JUDGMENT
N.D. Ojha, C.J.
1. This order shall govern the disposal of Misc. Petition No. 3390 of 1986, Misc. Petition No. 3521 of 1986 and Misc. Petition 3637 of 1986 also. In all these writ petitions the validity of certain amendments made in the Stamp Act (hereinafter referred to as the Act) by M.P. Act No. 8 of 1975 has been challenged. To be specific, the amendments that have been made in Section 27 and Schedule 1 of the Act and Section 47-A as inserted in the Ad by the aforesaid amendment Act No. 8 of 197,S are sought to be declared ultra vires. Section 27 of the Act after its amendment by M.P. Act No. 8 of 1975 reads as hereunder :
“27. Facts affecting duty to be set forth in instrument — (1) The consideration, if any, the market value of the property and all other facts and circumstances affecting the chargeability of any instrument with duty or the amount of the duty with which it is chargeable, shall be fully and truly set-forth therein.
(2) In the case of instruments relating to immovable property chargeable with an ad valorem duty on the market value of the property, and not on the value set forth, the instrument shall fully and truly set forth the annual land revenue in the case of other immovable property, the local rates, municipal or other taxes, if any, to which such property may be subject, and any other particulars which may be prescribed by rules made under this Act.”
S. 47-A, on the other hand, which has been inserted by M.P. Act No. 8 1975 is to the following effect:
“47-A. Instruments undervalued how to be dealt with — (1) If the registering officers appointed under the Registration Act, 1908 (No. XVI of 1908) while registering any
instrument has reason to believe that the market value of the property which is the subject matter of such instrument has not been truly set forth in the instrument, he may, after registering such instrument, refer the same to the Collector for determination of market value of such property and the proper duty payable thereon.
(2) On receipt of a reference under Sub- section (1), the Collector shall, after giving the parties a reasonable opportunity of being heard and after holding an enquiry in such manner, as may be prescribed, determine the market value of the property which is the subject matter of such instrument and the duty as aforesaid. The difference, if any, in the amount of duty shall be payable by the person liable to pay the duty.
(3) The Collector may suo motu, within five years from the date of registration of any instrument not already referred to him under Sub-section (1), call for and examine the instrument for the purpose of satisfying himself as to the correctness of the market value of the property which is the subject matter of any such instrument and the duty payable thereon and if after such examination, he has reason to believe that the market value of such property has not been truly set forth in the instrument, he may determine the market value of such property and the duty as aforesaid in accordance with the procedure provided for in sub-sec.(2). The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty.
Provided that nothing in this sub-section shall apply to any instrument registered prior to the date of the commencement of the Indian Stamp (Madhya Pradesh Amendment)
Act, 1975.
(4) Any person aggrieved by an order of the Collector under sub-sec.(2) or sub-sec.(3) may in the prescribed manner appeal against such order to the Commissioner of the division.
(5) Any person aggrieved by an order passed in appeal under sub-sec.(4) may in the prescribed manner appeal against such an order to the Chief Controlling Revenue Authority Madhya Pradesh.
(6) Every first and second appeal shall be filed within thirty days from the date of the communication of the order against which the appeal is filed, along with a certified copy of the order to which objection is made and shall be presented and verified in such manner as may be prescribed :
Provided that in computing the period aforesaid, the time requisite for obtaining a copy of the order appealed against shall be excluded.
(7) The appellate authority shall follow such procedure as may be prescribed :
Provided that no order shall be passed without affording opportunity of being heard to the appellant.
(8) The order passed in second appeal or, where no second appeal is preferred the order passed in first appeal shall be final and subject to orders passed in first or second appeal, as the case may be the order passed by the Collector under sub-sec.(2) or sub-sec.(3) shall be final and shall not be called into question in any Civil Court or before any other authority whatsoever.
Explanation — For the purpose of this Act,
(i) Market value of any property other than the property which is the subject matter of conveyance by or on behalf of the Central Government or the State Government or any authority or body incorporated by or under any law for the time being in force, shall be estimated to be the price which in the opinion of the Collector or the Appellate Authority, as the case may be, such property would have fetched or fetch if sold in the market on the date of execution of instrument.
(ii) Market value of any property which is subject matter of conveyance by or on behalf of the Central Government or the State Government or any authority or body incorporated by or under any law for the time being in force, shall be the value shown in the instrument.
