duty at the rate of 5% was accordingly
calculated at Rs.77,57,100/-. On that basis, a deficit of
Rs.43,84,100/- was held to be payable by the Petitioner. Apart



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from this amount, penalty at the rate of 2% was imposed.The
Petitioner was aggrieved by this determination of stamp duty and
therefore filed Appeal No.42 of 2018 before Respondent No. 2.
Respondent No. 2 thereafter passed the impugned Order dated 26
August 2019. The Petitioner has challenged the said Order, along
with the earlier Order dated 4 November 2015, by filing the
present Petition.

5.    Ms. Parasnis, learned Advocate for the Petitioner, submits
that the Respondent Authorities have wrongly applied Article 5(g)
(a) of Schedule I while calculating the stamp duty payable on the
instrument. According to the learned Advocate, in respect of
Survey No.10/3A, admeasuring 8,950 sq. metres, the calculation
made under Article 5(g)(a) is in different slabs. For the first 0 to
500 sq. metres, 100% of the Government rate of Rs.8,970/- has
been taken, resulting in a valuation of Rs.44,85,000/-. For the area
from 501 to 2,000 sq. metres, 90% of the Government rate of
Rs.8,970/-   has    been   taken,       resulting   in   a     valuation        of
Rs.1,21,09,500/-. For the area from 2,001 to 4,000 sq. metres,
80% of the Government rate of Rs.7,149/- has been taken,
resulting in a valuation of Rs.1,43,52,000/-. For the area from
4,001 to 10,000 sq. metres, 70% of the Government rate of
Rs.6,279/-   has    been   taken,       resulting   in   a     valuation        of
Rs.3,10,81,050/-. Thus, according to the Petitioner, the total
valuation of Survey No.10/3A comes to Rs.6,20,27,550/-.

6.    In respect of Survey No.26/2/1+2/3, admeasuring 371.74
sq. metres, the Government rate for open land is Rs.14,600/- per
sq. metre. On that basis, the valuation is calculated as 371.74 ×



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Rs.14,600/-, which comes to Rs.54,27,404/-. Therefore, according
to the Petitioner, the total valuation of both the lands is
Rs.6,74,54,954/-. The learned Advocate for the Petitioner submits
that under Article 47 relating to Partnership, the words “Joint
Venture” were introduced by amendment with effect from
24.04.2015. According to the Petitioner, before this amendment,
an instrument of this nature could not have been treated as an
instrument falling under Article 5(g-a). It is submitted that under
Article 25, the valuation has to be made in the same manner as in
the case of a Conveyance. The Petitioner relies upon Article 5(h)
(b), under which an instrument for which no specific provision is
made in Schedule I was chargeable with stamp duty of Rs.100/-.
Therefore, according to the learned Advocate, Respondent Nos. 2
and 3 were required to give proper reasons for treating the
instrument as one falling under Article 5(g-a). According to the
Petitioner, such reasons have not been properly given. The learned
Advocate for the Petitioner submits that, while calculating the land
cost and the revenue sharing, the impugned Orders have taken the
total valuation of both the lands at Rs.6,74,54,954/-. However, the
stamp duty has been calculated at 5% on a valuation of
Rs.15,51,41,600/-, resulting in stamp duty of Rs.77,57,100/- and
an alleged deficit of Rs.43,84,100/-.

7.    It is submitted that the consideration determined in the
impugned Order is baseless, without proper authority, hypothetical
and illogical. According to the learned Advocate, the consideration
payable under the instrument cannot be worked out on the basis of
an imaginary future calculation. The future revenue sharing



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cannot be treated as the present consideration for the purpose of
determining stamp duty. It is therefore submitted that the market
value should be determined on the basis of the land cost existing
on the date of the instrument. The value of construction which
may take place in future cannot, according to the Petitioner, be
taken into account for calculating the stamp duty. It is submitted
that the Authorities have wrongly calculated the share of the
Petitioner by notionally dividing the land according to the profit-
sharing ratio and thereafter multiplying such share by the new rate
of purchase of flats. According to the learned Advocate, there is no
basis for assuming that the same percentage of flats would be sold
in the market as the share of the Petitioner. Such an assumption,
according to the Petitioner, is only hypothetical and cannot form
the basis for determining stamp duty.

