{"id":138606,"date":"2010-03-23T00:00:00","date_gmt":"2010-03-22T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/ms-harshpriya-construction-p-vs-unknown-on-23-march-2010"},"modified":"2014-06-02T18:12:56","modified_gmt":"2014-06-02T12:42:56","slug":"ms-harshpriya-construction-p-vs-unknown-on-23-march-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/ms-harshpriya-construction-p-vs-unknown-on-23-march-2010","title":{"rendered":"M\/S. Harshpriya Construction (P) … vs Unknown on 23 March, 2010"},"content":{"rendered":"
Orissa High Court<\/div>\n
M\/S. Harshpriya Construction (P) … vs Unknown on 23 March, 2010<\/div>\n
                                    W.P.(C) NO.8690 OF 2009\n\n\n          In the matter of an application under Articles 226 and 227 of the\n          Constitution of India.\n\n          M\/s. Harshpriya Construction (P) Ltd.                .......                   Petitioner.\n\n                                                         Versus.\n\n          The Inspector General of Registration,\n          Orissa, Cuttack & Others                             ...........                 Opp.parties\n\n\n                         For petitioner          :       M\/s. S.S. Das & Sandipani Mishra\n\n                         For opp. parties        :       Additional Government Advocate\n\n                                                 AND\n\n                                    CONTC NO.963 OF 2009\n\n          M\/s. Harshpriya Construction (P) Ltd.                .......                   Petitioner.\n\n                                                         Versus.\n\n          T.M.S. Suguna, the Inspector General of\n          Registration, Orissa, Cuttack                        ...........                 Opp.party\n\n                         For petitioner          :       M\/s. S.S. Das & Sandipani Mishra\n\n                         For opp. parties        :       Additional Government Advocate\n\n          PRESENT\n\n                    THE HON'BLE SHRI ACTING CHIEF JUSTICE I.M.QUDDUSI\n                                          AND\n                           THE HON'BLE SHRI JUSTICE B.K.NAYAK\n\n          --------------------------------------------------------------------------------------\n<\/pre>\n
          Date of hearing : 03.11.2009 :               Date of judgment: 23.03.2010<\/p>\n
B.K.NAYAK, J.            The short question that arises for consideration in this writ<\/p>\n
          application     is   whether     the       Registering   Officer   under    the   Indian
\n                                          2<\/span><\/p>\n
Registration    Act   can   retain   possession    of   the    original   registered<\/p>\n
instrument (sale deed) where it raises a dispute in terms of Section 47-A<\/p>\n
of the Indian Stamp (Orissa Amendment) Act with regard to the stamp<\/p>\n
duty payable on such instrument.\n<\/p>\n
2.             The facts leading to the formulation of the aforesaid question<\/p>\n
have been depicted in the writ petition as follows:\n<\/p>\n
               The petitioner, a private limited company registered under the<\/p>\n
Companies Act, represented through its Director carries on business of<\/p>\n
development of land and construction of apartments. For the purpose of<\/p>\n
its business, the petitioner purchased a piece of Sarad non-irrigative<\/p>\n
variety of land measuring Ac.0.927 dec. pertaining to Sabik Plot No.1807<\/p>\n
and Sabik Khata No.507 of Mouza Gadakana                      under Bhubaneswar<\/p>\n
Tahasil of Khurda district corresponding to Mutation Plot No.3803 and<\/p>\n
Mutation Khata No.1053\/29, which further corresponds to                   Not Final<\/p>\n
Settlement Drat Khatiyan Plot No.1558 under Not Final Settlement Draft<\/p>\n
Khatiyan Khata No.3077, from the recorded owner by virtue of sale deed<\/p>\n
no.8927   which       was   registered   before   the   District    Sub-Registrar,<\/p>\n
Khurda(opposite party no.2) on 06.08.2007. The consideration money for<\/p>\n
the land as set forth in sale deed is Rs.30.00 lakhs, which is the prevalent<\/p>\n
market value of the land in question, and the petitioner-purchaser paid<\/p>\n
the required stamp duties and registration fees on such value of the land.<\/p>\n
Even after the registration when the registered sale deed was not<\/p>\n
returned, on enquiry the petitioner was informed that the valuation of the<\/p>\n
land mentioned in the sale deed as well as the stamp duties and
\n                                       3<\/span><\/p>\n
registration fees paid thereon are much less and, therefore, the petitioner<\/p>\n
was required to pay the deficit stamp duties and the registration fees after<\/p>\n