Entry No. 23 in Schedule I to the Act which deals with conveyance prior to its amendment by M.P. Act No. 8 of 1975 inter alia provides the mode of calculation of stamp duty treating “the amount or value of the consideration for such conveyance as set forth therein.” A’fter
its amendment by M.P. Act No. 8 of !975, it inter alia provides “23. Conveyance, not being a transfer charged or exempted under No. 62 where the market value of the property which is the subject matter of conveyance does not exceed…..” It is thus apparent that prior to
amendment of Entry No. 23 aforesaid by M.P. Act No. 8 of 1975 the amount or value of the consideration for such conveyance as set forth in the deed of conveyance constituted the basis for determining the stamp duty payable. The basis after the amendment is the market value of the property which is the subject matter of conveyance.
2. The facts, in brief, which give rise to the grievance of the petitioners in these four writ petitions are that sale deeds were executed on various dates on payment of stamp duty on the basis of the consideration shown in the said deeds. Subsequently, action was taken under Section 47-A as inserted in the Act by M.P. Act No. 8 of 1975 and the petitioners of these writ petitions were required to show cause as to why the stamp duty may not be determined on the basis of the market value of the property which was the subject matter of the various sale-deeds. In some of these cases orders determining stamp duty taking the market value of the property conveyed as the basis have been passed and it seems that in some order is yet to be passed.
3. In support of the submission that the amendments referred to above introduced in the Act by M.P. Act No. 8 of 1975 were ultra vires it was urged by learned counsel for the petitioners that it was not open to the State Legislature to introduce market value of the property which is the subject matter of conveyance as the basis for determination of the stamp duty payable. According to learned counsel, the amount or value of the consideration as set out in the deed of conveyance constituted the proper basis for determination of the stamp duty payable inasmuch as various considerations prevailed at the time of execution of the sale-deed and on account of those considerations it often happened that the property which was the subject matter of the conveyance had to be sold for an amount which did not represent
the market value of the property. It was urged that in this view of the matter for purposes of determination of stamp duty the amount or value of consideration as shown in the deed of conveyance would alone constitute proper basis for determination of the stamp duty and not the market value of the property conveyed. It appears that in pursuance of certain observations made by the Supreme Court in the case of Himalaya House Co. Ltd. v. Chief Controlling Revenue Authority, AIR 1972 SC 899 amendments similar to the amendments made by M.P. Act No. 8 of 1975 were made by various other States also. What has been emphasised by learned counsel for the petitioners in these cases as stated above is that the State Legislature was not competent to incorporate the concept of market value of property which is the subject matter of conveyance as the basis for determination of the stamp duty. In this connection our attention was invited by learned counsel for the petitioners to Entry 63 of List II of the Seventh Schedule to the Constitution which reads as hereunder :
“63. Rates of stamp duty in respect of documents other than those specified in the provisions of List I with regard to rates of stamp duty.”
On its basis it was urged that the State Legislature could only make such amendments in the Act as were relevant for determining the rates of stamp duty alone. We find it difficult to agree with this submission. This argument ignores Entry 44 of List III of the Seventh Schedule to the Constitution which reads as hereunder :
”44. Stamp duties other than duties or fees collected by means of judicial stamps, but not including rates of stamp duty.”
