Karnataka High Court
Smt Nagarathna Murthy vs State Of Karnataka on 16 October, 2012
Author: N.Kumar
Bench: N.Kumar
1
W.A. No. 5773/2011 (GM-ST/RN)
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 16TH DAY OF OCTOBER 2012
PRESENT
THE HON'BLE MR. JUSTICE N.KUMAR
AND
THE HON'BLE MR. JUSTICE V.SURI APPA RAO
W.A. No.5773/2011 (GM-ST/RN)
BETWEEN :
SMT NAGARATHNA MURTHY
W/O.SRI A N RAMESH MURTHY
AGED ABOUT 57 YEARS,
R/A NO.29/19, 3RD CROSS,
JUDICIAL OFFICERS' LAYOUT
GEDDALAHALLI, RMV II STAGE
BANGALORE 560 094. ...APPELLANT
(By SRI. G.B. NANDISH GOWDA, ADV. APPEARING FOR
SRI. R B SADASIVAPPA, SR. ADV.)
AND :
1 STATE OF KARNATAKA
REP BY ITS SECRETARY
REVENUE DEPARTMENT
VIKASA SOUDHA,
DR B R AMBEDKAR BEEDHI
BANGALORE 560 001
2 THE DIVISIONAL COMMISSIONER
BANGALORE DIVISION,
2ND FLOOR, BMTC BUILDING,
K H ROAD, SHANTHI NAGAR,
BANGALORE 560 027
2
W.A. No. 5773/2011 (GM-ST/RN)
3 DEPUTY COMMISSIONER
FOR UNDER VALUATION OF STAMPS
I FLOOR, REVENUE SURVEY BLDG,
K R CIRCLE
BANGALORE 560 001
4 SUB REGISTRAR, GANDHI NAGAR
BANGALORE 560 009. ...RESPONDENTS
(By SRI. K. KRISHNA, AGA)
This Writ Appeal is filed under Section 4 of the Karnataka
High Court Act, prays that this Hon'ble Court be pleased to set aside
the impugned order dated 24.06.2011 passed by the learned Single
Judge in W.P. No. 23480/2010 and thereby confirming the order
dated 14.05.2010 passed by the 2nd respondent in Case No.
DIV:C/STP(A) 105/2007-08 vide Annexure 'G' to the writ petition
and the order dated 29.07.2002 passed by the 2 nd respondent in Case
No. 45-A(1)/Ga/481/1998-99 vide Annexure 'B' to the writ petition;
remand the matter to the 3 rd respondent and direct the 3 rd respondent
to make a spot inspection and hold an enquiry regarding the market
value of the property in question as on the date of purchase.
This Writ Appeal coming on for Preliminary Hearing this day,
N. KUMAR. J., delivered the following :
JUDGMENT
This appeal is preferred challenging the order passed by the learned Single Judge who has declined to entertain the writ petition 3 W.A. No. 5773/2011 (GM-ST/RN) wherein the appellant has challenged the direction to pay additional stamp duty.
2. For the purpose of convenience the parties are referred to as they are referred to in the writ petition.
3. Petitioner purchased a residential site with the building thereon bearing No. 29/19, 3 rd Cross, Judicial Officers' Layout, R.M.V. II Stage, which is formed in the land which earlier belonged to Geddalahalli Village. It consists of Ground, First and Second Floors which measures 3500 sq. ft., (site measures 60 ft. x 48 ft.). The consideration paid for the purchase was Rs.24.30 lakhs under the sale deed dated 26.11.1997 and is duly registered.
The proceedings were initiated under Section 45-A(1) of the Karnataka Stamp Act on the ground that the property is under valued. It was alleged that the value of the property is worth Rs.2,000/- per sq. ft. Though an opportunity was given to the petitioner to have her say but she did not do so. Therefore, the Deputy Commissioner for Under Valuation taking into consideration the prevailing market rate as evidenced by the Notification issued by the Government 4 W.A. No. 5773/2011 (GM-ST/RN) prescribing the value of the site, valued the property at the rate of Rs.2,000/- per sq. ft. Aggrieved by the said order, the petitioner preferred an appeal before the Appellate Authority. The appeal came to be dismissed. Aggrieved by the said order, the petitioner preferred a Writ Petition. The learned Single Judge was of the view that the only question which arises for consideration before him was Whether the property is situated in Geddalahalli Village or is it situate in R.M.V. 2nd Stage. According to the Notification the property was worth Rs.260/- per sq. ft., if the property is situated in gramthana of Geddalahalli Village, otherwise it is worth Rs.2,000/- per sq. ft, if it is situated in R.M.V. II stage. Thereafter, he looked into the schedule to the sale deed. It clearly shows that the property is situated at R.M.V. 2nd Stage and therefore, recorded a finding that it is not situated in gramatana of Geddalahalli. Therefore, the petitioner was liable to pay stamp duty at the rate of Rs.2,000/- per sq. ft. and accordingly he dismissed the writ petition. Aggrieved by the same, the petitioner has preferred this appeal.
