In this case, Tejomay Apartments Condominium and others challenged the Maharashtra Stamp Act's rule for paying a government fee (stamp duty) on renewing a long-term lease. They argued it was unfair and against the law. The court, however, rejected the petitions.
Tejomay Apartments Condominium, represented by Secretary Bhavesh Majithia, and another group, New Ramdaspeth Griha Nirman Sahakari Sanstha, filed formal requests against the State of Maharashtra. The issue was the government fee charged on renewing a long-term lease. They claimed that the rule in the Maharashtra Stamp Act, 1958, which demanded this fee, was unfair and violated their rights.
The original lease was signed on April 1, 1947, and was supposed to last until March 31, 1975, with a renewal option. The lease was first renewed in 1987 for 30 years, but no fee was charged then. When the lease was renewed again from 2005 to 2035, the government asked for the fee, which led to the current legal battle.
The petitioners argued that since the lease was meant to last forever, renewing it was not creating a new agreement and should not incur the fee. They saw it as a continuation rather than a new deal. They also claimed that once the fee was paid on the original lease, it should not be required again for renewals.
"Asking the petitioners to pay the fee for renewal of the lease is illegal. The rule is clearly unfair."
The State, represented by Advocate General Birendra Saraf, argued that the fee is a tax on the document, not the agreement. Renewal creates a new document, thus justifying the fee. The court referred to several Supreme Court decisions supporting this view.
Judges Anil S. Kilor and Rajnish R. Vyas ruled that renewal of a lease is essentially a new lease requiring a new document. Therefore, the government was entitled to charge the fee. The court found no merit in the petitions and dismissed them.
"Renewal of lease means creation of a new lease which creates a fresh right and obligation between the contracting parties."
Both petitions were dismissed, and the rule was discharged with no order as to costs.