the   matter of under valuation       was adjudicated by the competent<\/p>\n
authority. The petitioner was also informed that only after payment of<\/p>\n
deficit stamp duties and registration fees, the original sale deed shall be<\/p>\n
returned to the petitioner. It is further stated that the valuation set forth<\/p>\n
in the sale deed exceeds Rs.1.00 lakhs and, therefore, as per the<\/p>\n
notification dated 31.05.2002 of the State Government in the Revenue<\/p>\n
Department, the Inspector General of Registration (opposite party no.1) is<\/p>\n
competent to act as the Stamp Collector under Section 47-A of the Stamp<\/p>\n
Act and adjudicate the dispute. The petitioner, however, received notice<\/p>\n
from opposite party no.2, the District Sub-Registrar, Khurda, a year after<\/p>\n
registration of the instrument calling upon the petitioner to appear before<\/p>\n
him on 18.7.2008 and to answer the claim of Rs.12,04,747\/- payable<\/p>\n
towards deficit registration fees and stamp duties on the instrument in<\/p>\n
question. Having not received      the original registered instrument, the<\/p>\n
petitioner is not in a position to carry on his business and also is unable<\/p>\n
to avail loans from the Banks. Finding no other way, the petitioner<\/p>\n
enquired from the office of opposite party no.1 about the pendency of<\/p>\n
undervaluation proceeding and also filed necessary objection along with<\/p>\n
some documents as well as an application for release of the original sale<\/p>\n
deed, but opposite party no.1, being in charge of a number of posts has<\/p>\n
not yet considered the objection and application of the petitioner.
\n                                      4<\/span><\/p>\n
3.          It is contended on behalf of the petitioner that provision of<\/p>\n
Sub section (2) of Section 61 of the Registration Act casts a statutory duty<\/p>\n
on the Registering Officer to return the original instrument immediately<\/p>\n
after completion of registration and that the mere initiation of a<\/p>\n
proceeding under Section 47-A of the Stamp Act for the purpose of<\/p>\n
adjudication of the payability of any further stamp duty and registration<\/p>\n
fees does not entitle the Registering Authority to retain possession of the<\/p>\n
original registered instrument.\n<\/p>\n<\/p>\n
            The petitioner, therefore, seeks a direction to the opposite<\/p>\n
parties to return his original sale deed and to quash the notice under<\/p>\n
Annexure-1.\n<\/p>\n
4.          The opposite parties have filed two counter affidavits<\/p>\n
contending inter alia that soon after the registration of the sale deed it<\/p>\n
was found that the instrument was prima facie undervalued and,<\/p>\n
therefore, the proceeding under Section 47-A of the Stamp Act has been<\/p>\n
initiated and the case was referred to the I.G.R. (opposite party no.1) for<\/p>\n
adjudication and notice under Annexure-1 has been issued to the<\/p>\n
petitioner in accordance with the procedure prescribed under the Orissa<\/p>\n
Stamp Rules, 1952. It is also stated that as per Rules 28 and 29 of the<\/p>\n
said rules, the instrument, which has been referred to the Stamp<\/p>\n
Collector under Section 47-A of the Stamp Act, shall be returned with the<\/p>\n
order of the Collector to the Registering Officer. The opposite parties,
\n                                       5<\/span><\/p>\n
therefore, cannot be said to have withheld or retained the instrument<\/p>\n
illegally.\n<\/p>\n
5.           Section 61(2) of the Registration Act, 1908 casts obligation on<\/p>\n
the Registering Officer to return the Registered instrument to the person<\/p>\n
concerned on completion of registration whereas Section 47-A of the<\/p>\n
Stamp (Orissa Amendment) Act speaks about reference of a dispute by<\/p>\n
the Registering officer to the Stamp Collector when he has reason to<\/p>\n
believe that the market value of the property which is the subject matter<\/p>\n
of such instrument has not been truly set forth in the instrument. For<\/p>\n
better appreciation, Section 47-A of the Stamp (Orissa Amendment) Act is<\/p>\n
quoted hereunder :\n<\/p>\n
                   “47-A. Instruments under-valued how to be
\n                   dealt with-(1) where the registering officer under
\n                   the Registration Act,16 of 1908, while registering
\n                   any instrument of conveyance, exchange, gift,
\n                   partition or settlement has reason to believe that
\n                   the market value of the property which is the
\n                   subject-matter of such instrument has not been
\n                   truly set forth in the instrument, he may, after
