THE GOVERNMENT OF TAMIL NADU v. THE INSPECTOR GENERAL OF REGISTRATION

V.GEORGE CHANDRASEKARAN ..RESPONDENT IN WA 2628/2003V.JAIN ALLAUDIN ..RESPONDENT IN WA 2629/2003R.THIRUMALAI RAJ ..RESPONDENT IN WA 2630/2003B.RAJAGOPALAN ..RESPONDENT IN WA 2708/2003R.VISWANATHAN ..RESPONDENT IN WA 2710/2003D.SWIKKIN RAJ ..RESPONDENT IN WA 2711/2003R.HARIRAMJI ..RESPONDENT IN WA 2712/2003ANTONY WILSON ..RESPONDENT IN WA 2713/2003M.VEERA MUTHU ..RESPONDENT IN WA 3179/2003K.PANDIYARAJAN ..RESPONDENT IN WA 3180/2003G.K.SRIDHARAN ..RESPONDENT IN WA 3181/2003SELVAMANI ..RESPONDENT IN WA 3182/2003SAMYKANNU ..RESPONDENT IN WA 3183/2003M.PONNAN ..RESPONDENT IN WA 3184/2003N.NATARAJAN ..RESPONDENT IN WA 3185/2003N.SAROJA ..RESPONDENT IN WA 3186/2003M.VIJAYALAKSHMI ..RESPONDENT IN WA 3187/2003P.MOHAMMED SHERIF ..RESPONDENT IN WA 3188/2003S.ISRAEL ..RESPONDENT IN WA 3189/2003M.N.RAJAN ..RESPONDENT IN WA 3190/2003B.CHANDRASEKARAN ..RESPONDENT IN WA 3191/2003V.MARUTHAMUTHU ..RESPONDENT IN WA 3192/2003S.PILLAPPAN ..RESPONDENT IN WA 3193/2003R.VIDYANATHAN ..RESPONDENT IN WA 2455/2003P.AGAMBHARAM ..RESPONDENT IN WA 2456/2003K.SRINIVASA GOPALAN ..RESPONDENT IN WA 2457/2003V.GOPALA KRISHNAN ..RESPONDENT IN WA 2458/2003A.G.NATARAJAN ..RESPONDENT IN WA 2459/2003S.ROSELIN ..RESPONDENT IN WA 2460/2003C.CHANDRA ..RESPONDENT IN WA 2461/2003P.B.SIVAGURU ..RESPONDENT IN WA 2462/2003P.RAJAGOPAL ..RESPONDENT IN WA 2463/2003A.PALANI ..RESPONDENT IN WA 2464/2003K.NARASIMHAN ..RESPONDENT IN WA 2465/2003V.LALITHA ..RESPONDENT IN WA 2466/2003A.RAJU ..RESPONDENT IN WA 2467/2003M.KAUSALYA ..RESPONDENT IN WA 2468/2003SANTHANA MOORTHY ..RESPONDENT IN WA 2469/2003R.M.RAMAMOORTHY ..RESPONDENT IN WA 2345/2004R.NAGARAJAN ..RESPONDENT IN WA 2346/2004T.KULANDAISAMY ..RESPONDENT IN WA 2347/2004V.S.SENGAMALAM ..RESPONDENT IN WA 2348/2004M.VEDHAVALLI ..RESPONDENT IN WA 2349/2004A. SAVARIMUTHU ..RESPONDENT IN WA.2350/2004P. KANNAN ..RESPONDENT IN WA.2351/2004K. JAYALAKSHMI ..RESPONDENT IN WA.2352/2004V. SANKARAN ..RESPONDENT IN WA.2353/2004K. LAKSHMI NARAYANAN ..RESPONDENT IN WA.2354/2004V. SANTHAKUMARI ..RESPONDENT IN WA.2355/2004P. SHANMUGAM ..RESPONDENT IN WA.2356/2004 https://hcservices.ecourts.gov.in/hcservices/ R. BALASUBRAMANIAN ..RESPONDENT IN WA.2357/2004R. RDHAKRISHNAN ..RESPONDENT IN WA.2358/2004R. USHA ..RESPONDENT IN WA.2359/2004K. SANTHANAM ..RESPONDENT IN WA.3373/2004M. MARUTHAMUTHU ..RESPONDENT IN WA.3374/2004P. GOPALAKRISHNAN ..RESPONDENT IN WA.3375/2004P. VENKATARAMAN ..RESPONDENT IN WA.3376/2004K. AMANTHARAJAN ..RESPONDENT IN WA.3377/2004T.P.SAKTHIVEL ..RESPONDENT IN WA.3378/2004T. THIRUMENI ..RESPONDENT IN WA.3379/2004E. CHIDAMBARAM ..RESPONDENT IN WA.3380/2004KARONLY ANNAMARY ..RESPONDENT IN WA.1236/2004R. NATARAJAN ..RESPONDENT IN WA.1237/2004V. RAJASEKARAN ..RESPONDENT IN WA.1238/2004C. THANGAPPAN ..RESPONDENT IN WA.1239/2004R. MANI ..RESPONDENT IN WA.1240/2004Writ Appeals filed under Clause 15 of the Letters Patentagainst the order of this Court dated 1.11.2002 and 14.10.2003 madein W.P.No.19862 of 2002 filed under Article 226 of the Constitutionof India to issue a Writ of Mandamus forbearing the 3rd respondentfrom demanding additional stamp duty for the document of sale.WP.No.19862/02dated 30.03.1999 bearing registration No.1352/99WP.No.21241/02dated 02.06.1999 bearing registration No.2409/99WP.No.19859/02dated 07.06.1999 bearing registration No.3200/99WP.No.19492/02dated 11.03.1999 bearing registration No.8192/99WP.No.19491/02dated 11.04.1999 bearing registration No.1771/99WP.No.19490/02dated 26.03.1999 bearing registration No.1224/99WP.No.19489/02dated 05.04.1999 bearing registration No.4312/99WP.No.13998/02dated 19.07.1999 bearing registration No.1787/99WP.No.30328/02dated 05.04.1999 bearing registration No.1528/99WP.No.19494/02dated 05.04.1999 bearing registration No.1444/99WP.No.19493/02dated 05.04.1999 bearing registration No.1457/99WP.No.19487/02dated 21.04.1999 bearing registration No.1775/99WP.No.19486/02dated 12.04.1999 bearing registration No.1621/99WP.No.19502/02dated 26.03.1999 bearing registration No.1192/99WP.No.19501/02dated 05.04.1999 bearing registration No.1422/99WP.No.19500/02dated 07.04.1999 bearing registration No.1554/99WP.No.19499/02dated 26.03.1999 bearing registration No.1194/99WP.No.19497/02dated 26.03.1999 bearing registration No.1208/99WP.No.19498/02dated 05.04.1999 bearing registration No.1441/99WP.No.19496/02dated 15.06.1999 bearing registration No.2586/99WP.No.19495/02dated 26.03.1999 bearing registration No.1192/99WP.No.19504/02dated 05.04.1999 bearing registration No.1442/99WP.No.31590/02dated 24.08.1999 bearing registration No.3714/99WP.No.13664/02dated 13.01.2000 bearing registration No.93/2000WP.No.19383/02dated 27.07.2001 bearing registration No.569/2001WP.No.19485/02dated 26.03.1999 bearing registration No.1230/99 https://hcservices.ecourts.gov.in/hcservices/ WP.No.19488/02dated 30.03.1999 bearing registration No.1355/99WP.No.19503/02dated 30.03.1999 bearing registration No.1323/99WP.No.19855/02dated 26.03.1999 bearing registration No.1201/99WP.No.30460/02dated 26.04.1999 bearing registration No.1529/99WP.No.21236/02dated 5.5.99 bearing registration No.2028/99WP.No.21232/02 dated 26.3.99 bearing registration No.1196/99WP.No.21234/02dated 26.3.99 bearing registration No.1193/99WP.No.21191/02dated 23.7.99 bearing registration No.3318/99WP.No.21233/02dated 12.3.01 bearing registration No.827/2001WP.No.21231/02dated 31.3.99 bearing registration