The Collector has no jurisdiction to embark upon an inquiry with regard to the valuation of the properties covered by a trust deed or to demand excess stamp duty and penalty based on his finding of valuation. The stamp duty should be paid on the valuation given in the document itself.

1. On the 23th February, 1952, the petitioners along with nine other persons executed a trust deed with regard to certain properties which they had inherited on the death of Sri Ram Pratap Kamalia, The object of the trust deed was to pay off the debts of Sri Ram Pratap Kamalia and to spend the income of the properties for the maintenance of relations and for other charitable purposes mentioned in the document. It is alleged by the petitioners that the properties inherited by them from Sri Ram Pratap Kamalia were burdened with debts to the extent of Rupees 1,95,000/-.

It appears that the document was presented for registration before the Joint Sub-registrar of Patna, who impounded the document under Sec.33 of the Indian Stamp Act and forwarded it in original to the Collector of Patna. A proceeding under Sec. 40 of the Indian Stamp Act was subsequently initiated by the Collector of Patna for investigating the value of the properties. According to the recital in the document the value of the properties was Rs, 95,551/- but the Collector of Patna found on enquiry that the value of the properties was Rs. 2,05,613/15/6.

By his order dated the 20th June, 1956, the Collector of Patna held that the deficit stamp duty was payable on the document to the extent of Rs. l,128/7/- and penalty was also leviable to the extent of Rs. 5,642/3/-. Against the order of the Collector the petitioners moved the Commissioner of Patna in appeal. The Commissioner dismissed the appeal by his order dated the 28th August, 1957. There was a revision application made to the Board of Revenue on behalf of the petitioners, but the revision application was dismissed by the Board of Revenue on the 8th February, 1958.

2. The petitioners have now applied to the High Court under Article 227 of the Constitution for setting aside the order of the Collector of Patna, dated the 20th June 1956, the order of the Commissioner of Patna Division, dated the 28th August, 1957, and the order of the Board of Revenue, dated the 8th February 1958.

3. On behalf of the petitioners the argument advanced in the first place was that the document of trust executed on the 25th February 1952, by the petitioners was not a "settlement" within the meaning of Article 58 of Schedule I of the Indian Stamp Act, but that it was a "declaration of trust" within the meaning of Article 64 of the same Schedule, and the view taken by the revenue authorities on this point is not correct.

It was submitted by learned counsel on behalf of the petitioners in the second place that even if the document was- a "settlement" within the meaning of Article 58, the proper stamp duty has already been paid on the valuation given in the document, and the Collector of Patna had no jurisdiction to make an independent inquiry into the valuation of the properties and to require the petitioners to pay the excess stamp duty upon his finding of valuation. In our opinion, it is not necessary to decide in the present case whether the document of trust deed executed by the petitioners on the 25th February 1958, is ,1 deed of settlement or whether it is a declaration of trust falling within Article 64 of the first Schedule of the Indian Stamp Act. We shall assume in favour of the respondent that the document is a document of settlement falling within Article 58. Even so, we arc of opinion that the order of the Collector of Patna, dated the 20th June, 1956, is ultra vires and without jurisdiction, The reason is that under Sec. 40 of the Indian Stamp Act the Collector has no power to embark upon an inquiry with regard to the market value of the properties and require the payment of further stamp duty by the petitioners in accordance with his finding as to valuation. According to Article 58, the instrument of settlement should be stamped with the same duty as a bond "for a sum equal to the amount or value of the property settled as set forth in such settlement". In our opinion, the words "as set forth in such, settlement" re