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High Court of Judicature at Madras
R. SUBBIAH, J.
M/s. Karpagavinayaga Associates
Versus
The Inspector General of Registration of Tamil Nadu cum Chief Controlling Revenue Authority & Others
C.M.A.No.2109 of 2014 & M.P.No.1 of 2014
Decided on: 16-09-2014
Indian Stamp Act - Section 47A - Determination of payment of deficit stamp duty - Market value of land – Quash of order - Appellant is a partnership firm having office at KNK Road,Town running in name and style - Appellant purchased 3 acres of dry Punja land in Village Taluk and District for a valuable sale consideration and paid a sum towards stamp duty and registered same before S.R.O - After registration of document Sub Registrar impounded said document and referred same under Section 47A of Indian Stamp Act to District Revenue Officer Stamp second respondent herein - On reference a spot inspection was conducted by competent authority and a report was also submitted to effect that land was land and crops were raised therein - Second respondent by conducting enquiry estimated market value of land and thus fixed total value of land measuring to an extent of acres purchased by appellant and directed appellant to pay deficit stamp duty of apart from registration charges - Pursuant to same appellant has also paid deficit stamp duty and documents have been returned to appellant – Held, Apart from above court find that Chief Controlling Authority has invoked suo motu proceedings only based on audit objection - Chief Controlling Authority can initiate suo motu proceedings by examining order passed by original authority under sub-Sections (2) and (3) of Section 47 of Indian Stamp Act on arriving at a subjective satisfaction - In this regard a reference could be placed in judgment of this Court reported Inspector General of Registration and others - A perusal of said judgment would show that Chief Controlling Revenue Authority cum Inspector General of Registration can arrive at a subjective satisfaction that order passed under subsection (2) of Section 47 by original authority is prejudicial to interest of revenue – But in instant case as observed earlier suo motu proceedings have been initiated only based on audit objection – Absolutely no material is available that suo motu proceedings have been initiated by first respondent after arriving at subjective satisfaction that order passed under sub-section (2) of Section 47 is prejudicial to interest of revenue - Since no such subjective satisfaction has been arrived at by first respondent before initiating suo motu proceedings on this ground also order of first respondent is liable to be set aside - Appeal is allowed
1. The present appeal has been filed challenging the impugned order passed by the first respondent in Letter No.31206/c1/10 dated 20.5.2014, initiating suo motu proceedings as against the appellant herein under Section 47A of the Indian Stamp Act.
2. The brief facts, which are necessary for the disposal of the present appeal, in nutshell, are as follows:-
(a) The appellant is a partnership firm, having office at No.792, KNK Road, Erode Town, running in the name and style of M/s.Karpaga Vinayagar Associates. On 29.11.2007, the appellant purchased 3 acres of Manavari / dry Punja land in R.S.No.372/1 in Sundakamuthur Village, Coimbatore Taluk and District for a valuable sale consideration of Rs.27,00,000/-and paid a sum of Rs.1,85,000/- towards stamp duty and registered the same before the S.R.O. Madukarai, Coimbatore. After registration of the document, the Sub Registrar impounded the said document and referred the same under Section 47A of the Indian Stamp Act to the District Revenue Officer, Stamp, Coimbatore, the second respondent herein. On reference, a spot inspection was conducted by the competent authority and a report was also submitted to the effect that the land was Manavari land and crops were raised therein. Thereafter, the second respondent by conducting enquiry, estimated the market value of the land at Rs.55,00,000/-per acre and thus, fixed the total value of the land measuring to an extent of 3 acres purchased by the appellant at Rs.1,65,00,000/- and directed the appellant to pay the deficit stamp duty of Rs.11,04,000/- apart from registration charges of Rs.1,38,000/-. Pursuant to the same, the appellant has also paid the deficit stamp duty and the documents have been returned to the appellant on 28.3.2008.
(b) While so, to the shock and surprise of the appellant, after 2-1/2 years from the date of the order passed by the District Revenue Officer, Stamp, Coimbatore under Section 47A of the Indian Stamp Act, a notice dated 8.9.2010 under Section 47A(6) of the Indian Stamp Act was issued by the first respondent, directing the appellant to show cause as to why the market value of the said land should not be fixed at Rs.1,00,000/-per cent. The appellant has also submitted their objection for the said show cause notice. The appellate authority has also directed the District Registrar to conduct spot inspection. Based on the spot inspection report, the first respondent passed the impugned order by fixing the market value of the land as Rs.1,00,00,000/-(Rupees one Crore) per acre and directed the appellant to pay the deficit stamp duty of Rs.10,80,000/- for a sum of Rs.1,35,00,000/-being the difference amount between Rs.3,00,00,000/- and Rs.1,65,00,000/- and to pay the deficit registration charges of Rs.1,35,000/-, totalling a sum of Rs.12,15,000/- within a period of 60 days. Aggrieved over the same, the present appeal has been filed.
3. I have heard the submissions made on either side and perused the entire materials available on record.
4. The appellant is a partnership firm. They have purchased Manavari / dry punja land measuring to an extent of 3 acres in R.S.No.372/1 in Sundakamuthur Village, Coimbatore Taluk and District for a valuable sale consideration of Rs.27,00,000/-, i.e., at the rate of Rs.9,00,000/-per acre. They have paid a sum of Rs.1,85,000/-towards stamp duty. After registration, the document was referred to the second respondent herein under Section 47A of the Indian Stamp Act for determination of payment of deficit stamp duty. Pursuant to the said reference, a spot inspection was conducted by the competent authority and a report was submitted to the second respondent to the effect that the land was only an agricultural land and crops were raised therein. Based on the said report, the second respondent passed an order by estimating the market value of the land at Rs.55,00,000/- per acre, i.e., at the rate of Rs.126/-per square feet and fixed the total value of the land at Rs.1,65,00,000/-and
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