8.   The learned Advocate for the Petitioner submits that several
factors which would affect the actual market value of the property
have not been considered. According to the Petitioner, the Ready
Reckoner is only a reference for arriving at a tentative market
value of property in a particular area. It is only a guiding factor
and cannot by determine the actual market value in every case. It
is submitted that the property was landlocked and was the subject
matter of a dispute. A suit and appeal concerning the property
were pending at the relevant time. According to the learned
Advocate, these circumstances had a direct bearing on the market
value of the property, but they were not properly considered while
determining the value.The learned Advocate for the Petitioner
raises a question regarding the powers of the CAG. It is submitted



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that the powers of the CAG are limited by the Constitution in
relation to the affairs of the Union and the States. According to the
learned Advocate a question arises as to whether the CAG could
examine the correctness or otherwise of an order passed by an
authority constituted under the Maharashtra Stamp Act for
determining the stamp duty. It is submitted that the CAG has no
authority to determine or decide the correctness of the
computation of stamp duty. According to the Petitioner, the
determination of stamp duty is required to be made by the
competent authority in accordance with the provisions of the
Maharashtra Stamp Act.

9.    The learned Advocate for the Petitioner submits that, as
stated at Page No. 6, the Petitioner had already paid stamp duty of
Rs.33,73,000/- and registration fees of Rs.30,000/-. It is submitted
that, according to the Order dated 4 November 2015, at Page No.
176, the Authorities valued Survey No.10 at Rs.6,35,97,300/- and
Survey No.26 at Rs.6,93,20,500/-. The total consideration was
therefore taken at Rs.13,70,31,000/-. On that amount, stamp duty
at 5% was calculated at Rs.68,51,550/-, leaving a balance stamp
duty of Rs.34,78,550/- after giving credit for the amount already
paid. It is submitted that, as recorded at Page No.178 under the
heading “50:50%”, the Authorities subsequently calculated the
total market value and consideration at Rs.15,51,41,600/-. On this
amount, stamp duty at 5% was calculated at Rs.77,57,100/-. After
giving credit for the stamp duty already paid, the balance amount
was determined at Rs.43,84,100/-.




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10.   Per contra, Ms. Srivasatva, learned AGP appearing for the
Respondents, submits that the instrument which is the subject
matter of the present Petition is a Development Agreement
concerning land admeasuring 9,592 sq. metres, bearing Survey
Nos.10 and 26 at Kharadi, Pune. The Agreement was executed on
2 November 2012. Clause 5.1 of the Agreement provides for
collective revenue sharing between the parties. According to the
learned AGP, this clause was required to be taken into account
while determining the stamp duty payable on the instrument. It is
submitted that the Petitioner did not submit the instrument to the
Collector of Stamps for adjudication of stamp duty. It is submitted
that, when the instrument was presented for registration, the
fourth Respondent valued the market value of the immovable
property at Rs.6,74,55,100/-. On that basis, the Petitioner paid
stamp duty of Rs.33,73,000/-. The learned Advocate for the
Respondents submits that, during the normal inspection of
registered instruments, the Audit General noticed that, in several
cases including the case of the Petitioner, the stamp duty had been
determined without taking into account the clause relating to
revenue sharing. According to the Respondents, this resulted in
short payment of stamp duty and corresponding loss to the public
exchequer. Therefore, directions were issued to the concerned
Authorities to take corrective steps and recover the amount found
to be payable.

