BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 03/09/2009 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM W.P.(MD)No.8647 of 2009 and M.P.(MD)No.1 of 2009 Sankareswari ... Petitioner vs 1.The Inspector General of Registration, Santhom High Road, Chennai-4. 2.The Special Sub Collector (Stamps), Office of the District Collector Campus, Madurai-625 020. 3.The Sub Registrar, Kallimandhayam, Oddanchathiram Taluk, Dindigul District. ... Respondents PRAYER Writ Petition filed under Article 226 of the Constitution of India praying for issuance of a Writ of Certiorarified Mandamus calling for the records relating to the proceedings in SR No.659/9/E dated 12.06.2009 in respect of the sale deed document Number 451 dated 29.04.2009 of the second respondent and quash the same and consequently, direct the second and third respondents to return the document without insisting for additional stamp duty. !For Petitioner ... Mr.S.Siva Thilakar ^For Respondents ... Mr.Pala Ramasamy Spl.Government Pleader :ORDER
The prayer in the writ petition is to quash the proceedings dated
12.06.2009 issued by the second respondent demanding deficit stamp duty from the
petitioner in respect of a sale deed, which was registered on 29.04.2009 as
document number 451/2009 on the file of the second respondent and for a further
direction to the respondents to return the document without insisting on the
additional stamp duty.
2. The case of the petitioner is that he filed a suit for specific
performance against M.Sakthivel and others in O.S.No.15 of 2007 on the file of
Sub Court, Palani, which was decreed by a judgment and decree dated 25.04.2007
and thereafter, the petitioner filed an execution petition in E.P.No.15 of 2007
for execution of the sale deed. After depositing the sale consideration as per
the decree, the sale deed was registered and the same was presented for
registration before the third respondent and the petitioner had paid the
appropriate stamp duty as per the consideration reflected in the document. The
Sub Collector (Stamps) issued notice in Form No.I dated 12.06.2009 stating that
the document is undervalued and made a demand for additional stamp duty.
3. One of the grounds raised in the writ petition is that the impugned
communication demanding deficit stamp duty is illegal, since the sale deed was
registered pursuant to the decree granted by a civil Court in a suit for
specific performance and the instrument cannot be stated to be undervalued.
4. The said issue has already been settled by the Honourable Supreme Court
in a decision reported in 2008(1) CTC 60 (State of Rajasthan v. Khandaka Jain
Jewellers), wherein the Honourable Supreme Court held in paragraph 10 as
follows;
“It may be mentioned that there is a difference between an agreement to
sell and a sale. Stamp duty on a sale has to be assessed on the market value of
the property at the time of the sale, and not at the time of the prior agreement
to sell, nor at the time of filing of the Suit. This is evident from Section 17
of the Act. It is true that as per Section 3, the instrument is to be registered
on the basis of the valuation disclosed therein. But Section 47-A of the
Rajasthan (Amendment) Stamp Duty Act contemplates that in case it is found that
properties are under valued then it is open for the Collector (Stamps) to assess
the correct market value. Therefore, in the present case when the Registering
Authority found that valuation of the property was not correct as mentioned in
the instrument, it sent the document to the Collector for ascertaining the
correct market value of the property. The expression “execution” read with
Section 17 leaves no manner of doubt that the current valuation is to be seen
when the instrument is sought to be registered. The stamp Act is in the nature
of a taxing statute, and a taxing statute is not dependant on any contingency.
Since the word “execution” read with Section 17 clearly says that the instrument
has to be seen at the time when it is sought to be registered and in that if it
is found that the instrument has been undervalued then it is open for the
Registering Authority to enquiry into its correct market value. The learned
Single Judge as well as the Division Bench in the present case had taken into
consideration that the agreement to sell was entered into but it was not
executed. Therefore, the incumbent had to file a Suit for seeking a decree for
execution of the agreement and that took a long time. Therefore, the Courts
below concluded that the valuation which was in the instrument should be taken
into account. In out opinion this is not a correct approach. Even the valuation
at the time of the decree is also not relevant. What is relevant in fact is the
actual valuation of the property at the time of the sale. The crucial expression
used in Section 17 is “at the time of execution”. Therefore, the market value of
the instrument has to be seen at the time of the execution of the sale deed, and
not at the time when agreement to sale was entered into. An agreement to sell is
not a sale. An agreement to sell becomes a sale after both the parties signed
the sale deed. A taxing statute is not contingent on the inconvenience of the
parties. It is needless to emphasize that a taxing statute has to be construed
strictly and considerations of hardship or equity have not role to play in its
construction. VISCOUNT SIMON quoted with approval a passage from ROWLATT, J.
expressing the principle in the following words
“In a taxing Act one has to look merely at what is clearly said. There is
no room for any intendment. There is no equity about a tax. There is no
presumption as to tax. Nothing is to be read in, nothing is to be implied. One
can only look fairly at the language used.”
5. In view of the law laid down by the Honourable Supreme Court, the
contentions raised by the petitioner is liable to be rejected.
6. It is to be noted that in the impugned order, the petitioner has been
granted 21 days time to submit his objection to the notice in Form I, this
period was already expired. Therefore, I deem it proper that the petitioner
shall be entitled to submit his objection to the impugned notice. Further the
petitioner has also sought for release of the document.
7. In view of the same, the writ petition is disposed of with the
following directions:-
i) The petitioner shall submit his objection to the impugned notice,
within a period of three weeks from the date of receipt of a copy of this order
and thereafter, the second respondent shall consider the same and pass orders in
accordance with law and as per the Provisions of the Indian Stamp Act and the
Rules framed thereunder;
(ii) The third respondent shall return the document registered as document
No.451/2009, within a period of two weeks from the date of receipt of a copy of
this order with an endorsement stating that the reference under Section 47(A)(1)
is pending;
(iii) The third respondent shall also make necessary entries in the
registers showing the pendency of the proceedings under Section 47(A)(1) so as
to reflect the same in the encumbrance certificates in the interest of
purchasers;
(iv) Pending the final order to be passed under Section 47(A)(1), there
shall be a charge over the property in favour of the Government as per Section
47(A)(4) of the Act; and
(v) After completion of the entire proceedings under Section 47(A)
including the appellate remedy available under the same, the petitioner shall
pay the amount which is arrived at ultimately and after such payment on
production of the original sale deed, the third respondent shall make necessary
endorsements stating that the entire amount due as per Section 47(A) has been
paid and there is no amount due under the Indian Stamps Act.
No costs. Consequently, the connected miscellaneous petition is closed.
JIKR
To
1.The Inspector General of Registration,
Santhom High Road,
Chennai-4.
2.The Special Sub Collector (Stamps),
Office of the District Collector Campus,
Madurai-625 020.
3.The Sub Registrar,
Kallimandhayam,
Oddanchathiram Taluk,
Dindigul District.