Point of Law : Stamp duty - Assessment - High Court was in error in observing that the fixation of value in the instant case was based on future development - what is necessary for the authority is to follow the guidelines stipulated under Rule 5 of the Tamil Nadu Stamp (Prevention of Undervaluation of Instruments) Rules, 1968, and once the factors stipulated are followed and assessment is made, the same becomes final and the Courts are expected to slow in interfering in such orders passed on merits

JUDGMENT :

(Prayer: Civil Miscellaneous Appeal filed under Section 47-A(10) of the Indian Stamp Act, 1899, against the order dated 21.10.2005 passed by the 1st respondent confirming the order passed by the 2nd respondent on 01.02.2003 pertaining to Document bearing No.721 of 1998 with the office of the 3rd respondent.)

1. The Civil Miscellaneous Appeal is preferred against the order dated 21.10.2005 passed by the 1st respondent under Section 47-A(5) of the Indian Stamp Act, 1899.

2. The sale deed in question was executed by the appellant on 26.03.1998 and the valuation as well as the stamp duty paid were objected by the competent authority, and accordingly, 47-A(5) proceedings were initiated by the competent authority and the assessment was made by following the procedure contemplated. The authorities competent assessed the market value as Rs.2,500/- per sq.ft. taking note of the fact that the subject property situates in the prime locality of Chennai city, more specifically, nearby Egmore, and therefore, the appellant was directed to pay the deficit stamp duty as assessed by the competent authority. Not satisfied with the order, the appellant preferred an appeal under Section 47-A(5) of the Indian Stamp Act.

3. The Inspector General of Registration adjudicated the issue by providing opportunity to the appellant. Enquiry was conducted. The property situates at Block No.50, Marshall Road, Door Nos.124 and 125 and the extent of the land is 3 grounds and 1655 sq.ft. The Inspector General of Registration considered the value of the adjacent lands as well as the registration done in the nearby vicinity, and accordingly, made a finding which reads as under:

“Tamil”

4. The authority competent found that it is a posh locality in the main city and mostly rich people are residing, big bungalows are constructed and further, important commercial premises are also found. The Government Eye Hospital, Fire Service Station, Rajarathinam Stadium, Raja Muthaiya Hall, Rani Meyyammai Hall are also situated in Marshall Road and the Egmore Railway Station is 1 km from the subject property. All these factors as well as the surrounding areas were taken into consideration and accordingly, the market value was fixed as Rs.2,500/- per sq.ft.

5. The learned counsel appearing for the appellant mainly contended that the authorities have not considered the value of the property with reference to the prevailing situation. The authorities have not applied their mind. They have not considered the facts and circumstances with reference to the valuation rules. No copy of the reference has been furnished to the appellant. Therefore, the order impugned is infirm and is liable to be scrapped. It is contended that it is not open to the authorities to make a reference under Section 47-A(5) of the Indian Stamp Act. The Statute presupposes the twin elements of under valuation and intent to defraud the revenue. In the present case, no such element was established, and therefore, initiation of proceedings under Section 47-A(5) of the Indian Stamp Act itself is not sustainable.

6. The learned Special Government Pleader appearing for the respondents brought to the notice of this Court that the valuation done as per the impugned order had also been paid by the appellant without any protest.

7. Considering the grounds raised by the parties to the lis on hand, it is relevant to consider Rule 5 of the Tamil Nadu Stamp (Prevention of Undervaluation of Instruments) Rules, 1968. Rule 5 contemplates the principles for determination of market value. Accordingly, the Collector shall, as far as possible, have also regard to the following points in arriving at the provisional market value. Rule 5(a) deals with lands, which enumerates the materials to be taken into consideration by the authorities competent and the same reads as follows:

“5. ... (a) In the case of lands –

(i) classification of the land as dry, manavari, wet and the like;

(ii) classification under various tarams in the settlement r