1. Refund of excess stamp duty and registration fee ordered, deduction of nominal registration fee. (Para 15 )
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2025 Supreme(Online)(Mad) 73231
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Honourable Mr Justice KRISHNAN RAMASAMY
V.VENKATAGIRI – Appellant
Versus
THE STATE REP. BY ITS SECRETARY – Respondent
W.P.No.23321 of 2023 | W.M.P.No.22862 of 2023
Advocates:
For the Appellants/Petitioners: A. Mohamed Ismail
For the Respondents: Abishek Murthy
For the Appellants/Petitioners: A. Mohamed Ismail
For the Respondents: Abishek Murthy
A ratification deed confirming an earlier sale is not a fresh conveyance; only nominal stamp duty and registration fee apply, and excess paid must be refunded.
Headnote:(A) Indian Contract Act, 1872 - Section 196 - Tamil Nadu Stamp Act, 1899 - Section 4 - Indian Registration Act, 1908 - Section 78 and Table of Fees Article 1(n) - Ratification of unauthorized act of agent - Where an agent acts without authority, the principal may ratify the act under Section 196 of the Contract Act; upon ratification, the same effects follow as if the act had been performed with authority - In a sale transaction, the principal instrument (original sale deed) alone is chargeable with full stamp duty under Section 4 of the Stamp Act; a ratification deed is a supplementary instrument chargeable only with a nominal stamp duty and registration fee - Article 1(n) of the Table of Fees under the Registration Act prescribes that the registration fee for a ratification deed falling under Section 4 of the Indian Stamp Act shall be the same as the fee leviable on the value of the original document at ad valorem rates subject to a maximum of Rs.10/-. (Paras 6, 7, 10, 12)
(B) Refund of excess stamp duty and registration fee - Once the principal instrument has already been duly stamped and registered, any additional stamp duty and registration fee paid at the time of registering a ratification deed is liable to be refunded, after deducting the nominal fee of Rs.10/- for registration of the ratification deed. (Paras 11, 13, 15)
Facts of the case:
The petitioner purchased property through a power of attorney agent in 2011. The agent, however, lacked authority to sell. To cure this defect, the vendors (principals) executed a ratification deed in 2022 confirming the sale. The petitioner paid full stamp duty and registration fee on the ratification deed, treating it as a fresh conveyance. His application for refund of the excess amount was rejected by the Registrar on the ground that the ratification deed amounted to a fresh conveyance. The petitioner then filed a writ petition. (Paras 2, 6)
Findings of Court:
The court held that under Section 196 of the Contract Act, ratification relates back to the date of the original act, making the original sale deed effective as if executed with authority. The original sale deed (2011) is the principal instrument under Section 4 of the Stamp Act, and the ratification deed is merely a supplementary instrument. Therefore, the petitioner is entitled to a refund of the entire stamp duty and registration fee paid on the ratification deed, except for a nominal registration fee of Rs.10/-. The respondents were directed to refund Rs.6,00,497/- (excess stamp duty) and Rs.3,43,416/- (excess registration fee) totalling Rs.9,43,913/-, after deducting the applicable charges on the ratification deed, within eight weeks. (Paras 11, 13, 15)
Issues: 1. Whether a ratification deed under Section 196 of the Contract Act is a fresh conveyance attracting full stamp duty and registration fee? 2. Whether the petitioner is entitled to a refund of excess stamp duty and registration fee paid on the ratification deed?
Ratio Decidendi: The ratification deed does not create a new conveyance; it merely confirms the original sale. The principal instrument (original sale deed) already bore the requisite stamp duty and registration fee. Under Section 4 of the Stamp Act and Article 1(n) of the Table of Fees, the ratification deed is chargeable only with a nominal registration fee of Rs.10/-. Hence, any excess payment must be refunded.
Result: Writ petition disposed of with direction to refund the excess amount as above. No costs. (Paras 15, 16)
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Table of Contents
2. What is the effect of ratification under Section 196 of the Indian Contract Act on the stamp duty payable on a ratification deed?