While dealing with the rule of interpretation of legislative entries, it was held by the Supreme Court in Calcutta Gas Co. v. State of West Bengal AIR 1962 SC 1044 that in the matter of construing entries in the lists given in Schedule 7 of the Constitution certain rules of interpretation are now well settled. The power to legislate is given to the appropriate Legislatures by Article 246 of the Constitution, The entries in the three Lists are only Legislative heads or fields of legislation, they
demarcate the area over which the appropriate Legislatures can operate. It is also settled that widest amplitude should be given to the language of the entries. But some of the entries in the different lists or in the same list may overlap and sometimes may also appear to be in direct conflict with each other. It is then the duty of the Court to reconcile the entries and bring about harmony between them. The underlying principle in such cases is that a general power ought not to be so construed as to make a nullity of a particular power conferred by the same Constitution and operating in the same field when by reading the former an a more restricted sense effect can be given to the latter in its ordinary and natural meaning. Thus, every attempt should be made to harmonize the apparently conflicting entries not only of different Lists but also of the same List and to reject that construction which will rob one of the entries of its entire content and make it nugatory. In a very recent decision in Kasturi Lal Harlal v. State of U.P., AIR 1987 SC 27 it was held by the Supreme Court that it is now well settled that an entry in a legislative List must be read in its widest amplitude and the legislature must be held to have power not only to legislate with respect to the subject matter of the entry but also to make ancillary or incidental provision in aid of the main topic of legislation. The scope of Entry 63 of List II and Entry 44 of List III came up for consideration squarely before the Supreme Court in the case of Bar Council of Uttar Pradesh v. State of U.P., AIR 1973 SC 231. It was held:
“If, however, it is purely a taxation measure then it would fall within Entry 44 of the Concurrent List in which event both the Parliament and the State Legislature would be competent to enact legislation for the levy of the duty although it is only under Entry 63 of List II that rates can be prescribed by the State Legislature. In other words, the charging provisions of Article 254 of the Constitution, it is well settled that the scheme of the Entries in the various lists is that taxation is not intended to be comprised in the main subject in which ‘it might on an extended construction be regarded as included but is treated as a distinct matter for the purpose of legislative competence.’ Even under the residuary power
of legislation conferred by Article 248 the Parliament can only impose that tax which is not mentioned in either List III or List II”.
On a conspectus of these authorities it is, therefore, apparent that in the exercise of powers conferred on it by Entry 63 of List II and Entry 44 of List III, it was open to the State Legislature not only to make an amendment in the Act in regard to the rates of stamp duty but also in regard to the mode of computation of stamp duty. In other words, it was open to the State Legislature to lay down that the basis for computing stamp duty shall not be the amount or value of the consideration for the conveyance as set forth therein but it shall be the market value of the property which is the subject matter of conveyance.
4. It was then urged by learned counsel for the petitioners that charging section in the Act is Section 3 and since no amendment had been made in this section by M.P. Act No. 8 of 1975, the basis for computing the stamp duty could not be altered merely by making an amendment in Schedule I. We find it difficult to agree with this submission. Section 3, inter alia, contemplates “Subject to the provisions of this Act and the exemptions contained in Schedule I, the following instruments shall be chargeable with duty thereof respectively, that is to say…..” Section 3 does not provide that the basis for calculating stamp duty shall be “the amount or value of the consideration for such conveyance as set forth therein.” This provision, on the other hand, has been made in Schedule I. The same Schedule also provides the rate on which the stamp duty is to be calculated. It thus appears that Entry 23 of the Schedule not only makes provision for the rate of calculation of stamp duty but also for the basis on which the duty is to be calculated on the rate prescribed therein. The charging section in the Act, therefore, apparently is not Section 3 minus the Schedule but Section 3 with the Schedule. When an amendment was made by M.P. Act No. 8 of 1975 in the Schedule whereby the basis for computation of stamp duty was amended, it is apparent that an amendment was made even in the charging section. Such an amendment in view of the power conferred on the State Legislature by
Entry 63 of List II and Entry 44 of List III was thus obviously within the Legislative competence of the State Legislature. In this connection it may be pointed out that the validity of a similar amendment made in the State of Madras came up for consideration before a Division Bench of the Madras High Court in State of Tamil Nadu v. T.N. Chandrasekharan, AIR 1974 Mad 117. Repelling the contention that the amendment was invalid, it was held :
“We agree with him that stamp duty is a duty on an instrument as defined in the Stamp Act, and that this concept as to the character of the duty is in accordance with the British and Indian Legislative practice, and the scope of Entry 44 of List III of the Seventh Schedule to the Constitution, to wit ‘stamp duty other than the duties or fees collected by means of judicial stamps but not including rates of stamp duty.’ But we cannot agree with him that the substitution made by the Amending Act has altered the character of the duty. While stamp duty is a charge on the instrument which by itself is the taxable event, the measure of charge may be fixed or ad valorem. Chargeable event which is an instrument, as defined in the Act and described in the first column of the First Schedule to the Act, is not to be confused or mixed up, or identified with the measure of duty, which is indicated in the second column of that Schedule. Section 3 of the principal Act, which is the charging section makes this clear, that is what attracts liability to duty is the instrument of the particular description, the charge is on the instrument, not on the consideration or amount indicated in the document which is but a measure of, or the basis for computation of the extent of liability to stamp duty. The section says that every instrument mentioned in the Schedule, subject to exemptions or exceptions, shall be chargeable with duty of the amount indicated in that Schedule as the proper duty therefor. Liability to duty is on the instrument, and its quantum depends on its description as well as the measure indicated in the First Schedule to the Act. To illustrate, an acknowledgment attracts stamp duty as an instrument, and for an instrument of that character or description, the proper stamp duty is fixed as 15 p. Conveyance in Entry 23
