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Punjab-Haryana High Court

Devi Singh vs Collector on 13 March, 2014

Author: Mehinder Singh Sullar

Bench: Mehinder Singh Sullar

            Civil Revision No.5927 of 1998                                                         1

                       IN THE HIGH COURT OF PUNJAB AND HARYANA AT
                                      CHANDIGARH

                                                                  Civil Revision No.5927 of 1998
                                                                  Date of Decision:- 13.3.2014
            Devi Singh                                                          ......Petitioner

                                                        Versus

            Collector, Rewari & Anr.                                            .....Respondents
            CORAM: HON'BLE MR. JUSTICE MEHINDER SINGH SULLAR
            Present:           Mr.J.V.Yadav , Advocate for the petitioners.
                               Mr.K.C.Bhatia, Addl. AG Haryana for the respondents
            MEHINDER SINGH SULLAR, J. (Oral)

Tersely, the facts & material, culminating in the commencement, relevant for deciding the instant revision petition and emanating from the record, are that petitioner-vendee Devi Singh s/o Nathu Singh had purchased the land in question from Ram Pal s/o Babu Lal and Shanti Devi d/o Shobha Ram, by virtue of two registered sale deeds dated 31.8.1993. In the wake of some complaints, the Sub-Registrar observed that the petitioner-vendee would have paid more stamp duty at the market value than the amount paid by him on the pointed sale deeds. Consequently, he referred the matter to the Collector for deciding the question of valuation of market price and stamp duty u/s 47-A of The Haryana Stamp (Prevention of Under Valuation of Instruments) Act and Rules, 1978 (hereinafter to be referred as "the Act & relevant Rules").

2. The petitioner-vendee refuted the claim of Sub-Registrar, termed the complaints as baseless and claimed that he had purchased the land in dispute at the prevailing market value and the price assessed by the Sub Registrar was illegal, without jurisdiction and against the rules. Thus, he prayed for dismissal of the reference petition.

2014.03.18 18:32 I attest to the accuracy and integrity of this document Chandigarh Civil Revision No.5927 of 1998 2

3. Although, the complainants did not support their complaints, but still, relying upon the photo copies of the agreements to sell (without any proof), the Collector assessed more market value and concluded that the petitioner-vendee has evaded the stamp duty and ordered the recovery of remaining deficient amount of stamp duty, by way of impugned order dated 9.3.1994 (Annexure P1).

4. Aggrieved thereby, the statutory appeal filed by the petitioner- vendee was dismissed as well, by means of impugned judgment dated 19.1.1996 (Annexure P2) by the appellate Court.

5. Sequelly, the petitioner-vendee still did not feel satisfied and preferred the present revision petition, to challenge the impugned order (Annexure P1) and judgment (Annexure P2) of the Courts below, invoking the superintendence jurisdiction of this Court under Article 227 of the Constitution of India. That is how I am seized of the matter.

6. After hearing the learned counsel for the parties, going through the record with their valuable assistance and after deep consideration over the entire matter, to my mind, the instant petition deserves to be partly accepted in this respect.

7. As is evident from the record that the Collector has determined the market price of the property in question u/s 47-A of the Act and relevant rules, which reads as under:-

"Section 47-A (1) to (4) of the Act 47-A Instruments of conveyance etc. undervalued how to be dealt with -(1) If the Registering Officer, appointed under the Registration Act, 1908, while registering any instrument, transferring any property, has reason to believe that the value of the property of the consideration, as the case may be, has not been truly set forth in the instrument, he may, after registering such instrument, refer the same to the Collector for determination of the value or consideration, as the case may be, and the proper duty payable thereon.

(2) On receipt of 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 by rules, made under this Act, determine the value or consideration and the duty, as aforesaid and the deficient amount of duty, if any, shall be payable by the person liable to pay the duty. (3) The Collector may, suo motu or on receipt of reference from the Inspector-

General of Registration or the Registrar of a district, in whose jurisdiction the property, or any portion thereof, which is the subject-matter of the instrument, is situated, appointed under the Registration Act, 1908, shall, within three 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 its value or consideration, as the case may be, and the duty payable thereon and if, after such examination, he has reason to believe that the value or consideration has not been truly set forth in the instrument, he may determine the value or consideration and the duty, as aforesaid, in accordance with the procedure provided for in sub-section (2); and the deficient amount of duty, if any, shall be payable by the person liable to pay the duty:

Provided that the Collector shall, within a period of two years from the date of the commencement of the Indian Stamp (Haryana Amendment) Act, 1973, also be competent to act as aforesaid in respect of the instruments registered on or after the first day of November, 1966 and before the first day of October, 1970. (4) Any person aggrieved by an order of the Collector under sub-section (2) or sub-section (3), may, within thirty days from the date of the order, prefer an appeal before the District Judge and all such appeals shall be heard and disposed of in such manner as may be prescribed by rules made under this Act.

"Rule 4 of the Rules Rule -4. Assessment of Duty -(1) On receipt of reference under sub-section (1) of Section 47-A, the Collector shall serve on the person or persons concerned a notice in form 1, requiring him on a date and at a place to be specified therein either to attend in person or through an authorised agent to produce or to cause to be produced any evidence on which such person or persons may reply in his support.