Ratification relates back to the original act; the original sale deed is the principal instrument, so no fresh stamp duty is payable. (Para 6 , 7 , 8 , 13 )
3. How does Section 4 of the Tamil Nadu Stamp Act apply to a ratification deed?
The ratification deed is a supplementary instrument; only the principal instrument (original sale deed) bears full stamp duty, ratification deed chargeable with nominal duty. (Para 10 , 11 )
4. What registration fee is payable on a ratification deed under Article 1(n) of the Table of Fees?
Registration fee is the same as fee leviable on value of original document at ad valorem rates, subject to a maximum of Rs.10. (Para 12 , 13 )
ORDER
The relief sought in this writ petition is to call upon the rejection proceedings of the third respondent in Na.Ka.No.817/B2/2023 dated 16.06.2023 and quash the same and consequently direct the first respondent to refund the excess stamp duty of Rs.6,00,497/- and the excess registration fee of Rs.3,43,416/- in all a sum of Rs.9,43,913/- paid on the deed of Ratification dated 27.09.2022 registered as Document No.14548 of 2022 with the office of the third respondent.
2. The case of the petitioner is that the petitioner had purchased the property bearing Plot No.62, comprised in S.No.38 and Patta No.16, bearing Old Door No.21, New Door No.3/23, 1st Street, Rajeshwari Nagar, Karampakkam Village, Poonamalle Taluk, Thiruvallur District measuring to an extent of 3200 sq.ft through the Power of Attorney of 1) Usha Rani Venkata Ramanujam 2) Preethi Venkata Ramanujam vide Sale deed dated 21.12.2011. Later, it was found that the said Power of Attorney did not carry the power to sell the subject property. Therefore, the said Vendors were called upon to execute a Ratification Deed (Deed of confirmation of sale). Accordingly, the aforesaid sale deed was ratified and registered by way of Ratification Deed dated 27.09.2022. Considering the Ratification Deed as deed of conveyance, the petitioner paid the excess stamp duty and registration fee. Hence, he made a representation dated 03.12.2022, seeking refund of excess stamp duty and registration fee. But, the said representation was rejected by the third respondent vide proceeding dated 16.06.2023 in Na.Ka.No.817/B2/2023, citing the reason that the deed of confirmation of sale/ratification deed amounts to a fresh conveyance. Challenging the said proceeding, the petitioner has come forward with the present writ petition.
3. Learned counsel for the petitioner would submit that in the present case, the agent who acted without any authority from the Principal can be ratified. Accordingly, the actions of the agent was ratified by the Principal, by virtue of Ratification Deed dated 27.09.2022, as defined under Section 196 of Indian Contract Act, 1872 . Therefore, once the said deed is ratified, there is no question of payment of full stamp duty and registration fee. Hence, he prayed for refund of excess stamp duty and registration fee.
4. Learned Government Advocate appearing for the respondents submitted that after a period of 11 years, the petitioner has approached the respondents for refund. Further, the stamp duty on the date registration of sale deed by the agent and the date of registration of Rectification Deed by the petitioner are entirely different. Therefore, there exist a different stamp duty. If at all the petitioner is entitled anything on the part of the stamp duty or registration charges, based on the registration of the sale deed presented by the agent in the year 2011, the limitation for making such claim also got expired. Since, his claim is barred by limitation, the petitioner is not entitled to any application for refund.
5. I have given due consideration to the submissions made by the learned counsel for the petitioner as well as the learned Government Advocate appearing for respondents and perused the materials available on record.
6. Initially, the petitioner’s vendors’ power agent executed a sale deed dated 21.12.2011. On perusal of the power of attorney, it is clear that the agent has not given any power to execute a sale deed. So, without any authority, he has executed a sale deed. In order to ratify the actions of the agent, the petitioner filed ratification application. Accordingly, a Ratification Deed was executed on 27.09.2022. According to the petitioner, once the ratification deed was filed to ratify all the actions of the agent, which was carried out unauthorizedly would be ratified with effect from the date of registration of the sale deed. Therefore, the actions of the agent had been ratified. At this juncture, it is pertinent to extract Section 196 of the Contra
