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2024 Supreme(Ker) 1639
IN THE HIGH COURT OF KERALA AT ERNAKULAM
SHOBA ANNAMMA EAPEN, J.
THE ALAPPUZHA GOVERNMENT SERVANTS CO-OPERATIVE BANK LIMITED REP. BY ITS SECRETARY – Petitioner
Versus
STATE OF KERALA – Respondent
W.P. (C) No. 38702 of 2017
Decided On : 25-11-2024
Advocate Appeared:
For the Petitioners: P.C. SASIDHARAN, P.E. SAJAL
For the Respondents: K.V. SOHAN, P.P. THAJUDEEN
A cooperative society is not entitled to remission of stamp duty for a sale deed executed by its members in their individual capacity, as per Section 40 of the Kerala Act.
Headnote:(A) Kerala Co-operative Societies Act, 1969 - Section 40 - Kerala Stamp Act - Remission of stamp duty - Petitioner society sought remission of stamp duty for registering a sale deed executed by its members in their individual capacity - Court held that society is not entitled to remission as the sale deed was not executed on behalf of the society - The execution of the sale deed by members in their own capacity does not satisfy the requirements for remission under Section 40 of the Kerala Act. (Paras 8-10)
(B) Legal Principle - The liability to pay stamp duty lies with the purchaser, and remission is only available for documents executed by or on behalf of the society. (Paras 21-22)
Facts of the case:
The petitioner society sought to register a sale deed for property purchased from its members, claiming entitlement to remission of stamp duty. The District Registrar demanded payment of stamp duty, which the society challenged.
Findings of Court:
The court found that the sale deed was executed by members in their own capacity, thus the society was not eligible for remission of stamp duty.
Issues: The main issue was whether the society, as the buyer, is eligible for remission of stamp duty when the sale deed is executed by its members in their individual capacity.
Ratio Decidendi: The court ruled that since the sale deed was not executed by or on behalf of the society, the society is not entitled to remission of stamp duty as per Section 40 of the Kerala Act.
Result: Writ petition dismissed.
JUDGMENT :
SHOBA ANNAMMA EAPEN, J.
1. “The writ petition raises the question, whether the Petitioner Society, as the buyer of the property is eligible for remission of stamp duty for registering the sale deed?”
2. This writ petition has been filed by the petitioner-society seeking a direction to the fourth respondent to register Ext.P2 sale deed, without insisting on stamp duty and to declare that they are entitled for remission of stamp duty for registering Ext.P2.
3. The petitioner is a cooperative society registered under the provisions of the Kerala Co-operative Societies Act, 1969. For expansion of its business, the society decided to acquire 22 cents of land near Vandanam Medical College and as per Ext.P1 order dated 04.07.2017, sanction was accorded by the fifth respondent, the Joint Registrar of Cooperative Societies (General), for expending fund from the society. The property was sought to be purchased from three members of the society. Though sanction was accorded for purchasing 22 cents, Ext.P2 document in white paper was executed for purchase of 18.300 cents. When Ext.P2 document was presented for registration, the third respondent, the District Registrar (General), issued Ext.P3 notice dated 01.11.2017 to determine payment of stamp duty. Pursuant to Ext.P3 notice, the society submitted Ext.P4 written notes and thereafter, the third respondent passed Ext.P5 order holding the society liable to pay 8% stamp duty along with a penalty. Challenging this, the petitioner has come up before this Court.
4. The respondents have not filed any counter affidavit in the writ petition.
5. I have heard the learned counsel appearing for the petitioner and the learned Special Government Pleader appearing for the respondents.
6. The learned counsel for the petitioner submitted that the petitioner is entitled for remission of stamp duty since the purchase is from the members of the society and the stamp duty is being paid by the petitioner herein, who is the purchaser of the property.
7. The learned Special Government Pleader, on the other hand, submitted that Ext.P5 was issued on the basis of the reference order of this Court in Sub Registrar, Palakkad & others v. Kerala State Co-operative Consumers Federation Ltd. Kochi, 2015 (1) KHC 17 (FB), wherein it was held that in cases where societies purchase properties, it is not entitled for remission of stamp duty and the said view has been confirmed by the apex court in Kerala Land Reforms & Development Cooperative Society Ltd. v. District Registrar (General) & Another, 2022 SCC Online SC 1407. The learned Special Government Pleader further submitted that the petitioner purchased the property from its three members in their own capacity for the purpose of business of the society and since the petitioner society is not the executant of the sale deed, it is not entitled for remission of stamp duty as held in Sub Registrar, Palakkad (supra), which was confirmed by the apex court in Kerala Land Reforms & Development Co-operative Society Ltd. (supra).
8. I have considered the rival contentions and arguments advanced on both sides. It is an admitted fact that in the case on hand, the society is the purchaser of the property. The owners of the property are stated to be the members of the society. The members execute the sale deed in favour of the society, not for and on behalf of the society, but in their own individual capacity. In Sub Registrar, Palakkad (supra), the Full Bench of this Court held as follows:
“20. It is true that when a property is purchased in terms of the provisions contained in Section 30 of the Kerala Stamp Act, unless otherwise so provided in an agreement between the parties, the liability to pay stamp duty is that of the grantee who is the purchaser. Therefore, in a case where a society purchases an immovable property, in terms of the provisions contained in Section 30 of the Stamp Act, the liability to pay stamp duty is that of the society and as provided in Section 40 of the Ker