11.   The learned Advocate for the Respondents submits that the
Petitioner has argued that the gross sale proceeds could not be
determined on the date of execution or registration of the



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Development Agreement because the revenue sharing and the
gross sale proceeds would depend upon the future market value of
the property. It is submitted that the future market value could not
be known on the date of registration. According to the
Respondents,       this   argument       is    “totally   misplaced       and
misconceived”. It is submitted that stamp duty can be calculated
on the basis of the consideration which would become receivable
in future. According to the Respondents, for this purpose, the rates
of flats prevailing on the date of execution of the instrument can
be taken into account. It is submitted that there is no requirement
to   apply   any     deferment   factor       for   reducing   the     future
consideration to its present value. The learned Advocate for the
Respondents submits that, according to the accepted principles of
valuation, the present value of consideration which is to be
received in future should ordinarily be determined by taking into
account the average period of the project and applying the
appropriate deferment factor. This factor is to be considered
having regard to the interest rates prevailing at the relevant time.
It is submitted that the Collector of Stamps, in the present case,
applied a deferment factor of 0.85. On that basis, the Collector
determined the present value of the consideration which the
Petitioner was to receive in the form of its agreed percentage of
revenue. The calculation was made by taking the rates of flats
prevailing on the date on which the instrument was executed.
According to the Respondents, the calculation was therefore not
based upon the future rates of flats, which could in fact be higher.




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12.    The learned AGP placed reliance on the judgment of this
Court in Kolte Patil Developers Ltd. v. Chief Controller (Revenue
Authority) and Inspector General of Registration and Controller of
Stamp & Ors., Writ Petition No.10675 of 2019, decided on 11
November 2024. According to the learned AGP, the said judgment
supports the stand taken by the Respondents in the present matter.

13.    The learned Advocate for the Petitioner distinguished the
judgment in Kolte Patil Developers Ltd.. It is submitted that the
facts of the said case are different from those of the present case.
According to the learned Advocate, in Kolte Patil Developers Ltd.,
the Petitioner was the developer of the property. In the present
case the Petitioner is the owner of the land in question and is not
the developer. It is therefore submitted that the ratio of the said
judgment cannot be directly applied to the present case without
considering this material difference in the nature and role of the
parties.

Reasons and Analysis:

14.    I    have   considered   the       Petition,   the   submissions        of
Ms.Parasnis, learned Advocate for the Petitioner, and the
submissions of Ms. Srivasatva, learned AGP for the Respondents. I
have       considered   the   impugned        orders,   the    Development
Agreement dated 2 November 2012 and the judgment of this Court
in Kolte Patil Developers Ltd. The relevant clauses of the
Development Agreement are required to be considered. The matter
has to be examined from the document as it is written and from
the provisions of the Maharashtra Stamp Act, 1958.




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15.   At the first stage, it is necessary to find out the real nature of
the document executed between the parties. The Petitioner says
that it is the owner of the property and is not the developer. To this
limited extent, the submission is correct because the Petitioner is
the First Party and is the owner of the land. But merely because
the Petitioner is the owner, it cannot be said that Article 5(g-a)(i)
will not apply. The provision does not say that the person who
presents the document must himself be the developer. It applies to
an instrument "if relating to giving authority or power to a
promoter or a developer, by whatever name called, for
construction on, development of or, sale or transfer (in any manner
whatsoever) of, any immovable property." Therefore, the question
is whether under the document any such authority or power has
been given to the developer.