No.1433/99WP.No.21247/02dated 30.3.99 bearing registration No.1312/99WP.No.19864/02 dated 8.6.01 bearing registration No.2196/2001WP.No.19862/02dated 30.3.99 bearing registration No.1352/99WP.No.19860/02 dated 17.8.99 bearing registration No.2194/99WP.No.19858/02 dated 10.4.99 bearing registration No.1675/99WP.No.19857/02dated 19.01.2000 bearing registration No.120/2000WP.No.19856/02dated 28.5.99 bearing registration No.2379/99WP.No.18852/02dated 5.8.99 bearing registration No.2134/99WP.No.18851/02dated 31.3.99 bearing registration No.1445/99WP.No.21852/02 dated 31.3.99 bearing registration No.2881/99WP.No.14079/02dated 26.3.99 bearing registration No.1235/99WP.No.14080/02dated 26.3.99 bearing registration No.1213/99WP.No.14081/02dated 26.3.99 bearing registration No.1216/99WP.No.14748/02dated 6.4.99 bearing registration No.1584/99WP.No.15180/02dated 19.7.01 bearing registration No.3236/99WP.No.21235/02dated 31.3.99 bearing registration No.1428/99WP.No.21242/02dated 30.3.99 bearing registration No.1324/99WP.No.21244/02dated 7.4.99 bearing registration No.1600/99WP.No.21246/02dated 30.3.99 bearing registration No.1530/99WP.No.21248/02dated 22.4.99 bearing registration No.1845/99WP.No.21680/02dated 8.7.99 bearing registration No.1620/99WP.No.21683/02dated 11.9.99 bearing registration No.4123/99WP.No.14078/02dated 22.3.99 bearing registration No.1136/99WP.No.21851/02dated 28.5.99 bearing registration No.2380/99WP.No.14190/02dated 30.3.99 bearing registration No.1317/99WP.No.14191/02dated 26.3.99 bearing registration No.1226/99WP.No.18850/02dated 31.3.99 bearing registration No.1372/99WP.No.19380/02dated 17.6.99 bearing registration No.2610/99WP.No.14084/02dated 25.8.99 bearing registration No.3753/99WP.No.14188/02dated 30.3.99 bearing registration No.1451/99WP.No.14189/02dated 30.3.99 bearing registration No.1366/99WP.No.19382/02dated 1.7.99 bearing registration No.2885/99WP.No.19381/02dated 30.3.00 bearing registration No.1276/00WP.No.21245/02dated 26.3.99 bearing registration No.1202/99WP.No.30453/02dated 5.4.99 bearing registration No.1426/99WP.No.13665/02dated 26.4.99 bearing registration No.1904/99WP.No.13999/02dated 9.8.99 bearing registration No.3495/99WP.No.14000/02dated 27.5.99 bearing registration No.2354/99WP.No.14083/02dated 1.6.99 bearing registration No.2414/99WP.No.28557/03dated 15.6.99 bearing registration No.2597/99 https://hcservices.ecourts.gov.in/hcservices/ WP.No.28558/03dated 26.3.03 bearing registration No.1159/03WP.No.28559/03dated 2.6.99 bearing registration No.2416/99WP.No.28560/03dated 18.11.99bearing registration No.1949/99WP.No.28561/03dated 8.8.01 bearing registration No. 2892/01WP.No.28562/03dated 21.4.03 bearing registration No.1508/03WP.No.28563/03dated 10.3.2000 bearing registration No.919/2000WP.No.28564/03dated 28.2.2000 bearing registration No.772/2000WP.No.21853/02dated 17.7.99 bearing registration No.3348/99WP.No.19861/02dated 26.3.99 bearing registration No.1215/99WP.No.21190/02dated 10.5.99 bearing registration No.2096/99WP.No.21187/02dated 8.1.00 bearing registration No.30/2000WP.No.21243/02dated 31.3.99 bearing registration No.1440/99executed by TNPHCL in favour of the petitioner. For Appellants : Mr.P.Subramanian, Addl.Govt.Pleader(W)For Respondents : Mr.R.Krishnasamy, S.C. for Mr.K.HarishankarJUDGMENTM.SATHYANARAYANAN, JThe appellants are the official respondents in writ petitions.The writ petitions were filed by each of the respondent in thesewrit appeals, challenging the demand of additional stamp duty on thedocument of sale executed by the Tamil Nadu Police HousingCorporation Limited ( in short " Corporation") a Government of TamilNadu Undertaking, in favour of the writ petitioners andconsequential refusal to release the respective sale deeds to thewrit petitioners, already registered by the Office of the SubRegistrar of Assurance, on account of non payment of additionalstamp duty. 2. The Tamil Nadu Police Housing Corporation is a Government ofTamil Nadu Undertaking which has been formed to provide houses,police stations and office for police personnel. Each of the writpetitioner was allotted a flat by the Corporation. The respectivewrit petitioner had executed lease-cum-sale agreement in the year1985 and also paid instalments in full. Thereafter, sale deed wasgiven to each of the writ petitioner and the sale deeds wereregistered in the Office of the Sub Registrar at Thiruverumbur,Trichy District. 3. The third appellant herein all of a sudden, during thebeginning of the year 2000, started issuing notices demandingadditional stamp duty on the instruments purporting to exercisepowers under Section 47-A of the Indian Stamp Act. The reason fordemand of additional stamp duty was that market value of theproperty as on the date of the registration has not been taken into https://hcservices.ecourts.gov.in/hcservices/ consideration by the Sub Registrar, Thiruverumbur while registeringthe sale deeds. 4. The writ petitioners formed an association viz., TrichyNavalpatti Police Colony Owners and Occupants Association and theysubmitted representation to the third appellant herein stating thatthe power under Section 47-A of the Stamp Act can only be exercisedby the Registering Officer when he has reason to believe that themarket value of the property which is the subject matter ofconveyance, has not been truly set forth with a view to fraudulentlyevade payment of stamp duty and that mere lapse of time between thedate of agreement and the execution of document will not be thedetermining factor that the document is under value. The thirdappellant in turn had sent a communication dated 20.12.2000 to thesecond appellant herein stating that all the sale deeds given byTamil Nadu Police Housing Corporation in favour of theallottees/writ petitioners may be registered on the basis of thereal value of the property agreed between the said Corporation andthe allottees. 