The court ruled that valuation procedures under the Indian Stamp Act must follow due process and be supported by substantiated evidence; arbitrary enhancements without proper procedure are legally unsustainable.

JUDGMENT :

K.GOVINDARAJAN THILAKAVADI, J.

The appeal is directed against the order of the 1st respondent / Inspector General of Registration, dated 15.07.2025 passed in Na.Ka.No.44160/IN/2024 confirming the order of the 2nd respondent / The Special Deputy Collector (Stamps), dated 27.09.2024 in Na.Ka.No.A3/3324/2023.

2. The facts leading to the filing of this appeal are as follows:

2.1. The appellants have purchased the property to an extent of 1023.30 sq. ft of undivided share of land along with built up are of 2062.09 sq. ft being an apartment situate at Dr. Banumathi Ramakrishnan Street, Bharani Colony, Saligramam, Chennai, comprised under S.No.213/1A1 (part) T.S. No. 6/1 Saligramam Village, vide sale deed dated 27.07.2023 and registered as Doc No. 6078/2023 with the office at the Sub Registrar, Virugambakkam. The sale consideration for the said purchase was Rs.82,04,000/-. The appellants are husband and wife. The Sub Registrar, Virugambakkam, had refused to accept the transaction value which was commensurate to the market and guideline value and had proposed an exorbitant value and therefore, he referred the subject matter to the Collector of Stamps for fixation of value under Section 47A of the Indian Stamps Act. The Collector of Stamps had, by his order dated 27.09.2024, passed an order, adopting a value of Rs.8,000/- per sq. ft of land and Rs.30,47,632/- as value for building and had further demanded a sum of Rs.3,56,471/- as deficit stamp duty. The appellants had preferred an appeal to the 1st respondent under (5) of the Indian Stamp Act. The 1st respondent after hearing the matter had rejected the appeal in Na.Ka. No.44160/IN/2024 by an order dated 15.07.2025 confirming the order of the 2nd respondent, aggrieved by the said order, this appeal has been preferred.

3. The learned counsel appearing for the appellants would submit that without proper appreciation of facts, the respondents have fixed the value of the subject property at Rs.8,000/- per sq. ft., which is illogical and deserves to be set aside. It is submitted that only after taking into consideration the prevailing advantages and disadvantages of the location of the property, that is to say the guideline value maintained by the Sub Registrar, Virugambakkam, is commensurate to the market value of the property and therefore, there is no reason why an additional value more and above the said guideline value is adopted by the respondents. It is submitted that the guideline value of the property for Arcot Road is Rs.12,000/- and for the subject property is Rs.6,000/- and the same is not disputed by the authorities. While so, the authorities cannot enhance the value for the reason that the said guideline value itself has been arrived based on the market value. Even after purchase of the subject property by the appellants, and even after revising the guideline value, the guideline value for the disputed area was fixed only at Rs.6,600/- with effect from 01.07.2024. This enhancement was done only after considering the prevailing market condition of the locality and the developments made in the vicinity. Therefore, the respondents cannot take a different stand and fix an enhanced value for the purchase made much prior to 01.07.2024. As far as the value of the building is concerned, no reason has been adduced for enhancing the value of the building, the value adopted in the sale consideration reflects the correct value of the building, considering the depreciation for about two decades old building and therefore, the same is liable to be set aside. He would further submit that the determination of market value of the property in question by the 2nd respondent / Special Deputy Collector was only in pursuance of the r