16.   On reading the Development Agreement as a whole, the
position is reasonably clear. The document describes the Second
Party as a "Promoter / Builder" having experience in development
and marketing of immovable properties. It is stated that the parties
wanted to develop the property by constructing multistoried
buildings containing flats, units and commercial premises and by
selling such premises. The document shows that the First Party was
to attend to matters relating to title, whereas the Second Party was
to undertake the construction and development work. The
document does not stop with saying that the parties would
cooperate at some future stage. Under the implementation clause,
the parties agreed to develop the property and its full potential by
construction of buildings and sale or alienation of flats, units and



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commercial premises to prospective purchasers. The Second Party
was permitted to enter upon the property and to implement and
construct the Project. This right was to continue during the Project
and until its completion and sale. Thus, the document gives actual
rights to the Second Party. The Second Party could enter upon the
property, develop it, construct the buildings, market the Project
and sell the units. It was required to take decisions relating to the
Project, arrange funds, obtain permissions and approvals, construct
the residential and commercial project and meet the development
expenses from its own funds and from the amounts available
under the agreed revenue arrangement. The other clauses show
the extent of authority given to the Second Party. The Second Party
was entitled to market the Project and was responsible for sale of
the units. The First Party was required to execute a Power of
Attorney in favour of the Second Party so that the Second Party
and its nominees could carry out the acts connected with the
development. The agreements for sale were to be executed
through the Second Party, subject to the confirmation mechanism
agreed between the parties. Therefore, only because the Petitioner
is the owner and is not the developer, Article 5(g-a)(i) cannot be
said to be inapplicable. The provision covers an instrument by
which authority or power is given to a promoter or developer for
construction, development, sale or transfer of immovable property.
In the present case, the owner has given such authority to the
Second Party. Therefore, the distinction made by the learned
Advocate for the Petitioner does not take the document outside
Article 5(g-a)(i).




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17.   The next question is regarding the consideration under the
Development Agreement. Here, the document gives the answer.
Clause 5.1 states that, "as consideration for jointly developing the
said Property", the parties agreed to share the "Gross Sale
Proceeds" received from sale of units and saleable or allotted areas.
In respect of residential units, the First Party was to receive 45%
and the Second Party 55%. In respect of commercial units, the
share was 50% each. Clause 5.2 shows that this revenue sharing
was intended to compensate the parties for their respective
contribution and expenses. This clause is important for the present
purpose. The parties have described the revenue sharing as
consideration for the arrangement. Therefore, merely because no
fixed amount was payable on the date of execution, it cannot be
said that there was no consideration. The consideration was
agreed in another form. It was linked with the Gross Sale Proceeds
and was to become payable as the Project progressed, and the
units were sold. The same arrangement can be seen from the
financial clauses. The Gross Sale Proceeds are the amounts
received from sale of units and other premises in the buildings to
be constructed on the property, including the property component
of the First Party. The parties agreed that these Gross Sale Proceeds
would be deposited in the collection account. From that amount,
the agreed 45% residential share and the agreed commercial share
were to be paid to the First Party, while the remaining amount was
to go to the Second Party. The monthly statement clause makes the
position clear. The Second Party was required to maintain the
account of the Gross Sale Proceeds and give the First Party




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statements showing the sales of flats, units and premises and the
amounts received from purchasers. Thereafter, the agreed
percentages were to be transferred to the respective accounts.
Therefore, the revenue sharing cannot be treated as some
uncertain or accidental term. It forms an important part of the
financial arrangement between the parties.

18.   I have considered that the parties have used the words that
they were acting on a "Principal to Principal" basis and that they
did not intend to create a partnership or Association of Persons.
Clause 12.3 says that the agreement is not an agreement to share
profits or losses. These clauses may have relevance if the question
is whether the parties have created a partnership or joint venture.
But that is not the question of which is required to be decided
here. The question for stamp duty is whether development rights
have been given and what consideration is recorded in the
document for valuation. The description used by the parties cannot
change the actual rights and obligations which are created by the
document.