5. The second appellant in spite of such communication from thethird appellant, had rejected the request of the above saidassociation on 24.1.2001. The association preferred further appealto the first appellant who had also rejected the said appeal videorder dated 9.11.2001. The association, challenging the vires ofthe said order, filed W.P.No.11082 of 2001 and this Court has passedan order dated 3.4.2002 stating that since the issue pertaining tothe right of an individual, each individual has to file a separatewrit petition setting out the details and granted liberty to theassociation to file a writ petition by each individual. Hence thewrit petitions came to be filed. 6. In the writ petitions, it is contended that the transactionof sale between the Corporation and the respective writ petitionerwas a sale between the Government of Tamil Nadu Undertaking and theallottee and there cannot be any under valuation or mala fideattached to such transactions. It is further contended that unlessthere is fraudulent evasion in payment of stamp duty, aid of Section47-A of the Indian Stamp Act cannot be pressed into service toreview the payment of stamp duty already paid on documents. 7. The second appellant who was arrayed as second respondent inthe writ petitions filed his counter submitting that the Corporationhas built various types of houses and allotted to the writpetitioners according to the category by way of executing sale deedsand the said sale deeds were presented before the registeringofficer Thiruverumbur and the said officer, has inadvertentlyadmitted the documents for registration on the value set forththerein, instead of taking into account, the guideline value andP.W.D. rates. By virtue of power conferred under Section 9(1)(a) of https://hcservices.ecourts.gov.in/hcservices/ the Indian Stamp Act, the Government empowered to issue notificationremitting or reducing the stamp duty for various kinds ofinstruments from time to time. 8. It is further contended by the second respondent that in theabsence of any notification under the above said provision, thedocuments in question are chargeable to stamp duty on the marketvalue, on the date of execution of such sale deeds as perexplanation to Section 47-A of the Indian Stamp Act. 9. The third respondent in the writ petition/ third appellanthas filed his counter stating that the registering officer,Thiruverumbur had inadvertently admitted the deeds of sale producedfor registration on the value set forth in the said documentsinstead of taking into consideration, guideline value and P.W.D.rates. The said mistake was pointed out by the Local Audit in itsreports 3/99 and 6/99 and hence action was taken under Section 47-A(1) and 47-A (3) of the Indian Stamp Act. 10. The learned Judge after taking into consideration theaverments made in the writ petitions and the counter affidavits,found that in the year 1985, Tamil Nadu Police Housing Corporationwhich is Government of Tamil Nadu Undertaking has executed lease-cum-sale Agreement in favour of the writ petitioners and they alsopaid their respective sale consideration in instalments andthereafter, got executed sale deeds by the Corporation before theconcerned Sub-Registrar as early as in the year 1999, 2000 and 2001respectively. 11. The learned Judge on consideration of the materialsavailable on record, held that there is no material on record eitherto suspect or to hold that the conveyance by the Tamil Nadu PoliceHousing Corporation in favour of the writ petitioners is eitherattracted by alleged under valuation or fraudulent evasion of stampduty. On the other hand, since the sale deeds were executed by theCorporation which is the Government of Tamil Nadu Undertaking infavour of the writ petitioners, it can be presumed that it is a bonafide transaction. The learned Judge further held that unless thereis any substantial and material evidence and reasons to believe thatthe market value of the property conveyed has not been truly setforth in the instrument, with an object to commit a fraudulentevasion of stamp duty to cause loss of revenue, it cannot bepresumed that the power conferred under Section 47-A of the IndianStamp Act is a routine one in respect of each and every transaction.12. The learned Judge taken into consideration thepronouncements of the Hon'ble Supreme Court of India and held thatthe market value as set forth in the sale deeds executed by theTamil Nadu Police Housing Corporation in favour of the respectivewrit petitioner are truly set forth and hence action under Section https://hcservices.ecourts.gov.in/hcservices/ 47-A (1) of the Indian Stamp Act cannot be invoked and therebyallowed all the writ petitions. The official respondents in the writpetitions, aggrieved by the said orders, had preferred these writappeals. 