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2021 Supreme(Online)(KER) 34212
HIGH COURT OF KERALA
RAJA VIJAYARAGHAVAN, J
N.MOHANAN – Appellant
Versus
STATE OF KERALA – Respondent
WP(C)/23069/2020
SRI.BEPIN VIJAYAN
Proper service of notice is crucial for ensuring lawful proceedings under the Kerala Stamp Act, and deviations from prescribed methods invalidate the actions taken.
Headnote:
Stamp Duty - Undervaluation - Kerala Stamp Act, 1968 Section 45B - The court analyzed the procedural requirements for issuing notices and determining the valuation of property under the Kerala Stamp (Prevention of Undervaluation of Instruments) Rules, 1968, and found the notices were invalid due to improper service.
Fact of the Case:
The petitioner challenged demand notices for deficient stamp duty, claiming the underlying proceedings were flawed as they were not properly notified about orders determining property valuation.
Finding of the Court:
The court held that the notices were invalid as they were not served according to the prescribed rules, emphasizing the necessity of proper communication and adherence to procedure.
Issues: Whether the demand notices for deficient stamp duty were validly served and whether the procedure under the Kerala Stamp Act and rules was followed.
Ratio Decidendi: The court determined that failure to adhere to specific procedures and modes of service under the rules rendered the issued demand notices invalid and liable to be quashed.
Final Decision: The writ petition was allowed, quashing the demand notices.
JUDGMENT
Under challenge in this petition is Ext.P2 notice dated 1.12.2019 issued by the District Registrar informing the petitioner that he has undervalued the sale consideration in Ext.P1 sale deed No.1547 of 2011 of the Edappally SRO. As per the said sale deed, which is dated 30.4.2011, the petitioner had purchased an apartment bearing Door No.XXVI/172 L having a super built-up area of 167.286 square metre in a multi-storied apartment complex by name “Asset North Star” with undivided share consisting of 41.44 square metres and situated in 26.97 Ares of land comprised in Re.Sy.Nos.53/1, 53/4, 53/5 and 53/7 of Thrikkakara North Village. The sale consideration set forth in the document is Rs.27,21,400/-. Through Exhibit- P2 demand notice, the petitioner was informed by the District Registrar to pay a sum of Rs.2,05,660/- towards deficient stamp. Later, Exhibits P5 and P6 notices were served on the petitioner wherein the very same demand is raised. All these notices are dated 01.12.2019. The petitioner states that in Ext.P2 demand notice, it is mentioned by the 3rd respondent that a notice in Form No.II of the Kerala Stamp (Prevention of Undervaluation of Instruments) Rules, 1968 (for short ‘the Rules, 1968’), was issued to the petitioner on 31.5.2011 from the office of the 3rd respondent and it is thereafter that a provisional order was passed on 7.11.2018, about 7½ years after the date of issuance of the Form II notice. It is further stated that a final order was passed on 29.12.2018 and it was on its basis that Exts P2, P5 and P6 notices have been issued. It is the case of the petitioner that neither the provisional order purportedly passed by the 3rd respondent nor the final order passed on 29.12.2018 was communicated to the petitioner as contemplated under the Rules and according to him, the procedure prescribed was also not followed before passing the final order. It is in the afore circumstances that the petitioner is before this Court seeking to quash Exts.P2, P5 and P6 and for incidental reliefs.
2. In the counter affidavit filed by the 3rd respondent it is stated as follows in paragraph No.4.
“4. It is submitted that, on receipt of the reference from the Sub Registrar, the District Registrar issued From II notice as per the Kerala Stamp Act (prevention of undervaluation instructments) Rule 1968 4(1A) to the petitioner on 31.05.2011 through ordinary post which intimating the reference received from the Sub Registrar, Edappally and also giving an opportunity for the petitioner to prove that the value of the property/consideration has been truly and correctly set forth in the document within 21 days of the receipt of the notice. There was no response from the petitioner.”
3. Thereafter in paragraph No. 6 it is stated thus:
“6. It is submitted that, this office issued provisional order on
07.11.2018 by ordinary post. Since there was no response, then final order was issued on 29.12.2018 by ordinary post intimating that the deficit stamp duty and fees of this document were fixed. It is respectfully submitted that the entire proceedings initiated are legal and on the basis of Kerala Stamp Act and Kerala Stamp Rule (prevention of undervaluation of instruments) 1968.”
4. Thus, it is obvious from the counter itself that the Form No. II notice, the provisional order as well as the final order was communicated to the petitioner by ordinary post.
5. The procedure to be followed for determination of value or consideration and the proper duty is provided in Rule 4 of the Rules 1968.
Rule 4, 6 and 7 reads as follows:
“4. Procedure for determination of the value or consideration and the proper duty under Section 45B .-
(1) A reference under sub-section (1) of Section 45B from a Registering Officer shall be accompanied by a statement in Form IA.
(1A) On receipt of such reference by the collector or where the Collector proposes to take action suo motu under sub-section (3) of [ Section 45B ], he shall issue a notice in Form II or Form IIA,
