Summary
The BOT road concession agreements were leases for stamp-duty purposes, and prior executive assurances did not defeat the subsequent legislative levy. However, the 2% duty applied only to expenditure attributable to the concessionaire under the agreement, excluding the State agency’s or another stakeholder’s contribution. The Court directed individual recalculation and appropriate refunds or payment of deficits.
Issues
- Whether BOT agreements granting toll-collection rights constituted leases liable to stamp duty.
- Whether the 2002 Madhya Pradesh rate amendment was invalid or barred by legitimate expectation or promissory estoppel based on earlier executive assurances.
- Whether duty could be assessed on the entire project cost rather than the concessionaire’s own expenditure.
Provisions considered
- Section 2(16), Indian Stamp Act, 1899The inclusive definition extends to instruments letting tolls, and covered the BOT concession agreements. (¶¶ 28, 29, 30)
- Section 105, Transfer of Property Act, 1882The contractual right, defined duration and consideration satisfied the requirements of a lease on the terms examined. (¶ 28)
- Schedule I-A, Article 33(C), proviso (c), Indian Stamp Act, 1899, as amended in Madhya Pradesh in 2002The proviso fixes duty at 2% of the amount likely to be spent under the agreement by the lessee, excluding sums attributable to the lessor or other stakeholders. (¶¶ 19, 31, 32, 33, 34)
Held
- The 2002 proviso concerned the rate and basis of duty, rather than redefining lease. It reduced the applicable rate to 2% of the lessee’s expenditure for the specified BOT transactions; the challenge to the amendment failed. (¶¶ 19, 27)
- As applied here, legitimate expectation afforded procedural fairness rather than an enforceable guarantee of the promised fiscal outcome. Executive assurances could not prevent the legislature from changing the law in the larger public interest. Promissory estoppel does not operate against the exercise of legislative power. (¶¶ 20, 21, 22, 23, 24, 25, 26, 27)
- The BOT concession agreements were leases on their terms. The Stamp Act’s definition is wider than Section 105 of the Transfer of Property Act and expressly includes an instrument letting tolls; the High Court’s classification disclosed no perversity. (¶¶ 28, 29, 30)
- The 2% levy is confined to the amount likely to be spent by the lessee under the agreement, not the whole project cost where the lessor or another stakeholder contributes. The precise concessionaire contribution must be determined individually rather than assumed to be exactly half. (¶¶ 31, 32, 33, 34)
- The Collector or Revenue Officer must recalculate and communicate each demand within two months. Excess deposits must be refunded within two months of determination, while any deficit must be paid within two months of the fresh demand. (¶ 34)
Result
Appeals partly allowed without costs. Lease classification and statutory levy upheld; demands based on the entire project cost set aside to that extent. Individual recalculation directed within two months, with refunds within two months of determination or deficit payments within two months of fresh demand.