of the Schedule attracts duty as an instrument of conveyance, but the proper stamp duty is measured on the amount of value of the consideration for such conveyance as set forth therein, which works out on a slab basis. Section 27 of the principal Act requires facts affecting duty to be set forth in the instrument. If the value of the property is understood, Section 64 makes it an offence punishable with fine. But on that account an instrument will not become void, nor is it rendered inadmissible in evidence. The Amending Act, in order to check evasion, required by the substitution complained against, market value to be mentioned in the instrument of conveyance, gift, or partition as the basis for measure of the extent of liability, or quantum of stamp duty with which such instrument is chargeable, and provides for determination of the true market value where it is suspected to be understated, and right of appeal to Court by an aggrieved party. We are clearly of opinion that the amendment to that effect has not shifted the chargeable event from an instrument to market value, and the duty after the Amending Act is still on the instrument, and not on the market value any more than consideration mentioned therein. We hold that the Amending Act is within the competence of the State Legislature.”
5. As regards the submission made by learned counsel for the petitioners that there were circumstances on account of which property had sometime to be sold for a consideration which did not represent the market value, suffice it so say that care has been taken of this aspect of the matter in Section 47-A which has been inserted in the Act by M.P. Act No. 8 of 1975. The said section contains an explanation after Sub-section (8) which has already been quoted above. Clause (i) of the Explanation lays down a very salutary principle for determining the market value, the same being “the price which in the opinion of the Collector or the Appellate Authority, as the case may be, such property would have fetched or fetch if sold in the market on the date of execution of instrument. It is well settled that in such context ‘opinion’ means opinion formulated on objective considerations. When clause (i) of the Explanation talks of the price which the property would have fetched or fetch if sold
in the market on the date of execution of instrument, it obviously contemplates consideration of such circumstances also on account of which that particular property could be sold for a particular price. Indeed, rules have been framed for determining market value. These rules are called the Indian Stamp (Madhya Pradesh Prevention of Undervaluation of Instruments) Rules, 1975, Rule 5 of these rules contains the principles for determination of market value. On a bare perusal of these principles it is apparent that they are very exhaustive and include almost every relevant consideration for determining market value. Rule 6, inter alia, provides that before determining the market value an opportunity shall be given by the Collector to the parties to submit their objections and representations and to grant them hearing also before passing final order determining the market value. In this connection it was pointed out by learned counsel for the petitioners that the State Government had prepared a list as is apparent from para. 10 of the return filed in Misc. Petition No. 3637 of 1986 which states that the rate list has been prepared by the State Government on the basis of previous transactions and the same is maintained by the office and that in the instant cases the same duty was not paid according to the list. According to the learned counsel for the petitioners, notwithstanding the specific procedure prescribed for determining the market, value in Section 47-A as inserted by M.P. Act No. 8 of 1975 and Section 5 of the rules referred to above, the market value was being determined on the basis of the list prepared by the State Government and that too even without disclosing the said list to the persons concerned. It was urged that when the market value was to be determined by the Collector, his discretion could not be guided or fettered by the State Government by preparing a list in this behalf. On principles, this submission finds support from the decision of the Supreme Court in Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR 1952 SC 16. In that case the discretion to cancel or suspend a licence granted in pursuance of the requisite licensing rules vested in the Commissioner of Police. It was held by the Supreme Court that since the power to do so was vested in the Commissioner of Police
and not in the State Government, it could only be exercised by him at his discretion and not at the direction of the State Government. Shri Dixit, learned Deputy Advocate General, however, in this connection made a statement that the list prepared by the State Government was not meant to be treated as conclusive but only laid down the broad guidelines. According to him, the broad guidelines provided therein were to be considered along with other relevant circumstances. In view of the statement made by Shri Dixit, we do not find it necessary to either quash the list which may have been prepared by the State Government or to issue any other direction in regard to that list. We, however, wish to make it clear that while determining the market value of a particular property, the Collector shall follow the principles contained in Section 47-A and Rule 5 referred to above. If any Broad guideline that may be contained in the list prepared by the State Government falls within any of the principles referred to in Section 47-A and Rule 5, the same may be considered but only after disclosing the contents of the list containing guidelines to the person concerned to whom notice under Rule 6 of the rules is contemplated to be issued. The list shall be treated only as providing one of the guidelines and considered as such only and shall in no case be treated as conclusive. In view of the foregoing discussion, we are of the opinion that the impugned provisions incorporated in the Act by M.P. Act No. 8 of 1975 were within the legislative competence of the State of Madhaya Pradesh and are not ultra vires.
