A memo cannot undo a Gazette: Punjab and Haryana HC sets aside stamp duty clawback from land-loser farmers
Justice Kuldeep Tiwari set aside two Haryana Revenue Department letters of 2019 and 2021 that treated the stamp duty and registration fee waiver for farmers buying replacement land as lapsed from 1 January 2014, along with every Section 47-A notice issued on their strength, across 113 writ petitions.
Farmers in Haryana who lost land to acquisition and used the compensation to buy replacement farmland were told, years after registering their sale deeds, that the stamp duty waived on those deeds should never have been waived. On 31 October 2026 the Punjab and Haryana High Court set aside the two government letters behind that demand.
Justice Kuldeep Tiwari, deciding a batch of 113 writ petitions led by Khushhal and Another v. State of Haryana, held that a benefit granted by Gazette notifications under the Indian Stamp Act, 1899 and the Registration Act, 1908 could not be withdrawn by an administrative letter, still less with retrospective effect.
Every notice issued under Section 47-A of the Stamp Act on the strength of those letters, and every consequent order of a Collector or Commissioner, fell with them.
A 2010 promise to land losers
The Haryana Government notified its Rehabilitation and Resettlement Policy on 9 November 2010, after approval by the Council of Ministers, with effect from 7 September 2010. It revised floor rates, introduced a No Litigation Incentive, raised annuity rates and offered a set of additional benefits to landowners whose land was acquired.
Clause 13 is the provision at stake. A landowner who bought alternate agricultural land in Haryana within two years of the award would be exempt from stamp duty and registration charges, up to the amount of compensation. The clause added that the Revenue and Disaster Management Department would separately issue orders to give effect to it.
That was done on 3 January 2011 through two Gazette notifications. The first, under Sections 78 and 79 of the Registration Act, added a proviso to the Haryana Registration Manual waiving registration fee on such sale deeds. The second, under Section 9(1)(a) of the Stamp Act, remitted the duty with effect from 7 September 2010.
Both carried the same conditions. The remission was limited to the compensation, including interest for delayed payment, and any excess purchase price remained liable to duty. The farmer also had to produce a certificate from the Land Acquisition Collector confirming the acquisition and the compensation paid.
Revenue authorities issued such certificates, and displaced farmers bought land on their strength without paying duty or fee. The petitioners’ sale deeds were executed and registered between 2014 and 2021.
Two letters after the 2013 Act
The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 came into force on 1 January 2014 and, by Section 114, repealed the Land Acquisition Act, 1894. Section 24(1)(a) applies the new Act’s compensation provisions, Sections 26 to 30, where acquisition began under the old Act but no award was made before that date.
On 23 October 2019 the Additional Chief Secretary, Revenue and Disaster Management, issued a clarification. It said compensation in such cases could now range from two to four times the market value.
Where proceedings under Sections 4 and 6 of the 1894 Act began before 1 January 2014 and enhanced compensation was given, the letter said, no other benefit of the 2010 policy or of Section 31 of the 2013 Act was admissible in awards made on or after that date.
The second letter, of 19 April 2021, stated that the exemption had been withdrawn from 1 January 2014 and that the State had lost revenue through irregular exemptions. It directed a special audit by Stamp Auditors, within 15 days, of transactions in 2018-19, 2019-20 and 2020-21.
District Registrars were then to refer any deficiency to the Collector for suo motu action under Section 47-A(3) of the Stamp Act. The petitioners challenged both letters and the notices that followed.
What the land losers argued
Several counsel appeared for the petitioners, with the principal arguments made by Mr R.N. Lohan. Mr Vivek Chauhan and Mr Gaurav Jindal, Additional Advocates General, argued for the State, which also filed a written statement in the lead case.
The petitioners put their case under three heads. First, the 2010 policy had a statutory character and could not be nullified by letters issued by the Additional Chief Secretary.
Second, the notifications of 3 January 2011 were issued under statutory powers and had never been withdrawn or amended under those statutes, so they still held the field. Third, farmers had bought land on the strength of exemption certificates and the State’s assurance, and the benefit could not now be taken back retrospectively.
The State: repeal ended the policy
The State described the letters as merely clarificatory. Because Section 114 of the 2013 Act repealed the 1894 Act, it argued, all rules, instructions and policies issued under the old Act stood automatically repealed, and the letters only recorded that position in line with Section 24(1)(a).
It also pointed to Chapter V of the 2013 Act, which provides for a separate rehabilitation and resettlement award alongside the compensation award. Compensation under the new Act is twice the market value for urban land and 2.5 to 4 times for rural land, depending on distance from urban limits.
A comprehensive statute of that kind, the State said, left no room for a policy written for the less accommodating 1894 regime.
Where the policy got its force
Justice Tiwari began with the legal character of each instrument: the policy, the 2011 notifications and the impugned letters. He framed the issue in these words:
“The central legal question is whether the R&R Policy derives its legal force from the Act of 1894 or constitutes an independent executive…” (para 15)
The alternative the court posed was a policy granting additional benefits to landowners whose land was acquired under the 1894 Act. The answer, it said, determined the source of the right, whether the benefits could be enforced, and what the repeal did to them.
The policy’s preamble recognised that compensation under the 1894 Act might not be adequate and that losing a livelihood to acquisition could be painful. Its stated objects included helping farmers reinvest in farmland within Haryana and cutting the stamp duty and registration cost of doing so.
