I am developing an asp.net mvc application where user1 could delete data records which were just loaded before by user2. User2 either changes this non-existent data record (Update) or is doing an insert with this data in another table that a foreign-key constraint is violated.

Where do you catch such expected exceptions?

In the Controller of your asp.net mvc application or in the business service?

Just a sidenote: I only catch the SqlException here if its a ForeignKey constraint exception to tell the user that another user has deleted a certain parent record and therefore he can not create the testplan. But this code is not fully implemented yet!

Controller:

  public JsonResult CreateTestplan(Testplan testplan)
  {
   bool success = false;
   string error = string.Empty;

   try
  {
   success = testplanService.CreateTestplan(testplan);
   }
  catch (SqlException ex)
   {
   error = ex.Message;
   }
   return Json(new { success = success, error = error }, JsonRequestBehavior.AllowGet);
  }

OR

Business service:

public Result CreateTestplan(Testplan testplan)
        {
            Result result = new Result();
            try
            {
                using (var con = new SqlConnection(_connectionString))
                using (var trans = new TransactionScope())
                {
                    con.Open();

                    _testplanDataProvider.AddTestplan(testplan);
                    _testplanDataProvider.CreateTeststepsForTestplan(testplan.Id, testplan.TemplateId);
                    trans.Complete();
                    result.Success = true;
                }
            }
            catch (SqlException e)
            {
                result.Error = e.Message;
            }
            return result;
        }

then in the Controller:

public JsonResult CreateTestplan(Testplan testplan)
      {
       Result result = testplanService.CreateTestplan(testplan);      
       return Json(new { success = result.success, error = result.error }, JsonRequestBehavior.AllowGet);
      }