Back
2024 Supreme(Online)(MAD) 18014
HIGH COURT OF MADRAS
Hon`ble Mr Justice N. SATHISH KUMAR
K.KARUNAKARAN CHETTIAR – Appellant
Versus
THE INSPECTOR GENERAL OF REG – Respondent
Stamp duty is assessed based on the market value of property at the time of execution, not merely on the stated consideration, and proper procedures for registration must be followed.
Headnote:
Stamp Duty - Registration - Stamp Act Section 47A - The court clarified that the stamp duty is based on the market value at the time of execution and not solely on the consideration mentioned, emphasizing the proper procedure for registration and valuation inquiries.
Fact of the Case:
The petitioner challenged the refusal of the registering authority to register a court-executed sale deed, insisting on payment based on current guideline values instead of the market value at the time of the agreement.
Finding of the Court:
The court found that the registering authority improperly refused registration without a proper inquiry into the property valuation and must register the document before referring it to the Collector under Section 47A if undervaluation is suspected.
Issues: Whether the registering authority can refuse to register a sale deed based on current guideline value and whether the valuation should be determined at the time of execution.
Ratio Decidendi: The court held that stamp duty applies to the market value at the time of execution, and authorities must register first and investigate later under Section 47A if undervaluation is suspected.
Final Decision: The impugned refusal check slip was set aside, directing the registration of the document presented by the petitioner.
ORDER
This present writ petition has been filed seeking a writ in the nature of declaration that the action of the 3rd respondent refusing to register the document by issuing a check slip dated 22.11.2023 on the ground that payment of stamp duty and registration fees were not paid on the present guideline value of the property covered under the documents and for a consequential direction for registration of document without insisting on payment of stamp duty and registration fees on the guideline value as on 22.11.2023.
2. It is the case of the petitioner that his father obtained a judgement and decree in a suit for execution of contract of allotment dated 25.08.1984 in respect of the subject matter of property on 20.09.1996 in O.S.No.1235 of 1986 on the file of the District Munsif at Poonamallee against the Executive Officer of Arulmigu Yoga Narasimhar Devasthanam and also against the Commissioner, Hindu Religious and Charitable Endowment Board, Chennai 600 034. The HR & CE department lost in the first appellate court as well as in the second appellate court. There was no further appeal preferred by the defendant department. The judgement and decree of the trial court had become final. Pursuant to the above said decree, an execution petition was filed and the executing court executed the sale deed in execution of the decree for specific performance. The grievance of the petitioner is that when the document executed by the court was presented for registration, the 3rd respondent registering authority insisted for enclosure of Form 1-A and also for payment of stamp duty and registration fees as on 22.11.2023. It is this check slip which is now under challenge in the present writ petition.
3. Heard both sides.
4. Mr.Krishnasamy R, learned counsel for the petitioner would submit that the market value as on the date of agreement alone has to be considered for payment of stamp duty. Merely because of the fact that there is a time gap between the agreement of sale and the execution of the document by itself is not sufficient for the registering authority to invoke Section 47-A of the Stamp Act, unless there are reasons to believe that there is an attempt on the part of the parties to the document to undervalue with a view to evade payment of property stamp duty.
5. In support of this contention, the learned counsel for the petitioner placed reliance upon a judgement of a Division Bench of this Court in the case of Padmavathi S.P. v. State of Tamil Nadu reported as [1997 (II) CTC
617].
6. The learned counsel for the petitioner would further submit that the 3rd respondent registering authority has no power to refuse to register the document in question which was presented for registration. Even if the registering authority had reason to believe that the property covered and the document was undervalued, it should have referred the document to the Collector under Section 47A of the Stamp Act, 1899. Without doing so, it ought not to have demanded deficit stamp duty and registration fees on the market value of the property as on 22.11.2023.
7. In support of his above submission that even if the registering authority is satisfied that an instrument is undervalued, he is obliged to register the instrument and then only make a reference to the Collector for action under Section 47-A of the Stamp Act, the learned counsel for the petitioner would place reliance upon a judgement of the Hon'ble Supreme Court in State of Punjab v. Mohabir Singh reported as [(1996) 1 SCC 609]; and Government of Tamil Nadu v. Park View Enterprises reported as [(2001) 1 SCC 742].
8. Mr.B.Vijay, learned Additional Government Pleader would on the other hand placing reliance heavily upon a recent judgement of the Hon'ble Supreme Court in Shanti Bhushan (Dead) through Lrs v. State of Uttar Pradesh reported as [2023 SCC OnLine SC489] contend that now the law has been well-settled that stamp duty payable on subject property covered under the document will be in accordance w