13. Mr.P.Subramanian, learned Additional Government Pleader hassubmitted that in the absence of exemption notification underSection 9(1)(a) of the Indian Stamp Act, the deeds of conveyanceexecuted by the Tamil Nadu Police Housing Corporation in favour ofthe writ petitioners are liable for stamp duty as on the date ofregistration of instruments. The learned additional GovernmentPleader would further contend that the powers conferred underSection 47-A(1) and 47-A(3) of the Indian Stamp Act can be invokedwhen there is a reason to believe that there is loss of revenue dueto under valuation.14. The learned Additional Government Pleader in support of hissubmissions, placed reliance upon the judgment reported in 2008(1)CTC 60 (SC) - State of Rajasthan and others vs. Khandaka JainJewellers. The said case arose out of the suit for specificperformance. The Hon'ble Supreme Court of Indian has taken intoconsideration Section 17 and Section 47-A of the Rajasthan(Amendment) Stamp Duty Act found that the Registering Authority isunder an obligation to ascertain the correct value at the time andshould not go by the value mentioned in the instrument. The Hon'bleSupreme Court of India after considering the scope of Section 47-Aread with Sections 3, 17 and 27 of the above said Act found that theRegistering Authority has to ascertain whether the Correct value isgiven in the instrument regarding the market value of the propertyat the time of sale. Ultimately, it has been held in the saiddecision that the Collector shall determine the valuation of theinstrument on the basis of the market value of the property at thedate when the document was tendered by the respondent forregistration, and the respondent therein shall pay the stamp dutycharges and surcharge, if any, as assessed by the Collector as perthe provisions of the Act. 15. The learned Additional Government Pleader heavily stressedupon the ratio laid down in the said decision and submitted thevaluation as on the date of presentation of the instrument is theprimary factor for levying the stamp duty and since the RegisteringOfficer has inadvertently admitted the instruments for registrationon the value set forth in the document instead of taking intoaccount, guideline value and P.W.D. rates, representations submittedby the writ petitioners were rightly rejected, which were confirmedby the Appellate Authority. It has been further submitted by thelearned Additional Government Pleader (Writs) that the scope ofSection 47-A (1) of the Indian Stamp Act has not been properlyconsidered at the time of disposal of the writ petitions and https://hcservices.ecourts.gov.in/hcservices/ therefore, prayed for setting aside the impugned orders passed inthe writ petitions. 16. Per contra, Mr.R.Krishnasamy, learned senior counsel forMr.K.Harishankar, learned counsel appearing for the respondent ineach of the writ appeals would contend that the lease-cum-saleAgreement came to be executed in the year 1985 by the Tamil NaduPolice Housing Corporation and after the entire instalments werepaid, the documents were registered by the respective Sub Registrarin the year 1999, 2000 and 2001. Since the transactions werebetween the Government Undertaking and the allottees who are thePolice Personnel, there is no reason to believe or doubt bona fideof the valuation set forth in the respective instruments. It isfurther submitted by the learned senior counsel appearing for therespondent that the learned Judge has taken into consideration theratio laid down in various judgments of the Hon'ble Supreme Court ofIndia and this Court and correctly arrived at a finding and therebyallowed the writ petitions and no interference is warranted inexercise of powers conferred under Clause 15 of Letters of Patent. 17. The learned senior counsel in support of his submissions,placed reliance upon the following decisions:-i.AIR 1982 (Mad.) 138 - Collector of Nilgiris atOotacamund vs. M/s. Mahavir Plantations Pte. Ltd.ii.(1994)4 SCC 595 - Jawajeenagnatham vs. RevenueDivisional Officer, Adilabad, A.P. and others.iii.1997(II) CTC 617 (DB) - S.P.Padmavathi vs. TheState of Tamil Nadu. iv.1999 (2) L.W. 231 - M.Ponnusamy and others vs.The District Collector, Erode and others. v.2001(2) CTC 449 (DB) - The District Collector,Erode District, Erode vs. M.Ponnusamy. vi.2002(2) CTC 329 - R.Sukumaran and others vs.State of Tamil Nadu and others. vii.2006(4) L.W. 695 - The Sub Registrar, Adayar,Chennai vs. Canara Bank, Saidapet Branch and another.viii.2008-1-L.W. 743 (DB)- State of Tamil Naduand others vs. Janab Habeeb Jan.K.18. In AIR 1982 (Mad.) 138 - Collector of Nilgiris atOotacamund vs. M/s. Mahavir Plantations Pte. Ltd., it has been heldthat: https://hcservices.ecourts.gov.in/hcservices/ "The valuation guidelines prepared by the RevenueOfficials at the instance of the Board of Revenue wereavowedly intended merely to assist the Sub-Registrars tofind out, prima facie, whether the market value set out inthe instruments had been set forth correctly. Theguidelines were not intended as a substitute for marketvalue or to foreclose the inquiry by the Collector whichhe is under a duty to make under Sec. 47A."It has been further held in the said decision that the determinationof market value in land acquisition proceedings cannot be adoptedeither as the basis or even as one of the piece of evidence, for thepurpose of determining the market value under Section 47-A of theIndian Stamp Act. The learned Judge in the said decision has takeninto consideration the judgment of a Division Bench of this Courtreported in AIR 1974 (Mad.) 117 - State of Tamil Nadu