(2) The Collector, after taking such evidence as the person or persons may produce any after making such enquiry as he may deem proper, shall determine the value of property or consideration as the case may be, and assess the amount of deficient duty recoverable from the person concerned.

(3) If the person or persons fails or fail to attend in response to the notice served under sub-rule (1), the Collector shall proceed ex parte and assess the deficient amount of duty, if any, to the best of his judgment."

8. A conjoint and meaningful reading of these provisions would leave no manner of doubt that the Collector has the mandatory/statutory duty to hold an enquiry to determine the market price for the purpose of stamp duty in the same manner prescribed by the rules framed under the Act, after giving a reasonable opportunity of hearing to the parties in this behalf and not otherwise. He was required to provide an adequate opportunity to the vendee to produce the evidence available or collected by him. Not only that, the vendee can also ask for an opportunity to adduce evidence to rebut the evidence collected by the competent authority. This matter is no more res integra and is now well settled.

9. An identical question came to be decided by a Division Bench of this court in case Lalita Devi v. The Commissioner, Gurgaon Division, Gurgaon 2001(3) RCR (Civil) 653, it was ruled as under:-

"Before passing an order under sub-section (2) of Section 47-A, the Collector, is under a statutory duty to hold an enquiry and also give opportunity to the vendee and the Sub Registrar to project their respective cases on the issue of determination of the value of the land or property which is subject-matter of the deed. The Collector is also required to disclose the evidence collected during the course of enquiry or otherwise and give opportunity to both the parties to support or controvert such evidence. In the present case, the Collector neither made enquiry envisaged by Section 47-A(2) and Rule 4 nor did he give opportunity to the petitioners to explain the circumstances appearing before them or to rebut the evidence collected at the time of inspection. In view of this, we do not have the slightest hesitation to hold that the order Annexure P1 is violative of the mandatory provisions of Section 47-A(2), read with Rule 4 and the rules of natural justice".

10. Again, this Court in case The Mohali Club, Mohali, through its President Kuldeep Singh son of Shri Roshan Singh v. State of Punjab and others 2010(4) RCR (Civil) 69 has formulated the following legal formalities while determining the market value for the purpose of stamp duty:-

2014.03.18 18:32 I attest to the accuracy and integrity of this document Chandigarh Civil Revision No.5927 of 1998 5

a). The Registering Officer, after registration may refer the documentation, for adjudication before the Collector, if he has reason to believe that there is deliberate under valuation. (see Section 47-A of the Indian Stamp Act)

b). The reference is not a mechanical act but the Registering Officer shall have a basis for coming to a prima facie finding that there is an under valuation. (V.N.Devadoss's case)

c). The circle rate or the Collector's rate (determined in the State of Punjab in the manner provided under Rule 3-A of the Punjab Stamps (Dealing of Under Valued Instruments) Rules shall afford such basis. (K.S.Jhamb's case (DB); Manoj Kumar's case (SC)

d). The circle rate or the Collector's rate shall normally be with reference to the date of execution of sale and registration and not the valuation on the date of agreement or the date of allotment.(State of Rajasthan's case)

e). The Registering Officer shall have no need, normally to suspect the valuation relating to the property valuation, when the State or its instrumentalities themselves have determined the market valuation or when the market valuation is best obtained through competitive bidding (V.N.Devadoss's case (SC)).

f). If the date of auction/allotment and payment of installment are distanced by a long period to the date of execution of sale or registration, the issue of the valuation for the purpose of stamps could be controlled by specific Rules and the contingencies provided under the Rules will have to be strictly applied for taking the benefit under the Rules (See Rule 3-B and the contingencies mentioned therein).

11. In the instant case, it is not a matter of dispute that neither the Collector conducted any inquiry nor provided adequate opportunity to the petitioner-vendee to adduce his evidence. He has only determine the market price on the basis of photo copies of the agreements to sell without any proof. Not only that, the same very error was committed as well, by the appellate Court. Therefore, the impugned order (Annexure P1) and judgment (Annexure P2) cannot legally be sustained in the obtaining circumstances of the case.

12. No other legal point, worth consideration, has either been urged or pressed by the counsel for the parties.

13. In the light of aforesaid reasons and without commenting Arvind Kumar Sharma 2014.03.18 18:32 I attest to the accuracy and integrity of this document Chandigarh Civil Revision No.5927 of 1998 6 further anything on merits, lest it may prejudice the case of either side during the course of subsequent enquiry by the Collector, the instant revision petition is hereby partly accepted. The impugned order (Annexure P1) and judgment (Annexure P2) are set aside. Consequently, the matter is remitted back to the Collector for fresh determination of the market price of the property in litigation at the relevant time in the manner indicated here- in-above and in accordance with law.

Sd/-

(Mehinder Singh Sullar) Judge 13.3.2014 AS Arvind Kumar Sharma 2014.03.18 18:32 I attest to the accuracy and integrity of this document Chandigarh