\n                   registering such instrument, refer the matter to
\n                   the Collector for determination of the market
\n                   value of such property and the proper duty
\n                   payable thereon.\n<\/p><\/blockquote>\n
                         (2) On receipt of a reference under Sub-
\n                   section (1), the Collector shall, after giving the
\n                   parties   an   opportunity    of   making    their
\n                   representations and after holding an inquiry in
\n                   such manner as may be prescribed by rules
\n                   made under this Act, determine the market
\n                                      6<\/span><\/p>\n
                value of the property which is the subject matter
\n                of such instrument, and the duty as aforesaid
\n                and the deficient amount, if any, shall be
\n                payable by the person liable to pay the duty.\n<\/p><\/blockquote>\n
                      (2-A) The Collector may suo motu within
\n                two years from the date of registration of such
\n                instrument examine the instrument, not already
\n                referred to him under Sub-section (1), call for
\n                and examine the instrument for the purpose of
\n                satisfying himself as to the correctness of the
\n                market value of the property which is the
\n                subject matter of such instrument and the duty
\n                payable thereon and if, after such examination
\n                he has reason to believe that the market value of
\n                such property has not been truly set forth in the
\n                instrument, he may determine the market value
\n                of such property and the duty as aforesaid in
\n                accordance with the procedure provided for in
\n                Sub-section (2), and the deficient amount of
\n                duty, if any, shall be payable by the person
\n                liable to pay the duty.\n<\/p><\/blockquote>\n
                (3) Any person, aggrieved by an order of the
\n                Collector under Sub-section (2) or Sub-section
\n                (2-A), may, within thirty days from the date of
\n                the order, prefer an appeal before the District
\n                Judge and all such appeals shall be heard, and
\n                disposed   of   in   such   manner   as   may   be
\n                prescribed by rules made under this Act.”\n<\/p><\/blockquote>\n
6.         Similar question came up for consideration before the Kerala<\/p>\n
High Court in the case of Periyar Real Estates and etc. v. State of<\/p>\n
Kerala and others, etc; AIR 2002 Kerala 248. Relevant provisions of
\n                                       7<\/span><\/p>\n
Section 45-B of the Kerala Stamp Act, 1959 which are similar to the<\/p>\n
provisions of Section 47-A of the Stamp (Orissa Amendment) Act., were<\/p>\n
considered vis-\u00e0-vis the provisions of Section 61 (2) of the Registration<\/p>\n
Act. Analysing the different provisions of both the Acts., the Kerala High<\/p>\n
Court held that if there is a dispute as to the stamp duty payable on the<\/p>\n
instrument subject to registration, after registration of the instrument,<\/p>\n
the registering authority is not entitled to retain possession of the<\/p>\n
original document under Section 45-B of the Kerala Stamp Act. By reason<\/p>\n
of Section 61(2) of the Registration Act, 1980, it is obliged to return the<\/p>\n
document and thereafter take appropriate proceedings under Section 45-<\/p>\n
B of the Kerala Stamp Act for adjudication and recovery of the under paid<\/p>\n
duty. One of the grounds which found favour with the Kerala High Court<\/p>\n
to take the aforesaid view is that the expression ‘reference’ used in<\/p>\n
Section 45-B of the Kerala Stamp Act means the sending of the matter for<\/p>\n
decision or consideration to some authority, and it does not require<\/p>\n
sending of the document itself. It was also reasoned that sending of the<\/p>\n
original instrument to the Stamp Collector was not at all necessary for<\/p>\n
deciding the claim of undervaluation.\n<\/p>\n
7.    Sub Section (1) of Section 47-A of the Stamp (Orissa Amendment)<\/p>\n
Act specifically uses the expression “refer the matter” and does not speak<\/p>\n
of referring or sending the instrument itself to the Collector. The aforesaid<\/p>\n
decision of the Kerala High Court was relied upon by this Court in exactly<\/p>\n
a similar matter vide order dated 30.01.2003 passed in O.J.C. No.472 of<\/p>\n
2001 and we do not find any reason to differ from the aforesaid view.
