High Court · 2009

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED:23.07.2009CORAMTHE HONOURABLE MR.JUSTICE T.SUDANTHIRAMC.M.A.No.972 of 2009andM.P.No.1 of 2009Ramkumar Giri...Appellant Versus1. The Chief Controlling Revenue Authority cum Inspector General of Registration No.100, Santhome High Road, Chennai – 600 028.2. The Deputy Collector (Stamps) Collectorate Campus, Coimbatore – 641 018.3. Joint Sub-Registrar I, District Registrar Office, Collectorate Campus, Coimbatore – 641 018.4. District Registrar Administration, Collectorate Campus, Coimbatore – 641 018...RespondentsCivil Miscellaneous Appeal against the order dated 10.12.2008made in Pa.Mu.En.17625/N2/06 on the file of the 1st respondent, theChief Controlling Revenue Authority.For Appellant : Mr.G.RajagopalanSr.Advocate for M/s.Arulselvam AssociatesFor Respondents: Mr.Bhavani Subbarayan****JUDGMENTThis Civil Miscellaneous Appeal has been preferred by theappellant challenging the order passed by the Chief ControllingRevenue Authority cum Inspector General of Registration inPa.Mu.En.17625/EN2/2006 dated 10.12.2008.2. The appellant herein purchased a property which was sold in https://hcservices.ecourts.gov.in/hcservices/ Open Public Auction in pursuance of the order dated 12.04.2000 madein W.P.No.12437 of 1997 by the Honourable Madras High Court. Theappellant herein was the highest bidder of the property and theauction was confirmed by the Honourable Madras High Court by itsorder dated 30.11.2000 in the above said writ petition. TheHonourable High Court confirmed the sale and opined that the highestbid of Rs.1,33,10,000/- as the fair price of the property. The saledeed was also executed by the administrator Mr.C.Venkataramanappointed by the Honourable Madras High Court for M/s.MaximaInvestments and Finance and its group of companies in favour of theappellant Mr.Ramkumar Giri. On 25.05.2001, the sale deed wasexecuted for a sum of Rs.1,33,10,000/- and the market value of thesale deed was shown as Rs.1,33,10,000/-. At the time ofregistration, the Registering Officer raised doubts regarding thevaluation of the property made in the document and so, he referredthe document under Section 47A of the Indian Stamp Act to the DeputyCollector (Stamps) for adjudication. The Deputy Collector (Stamps)Collectorate Campus, Coimbatore initiated action and passed an orderon 04.02.2006 fixing the market value of the said property asRs.2,46,33,120/- and thereby also fixing the stamp duty asRs.32,02,312/-. As already stamp duty of Rs.17,30,300/- was paid, ademand was made for the remaining amount of Rs.14,72,012/-.3. Agriveed by the said order of the Deputy Collector (Stamps),an appeal was preferred by the appellant herein before the ChiefControlling Revenue Authority. The Chief Controlling RevenueAuthority dismissed the appeal of the appellant and passed an orderobserving that fixing the market value of the property asRs.1,620.60/- per sqft. and on that basis directed the appellant topay the deficit stamp duty with interest at the rate of 2% permonth. Agriveed by the other order, the Civil Miscellaneous Appealhas been preferred by the appellant before this Court.4. The learned senior counsel Mr.G.Rajagopalan appearing forthe appellant submitted that the property was purchased in openauction sale. As per the order of the Honourable High Court, theproperty was sold in the Open Public Auction and the appellant wasthe highest bidder and the auction was confirmed by the High Courtand there is no fraudulent attempt on the part of the appellant andthe actual bid amount was also shown in this sale deed executed bythe administrator of the Honourable High Court and there is noevasion of payment of stamp duty and in such a case the authorityhas no power to initiate action under Sec 47 A of the Indian StampAct 1988.5. The learned senior counsel for the petitioner also submittedthat the authorities have taken into consideration the guidelinevalue alone and without any basis they have decided the value of theproperty. The learned senior counsel also relied on the decision of https://hcservices.ecourts.gov.in/hcservices/ the Honourable Supreme Court reported in 2009 (1) TLT 465 SC(V.N.Devadoss Vs Chief Revenue Control Officer-cum-Ins. and Ors.)6. The learned Government pleader was also heard. The learnedGovernment pleader submitted that the property is situated in themain place of the Coimbatore. The actual value of the property ishigher than the bid amount. The learned Government pleader alsosubmitted that as per the Indian Stamp Act, the stamp duty is to becollected according to the market value of the property.7. This Court considered the submissions made by both partiesand perused the records.8. Section 47 A Indian Stamp Act is as follows:(10) Any person aggrieved by an order of theAuthority prescribed under sub-section (5) or theChief Controlling Revenue Authority under sub-section(6) may, within such time and in such manner, as maybe prescribed by rules made under this Act, appeal tothe High Court.Explanation.