Market value for stamp duty is determined by open market conditions and cannot be reduced based solely on property encumbrances.

ORAL ORDER

The petitioner has challenged an order bearing No. J¸ï n ¦ (C)/11/2020 dated 06.04.2021 issued by the respondent No.1 rejecting an appeal filed under Section 45A (5) of the Karnataka Stamp Act , 1957 (for short, ‘the Act, 1957’). She has also challenged the order bearing No.f£ÉÆç/MVD/JGN/15/16- 17 dated 06.02.2020 passed by the respondent No.2 determining the deficit stamp duty and the deficit registration charges payable, to the extent it is prejudicial to her interest. She has sought for a writ in the nature of mandamus to direct the respondent No.3 to accept the valuation of the property as arrived at by her and collect the stamp duty and registration charges on the property and register the sale deed dated 08.07.2016 in her name. She has also sought for a writ in the nature of mandamus to direct the respondent No.3 to refund a sum of Rs.9,66,263/-.

2. The petitioner contends that the property measuring 01 Acre in Sy. No.3, plot No.258/B, B-1, khata No.299/1-258-B, Ward No.09, Bommasandra Industrial Layout, Kittaganahalli (stated as Kittamangala in the petition) village, Attibele Taluk, Bengaluru Urban District, was earlier part of a larger plot of land measuring 07 Acres and 1.85 guntas and belonged to Narayana Hrudayalaya Private Limited. The said 01 acre of land was leased to one Dr. K. Bhujanga Shetty for a period of 28 years from 01.07.2007 to 30.06.2035 in terms of a lease deed dated 10.07.2007 duly registered. The petitioner had agreed to purchase the said 01 Acre of leased property for a total sale consideration of Rs.50,00,000/- and presented a sale deed dated 08.07.2016 for registration.

3. The respondent No.3 claimed that the stamp duty and registration charges offered to be paid by the petitioner were insufficient and therefore, refused to register the sale deed and kept the registration pending. He thereafter referred the matter under Section 45-A(1) of the Act, 1957 to the respondent No.2 for determination of proper market value and collection of deficit stamp duty. The respondent No.3 reported to respondent No.2 that the market value of the property was a sum of Rs.5,05,85,285/- as against a sum of Rs.50,00,000/- mentioned in the sale deed. He calculated the deficit stamp duty and registration fee payable at a sum of Rs.30,31,425/-. The petitioner submitted an elaborate statement before the respondent No.2 to contend that the market value mentioned in the sale deed was the real market value of the property and therefore, the stamp duty paid thereon was just and proper. However, the respondent No.2 allegedly without considering the submissions of the petitioner, passed an order dated 18.08.2017 determining the market value at a sum of Rs.3,92,04,000/- and determined the deficit stamp duty at Rs.19,32,526/- and deficit registration charges at Rs.3,42,040/- totalling to Rs.22,74,566/-.

4. Being aggrieved by the said order, the petitioner filed an appeal before the respondent No.1. The petitioner deposited 50% of the deficit stamp duty demanded by the respondent No.2 towards compliance of the first proviso to Section 45-A(5) of the Act, 1957. The respondent No.1 considered the appeal and held that the contentions urged by the petitioner merited consideration and therefore, allowed the appeal filed by the petitioner herein and set aside the order dated 18.08.2017 passed by the respondent No.2 and remanded the matter back to the respondent No.2 for fresh consideration in terms of an order dated 26.09.2019.

5. The respondent No.2, however, in terms of the order dated 06.02.2020, proceeded to recalculate the market value of th