\n                                       8<\/span><\/p>\n
8.    Reliance has been placed by the opposite parties on the provisions<\/p>\n
of Orissa Stamp Rules, 1952. Chapter-V of the Rules (Rules 23 to 36)<\/p>\n
deals with the procedure to be followed in the matter of reference under<\/p>\n
Section 47-A of the Stamp (Orissa Amendment) Act.              Rule 23 only<\/p>\n
reiterates the provision of Sub-section (1) of Section 47-A of the Act using<\/p>\n
the expression “refer the same”, and at a later stage states that while<\/p>\n
referring the document to the Collector, the facts and circumstances that<\/p>\n
prompted the Registering Officer to come to the belief that the property,<\/p>\n
has been undervalued, shall be fully and clearly stated. As a corollary to<\/p>\n
the second part of the Rule 23, Rule 28 only speaks about how the<\/p>\n
instrument which has been referred to the Collector under Section 47-A<\/p>\n
shall be dealt with after the Collector adjudicates the question of<\/p>\n
undervaluation. Since the provision of the Act, viz. Section 47-A, does not<\/p>\n
speak of reference of the instrument itself to the stamp Collector and, on<\/p>\n
the other hand, it is obligatory on the part of the Registering Officer, as<\/p>\n
per provision of Section 61 (2) of the Registration Act, to return the<\/p>\n
registered instrument, the provision of the Rules cannot override the<\/p>\n
provision of the Act.\n<\/p>\n
9.    On the aforesaid analysis, we hold that neither the Registering<\/p>\n
Officer nor the Stamp Collector in exercising jurisdiction under Section<\/p>\n
47-A of the Act is legally entitled to retain possession of the instrument<\/p>\n
(sale deed) of the petitioner. They are legally obliged to return the same. It<\/p>\n
is apparent that interim order was passed in this writ petition on<\/p>\n
29.6.2009 directing the opposite parties to return the registered sale deed
\n                                      9<\/span><\/p>\n
in question to the petitioner subject to further orders to be passed in the<\/p>\n
writ petition. We, therefore, direct that the instrument (sale deed) in<\/p>\n
question which has not yet been returned to the petitioner in pursuance<\/p>\n
to the interim order dated 29.06.2009 be returned within ten days from<\/p>\n
the date of communication of this order or production of a certified copy<\/p>\n
thereof, which ever is earlier.\n<\/p>\n
10.         The notice at Annexure-1 does not appear to be one to<\/p>\n
answer the claim under Section 47-A of the Act, as admittedly, it has<\/p>\n
been issued by the District Sub-Registrar, Khurda styling himself as the<\/p>\n
Stamp Collector and directing the petitioner to appear before him, though<\/p>\n
admittedly the proceeding is pending before the Inspector General of<\/p>\n
Registration, Orissa (opposite party no.1). Further, the notice is not in<\/p>\n
Form No.1, as required by Rule 24(1) of the Rules. We, therefore, quash<\/p>\n
the notice under Annexure-1 and direct opposite party no.1, the Stamp<\/p>\n
Collector, to issue appropriate notice to the petitioner within 15 days from<\/p>\n
the date of communication of this order and thereafter dispose of the<\/p>\n
undervaluation proceeding expeditiously.\n<\/p>\n
            The writ petition is accordingly allowed in the light of the<\/p>\n
aforesaid directions.\n<\/p>\n
11.         The CONTC No.963 of 2009 is also disposed of in view of the<\/p>\n
order passed in the writ petition. There shall, however, be no order as to<\/p>\n
costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Orissa High Court M\/S. Harshpriya Construction (P) … vs Unknown on 23 March, 2010 W.P.(C) NO.8690 OF 2009 In the matter of an application under Articles 226 and 227 of the Constitution of India. M\/s. Harshpriya Construction (P) Ltd. ……. Petitioner. Versus. The Inspector General of Registration, Orissa, Cuttack & Others ……….. Opp.parties For petitioner […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,25],"tags":[],"class_list":["post-138606","post","type-post","status-publish","format-standard","hentry","category-high-court","category-orissa-high-court"],"yoast_head":"\nM\/S. 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