- For the purpose of this Act,market value of any property shall be estimated to bethe price which, in the opinion of the Collector ofthe Chief Controlling Revenue Authority or the HighCourt, as the case may be, such property would havefetched or would fetch, if sold in the open market onthe date of execution of the instrument ofconveyance, exchange, gift, release of benami rightor settlement.9. It is observed by the Honourable Supreme Court in thedecision cited supra as follows:10. Market value is a changing concept. Theexplanation to Sub-Rule (5) makes the position clearthat value would be such as would have fetched or wouldfetch if sold in the open market on the date ofexecution of the instrument of conveyance. Here, theproperty was offered for sale in the open market andbids were invited. That being so, there is no questionof any intention to defraud the revenue or nondisclosure of the correct price. The factual scenarioas indicated above goes to show that the properties weredisposed of by the orders of BIFR and AIFR and that tooon the basis of value fixed by ASG. The view expressedby the Assets Sales Committee which consisted of memberssuch as representatives of IDBI, Debenture Holders,Government of West Bengal and Special Director of BIFR. https://hcservices.ecourts.gov.in/hcservices/ That being so, there is no possibility of any undervaluation and, therefore, Section 47-A of the Act has noapplication. It is not correct as observed by the HighCourt that BIFR was only a mediator.11. Sale has been defined under Section 54 of theTransfer of Property Act, 1882 (in short the 'TP Act').Although the Act has not included the definition ofsale, Section 2(10) of the Act defines conveyance asincluding a conveyance on sales, every instrument andevery decree of final order of any Civil Court by whichproperty whether immovable or moveable or any estate orinterest in any property is transferred to, or vested inor declared to be of any other person, inter vivos, andwhich is not otherwise specifically provided for bySchedule I or Schedule 1-A, as the case may be.12. On the facts of the case it cannot be said thatSection 47-A has any application because there is noscope for entertaining a doubt that there was any undervaluation. That being so, the High Court's order isclearly unsustainable and is set aside. Theregistration shall be done at the price disclosed in thedocument of conveyance. There is no scope forexercising power under Section 47-A of the Act as thereis no basis for even entertaining a belief that themarket value of the property which is the subject matterof conveyance has not been truly set forth with a viewto fraudulently evade payment of proper stamp duty.10. In this particular case, the Chief Controlling RevenueAuthority had relied only on the guideline value. The guidelinevalue is not the market value. He has not substantiated with anymaterial also in his order for fixing the market value of theproperty. This Honourable High Court while passing an order in WPNo.12437 of 1997 on 30.11.2000 has observed as follows:3. Taking into consideration of the location of theproperty, the nature of the property the present trendin the market pendency of earlier litigation, and therepresentations made by Mr.Madhan, we are of theconsidered view that the highest bid of Rs.1,33,10,000/-(Rupees one crore, thirty three lakhs and ten thousandonly) in the auction sale, is a fair offer and theauction could be confirmed by the Administrator.Mr.Madhan represented that the said bid is fair andthere is no chance of getting higher offer. Further,any further delay in the sale will not be in the https://hcservices.ecourts.gov.in/hcservices/ interest of any one, much less, the depositors.11. It cannot be said in this case that the market value of theproperty which is the subject matter of conveyance has not beentruly set forth with a view to fraudulently evade payment of properstamp duty. In view of the ratio laid down by the HonourableSupreme Court in the decision cited above, this Court holds thatthere is no scope for authorities to exercise power under Section 47(10) A of the Indian Stamp Act, since there is no scope forentertaining a doubt that there was any under valuation.12. The order passed by the 1st respondent is set aside andCivil Miscellaneous Appeal is allowed. Consequently, the M.P.No.1of 2009 is closed. There shall be no order to costs. Sd/Asst.Registrar/true copy/Sub Asst.RegistrarTo1. The Chief Controlling Revenue Authority cum Inspector General of Registration No.100, Santhome High Road, Chennai – 600 028.2. The Deputy Collector (Stamps) Collectorate Campus, Coimbatore – 641 018.3. Joint Sub-Registrar I, District Registrar Office, Collectorate Campus, Coimbatore – 641 018. https://hcservices.ecourts.gov.in/hcservices/

4. District Registrar Administration, Collectorate Campus, Coimbatore – 641 018.+2cc to M/s.Arulselvam Associates Sr 34464KA(CO)km/6.8.C.M.A.No.972 of 2009