1. VERDICT:
(i) The writ petition stands accepted.
(ii) The Court found that the impugned notices are liable to be declared as anomalous and unlawful.
2. FOREW ORD: The captioned writ petition has been addressed under Article 44 of the Azad Jammu and Kashmir Interim Constitution, 1974, whereby following relief is prayed for:
(i) Declaring the entire proceedings taken by the respondents including audit objection as contained in para 11(ii) of the audit objections, notices dated 24.07.2020, 18.08.2020, 10.11.2020 (wrongly dated as 10.11.2019) and undated notice (annexure-PJ) demanding from the petitioner deposit of the amount of alleged stamp duty alongwith recovery charges by 28.12.2020 as without lawful authority and of no legal effect;
(ii) Restraining the respondents from making demand from or issuing any process against the petitioner any amount as stamp duty regarding the plot (No. 4-A Lower Chatter Housing Scheme Muzaffarabad) for which decree of possession through pre-emption has been passed by the learned District Judge Muzaffarabad on 14.12.2016."
3. STANCE OF PETITIONER.
4. The learned counsel for the petitioner reiterated the grounds already taken in the writ petition by contended that Plot No. 4-A situated in Lower Chatter Housing Scheme Muzaffarabad was sold by Rashid Hussain Awan S/o Manzoor Hussain Awan through an agreement dated 18.07.2012 to M/s. Jamil Ahmed Malik and Aftab Ahmed Malik against the consideration amount of Rs. 85,00,000/-. It was contended that Plot No. 5-A owned by the petitioner is situated adjacent to Plot No. 4-A, hence the petitioner filed a suit for possession on the basis of right of prior purchase and pre-empted sale dated 18.07.2012 before District Judge Muzaffarabad. The learned advocate stated that the parties entered into a compromise and a compromise decree for possession on the basis of right of prior purchase was passed in favour of petitioner on payment of Rs. 1,00,30,000/-on 14.12.2016. It was claimed that the petitioner produced said decree before the Deputy Commissioner/Chairman Allotment Committee Housing Scheme Lower Chatter Muzaffarabad and the entries were changed accordingly but after a lapse of more than 3 years and 8 months, Respondent No. 6 issued a notice to the petitioner on 24.07.2020 by claiming a sum of Rs. 3,00,900/-as stamp duty on the basis of an audit objection raised by the Audit Department of Azad Jammu & Kashmir. The petitioner filed objections on the said notice before Respondent No. 6 on 03.09.2020 and claimed that stamp duty is not payable on a decree for possession obtained through pre-emption but the objections of the petitioner were turned down and Respondent No. 5 has ordered the recovery of the said amount as being the arrears of land revenue. As per the main stance of the petitioner, the plot in question has been transferred to him as an outcome of de1cree for possession on the basis of right of prior purchase, hence he stepped into the shoes of vendee, so no stamp duty was leviable. He further pressed into service that the Stamp Act 2014 was enforced on 25.06.2014, whereas the plot in question was transferred to vendee in the year 2012, thus on this ground too, the stamp duty was not liable to be paid by the petitioner. The learned advocate also vehemently contended that the impugned notice is coram non judice because the Deputy Commissioner has never been designated as Chairman of the Allotment Committee by any law, rule or regulation. He also asserted that the proper course for the respondents was to refer the matter to the Public Accounts Committee and if the PAC endorsed the audit objections then notice for recovery can be issued. He placed his reliance on following case law:
1. PLD 1967 Pesh.76;
2. 1992 CLC 2433; PLD 1967 Pesh.76;
3. PLD 2002 SC 263.
5. REFUTATION OF RESPONDENTS.
6. The learned counsel for the respondents strenuously argued that after the decree for possession on the basis of pre-emption the plot has been transferred to the petitioner vide Musna (second) allotment chit dated 24.03.2018 which has not been assailed by the petitioner rather accepted as correct, hence now the petitioner cannot take a stance that the stamp duty is not liable to be paid.
7. He also stated that the plot was transferred to the petitioner in the year 2018, thus at the relevant time the Stamp Act was applicable, hence no illegality has been committed by the respondents.
