Karnataka High Court
Smt. Zareena Siddiqui vs State Of Karnataka on 10 September, 2024
Author: M.G.S. Kamal
Bench: M.G.S. Kamal
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NC: 2024:KHC:37607
WP No. 46450 of 2016
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 10TH DAY OF SEPTEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE M.G.S. KAMAL
WRIT PETITION NO. 46450 OF 2016 (GM-ST/RN)
BETWEEN:
SMT. ZAREENA SIDDIQUI
SINCE DECEASED BY HER LR'S
a) MOHAMMED USMAN KHAN
S/O ZAREENA SIDDIQUI
AGED ABOUT 44 YEARS
b) MOHAMMED UMAR FAROOQ
S/O ZAREENA SIDDIQUI
AGED ABOUT 45 YEARS
BOTH ARE R/AT NO.43
MISSIN ROAD, IST MAIN ROAD
SAMPANGIRAM NAGAR
BENGALURU-560 027.
...PETITIONERS
Digitally (BY SRI. S.P. KULKARNI SENIOR COUNSEL A/W
signed by SRI. VASANTH KUMAR K.M., ADVOCATE)
SUMA B N
Location:
High Court of AND:
Karnataka
1. STATE OF KARNATAKA
REPRESENTED BY REVENUE SECRETARY
VIDHANA SOUDHA
BENGALURU-560 001.
2. THE DISTRICT REGISTRAR CUM
DEPUTY COMMISSIONER
FOR REGISTRATION
GANDHI NAGAR
BENGALURU-560 001.
3. THE SUB REGISTRAR
GANDHI NAGAR
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NC: 2024:KHC:37607
WP No. 46450 of 2016
BENGALURU-560 001.
...RESPONDENTS
(BY SRI. SPOORTHY HEGDE N., HCGP FOR R1 TO R3)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER VIDE
ANNEX-F DATED.11.08.2016 PASSED BY THE RESPONDENT NO.2
WITH REFERENCE NO.45-A[1]/G/09/2015-16 ACCORDING TO LAW.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN
'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE M.G.S. KAMAL
ORAL ORDER
Petitioner is before this Court being aggrieved by the order dated 11.08.2016 produced at Annexure-F passed by the respondent No.2 by which the petitioner has been called upon to pay additional Stamp Duty of Rs.25,36,970/- and Registration fees of Rs.4,53,030/- aggregating a sum of Rs.29,99,000/-.
2. Sri.S.P.Kulkarni, learned Senior Counsel appearing for Sri.Vasanth Kumar.K.M, learned counsel for the petitioner reiterating the grounds urged in the memorandum of petition submitted that the husband of the petitioner had originally entered into an agreement of sale dated 25.06.1979 in respect of 1/3rd share of the property which is equivalent to 4278 Square feet bearing old No.7, later assigned with the new -3- NC: 2024:KHC:37607 WP No. 46450 of 2016 No.24 and thereafter present No.43, situated at Rama Mandir road, Sampangiramanagara road, Bengaluru with one Amaranath-owner of the said property. That the matter went into dispute resulting in petitioner filing suit for specific performance in O.S.No.30/1981, which was decreed. Aggrieved by the same a Regular First Appeal in R.F.A.No.265/1999 was filed in which the said appeal was partly allowed directing the vendor to refund the amount. Aggrieved by the same, petitioner preferred a Special Leave Petition in S.L.P.No.6956/2004 before the Hon'ble Apex Court which remanded the matter for fresh consideration. After the remand this Court had set-aside the decree of specific performance which resulted in Petitioner again approaching the Hon'ble Apex Court in S.L.P.No.19555/2012. That the Hon'ble Apex Court by its Order dated 29.10.2014 allowed the said appeal granting the relief for specific performance subject to petitioner paying additional sum of Rs.15,00,000/- over and above Rs.65,000/- which was already paid. Thus, he submits that the sale consideration as per the decree passed by the Hon'ble Apex Court was Rs.15,65,000/-. He submits thereafter the petitioner preferred Execution Proceedings and the -4- NC: 2024:KHC:37607 WP No. 46450 of 2016 Executing Court had appointed a Commissioner through whom a deed of sale dated 07.09.2015 was executed and presented the same for registration. It was at that time, respondent No.3-Sub-Registrar declined to register the document on the premise that the same being under valued and referred the matter for adjudication before the respondent No.2. The respondent No.2 by the impugned order referring to the guidance value applicable to the subject property directed the petitioner herein to pay the additional Stamp Duty and Registration fees of Rs.29,99,000/- as noted hereinabove. Aggrieved by the same petitioner is before this Court.
