Back
SUPREME COURT OF INDIA
K.M. JOSEPH, HRISHIKESH ROY, JJ.
The Sub Registrar, Amudalavalasa & Anr. - Appellants
Versus
M/s Dankuni Steels Ltd. & Ors. - Respondents
Civil Appeal No(S). 3134-3135 of 2023 [@ SLP (Civil) No(s).8708-8709 of 2019]
Decided on : 26-04-2023
Indian Stamp Act, 1899 – Sections 3, 4, 5, 27 and 47A[introduced by Andhra Pradesh (Amendment) Act of 1971] – Registration Act, 1908 – Section 17 – Transfer of Property Act, 1882 – Section 8 – Agreement to sell – Registration of sale-deed – Levy of stamp duty – Auction sale related to assets of company which included land, building, plant and machinery and other assets – Unit was purported to be operated as a going concern and apparently first respondent did not intend to dispose of plant and machinery as scrap – Distinct matters are dealt with in sale deed in question – If different instruments had been executed purporting to convey land, building, plant and machinery, it would be aggregate of value of such matters, which would have exposed them to duty – If instead of separate instruments, distinct matters are made subject matter of one instrument, then, it would hardly matter and liability to pay duty would be still found within four walls of Section 5 of the Act – Mere fact that there is no express reference to plant and machinery in Recital Clause cannot mean that the interest in plant and machinery which stood attached to land, which was scheduled, was not conveyed to first respondent – Matter may have to go back to consider actual plant and machinery as would answer description of immovable property. (Paras 34, 35, 41 and 43)
Facts of the case:
By order dated 13.06.2002, High Court of Andhra Pradesh ordered M/s. Midwest Iron & Steel company Ltd. (which is Respondent No.3 in appeals) to be wound up. Though pursuant to order dated 22.09.2003, efforts were made to sell property of respondent no.3 in three lots, finally, based on an auction for a consolidated sale, second respondent herein, namely, M/s. SMC Marketing Private Ltd. who figured as highest bidder, became the successful auction purchaser. It bid for the property which consisted of land, building, civil works, plant & machinery and current assets, etc. The amount for which the second respondent was declared the highest bidder was Rs.8.35 Crores. On the basis of a direction given in C.A. No. 1203 of 2004 at the instance of the second respondent, Official Liquidator was accorded permission by Company Judge to execute the sale deed in favour of the first respondent in the appeals, viz, M/s. Dankuni Steel Ltd.
Findings of Court:
Second appellant will ascertain value of plant and machinery on the basis of it answering description of immovable property as understood in law. Second appellant will also go into the question, whether first respondent would be entitled to benefit of exemption of stamp duty, etc., as claimed while taking a decision and make available exemption, if entitled in law. Second respondent cannot be made liable under this judgment.
Result : Appeals partly allowed.
JUDGMENT :
K.M. JOSEPH, J.
1. Delay condoned. Leave granted.
2. By order dated 13.06.2002, the High Court of Andhra Pradesh ordered M/s. Midwest Iron & Steel company Ltd. (which is Respondent No.3 in the appeals) to be wound up. Though pursuant to order dated 22.09.2003, efforts were made to sell the property of respondent no.3 in three lots, finally, based on an auction for a consolidated sale, the second respondent herein, namely, M/s. SMC Marketing Private Ltd. who figured as the highest bidder, became the successful auction purchaser. It bid for the property which consisted of land, building, civil works, plant & machinery and current assets, etc. The amount for which the second respondent was declared the highest bidder was Rs.8.35 crores. On the basis of a direction given in C.A. No. 1203 of 2004 at the instance of the second respondent, the Official Liquidator was accorded permission by the learned Company Judge to execute the sale deed in favour of the first respondent in the appeals, viz, M/s. Dankuni Steel Ltd. A sale deed came to be executed by the Official Liquidator in favour of the first respondent dated 5th August, 2004. In the sale deed in the preambular portion we may notice the following statements:
“D. WHEREAS the Official Liquidator has put the properties of the Company for sale in terms of orders of the Hon'ble High Court and whereas the Hon'ble High Court of Andhra Pradesh, Hyderabad by an order dated 04-02- 2004 made in C.A.No.736/2003 in R.C.C.No. 10/2001 (copy enclosed) was pleased to confirm the sale of the assets pf the Company such as land, building, plant and machinery and other assets in favour of Messrs SMC Marketing Pvt. Ltd., having its office at Room No.617, 6th floor, P 41, Princep Street, Kolkatta -700 072, represented by its authorized representative Sri Amar Chand. Choudhary for a total sale consideration of Rs.8.35 crores.
E. WHEREAS the Hon'ble High Court of Andhra Pradesh, Hyderabad passed by an order dated 15-06-2004 made in C.A. No. 1202/2004 was pleased to direct the Official Liquidator to execute necessary conveyance deeds for the land sold in auction in favour of the vendee here in who is the nominee of the said highest bidder Messrs SMC Marketing Pvt. Ltd. A copy of which is enclosed herewith.”
3. Clause H of the preamble, reads as follows:-
“H. WHEREAS the Vendee has paid the full consideration to the vendor within the time stipulated by the Hon'ble High Court of Andhra Pradesh, Hyderabad and as per the terms and conditions of the sale, properties have been sold by the Vendor to the Vendee on 'as is where is whatever there is basis'. Vendor hereby admits and acknowledges that he has received the full consideration from the Vendee and there is no balance payable by him. Further the Vendor has already given possession of the Schedule property to the Yendee under due acknowledgement. The Vendor hereby conveys, transfers and assigns all the rights, title interest together with all the liberties, advantages, held and enjoyed by Messrs Midwest Iron & Steel Co. Ltd., to the Vendee, who shall hereinafter enjoy the same with full and absolute rights without any dispute or objection from any source as owner.
AND WHEREAS the total sale consideration is Rs.8.35 crores for the entire assets of the company comprising of land, building, Civil works, plant & machinery and current assets, etc"
An amount of Rs.1,01,05,000/-is taken as the value of the land, building and civil works basing on the offer received by the official liquidator when the assets were put for sale individually and the purchaser has agreed to pay the stamp duty/registration fees per the-value derived by /transfer fees as the sub registrar.
WHEREAS the land to an extent of Acres 46.7167 cents situated in Dusi Village as per details given below is now registered in favour of the VENDEE through this document, hereinafter referred
Agreement to sell – If instead of separate instruments, distinct matters are made subject matter of one instrument, liability to pay duty would be still found within four walls of Section 5 of Stamp ....
In Court-ordered sales, stamp duty applies only to the sale consideration, not to market value, as established by the Transfer of Property Act.
The court affirmed that all components of the sale, including outstanding mortgage obligations, must be considered for stamp duty valuation, adhering strictly to statutory definitions.
Unregistered agreement for sale with possession, stamped as conveyance under amnesty, is principal instrument under Section 4; subsequent registered sale deed is other instrument attracting fixed dut....
The court clarified that only sales conducted by the Company Court with proper publicity and without connections to the purchaser are protected under the Indian Stamp Act.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
