IMPORTANT POINT
Stamp duty--Deficiency of--Demand notice--Sub-registrar has no authority to issue demand notice.

L. N. Mittal, J. (Oral) : C. M. No. 5900-C of 2011 :

For reasons mentioned in the application, which is accompanied by affidavit, delay of 35 days in filing the appeal is condoned.

Main Appeal :

2. Defendants no.1 and 2 – Sub Registrar, Nuh and State of Haryana respectively, having lost in both the courts below, have filed the instant second appeal.

3. Vidya Devi – mother of plaintiffs and proforma defendant no.3 (all respondents herein) executed registered relinquishment deed dated 20.09.2002 in favour of plaintiffs and proforma defendant regarding agricultural land measuring 87 kanals 01 marla. Defendant no.1 – Sub Registrar, who had registered the said relinquishment deed, issued impugned notice (received by father of plaintiffs on 18.12.2006) requiring the plaintiffs and proforma defendant no.3 to make good the deficiency of stamp duty on the relinquishment deed to the extent of Rs.40,850/-.

4. Plaintiffs (respondents no.1 and 2 herein) challenged the aforesaid demand notice. It was alleged that Sub Registrar – defendant no.1 has no jurisdiction to issue the aforesaid notice under Section 47-A of the Indian Stamp Act, 1899 (in short – the Act). It was also pleaded that the notice, having been issued beyond the period of three years after registration of the relinquishment deed, is also barred by limitation.

5. Defendants no.1 and 2 contested the suit and inter alia pleaded that in fact, deficient stamp duty on the relinquishment deed was to the extent of Rs.4,08,065/-, but was inadvertently written as Rs.40,850/- in the impugned notice on account of arithmetical mistake. It was denied that defendants have no jurisdiction issue the impugned notice or that the impugned notice is time barred. It was pleaded that defendants have right to recover the remaining deficient stamp duty of Rs.3,67,200/- also. Various other pleas were also raised.

6. Learned Additional Civil Judge (Senior Division), Nuh, vide judgment and decree dated 11.06.2010, decreed the plaintiffs’ suit. First appeal preferred by defendants no.1 and 2 has been dismissed by learned Additional District Judge, Nuh, vide judgment and decree dated 17.01.2011. Feeling aggrieved, defendants no.1 and 2 have filed the instant second appeal.

7. I have heard learned counsel for the appellants and perused the case file.

8. Under Section 47-A of the Act, Registering Officer i.e. Sub Registrar, on finding that the instrument does not contain the true value or consideration for the property to be transferred, may make reference to the Collector for determination of the value or consideration and the proper duty payable thereon. It is further stipulated that Collector may do so within three years from the date of registration of any instrument. In the instant case, the impugned demand notice has been issued by Sub Registrar, who had no authority to do so. Under Section 47-A of the Act, Sub Registrar, who is the Registering Officer, is not competent to determine the proper duty payable on an instrument or to make demand thereof. On the contrary, Sub Registrar can only make a reference to the Collector, who thereupon, has to determine the proper duty payable on the instrument. The said determination also has to be after issuing show cause notice to the concerned party and granting opportunity of hearing. In the instant case, demand notice was issued by Sub Registrar, who was not competent to do so, and therefore, the impugned demand notice is patently illegal and without authority. Secondly, the demand notice was issued without following principles of natural justice. No show cause notice was issued to the plaintiffs before making the impugned demand nor any opportunity of hearing was given to the plaintiffs. For this reason also, the demand notice is bad. Thirdly, the relinquishment deed was registered on 20.09.2002, whereas the impugned demand notice was issued in December 2006 i.e. after 04 years and 03 months, whereas under Section 47-A of the Act, even Collector can i