vs.Chandrasekharan, which considered rationale behind Section 47-A ofthe Stamp Act. In the above said decision, the observations madeare as follows:- "...we are inclined to think that the object of theAmending Act being to avoid large scale evasion of stampduty, it is not meant to be applied in a matter of factfashion and in a haphazard way. Market value itself as wealready mentioned, is a changing factor and will depend onvarious circumstances and matters relevant to theconsideration. No exactitude is, in the nature of thingspossible. In working the Act, great caution should betaken in order that it may not work as an engine ofoppression. Having regard to the object of the Act, weare inclined to think that normally the considerationstated as the market value in a given instrument broughtfor registration should be taken to be correct unlesscircumstances exists which suggest fraudulent evasion."19. In (1994)4 SCC 595 - Jawajeenagnatham vs. RevenueDivisional Officer, Adilabad, A.P. and others, it has been held thatin respect of market value to be computed under Section 23 of theLand Acquisition Act, Basic Valuation Register maintained by theRegistering Authority for collection of stamp duty, has notstatutory foundation to determine the market value under and theevidence of price fetched in comparable sale transaction, isgenerally accepted as the best method to determine the market value.The Hon'ble Supreme Court of India in the said decision, hadconsidered the scope of Section 47-A (A.P. Amendment) of the StampAct and held that the said provision does not confer power todetermine market value of an entire area, region or block and tomaintain Basic Valuation Register for levy of stamp duty and thesaid power is exercisable with reference to the particular landcovered by the instrument for registration. https://hcservices.ecourts.gov.in/hcservices/

20. In 1997(II) CTC 617 (DB) - S.P.Padmavathi vs. The State ofTamil Nadu, the scope of Section 47-A of the Indian Stamp Act cameup for consideration and this Court has considered all the earlierdecisions on this aspect and held as follows:-"It is not in each and every case, the Registering Officeris expected to deal with the instrument under Sec.47-A ofthe Act, but it is only when the instrument has beenundervalued or has not been truly set forth in theinstrument. In the case of instrument executed pursuantto the decree, there is no scope for doubting the bonafides of the parties. Of course, we do not rule out thepossibility of unscrupulous persons, with a view to evadepayment of proper stamp duty, creating agreements to sellfor a very low sum and them approaching the Court forspecific performance by mutual consent or without muchcontest, and thereafter presenting the documents forregistration pursuant to the decree passed for specificperformance. In such cases, under valuation would beapparent and it would also be open to the RegisteringOfficer, after being satisfied as to lack of bona fidesand fraudulent attempt on the part of the parties toundervalue the subject of transfer, to invoke the powerunder Section 47A of the Act. But such a process orproceedings cannot, in the normal course, be pursued inall cases. It is only if the Registering Officer hasreason to believe that the consideration about has notbeen truly set forth in the document."21. In 1999 (2) L.W. 231 - M.Ponnusamy and others vs. TheDistrict Collector, Erode and others, the act of reference made tothe Collector under Section 47-A(2) of the Indian Stamp Act afterlapse of two years and retention of the sale deeds after completionof registration came up for consideration and it has been held asfollows:-"It is obvious that before registering the document, theRegistering Officer has to come to a prima facieconclusion that in the instrument, the market value ofthe property has not been truly set forth and thereafter,complete registration and refer the same fordetermination of the market value. The language ofSection 47-A of the Indian Stamp Act is very clear. Thecondition precedent for making a reference is, there mustbe reason for the Registering Authority to believe thatthe market value of the property has not been truly setforth in the document presented for registration. Hence,it follows that the reasons must be recorded, howevershort it may be. It is the duty of the RegisteringAuthority to record reasons for his belief that true https://hcservices.ecourts.gov.in/hcservices/ market value has not been set out in the document,complete registration and thereafter refer the matter tothe Collector for determination of the market value ofthe property and the proper duty payable thereon.It is essential to point out that beforeregistration, the Registering Authority has to recordthat he has reasons to believe that the value of theproperty has not been duly set forth in the instrument.Only after recording such reasons, the RegisteringAuthority has to complete registration of the instrumentin question and thereafter alone, he could refer the sameto the Collector under Sub-Section (1) of Section 47-A ofthe Indian Stamp Act. Such is not the case of therespondents herein. To this extent, the function of theRegistering Authority is quasi judicial in nature and hehas to come to a conclusion that the market value of theproperty dealt under the document had not been truly setforth and after completion of registration, he could makea reference. At least some reasons