5. The learned Counsel for the petitioner assailing the impugned order contends that even if it is to be held that the property 5 W.A. No. 5773/2011 (GM-ST/RN) is not situated in the gramatana of Geddalahalli and Rs.260/- per sq. ft., is not applicable in terms of the Notification dated 05.12.1998 the Sub-Registrar rate was Rs.893/-, the authorities have wrongly applied Rs.2,000/- per sq. ft., atleast to that extent the petitioner has to succeed.
6. Per contra, the learned Government Advocate submits the sale deed is dated 26.11.1997, the notification dated 20.01.1997 prescribe Rs.2,000/- per sq. ft. as the value. It was the prevailing on the date of registration of the sale deed. It is only on 05.12.1998 the Sub-Registrar rate was reduced to Rs.893/- per sq. ft., which has no application to the facts of this case. Therefore, he submits that no case is made out for interference.
7. In the light of the aforesaid facts and rival contentions, the question that arise for our consideration is :
"What is the market value of the property on the date the property was registered, on the basis of which the petitioner is liable to pay stamp duty" ?
Section 45-A(1) provides: if the market value of the property which is the subject matter of an instrument, in this case the sale 6 W.A. No. 5773/2011 (GM-ST/RN) deed, has not been truly set forth, the Registering Authority after arriving at the estimated market value, communicate the same to the parties and unless the parties pay the duty on the basis of such valuation, shall keep pending the process of registration and refer the matter along with a copy of such instrument to the Deputy Commissioner for determination of the market value of the property and the proper duty payable thereon. On receipt of the reference in the aforesaid manner, the Deputy Commissioner shall after giving the parties reasonable opportunity of being heard and after holding an enquiry determine by order the market value of the property which is the subject matter of instrument. The difference if any, in the amount of duty shall be payable by the person liable to pay the duty. Therefore, it is clear, the stamp duty is payable on the market value and not on the estimated market value. The estimated market value is helpful to find out whether the instrument has been under valued but the stamp duty under law is payable only on the market value. The value of the property mentioned in the instrument is Rs.24.30 lakhs. If it is calculated on the basis of Rs.260/- per sq. ft., that is the fair market value. If it is calculated on the basis of Rs.2,000/- per sq. ft., 7 W.A. No. 5773/2011 (GM-ST/RN) it is under valued. The notification issued by the Government setting out to Rs.2,000/- per sq. ft., as the market value of the property is only an estimated market value. If the property is registered for a value less than the estimated market value the law enjoins on the Sub-Registrar to impound the document, calculate the deficiency in the stamp duty and then refer the matter to the Deputy Commissioner for determination of the correct market value. No doubt, on 20.01.1997 the value of the property was shown as Rs.2,000/- per sq. ft. in the notification issued. The value mentioned in the sale deed was based on Rs.260/- per sq. ft. Therefore, it was under value. The Sub-Registrar was justified in calculating the market value on the basis of the notification dated 20.01.1997 and referring the matter to the Deputy Commissioner. But when the matter was before the Deputy Commissioner, one more notification dated 05.12.1998 reducing the market value from Rs.2,000/- per sq. ft., to Rs.893/- per sq. ft was issued. The said notification is undoubtedly subsequent to the sale deed. The Deputy Commissioner is expected to find out what is the market value prevailing on the date of registration of the sale deed. Thus, the estimated value mentioned in the notification is 8 W.A. No. 5773/2011 (GM-ST/RN) only a guiding factor. The property in Geddalahalli grama tana was valued at Rs.260/- per sq. ft., whereas in the layout formed in the same village, the property valued at Rs.2,000/- per sq. ft. There was a public agitation opposing the same. Therefore, keeping in mind the market value prevailing in the locality, by a notification dated 05.12.1998 it was reduced to Rs.893/- per sq. ft. Therefore, the market value on the date of registration probably was Rs.893/- per sq. ft. and not Rs.2,000/- per sq. ft. mentioned in the notification dated 20.01.1997. These aspects have been completely ignored by the Deputy Commissioner as well as the learned Single Judge. In that view of the matter, both the orders requires to be set aside. Hence, we allow the writ appeal and the impugned orders are set aside. The market value is to be determined at the rate of Rs.893/- per sq. ft. The Deputy Commissioner shall re-calculate the market value of the property at the rate of Rs.893/- per sq. ft. and issue demand notice for payment. On such demand being complied with to complete the registration formalities.
Parties to bear their own costs.9
W.A. No. 5773/2011 (GM-ST/RN) In view of the disposal of the main appeal, Misc. W. No. 8388/2011 filed for stay does not survive for consideration.
Sd/-
JUDGE.
Sd/-
JUDGE.
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