Those features, the court held, show the benefits were meant to supplement statutory compensation, not form part of the compensation machinery of the 1894 Act. The two operated in distinct fields: the Act governed acquisition and payment, while the policy addressed the inadequate rehabilitation the Act offered.
Gazette publication after Cabinet approval raised no presumption that the policy was issued under the 1894 Act. The repeal therefore “would not, ipso facto, nullify the executive R&R Policy” (para 18).
The 2011 notifications still stand
The court then turned to the 2011 notifications. Clause 13 itself acknowledged that an administrative policy alone could not alter the statutory liability to pay stamp duty, which is why it promised separate orders.
Those orders came as Gazette notifications under the Registration Act and the Stamp Act. The competent statutory authority had neither amended nor withdrawn them, the court noted, so they continued to hold the field and retained their legal force.
The State’s central fallacy, Justice Tiwari wrote, lay in misreading where the exemption came from. The land acquisition statutes were only the factual trigger that identified eligible landowners; the legal authority for the remission came independently from Section 9(1)(a) of the Stamp Act and Sections 78 and 79 of the Registration Act.
Memos cannot override Gazette notifications
It was undisputed that the impugned letters were not issued under any statutory provision. The court found several constitutional and executive defects in them.
They were not framed or issued in the name of the Governor, as Article 166(1) of the Constitution requires of all executive action of a State Government. Under Section 21 of the General Clauses Act, 1897, read with Article 166, a Cabinet decision published in the Gazette can be changed only by an act of equal legal solemnity.
A benefit created that way, the court said, cannot be curtailed by a departmental memo signed by an Additional Chief Secretary. If the State wants to roll it back, it must amend or rescind the parent policy through a fresh Cabinet decision and a corresponding Gazette notification.
Without such a formal rollback, the letters “remain legally ineffective” against the 2011 notifications (para 22). They were also never published in the Haryana Government Gazette, which the court described as a statutory prerequisite for modifying orders under Section 9 of the Stamp Act or Sections 78 and 79 of the Registration Act.
The letters cited no rule-making authority and worked only as internal directions to field officers. Executive power may operate where statute leaves a field empty, the court explained, but once a statutory notification occupies it, an administrative letter cannot alter or override that notification.
The court called this the doctrine of executive subservience. Executive instructions must stay subordinate to statutory rules and delegated legislation, so letters issued in exercise of administrative power cannot restrict rights created by statutory notifications.
Remission power excludes retrospective withdrawal
Section 9(1)(a) of the Stamp Act allows the Government, by rule or order published in the Official Gazette, to reduce or remit duty prospectively or retrospectively. Justice Tiwari read that text closely.
It does not expressly allow an existing remission to be withdrawn retrospectively, he held. A power to grant retrospective remission is not the same as a power to withdraw one retrospectively.
The State can rescind a remission through the appropriate legal mechanism, the court accepted. But any withdrawal takes effect from the date of its notification, so letters purporting to withdraw the remission retrospectively were beyond the scope of Section 9.
The court relied on the Supreme Court’s ruling in Union of India v. G.S. Chatha Rice Mills, 2021(2) SCC 209. As the High Court read it, executive circulars cannot operate retrospectively so as to impose fiscal burdens or alter vested rights.
The passages it reproduced from that ruling restate principles from Hukum Chand v. Union of India and Federation of Indian Minerals Industries v. Union of India. A delegate cannot make subordinate legislation with retrospective effect unless the parent statute authorises it expressly or by necessary implication.
The court also drew on Income Tax Officer v. M.C. Ponnoose, decided by the Supreme Court in 1970. Delegated rules and executive circulars operate prospectively unless the primary statute expressly allows otherwise, and neither the Stamp Act nor the Registration Act gives the executive retrospective circular-making power.
Section 47-A is about valuation
The State had relied on Section 47-A(3) of the Stamp Act to support the notices. The court called that reliance highly misplaced, because the provision operates in a totally different field.
It lets the Collector, on his own or on a reference from the Inspector-General of Registration or the district Registrar, examine an instrument within three years of its registration. The purpose is to check the correctness of its market value and the duty payable on it.
The Collector must assess both as on the date the instrument was registered. Nothing in Section 47-A(3) allows a remission already granted to be withdrawn retrospectively.
Completed deals and legitimate expectation
On the petitioners’ last argument, the court accepted that the landowners had altered their financial position. They relied on the 2011 notifications and the exemption certificates and reinvested their compensation in farmland; had the letters been in force then, they could have weighed other kinds of investment.
The doctrine of legitimate expectation, derived from Article 14, protects citizens against retrospective impairment of rights, Justice Tiwari held. The State may alter its stamp duty policy prospectively in the public interest, but it cannot apply the change retrospectively to penalise those who completed transactions under the earlier statutory regime.
Here the deeds had been executed and registered between 2014 and 2021, with duty remitted under valid exemption certificates. Once those transactions were complete, the court said, vested legal rights came into existence.
The letters sought to read into the 2011 notifications a restriction their text did not contain. Administrative letters, the court concluded, cannot operate retrospectively to impose fresh financial liabilities or to invalidate statutory exemptions already acted upon.
Order
The court held that the letters of 23 October 2019 and 19 April 2021 do not withstand judicial scrutiny and set them aside. Any notices issued under Section 47-A of the Stamp Act, and any later orders of a Collector or Commissioner relying on the letters, were also set aside.
All 113 writ petitions were disposed of in those terms, along with pending applications. A copy of the order was directed to be placed on the file of each connected case.