19.   The Petitioner has submitted that under Article 47 the words
"Joint Venture" were introduced only from 24 April 2015 and
therefore an agreement executed in 2012 could not be considered
under the provisions relating to a Joint Venture. This submission
does not take the Petitioner's case because the impugned
determination is based on Article 5(g-a)(i). That provision
concerns an agreement giving authority or power to a promoter or
developer for construction, development, sale or transfer of
immovable property. Therefore, it was not necessary for the



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Authority to treat the document as a partnership deed only
because there was revenue sharing between the parties. The
description given by the Authority to the transaction as a Joint
Venture or revenue sharing arrangement cannot be treated as the
foundation of the order. What is required to be seen is the
substance of the Development Agreement. The document gives
development rights to the Second Party. It places the responsibility
of construction and sale upon the Second Party. It gives the First
Party a specified percentage of the Gross Sale Proceeds. These
terms are sufficient to consider the document under Article 5(g-a)
(i).

20.    The judgment in Kolte Patil Developers Ltd. is therefore
relevant on the question of revenue sharing. In paragraph 12, the
Court considered whether revenue sharing of gross sale proceeds
between    the   owner   and    developer   could    be    treated      as
consideration for determining market value. In paragraph 22, after
considering the agreement as a whole, the Court held that
monetary consideration can be in the form of revenue sharing and
that such consideration can be deferred until the constructed units
are sold. The learned Advocate for the Petitioner sought to
distinguish Kolte Patil by pointing out that in that case the
petitioner was the developer, whereas in the present case the
Petitioner is the owner. This distinction is factually correct. But it
does not change the principle laid down in that judgment. The
principle does not depend upon whether the person challenging
the stamp duty is the owner or the developer. Where development
rights are given and the owner's return is agreed as a percentage of



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gross sale proceeds, such revenue sharing can constitute
consideration under Section 2(na). In the present case, the owner
is entitled to 45% of residential Gross Sale Proceeds and 50% of
commercial Gross Sale Proceeds. Therefore, the different position
of the Petitioner does not make the principle inapplicable.

21.   There is another reason why this distinction cannot be
accepted. In Kolte Patil, the Court considered an agreement under
which development rights were given to the developer and the
consideration was in the form of revenue sharing. Here, the First
Party has given development rights to the Second Party. The
Second Party is described as a "Promoter / Builder" and is given
responsibility for development, construction, marketing and sale.
Therefore, the important feature of both transactions is similar,
though the party challenging the assessment in the present matter
is the owner.

22.   The Petitioner has argued that future Gross Sale Proceeds
cannot be treated as present consideration because the price at
which the flats may ultimately be sold is not known. This
submission cannot be accepted. The decision in Kolte Patil has
considered this question. In paragraph 23, the Court held that
where consideration is by revenue sharing, it can be computed as
on the date of execution by taking into account the available FSI
and the ASR applicable to the land and constructed tenements.
The reason for this is clear. Stamp duty has to be considered with
reference to the date of the instrument. The Authority is not
required to wait until the Project is completed, and actual flats are
sold. What has to be seen is what consideration was agreed under



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the document and thereafter its value has to be determined
according to the statutory provisions. The fact that the actual sale
price in future may be uncertain does not remove the agreed
percentage of sale proceeds from the document.

23.   The Petitioner has pointed out that various things may
change in the future Project. Construction may not be completed
in the same manner. Market rates may change. The actual sale
price of the units may be different. These submissions may have
some factual basis because future events cannot be known exactly.
But the law does not require the future to be known with
exactness. The consideration has to be computed according to the
statutory method as on the date of the instrument. In paragraph
25 of Kolte Patil, this Court has considered such future uncertainty
and held that the consideration has to be computed as on the date
of the instrument.

24.   The Petitioner has submitted that such calculation would
amount to taxing future profits. This submission cannot be
accepted. The amount is not being taken as income tax or as tax
on future profits. It is being considered only for determining the
market value on which stamp duty is payable. Paragraph 26 of
Kolte Patil deals with this submission and holds that computation
of consideration for determining market value does not amount to
taxing profits. The same reasoning applies in the present matter.

