BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 17/11/2009
Coram
THE HONOURABLE MR.JUSTICE S.PALANIVELU
C.M.A.(MD).No.636 of 2009
and
M.P.(MD)No.1 of 2009
Santosh ... Appellant/Petitioner
Vs
1.The Inspector General of Registration and
Chief Revenue Controlling Authority,
120, Santhom Highway,
Pattinapakkam,
Chennai - 600 028. ... 1st Respondent/Respondent
2.The Special Deputy Collector (Stamps),
Collectorate Building,
Madurai - 625 020.
3.The Sub-Registrar,
Nilakottai,
Dindigul District. ... Respondents/Third parties
PRAYER
Appeal filed under Section 47(A)(10) of the Indian Stamp Act , against
the order dated 17.04.2009 of the Inspector General of Registration in
proceedings No. g.K. .No.4835/N 4/07.
!For Petitioner ... Mr.K.Sekar
^For Respondents ... Mr.So.Paramasivam
Government Advocate.
***
:ORDER
This Civil Miscellaneous Appeal is filed against the order of the
Inspector General of Registration in proceedings No. g.K.No.4835/N 4/07 dated
17.04.2009.
2. The appellant is the successful bidder in an auction conducted by the
Tamil Nadu Industrial Investment Corporation Limited, established under the
Indian Companies Act, with respect to the lands measuring about 1.08 Acres and
the building in Survey Nos.23/2, 23/4 and 23/6 in Veelinaickenpatty, Nilakkottai
Taluk, Dindigul District and 3 Acres 3 cents in survey No.11/2 in the same
village. The sale was conducted on 03.03.1998 and the sale price was
Rs.65,000/-. The sale deed was executed by the above Corporation on 17.08.1999
and the same was registered on 27.04.2000. At the outset, for Rs.65,000/-,
stamp duty was paid and was accepted. Thereafter deficiency in stamp duty of
Rs.12,840/- was collected from the appellant, under Section 41 of the Indian
Stamp Act, by the Sub-Registrar, Nilakkottai, as per the guideline valuation of
the above said property as on the date of the sale.
3. The Special Deputy Collector (Stamps), Madurai, issued Form No.1 to the
appellant requiring him to pay additional stamp duty of Rs.16,112/-, assessing
the market value of the property at Rs.3,06,268/-. Thereafter, he preferred an
appeal before the first respondent. The first Respondent, in turn, directed the
District Registrar, Dindigul, to inspect the property, in pursuance of which, he
visited the property and submitted the report to the first respondent stating
that the property remains as a barren land, that there are small rocks and that
there was no symptom to ascertain running any factory
or construction of any building and recommended that the sale price fixed by the
corporation may be accepted as market value of the property.
4. However, the first respondent did not concede the report containing the
recommendations of the District Registrar, Dindigul and proceeded to assess the
market value of the property on the basis of the guidelines value maintained for
the above said survey numbers. As per the guideline value, the market value is
Rs.3/- for one sq.ft. in Survey No.23/3 and for 1 cent Rs.500/- for survey
No.11/2, thereby the valuation made in the Deputy Collector (Stamps), Madurai,
could be sustained and directed the appellant to pay as required by the Deputy
Collector (Stamps). Challenging the above said proceedings of the first
respondent, the appellant is before this Court.
5. Mr.K.Sekar, learned counsel for the appellant contended that the
guideline value maintained by the Sub-Registrar’s Office, would not reflect the
actual market value of the property and that when a statutory body fixes its
market value of the property for the purpose of conducting auction, it has to
be treated as market value of the property and the observations of first
respondent are not at all maintainable.
6. Conversely, Mr.So.Paramasivam, learned Government Advocate, would
submit that there is no wrong on the part of the first respondent to reject the
recommendations of the District Registrar, Dindigul and that the present market
value of the property has been correctly fixed as per the guideline value and
the appellant has been required to pay the additional stamp duty.
7. In support of his Contentions, the learned counsel for the appellant
would place reliance upon the decision of the Supreme Court in VI(2009) SLT
673=2009 (3) L.W.236 (DB), in V.N.Devadoss Vs. Chief Revenue Control Officer,
Cum-INS and Others, wherein their Lordships were pleased to observe that the
Explanation to Sub-rule (5) of the Section 47 of the Indian Stamp Act, makes the
position clear that the value would have fetched or would fetch if sold in the
open market on the date of execution of the instrument of conveyance and that
property was offered for sale in open market and bids were invited by the
statutory body i.e. part of Industrial and Financial Reconstructions and the
Appellate authority and that no question of any intention to defraud revenue or
non- disclosure of correct price would arise. The relevant portion of the
Judgment goes thus:
“10. Market value is a changing concern. The explanation to Sub-rule (5) makes
to position clear that value would be such as would have fetched or would fetch
if sold in the open market on the date of execution of the instrument of
conveyance. Here, the property was offer for sale in the open market and bids
we invited. That being so, there is no question of any intention to defraud the
revenue or non disclosure of the correct price. The fact scenario as indicated
above goes to show to the properties were disposed of by the order of BIFR
and AIFR and that too on the basis of value fixed by ASG. The view
expressed by the Assets Sales committee which consisted of members such as
representatives of IDBI, Debenture Holders, Government of West Bengal and
Special Director of BIFR. That being so, there is no possibility of any under
valuation and, therefore, Section 47-A of the Act has no application. It is not
correct as observed by the High Court that BIFR was only a mediator.”
7. The said decision has been followed by this Court in the judgment
reported in 2009(4) L.W.532, in Ramkumar Giri Vs. The Chief Controlling Revenue
Authority cum Inspector General of Registration and Others, wherein the learned
Judge has opined that the Chief Controlling Revenue Authority had relied upon
only the guideline value. The guideline value is not the market value. He has
not substantiated with any material also in his order for fixing the market
value of the property. Concluding the Judgment, it is stated that it cannot be
said in this case that the market value of the property which is the subject
matter of conveyance, has not been truly set forth with a view to fradulently
evade payment of proper stamp duty.
8. Following the ratio laid down in the above said Honourable Supreme
Court decision, it is to be held that there could be no malafide intention on
the part of the statutory authority, namely, the Corporation and the market
value as fixed by the said authority for the purpose of auction, could be
treated to be the market value of the property and the collection of stamp duty
on that basis, is appropriate. Section 47(A) of the Indian Stamp Act was
incorporated in the Indian Stamp Stamp Act with an intention to curtail the
parties to enter into transactions relating to the immovable properties to show
lesser valuation of the properties so as to defraud the revenue to the
Government. But if any malafide intention could not be ascertained in the minds
of the parties, then the Court may interfere and direct the authorities to abide
by the settled procedures.
9. In such view of this matter, this Court is of the considered opinion
that there was no suppression of material factors on the part of the Corporation
and the appellant and the sale price mentioned in the sale deed is correct and
there is no need to pay further stamp duty as called for in the impugned
proceedings
passed by the first respondent. The appeal deserves to be allowed.
10. In fine, the above Civil Miscellaneous Appeal is allowed and the
connected Miscellaneous Petition is closed. No costs.
ssl
To
1. The Inspector General of Registration and
Chief Revenue Controlling Authority
120, Santhom Highway
Pattinapakkam
Chennai – 600 028.
2. The Special Deputy Collector (Stamps)
Collectorate Building
Madurai – 625 020
3. Sub-Registrar
Nilakottai,Dindigul District