should be recordedand immediately after completion of registration orsooner thereafter, a reference has to be made under Sub-Section (1) of Section 47-A of the said Act. What is required under Sub-Section (1) of Section47-A of the Indian Stamp Act is that the RegisteringAuthority had to come to a conclusion before registrationthat the market value of the property, dealt under theinstrument of conveyance or release, has been under-valued and he should have entertained reasonable beliefin this respect and also, he should have recorded such areason. Immediately after recording such reason, he hasto complete the registration and thereafter refer theinstruments to the Collector in terms of Sub-Section (1)of Section 47-A of the Indian Stamp Act. Only in respectof the instruments, which have not been referred to foradjudication to the Collector under Sub-Section (1) ofSection 47-A of the said Act, the Collector couldexercise or invoke suo motu powers conferred on him underSub-Section (3) of Section 47-A and had a reference beenmade under Section 47-A(1) of the said Act it would havebeen answered either way by the Collector, then it isobvious that the Collector cannot exercise suo motupowers in terms of Sub-Section (3) of Section 47-A of thesaid Act."22. In 2001(2) CTC 449 (DB) - The District Collector, ErodeDistrict, Erode vs. M.Ponnusamy, the said question once again cameup for consideration and a Division Bench of this Court has takeninto consideration the decision reported in S.P.Padmavathi vs. The https://hcservices.ecourts.gov.in/hcservices/ State of Tamil Nadu, [1997(II) CTC 617 (DB)] (cited supra) and heldthat the documents presented for registration has to be registeredif it sets forth market value and registering officer has power tofind out whether the market value has been correctly furnished ininstrument presented for registration. In the event of theRegistering Officer not accepting the valuation, he shall registerthe document and thereafter, he can refer the same to the Collectorfor adjudication. In the absence of document or material producedto show that the documents in question have been undervalued, theRegistering Officer cannot decide the same and apply provisionsunder Section 47-A of the Indian Stamp Act without forming anindependent decision. 23. In 2002(2) CTC 329 - R.Sukumaran and others vs. State ofTamil Nadu and others, the issue was in respect of stamp dutypayable by the transferee from the Housing Board on the instrumentexecuted by the Housing Board and presented for registration. 24. This Court while deciding the said case has taken intoconsideration the S.P.Padmavathi’s case reported in 1997(2) CTC 617:1997(2) L.W. 579 and M.Ponnusamy and 42 others vs. The DistrictCollector and others, 1999(2) L.W. 231 and the decision reported in2001(2) CTC 449 –District Collector, Erode District and others vs.M.Ponnusamy and held that , the Registrar cannot have any ground orreason or rhyme or basis or reason whatsoever to doubt about theconsideration paid by the transferee to the Housing Board – thetransferor. 25. In 2006(4) L.W. 695 - The Sub Registrar, Adayar, Chennaivs. Canara Bank, Saidapet Branch and another, the question came upfor consideration with regard to the calculation of stamp duty inrespect of value of properties which were subject matter of acompromise decree as fixed and directed by the Court. This Court inthe said decision, held that market value is always a changingfactor depending on various circumstances and no exactitude is, inthe nature of things possible and that normally the considerationstated as market value in a given instrument brought forregistration should be taken to be correct unless circumstancesexist which suggest fraudulent evasion. 26. In 2008-1-L.W. 743 (DB)- State of Tamil Nadu and others vs.Janab Habeeb Jan.K, the issue came up for consideration with regardto the stamp duty payable in respect of value of property in a saledeed executed by the Court pursuant to the decree for specificperformance. This Court has taken into consideration the judgmentreported in 1998(3) L.W. 254 – Narayanaswamy Naicker vs. DistrictCollector of Chengalpattu and others and held that in case ofexecution of sale deed through Court in pursuance of a decree forspecific performance, demand made on the purchaser for payment of https://hcservices.ecourts.gov.in/hcservices/ stamp duty on the basis of market value as on the date of executionand registration of the document would not be legal. 27. On a consideration of the principles laid down in thosedecisions, it is clear that the term “market value” itself is vague,uncertain and a matter of guess work. The said issue also came upfor consideration in the judgment reported in 2001 Supp. CTC page.1– J.Jayalalitha and five others vs. State represented by AdditionalSuperintendent of Police, CBCID, Chennai and this Court has held asfollows:- "The term "Market value" itself is vague, uncertain and amatter of guesswork. It is also not defined in the IndianStamp Act. Explanation to Section 47-A of the said Actreads as follows:"For the purpose of this Act, market value of anyproperty shall be estimated to be the price which, in theopinion of the Collector or the Chief Controlling RevenueAuthority of the High Court as the case may be, suchproperty would have fetched or would fetch, if sold in theopen market on the date of execution of the instrument ofconveyance, exchange, gift, release