Anti-Corruption

Statement of ‘Facts’ Regarding Allahabad Property of Bhushans

Coalition of Democratic Movements, an independent group has come up with  answers to specific allegations put on Bhushans.

BeyondHeadlines News Desk

Q1. Have the Bhushans bought a Rs. 20 crore house for Rs. 1 lakh in Allahabad?

1. The agreement for sale of the said property was made and signed by both parties in 1966 at the prevailing market value at that time (Rs. 1 lakh). However, on account of the fact that the 99 years lease granted by the Government in favour of the owner had expired and was pending renewal, the sale deed could not be executed.

2. Finally when the lease deed was renewed and the property was converted into free-hold, the Bhushans demanded execution of the sale deed which was refused by the owner.

3. The Bhushans instituted a suit for specific performance in the year 2000 in Civil Court at Allahabad which was pending.

4. Thereafter a compromise was arrived at between the Bhushans and the owner, under which the owner agreed to sell a major portion of the property to the Bhushans for the consideration agreed to in the agreement to sell, provided that the remaining portion of 4317.78 sq. yards be released from the agreement and be left with the owner to sell independently to other persons. The pending suit was decreed in terms of the agreement and it is in this background that the property was purchased for Rs. 1 lakh.

5. The sale deed was executed in 2010 through complete mutual agreement by both parties.
Q2. Have the Bhushans evaded stamp duty?

1. No. There is absolutely no question of evading Stamp Duty.

2. As per law the stamp duty could be calculated in either of three ways:

o If it is a matter of sale consideration which was Rs. 1 Lakh, the stamp duty payable would be on Rs. 1 Lakh.

o If it is a case of sale of a house, the stamp duty will be payable on 20 times the annual assessed rent in which case the amount payable would be on Rs. 6,67,200/-.

o It could also be considered as a sale of land, in which case the stamp duty payable would be dependent on the value of the land on the date of the execution of the sale deed. The 3rd required the collector to assess
the value of the land and therefore the stamp duty.

3. In light of the above, the Bhushans applied under section 31 of the Stamp Act on 29th September 2010 for the Collector to determine the appropriate stamp
duty payable. Since no response was received and duty had to be paid by 29th November 2010, Bhushans paid the higher of the first two methods of duty calculations that were possible for them to calculate. The 3rd would have to be determined by the collector.

4. Much before any notice was received, the Bhushans have themselves asked the collector to assess the duty payable and there is no question of evading duty.

Q3. Have the Bhushans received any notice asking them to pay stamp duty worth Rs. 1.33 crores?

1. The first notice from the authorities was dated February 5th 2011 asking the Bhushans to come on 22nd April to discuss the stamp duty payable. It did not mention any figure. A follow up date has been issued for May 5, 2011.

2. Another notice dated 15/04/2011 has been received only on 23rd April 2011. For the first time it mentions a figure of approx. 1.33 Cr and fixes a date of 28/04/2011 for finalization of the Stamp Duty. It is important to note that this notice was issued on the very day that Mr. Digvijay Singh publicly made the allegation about evasion of Stamp duty.

3. There is no notice for evasion of stamp duty. The final decision on the Stamp Duty payable is still pending. All legally applicable stamp duty will be paid.

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