The registering authority must impound documents with insufficient stamp duty and cannot return them before determining the proper duty.

JUDGMENT :

(Judgment of the Court was delivered by S.M.SUBRAMANIAM, J.)

Present writ appeal has been instituted challenging the writ order dated 27.11.2023 passed in W.P.No.33963 of 2022. Writ petitioner is the appellant before this Court.

2. The facts in short admitted between parties are that the appellant has presented a document before Sub Registrar/Registering authority for registration on 29.07.2021. It is an assignment agreement. The Registering Authority referred the matter to the District Registrar, Administration, on the ground that the document presented for registration was not sufficiently stamped. The appellant found that the stamp duty is very high and took a decision to take back the document presented for registration. It is not in dispute that the said assignment agreement has been executed between the parties. Since the appellant has taken a decision not to proceed with the registration, an application was moved for return of document presented for registration. Application was dismissed by the Registering Authority. Appellant preferred a review questioning the demand of stamp duty by the Registering Authority. The said review was rejected by reducing the stamp duty. The document was impounded to recover the stamp duty. Under these circumstances, the writ petition came to be instituted. Writ court since dismissed the petition, present appeal has been instituted.

3. The learned counsel for the appellant would contend that the instrument has not been registered. Therefore, by choice, the appellant has submitted an application for return of document presented for registration. They have no intention to act on the assignment agreement. Therefore, the authorities have no powers to demand stamp duty.

4. The learned counsel for the appellant would rely on Rule 107 of the Registration Rules and would contend that the document presented has not been registered. Therefore, the presentant of the document is entitled to submit an application for return of documents. To substantiate the said condition, he relied on the judgment of the learned Single Judge of this Court in the case of Cybercity Builders and Developers Private Limited vs The Inspector General of Registration dated 02.08.2024. The learned Single Judge made an observation in the said judgment that the document which has not been registered is liable to be returned back to the presentant of the document. In the case of Government of Andhra Pradesh and others vs P. Laxmi Devi (SMT) reported in (2008) 4 SCC 720 also such a position has been clarified and therefore the writ appeal is to be allowed.

5. The learned Special Government Pleader would strenuously oppose by stating that the provisions under the Registration Act and the Indian Stamp Act are unambiguous. Once the document is presented for registration, the Registering Authority is bound to verify the correctness of the stamp duty paid and in the event of any deficit, he has to initiate action by impounding the document and referring the document to the Collector for determination of stamp duty to be paid by the presentant of document. In the present case such a procedure has been followed and there is no infirmity as such.

6. The learned Single Judge also has considered the relevant provisions of the Registration Act and Indian Stamp Act and held that the document presented need not be returned back once it is found that the stamp duty has not been duly paid. Thus, the writ appeal is to be rejected.

7. This Court has heard the parties to the lis on hand. It would be relevant to consider the provisions of the Registration Act and Indian Stamp Act. Chapter IV of Indian Stamp Act, 1899 deals with instrument not duly stamped.

7.1. Section 33 (1) (a) of