8. I have heard the learned counsel for the parties, gone through the record of the case with utmost care and caution.
9. COURT OBSERVATION AND RELEVANT LAW: It is a bedrock precept of law that right of preemption is not a right of re-purchase but simply a right of substitution by reason of a legal incident to step into the shoes of vendee in respect of all the rights and obligations-arising from the sale under which he has derived his title. Reliance may be placed on 1992 CLC 2433 referred to and relied upon by the learned counsel for the petitioner wherein at page 2439 it has been observed as under: "9. Reverting to the second point, I feel it necessary to re-state three well settled principles regarding enforcement of right of pre-emption. Firstly; the right of pre-emption in the words of Mr. Justice Mahmud is not a right of repurchase, either from the vendor or from the vendee, invoking any new contract of sale but it is simply a right of substitution, entitling the pre-emptor, by reason of a legal incident to which the sale itself was subject, to stand in the shoes of the vendee in respect of all the rights and obligations arising from the sale under which he has derived his title. It is, in effect, as if in a sale-deed the vendee's name were rubbed out and the pre-emptor's name inserted in its place."
10. The right of pre-emption is nothing more and less than the substitution of the pre-emption for the vendee and after substitution the pre-emptor steps into the shoes of vendee as has been held in PLD 1967 Pesh. 67, wherein at page 79 it has been held as under: "8. In paraphrase the right of pre-emption is nothing more and nothing less than the substitution of the pre-emptor for the vendee and I would respectfully add to the aforesaid definition of Mahmud, J., that the pre-emptor after having been substituted for the vendee steps into the shoes of the transferor and as such succeeds in entirety to his rights, title and interest and obligations. In other words, the pre-emptor does not get a better title than the vendor and it follows as a necessary corollary that if the title of the vendor is defective in the sense that he had obtained the title by fraud or he had sold the property in excess of his entitlement the right of pre-emption is subject to all the infirmities and defects which the seller may have."
11. The above reproduced dictums of the superior Courts illuminate it blatantly obvious that the pre- emptor has got all the rights which were available to the vendee, the obligations of the vendee also transfer to pre-emptor and transfer of title by way of a decree for possession through pre-emption is not repurchase rather a substitution of pre-emptor in place of vendee.
12. In ordinary course of law when a suit for possession on the basis of right of prior purchase is succeeded the pre-emptor is substituted in the place of vendee and his name is entered in the revenue record in view of decree of the Court without any stamp duty etc. The case in hand is slightly divergent because the plot which was pre-empted was situated in a housing scheme and under the bylaws of every housing scheme on the transfer of plot the stamp duty is imposed in a normal routine but as the plot in question was transferred to the petitioner as a result of decree of the Court for possession through pre-emption, thus the official respondents were duty bound to transfer it to the petitioner in the light of decree of the Court and no stamp duty was liable to be paid by the petitioner because he turned into an owner by the reason of a legal incident, so the impugned notice to the petitioner for demanding stamp duty is anomalous and void ab-initio.
13. It is also evident from the contents of plaint filed by the petitioner herein for possession of plot in question through pre-emption as well as the judgment of District Judge that the plot was transferred to the vendee in the year 2012 and at the relevant time no stamp duty was liable to be paid as the Stamp Act was enforced in Azad Jammu & Kashmir vide notification dated 25.06.2014 and obviously the vendee paid all the dues at the relevant time which cannot be claimed again from the petitioner because as stated earlier the petitioner just by reason of legal incident stepped into the shoes of vendee and all the dues paid by vendee would be deemed to have been paid by pre-emptor/petitioner.
14. Furthermore, the plot in question was sold to the vendee for the consideration of Rs. 85,00,000/-but the decree was passed subject to payment of consideration amount of Rs. 85,00,000/-and other expenses including consideration amount to the total sum of Rs. 1,00,30,000/-, hence all the dues payable at the relevant time have been paid, so demanding further stamp duty from the petitioner who stepped into the shoes of vendee is illegitimate., hence not justified.
15. The argument advanced by the learned counsel for the respondents that the plot was transferred to the petitioner vide Musna (second) allotment chit dated 24.03.2018, hence the stamp duty was liable to be paid as the petitioner has not challenged the said allotment chit rather accepted the same has got no substance because after decree of the Court the respondents were duty bound to transfer the plot in the name of petitioner, so the Musna (second) allotment chit dated 24.03.2018 was not required to be assailed rather was rightly issued as a result of decree of the Court. The fact of payment of all the dues is also proved from the script dated 17.01.2018 addressed to Deputy Commissioner/Chairman Allotment Committee by Secretary Allotment Committee as it has been mentioned in the said letter that Article 63(A) of the Stamp Act, 1899 is not attracted, so the argument of the learned counsel for the respondents is repelled.
16. DISPOSAL: The crux and epitome of the above debate is, the notices dated 24.07.2020, 18.08.2020, 10.11.2020 alongwith para 11-(ii) of Audit Objections and all the subsequent proceedings in furtherance of said Audit objection are hereby set at naught by declaring the same as anomalous, void ab-initio and coram non-judice.