of benami right orsettlement." Author Manohar N.Dange in his book titled'Valuation of Immovable Properties' has stated that theprice that a willing purchaser pays to a willing sellerfor a property having due regard with its existingconditions, with all its existing advantages and with itspotential possibilities when laid out with mostadvantageous manner, excluding any disadvantages due tothe carrying out of the scheme for the purpose for whichthe property is transacted and this relates how the marketvalue applies to the valuation for compulsory purchases.He has quoted the judgment rendered by Justice Eve inSouth Eastern Rail Company v. L.C.C., that the value to beascertained is the value to the vendor, and not its valueto the purchaser and that in fixing the value to thevendor all restrictions imposed on the user and enjoymentof the land in his hand are to be taken into account butthe possibility of such restrictions being modified orremoved for his benefit is not to be overlooked and thatthe market price is not a conclusive test of real value.According to the author, the concept of market value hasto be understood in the light of what has been explainedfor the purpose of land acquisition and that the marketvalue of a property may be different in practice fordifferent angles. According to him, the market vaue for apurpose is to be decided with due relations to laws andpurpose of the concerned valuer and the market value,though appears to be a very simple term, is very difficult https://hcservices.ecourts.gov.in/hcservices/ to decide under particular circumstances. He went on toadd that a proper research is necessary which coulddetermine the market value since in one case, there can beheavy demand for smaller tenements with inadequate supplyand in another case, the supply may be more than adequatebut without any demand. According to the author, the sizeof the plot has got a direct bearing on the willingpurchasers in the market. The market value of a land canbe fixed only by taking into consideration severalfactors, like potentiality of a plot for development,shape of the plot, frontage and depth, modification fordepth, value in the sense of value of additional cost lessdepreciation and the most important factors which a valuershould study in respect of a property are (1) advantagesto the property and (2) disadvantages to the property.J.A.Parks in his book, 'Principles and Practice ofValuation' (Fifth Edition by D.N.Banerjee) by referring tothe judgment of the Supreme Court of British Columbia(Canada) in Rowan v. City of Vancouver, wherein it washeld that "a recent market price is not the best test ofactual value. The whole evidence surrounding thetransaction, the condition of market and other factorshave to be weighed carefully", stated that valuation ofimmovable property is not an exact science and it is aninquiry relating to a subject abounding in uncertaintieswhere there is more than ordinary guesswork and where itwould be unfair to require an exact exposition of reasonsfor the conclusions arrived at. He has relied on thejudgment of this Court in Velayudam Chettiar v. SpecialTahsildar, 1959 (1) MLJ 348 and on the judgment ofAllahabad High Court rendered in Chand Kiran Tyagi v.State of U.P., 1994 (24) ALR 196. The question of faircompensation is not an algebraic problem which would besolved by an abstract formula as there is room forinterference and inclinations of opinion which being moreor less conjectural, are difficult to reduce to exactreasoning or to explain to others and it is not fair torequire an exact exposition of reason for the conclusionsarrived at. The learned author has relied on theobservations of Bhagwati, J., as he then was, inAdministrator-General W.B. v. Collector, 1988 (2) SCC 150.Bhagwati, J., observed in the above judgment as follows:"We are conscious that this process of determinationof market value adopted by us may savour of conjecture orguess, but the estimation of market value in many casesmust depend largely on evaluation of many imponderablesand hence, it must necessarily be to some extent a matterof conjecture or guess." https://hcservices.ecourts.gov.in/hcservices/ The author has also relied on the observations of theSupreme Court in Prithvi Raj Taneja v. State of M.P., 1977(1) SCC 694, wherein the Supreme Court held that there isan element of guesswork inherent in most cases involvingdetermination of the market value. In G.Loganathan v. S.Chenniya Chettiar, 1995 (2) CTC492, this Court observed that the Supreme Court and othercourts including Madras High Court have held thatguideline value is not market value and it will bedangerous to value a property according to the guideinevalue because there is no guarantee of truth orcorrectness of the data given in the guideline value. Thelearned Judge also relied on the judgment of the SupremeCourt rendered in Land Acquisition Officer v. JastiRohini, 1995(1) SCC 717 wherein it was held that thevaluation register on the basis of the notification underSection 47-A of the Stamp Act is for collection of revenueand it cannot be the basis for determination of the marketvalue of the land. It was further held, that from thedecisions, it is clear that the guideline value cannot bethe market value of the property as the guideline value isintended for the collection of revenue and market value isthe criteria to value the suit. When we consider the above principles, it is