25.   The argument regarding double stamp duty does not make
the assessment invalid. The Development Agreement and the
subsequent sale of a completed unit are separate instruments and




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concern different stages of the transaction. Merely because the
subsequent sale may attract stamp duty, it does not mean that the
development rights given under the earlier document become free
from stamp duty. Paragraph 27 of Kolte Patil deals with this aspect
and rejects such an argument.

26.   The Petitioner has relied upon the Ready Reckoner value of
the land, which according to the Petitioner was about Rs.6.74
crore, and has pointed out that stamp duty of Rs.33,73,000/- was
already paid on that basis. There is no dispute regarding this
payment. But that payment alone cannot conclude the matter
when the consideration mentioned in the Development Agreement
is required to be considered. Section 2(na), as considered in
paragraph 15 of Kolte Patil, requires consideration of the price
which the property would have fetched in the open market on the
date of execution and the consideration stated in the instrument.
The higher of the two is then required to be taken as the market
value. Therefore, the submission that the Ready Reckoner is only a
guiding factor is not incorrect. It is a reference for determining
market value. But this does not mean that the consideration
expressly agreed between the parties can be ignored. If the agreed
consideration is higher, it has to be taken into consideration while
determining the market value.

27.   The Petitioner has relied upon the fact that the Development
Agreement does not mention the exact residential and commercial
construction area. This submission requires some consideration
because valuation should have a proper basis and should not be
based only on an assumed figure. But merely because the exact



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constructed area is not separately mentioned, the agreed
percentage of revenue sharing does not disappear. The document
provides for construction of flats, units and commercial premises.
The First Party had agreed to make available additional F.A.R., to
the extent permissible, and the Second Party was to use such
additional F.A.R. in the development. Thus, the development
potential of the land was part of the arrangement.

28.   The more important question is whether the Authority, while
making the calculation, adopted a reasonable basis for converting
the revenue sharing into present valuation. The impugned order
records the valuation at Rs.15,51,41,600/- after considering the
land valuation and the applicable residential and commercial
rates. The calculation is given in the impugned order. It is not
based on an actual future sale price. It is based on the land area,
ASR rates, available development potential and the percentages
agreed under the Development Agreement. The Respondents have
relied upon the deferment factor. Their case is that future
consideration has to be brought to its present value and that the
Collector applied a deferment factor of 0.85. This does not change
the basic issue. The main question is whether revenue sharing can
be treated as consideration. The answer is in the affirmative. Once
this is decided, the exact mathematical application of the
deferment factor is mainly a question of valuation method.

29.   On the material before me, I do not find that the valuation
method adopted by the Authority is so arbitrary that it has no
connection with the Development Agreement. The Authority has
proceeded on the percentages agreed between the parties and on



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the rates applicable to the land and proposed use. The available
development potential has been considered. Therefore, the figure
cannot be said to be an imaginary figure having no relation to the
document.

30.   The Petitioner has pointed out that the property was
landlocked and was involved in litigation. These matters may, in
an appropriate case, have some effect upon the actual market
value. But from the material presently available, it cannot be said
that the valuation becomes invalid merely because these factors
were not separately calculated. The Development Agreement
describes the property as being in possession of the First Party and
proceeds on the basis that development rights could be exercised.
The First Party gave various assurances regarding title and
development rights to the Second Party. Therefore, the material on
record does not show that the property had no effective
development potential.

31.   The submission regarding the powers of the Accountant
General or CAG does not provide a ground for setting aside the
impugned order. An audit objection by does not determine the
stamp duty payable. The final determination was made by the
competent stamp authority. The objection of the Accountant
General only brought the alleged short payment to the notice of
the concerned department. Thereafter, the Collector of Stamps
considered the document, the valuation and the applicable
provision and passed the order. Therefore, even if it is assumed
that the Accountant General could not himself determine the
stamp duty, that does not take away the jurisdiction of the



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Collector to examine the matter and determine the stamp duty.

