Lap Shun Textiles Industrial Company Ltd v Collector of Stamp Revenue
| Jurisdiction | UK Non-devolved |
| Judgment Date | 1976 |
| Date | 1976 |
| Year | 1976 |
| Court | Privy Council |
Revenue - Stamp Duly - Conveyance or transfer on sale - Sale of land for inadequate consideration in arms' length bargain - Whether chargeable as voluntary disposition inter vivos for full value -
By section 27 (4) of the Stamp Ordinance (which is identical to section 74 (5) of the
“Any conveyance or transfer (not being a disposition made in favour of a purchaser or incumbrancer or other person in good faith and for valuable consideration) shall for the purposes of this section be deemed to be a conveyance or transfer operating as a voluntary disposition inter vivos, and … the consideration for any conveyance or transfer shall not for this purpose be deemed to be valuable consideration where the collector is of opinion that by reason of the inadequacy of the sum paid as consideration or other circumstances the conveyance or transfer confers a substantial benefit on the person to whom the property is conveyed or transferred.”
Land was sold to a purchaser for $16,465.68 as a result of an arms' length bargain in which the purchaser had acted in good faith. The conveyance was stamped at the appropriate rate for a conveyance for sale, namely, 2 per cent. of the purchase price. Later the property was valued by the district officer at $37,500. The Collector of Stamp Revenue applied section 27 (4) and, treating the conveyance as a voluntary disposition inter vivos, made an assessment claiming duty at 2 per cent. on the district officer's valuation. On appeal by the purchaser the district court and the Full Court of Supreme Court upheld the assessment.
On appeal by the purchaser to the Judicial Committee: —
Held, dismissing the appeal, that the clear wording of section 27 (4), by first excepting from its ambit those dispositions made in good faith for valuable consideration and then excluding from the exception those dispositions for inadequate consideration which by reason of the inadequacy conferred a substantial benefit on the transferee, resulted in all dispositions falling within the exclusion being deemed to be voluntary dispositions inter vivos in respect of which duty would be exigable; that, accordingly, since the consideration for the sale was less than half the value of the land, the collector was entitled to take the view that as a result of inadequate consideration the conveyance conferred a substantial benefit on the purchaser, and, therefore, the conveyance was deemed to be a voluntary disposition inter vivos under section 27 (4) and was liable to stamp duty on that basis on its full valuation.
The following cases are referred to in the judgment of their Lordships:
Baker v. Inland Revenue Commissioners[
Indo-China Steam Navigation Co., In re[
Wigan Coal and Iron Co. Ltd. v. Inland Revenue Commissioners[
The following additional cases were cited in argument:
Luke v. Inland Revenue Commissioners[
Russell v. Scott[
Weir and Pitt's Contract, In re(
APPEAL (No. 32 of 1975) from a judgment (January 24, 1975) of the Full Court of the Supreme Court of Hong Kong (Appellate Jurisdiction) (Huggins and McMullin JJ.) dismissing the appeal of the appellant, Lap Shun Textiles Industrial Co. Ltd., from a judgment of Garcia D.J. (July 31, (1974) in the district court upholding an assessment for stamp duty of a conveyance on sale of February 8, 1973, made by the respondent, the Collector of Stamp Revenue. The collector applied section 27 (4) of the Stamp Duty Ordinance and charged the conveyance as a voluntary R disposition inter vivos at 2 per cent. of the value of the property.
The facts are stated in the judgment of their Lordships.
Andrew Park for the...
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Healey v Attorney General
...entity may also be a party to an inter vivos transfer, as a person existing at the time of the transfer. In Lap Shun Textiles Industrial Co Ltd v. Collector of Stamp Revenue [1976] 1 All E.R. 833, a conveyance to a company was held by the Privy Council to be liable to stamp duty as a volunt......
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G A Roe & Sons Ltd v Commissioner of Stamps Attorney General of Belize
...Stamps (Belize HC, 18 January 2019); G A Roe & Sons Ltd v Commissioner of Stamps (Belize CA, 3 November 2020); Lap Shun Textiles Industrial Co Ltd v Collector of Stamp Revenue [1976] 1 All ER 833; MacNiven v Westmoreland Investments Ltd [2001] STC 237; Padfield v Minister of Agriculture, F......
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Wong Suet Foon Shirly v Collector Of Stamp Revenue
...or other circumstances. As explained by Lord Wilberforce in Lap Shun Textiles Industrial Co Ltd v Collector of Stamp Revenue [1976] AC 530 at “It is reasonably clear what section 27 was intended to achieve. In the first place it charges voluntary conveyances, i.e., conveyances for which no ......