State can’t charge stamp duty on registration of relinquishment deeds through which a family member gives up his share in a property for another family member, the Gujarat High Court (HC) has ruled.
The HC made this observation while setting aside two orders by revenue officials, demanding Rs 22.42 lakh from one Shreya Patel, who had given up her right in a family property in Gandhinagar in favour of her brother Shalin Patel in 2016 on a Rs 100 stamp paper. Rejecting the transaction, the sub-registrar demanded Rs 22.42 lakh as stamp duty on the transaction, based on the market value of the land.
Defending its logic, the state said: “In case of a self-acquired property when the person wants to transfer the said property in his lifetime, it is conveyance within the meaning of Section 2(G) of the Act and therefore Article 49 (b) is applicable and stamp duty is accordingly to be paid on the instrument which is a sale deed.” Gujarat charges 4.9% stamp duty on sale deed registrations.
“For a release, in law, it may be effected either for consideration or for no consideration. In either case, if a transaction operates as a relinquishment or a renunciation of a claim by one person against another, it is a release. It cannot be said to be a conveyance for consideration or other rights and therefore stamp duty has to be charged not in accordance with the reasoning given in the impugned order,” the HC while quashing the revenue order.
Recall here that registration of relinquishment deed is mandatory under the registration act. In July 2021, the Gujarat HC had also said that a relinquishment deed must be registered under the Registration Act to have legal validity. Without registration, the document cannot be treated as a relinquishment deed, it added.