32.   The Petitioner has submitted that Respondent Nos. 2 and 3
have not given sufficient reasons for treating the document as
falling under Article 5(g-a). This submission has to be considered
from the impugned order. The order refers to the Development
Agreement, the nature of the transaction, the development rights,
the revenue sharing clause and the valuation made by the
Assistant Town Planner. It records that the arrangement involves
Joint Venture or revenue sharing and thereafter applies Article 5(g-
a)(i). Therefore, in my view, the order contains the basic reasons
from which it can be understood why Article 5(g-a)(i) was applied.

33.   Merely because the Authority has used the expression "Joint
Venture", the order does not become defective. Even according to
the Petitioner's own case, the parties were not creating a
partnership in the technical sense. Clauses 3.1 and 3.2 state that
the parties were working on a principal to principal basis and did
not intend to create a partnership or association of persons.
Therefore, the proper way is to see the actual rights and
obligations under the document and not to decide the stamp duty
only from the name or label given to the transaction.

34.   There is one aspect on which a clear finding is necessary. The
Development Agreement does not merely say that the parties may
share some profit if the Project succeeds. Clause 5.1 states that the
Gross Sale Proceeds are shared "as consideration". The Second
Party is separately required to provide the entire capital and efforts
necessary for implementing the Project at its own cost and




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responsibility. The First Party contributes the land and title. The
Second   Party   contributes   capital,   development    experience,
construction and marketing. Therefore, the agreed percentages of
revenue are the agreed return for their respective contributions.
The revenue sharing is an important part of the consideration.

35.   It cannot be ignored that the Second Party was given the
necessary control for developing and selling the Project. It was
responsible for marketing, sales, construction and obtaining
approvals. The First Party was required to execute a Power of
Attorney so that these activities could be carried out. These
provisions clearly show that authority was given to the developer
for development and sale of the immovable property.

36.   The principle laid down in Kolte Patil is not defeated by the
wording of the present Development Agreement. Some clauses of
the present agreement make the nature of the arrangement clear.
The Second Party is described as a "Promoter / Builder". It has to
bear the construction expenditure. It is responsible for marketing
and sales. The Gross Sale Proceeds are to be collected and divided
in fixed percentages. The First Party is to receive its agreed share
as consideration for its land contribution and rights. The
Petitioner's argument that only the existing land value could be
considered and that future construction could not be taken into
account therefore cannot be accepted. The reason is that the
agreed consideration is connected with the sale of the units which
are to be constructed. The valuation cannot be completely
separated from the source from which that consideration is to
come. Paragraph 23 of Kolte Patil recognises this position and



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holds that available FSI and ASR of land and constructed
tenements can be considered for computing such deferred revenue
sharing.

37.   I find that the Petitioner's reliance on the later amendment
or later valuation guidelines does not change the result. The stamp
liability comes from the Maharashtra Stamp Act. If detailed
guidelines regarding revenue sharing were introduced later, that
by does not mean that consideration clearly mentioned in an
earlier instrument ceases to be consideration. Paragraph 24 of
Kolte Patil considered the absence of a detailed revenue sharing
guideline and held that the statutory definition of market value
continues to apply.

38.   The principle that a taxing statute has to be strictly
construed does not take the Petitioner. In paragraph 28 of Kolte
Patil, while referring to Shanti Bhushan, this Court has recorded
that the Stamp Act is a taxing statute and has to be understood
according to the natural meaning of the words used in it. Nothing
can be added to the language of the statute. But in the present
case, the words of Article 5(g-a)(i) are clear. The document gives
authority to a developer for construction, development and sale of
immovable property. Therefore, the provision applies on its plain
meaning.

39.   The reliance upon the decision in Prabha Laxman Ghate does
not help the Petitioner. Kolte Patil, in paragraph 31, has already
distinguished that decision because it was decided before Article
5(g-a) was introduced in Schedule I. Therefore, the position




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applicable after insertion of Article 5(g-a) has to be considered in
the present matter.