clearthat guideline and market value are two different conceptsand that the term "Market value" is vague, uncertain and amatter of guesswork. The market value, in my view, doesnot lie in the property contemplated to be purchased butlies in the mind of the person contemmplating to purchasethe said property. From the discussion made above, itcould be seen that guideline value and market value beingtwo different concepts, the trial Judge was not justifiedin taking the market value for arriving at the conclusionthat there was a loss, since Explanation to Section 47-Aof the Stamp Act, which has been extracted above, statesthat the market value will be the price the property wouldhave fetched in open market."The said judgment has also been confirmed by the Hon'ble SupremeCourt of India in 2004(2) SCC page 9 - R.Saibharathi vs.J.Jayalalitha and others.28. A perusal of the impugned order and the counter affidavitfiled by the second and third respondents would reveal that thedocuments have already been registered and in pursuant to objectionsraised by the Local Audit in its reports 3/99 and 6/99 respectively,demand of additional stamp duty was made on the basis of the marketvalue on the date of the registration of the sale deed. No doubt https://hcservices.ecourts.gov.in/hcservices/ sub-section 3 of Section 47-A clothe the Collector the suo motupower within 5 years from the date of registration of the anyinstrument of conveyance etc., not already referred to him undersub-section (1) of Section 47-A to call for and examine theinstrument for the purpose of satisfying himself as to thecorrectness of the market value of the property which is the subjectmatter of the conveyance etc.,and the duty payable thereon and ifafter such examination, has reason to believe that the market valueof the property has not been truly set forth in the instrument, hemay determine the market value of the said property and the duty asaforesaid in accordance with the procedure provided for in sub-section (2) of Section 47-A of the Indian Stamp Act and thedifference, if any, in the amount of duty, shall be payable by thepersons liable to pay the duty. In the case on hand, a perusal ofthe impugned orders would reveal that the appellants herein hasfailed to take into consideration any material nor any material wasplaced before them to arrive at a conclusion that the market valueof the property conveyed to the allottees under the respective deedsof sale has not been truly set forth and that no reasons have beenrecorded that the allottees had fraudulently evaded the payment ofstamp duty. 29. This Court, in the judgment reported in 2008 (5) CTC - page239 - A.J.Mapillai Mohadeen v. The Sub-Registrar, RegistrationDepartment, has considered the issue in respect of the value fixedby the Public Authority in a public auction sale. While decidingthe said case, this Court has taken into consideration, the judgmentreported in 2008(4) SCC 720 – Government of Andhra Pradesh vs.P.Laxmidevi, 2002(2) CTC 329 – R.Sukumaran vs. State of Tamil Nadu,1997 (2) CTC 617 – S.P.Padmavathy vs. State of Tamil Nadu and thelatest decision of the Hon’ble Supreme Court of India reported in2008(1) CTC page 6 – State of Rajasthan vs. Khandaka Jain jewellers,has held that unless there is an under valuation of the subjectmatter with fraudulent intention to evade proper payment of stampduty, the respondents cannot impose such a heavy stamp duty on thepetitioner with regard to the document in question and hence, thevalue fixed by the Public Authority in the Public auction cannot bedoubted after reference under Section 47-A (1). The said casepertaining to the sale of the assets by the Tamil Nadu IndustrialInvestment Corporation which was taken possession in exercise ofpowers under Section 29 of the State Financial Corporations Act andthe payment of the stamp duty in respect of such sale. This Courthas ultimately held in the said decision that the market valuestated in the instrument brought for registration should be taken tobe correct and that value cannot be doubted or disbelieved. 30. This Court taking into consideration that the allotment ofplots were made in the year 1985, and that the sale deeds have beenregistered in the year 1999, 2000 and 2001, and no reason has beenstated by the authority with regard to the fraudulent evasion of https://hcservices.ecourts.gov.in/hcservices/ stamp duty payable on instruments, and in the light of theprinciples laid down in the above said decisions, is of the view,there is no illegality or error apparent on the face of the recordin the impugned orders allowing the writ petitions. 31. In the result, all the writ appeals are dismissed and theorders passed in the writ petitions are confirmed. But in thecircumstances, there will be no order as to costs. Consequently,Miscellaneous Petitions are closed. sd/-Asst.Registrar/true copy/Sub Asst.Registrargr.To1. THE SPECIAL SECRETARY TO GOVERNMENT GOVERNMENT OF TAMIL NADU COMMERCIAL TAXES (J1 DEPARTMENT), SECRETARIAT, CHENNAI-600 009. 2. THE INSPECTOR GENERAL OF REGISTRATION, CHENNAI-600 028. 3. THE DISTRICT REGISTRAR, TRICHY DISTRICT, TIRUCHIRAPPALLI - 620 001.+ 4 c.cs. to Mr. Srinath Sridevan, Advocate. S.R.No.1401.+ 1 c.c. to The Government Pleader. S.R.No.1037. COMMON JUDGMENT IN Writ Appeal Nos.2607 to 2630, 2708 to 2713, 3179 to 3193, 2455 to 2469 of 2003 & 2345 to 2359 & 3373 to 3380 of 2004 & 1236 to 1240 of 2005.KM (CO)GSK 18.02.2009.