6. Coming to the merits about the determination of the amount which is to constitute the basis for computing the stamp duty in each case, we may point out that in those cases where amount has not yet been determined by the Collector, the proceedings do not deserve to be quashed and the petitioners should be required to appear before the Collector and get the matter finally decided or to take recourse to such other remedy as may be available under the Act. In such of the cases where the matter has already been decided, we do not find it expedient to interfere inasmuch as appeal has been provided against such determination under
S. 47-A. In view of the principles laid down in this behalf by the Supreme Court in Titaghur Paper Mills Co. Ltd. v. State of Orissa, AIR 1983 SC 603 and reiterated in Assistant Collector of Central Excise. Chandan Nagar. West Bengal v. Dunlop India Ltd. AIR 1985 SC 330, the petitioners in whose cases such orders have been passed should, therefore, first exhaust the alternative remedy of appeal. In this connection, we may point out that if such an appeal is filed and on account of the pendency of the writ petition in this court the limitation for filing the appeal may have run out, the appellate authority shall condone the delay and dispose of the appeal on merits keeing in view of the observations made by the Supreme court in M/s. Nehha and Co. v. State of Gujarat, AIR 1986 SC 987 where, in a similar situation, it was held in the last sentence of para. 8 of the report that the pendency of the writ petitions may be considered as sufficient ground for condoning the delay in availing of the alternative remedies.
7. In regard to four out of the five sale-deeds which were the subject matter of proceedings challenged in Misc. Petition No. 3637 of 1986, however, we are of the opinion that the orders passed in respect thereof deserve to be quashed on the ground that the proceedings culminating in those orders were initiated beyond the period of five years contemplated by Sub-section (3) of Section 47A of the Act as inserted by M.P. Act No. 8 of 1975. Para 2 of the writ petition gives the various dates of these five sale deeds. They are 13-5-1981, 4-7-1981, 10-8-1981, 30-9-1981 and 7-8-1981. It has been stated in para. 4 of the writ petition that the District Registrar, respondent No. 2, reopened the documents and issued the notices to the petitioners after five years. The return which has been filed in this case contains an averment in para. 4 that notices were issued for 25-9-1986. Although it has been stated in the said paragraph that the case was registered in the month of Jan. 1986, no document or any other material has been furnished along with the return which ” may support this contention that the proceedings were initiated in Jan. 1986. As seen above, Rule 6 of the rules contemplates an opportunity being given to the parties to
submit objections and representations as also of hearing. Such opportunity was given according to para 4 of the return by issuing a notice requiring the petitioners to appear on 25-9-1986. In the absence of any material, action as contemplated by Sub-section (3) of Section 47-A, initiated in regard to the sale-deeds referred to in para. 2 of the writ petition other than the sale-deed dt. 30th Sept. 1981 in respect whereof notice was issued for 25-9-1986, was obviously beyond five years, and qua them the proceedings were barred by time. Consequently, the orders redetermining the amount of stamp duty in regard to the sale-deeds dt. 13-5-1981, 4-7-1981, 10-8-1981 and 7-8-1981 deserve to be quashed.
8. In the result, Writ Petition No. 3637 of 1986 is allowed in part to this extent that the orders re-determining the stamp duty in regard to sale-deeds dt. 13-5-1981, 4-7-1981, 10-8-1981 and 7-8-1981 are quashed. The writ petition in so far as the remaining reliefs are concerned is dismissed. The other three writ petitions are dismissed in their entirety. The dismissal of these writ petitions, however, is subject to the observations made in regard to the alternative remedies to be pursued by the petitioners. In the circumstances of the case, however, there shall be no order as to costs in any of these writ petitions. The outstanding amount of security may be refunded to the petitioners.