40.   On considering the entire matter, I find that the Petitioner's
challenge has some substance only to the extent that the Petitioner
is the owner and not the developer and that the Development
Agreement contains clauses saying that the parties are acting
independently and are not partners. But these facts do not change
the real nature of the transaction for stamp duty. The owner has
given development authority to the developer. The developer has
undertaken construction, development and sale. The owner's
consideration is an agreed percentage of the Gross Sale Proceeds.

41.   The final conclusion therefore follows from the Development
Agreement. Article 5(g-a)(i) applies because the instrument relates
to giving authority or power to a promoter or developer for
construction on, development of and sale or transfer of immovable
property. The consideration is not confined to the refundable
security deposit of Rs.4.20 crore. The security deposit is described
as refundable, whereas the revenue sharing is stated to be
consideration. Therefore, the Development Agreement contains
deferred consideration in the form of the agreed share of Gross
Sale Proceeds. The stamp authority was entitled to take this
consideration into account while determining the market value.

42.   The Petitioner cannot succeed merely because the final sale
price was not known on 2 November 2012. The statute requires
the market value to be determined as on the date of the
instrument. Therefore, the Authority was required to compute the




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consideration as on that date by considering the development
potential and applicable rates. This is the approach approved in
paragraph 32 of Kolte Patil, where the Court held that the owner's
share of Gross Sale Proceeds is consideration and that it is to be
computed on the date of execution by considering the available
FSI and ASR. At the same time, the finding and the exact
mathematical calculation have to be kept separately. The power to
determine market value does not permit the Authority to take any
figure without proper basis. In the present case the impugned
order shows the land areas, applicable rates, residential and
commercial components and the resulting valuation. The figure of
Rs.15,51,41,600/- therefore has a visible basis in the valuation
exercise. There is no sufficient material before me to hold that this
figure is arbitrary or has no support from the record.

43.    Therefore, the demand of deficit stamp duty cannot be
interfered with merely because the Petitioner wants the valuation
to be made only on the land component. The determination made
by the Authority is based on a permissible approach and is
consistent with the principle laid down by this Court in Kolte Patil
Developers Ltd., particularly paragraphs 22 to 25 and paragraph
32. The fact that the Petitioner is the landowner does not make
that principle inapplicable.

44.    I therefore hold that the Development Agreement dated 2
November 2012 was correctly treated as an instrument falling
under Article 5(g-a)(i) of Schedule I to the Maharashtra Stamp
Act,   1958.   The   revenue    sharing   arrangement      constitutes
consideration for the development rights given under the



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document. For determining the market value, the agreed share of
the Gross Sale Proceeds could be computed as on the date of
execution by considering the development potential, applicable
ASR and the rates of the constructed tenements. The Respondent
Authorities were therefore justified in taking the higher valuation
resulting from such consideration. The finding of deficit stamps
duty of Rs.43,84,100/- therefore does not require interference.

45.     For these reasons, the challenge to the orders dated 4
November 2015 and 26 August 2019 fails. The Petition is
dismissed. The interim relief, if any, stands vacated. The
Respondents shall be entitled to recover the deficit stamp duty of
Rs.43,84,100/- together with such statutory penalty or other
amount as may be payable under the Maharashtra Stamp Act,
1958.

46.     In view of the foregoing discussion and for the reasons
recorded hereinabove, the following order is passed:

        i.     The Writ Petition is dismissed.

        ii.    The impugned Order dated 4 November 2015 passed
        by Respondent No.1 in Case No. JK/SJL/PS/MLP/S-9/PR
        /No.08_13/ Instrument No.3986_13/1784/2016 and the
        impugned     Order    dated    26   August    2019    passed      by
        Respondent No.2 in Appeal No.42 of 2018 are upheld.

        iii.   Rule is discharged.

        iv.    There shall be no order as to costs.


                                                 (AMIT BORKAR, J.)



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