3. Learned Senior Counsel appearing for the petitioner submits that since the Hon'ble Apex Court had fixed the sale consideration at Rs.15,65,000/-, the same was reflected in the deed of sale. He refers to Section 45-A of the Karnataka Stamp Act, 1957 (hereinafter referred to 'the Act, 1957') and submits that invocation of provisions under Section 45-A of the Act, 1957 would arise only if there is any error in setting forth the true value of the property. He submits that the petitioner in the instant case had indeed set forth the true value of the property at Rs.15,65,000/- as fixed by the Hon'ble Apex Court. -5-
NC: 2024:KHC:37607 WP No. 46450 of 2016 That there has been no suppression of the fact or falsification of the document. As such, provisions under Section 45-A of the Act, 1957 could not have been invoked. He further submits that the deed of sale in question was executed with the assistance of the Court, as such, there could not have been any case of under valuation. He submits therefore the order impugned requires to be set-aside.
4. The other submissions made by the learned Senior Counsel appearing for the petitioner is that even on merits, the impugned order is unsustainable as no reasons are assigned as to why the market value of the property is assessed at Rs.8,900/- which is applicable to properties as Mission Road instead of properties on Rama Mandir road, which are lesser in value.
5. On the other hand, learned HCGP appearing for the respondent justifying the impugned order submits that irrespective of the value shown in the document for the purpose of payment of additional Stamp Duty and Registration fees the guidance value published by the Committee constituted under Section 45-B of the Act, 1957 has to be -6- NC: 2024:KHC:37607 WP No. 46450 of 2016 taken into consideration and in the instant case a notification has been published providing guidance value in respect of the subject property and the adjudication made by the respondent No.2 is based on the said guidance value and the same cannot be found fault with.
6. Learned HCGP further submits that the property in question has three roads abutting to it, namely, Mission Road, Rama Mandir road and Sampangiramanagara road. He fairly submits that no reasons are assigned in the order for specifically choosing the market value of the property situated on the Mission Road and he submits same may required to be reconsidered. He further submits that any order is subject to revision under Section 45-A(5) of the Act, 1957 and the petitioner may seek remedy thereunder. Hence, seeks for dismissal of the petition.
7. Heard and perused the records.
8. The purpose of Section 45-A of the Act, 1957 is only to determine the market value of the property while registering any interest listed under Sub-Section (1) (a) to (k) thereunder based on the estimated market value of the property published -7- NC: 2024:KHC:37607 WP No. 46450 of 2016 by the Committee constituted under Section 45-B of the Act, 1957.
9. It is relevant at this juncture to refer to Section 45-a of the Act, 1957 which reads as under;
45-A. Instrument of conveyance, etc. undervalued how to be dealt with;
(1)If the registering officer appointed under the Registration Act, 1908 (Central Act XVI of 1908) while registering any instrument of,-
(a)Conveyance [section 2(1)(d) ];
(b)Gift [Article 28(a)];
(c)Exchange of property (Article 26);
(d)Settlement (Article 48-A(i))
(e)Reconstitution of Partnership (Article 40-B
(a));
(f)Dissolution of partnership (Article 40-C (a) );
(g)An agreement to sell covered under sub-clause
(i) of clause (e) of Article 5;
(h)[ a lease covered under item [(vi)] of Article 30;]
(i)A power of Attorney covered [under clause (e), clause (ea) and clause (eb)] [Substituted by Act 9 of 2009 w.e.f..1.4.2009] of Article 41;
(j)Release [(Article 45-(a)] [Substituted by Act 7 of 2007 w.e.f. 1.4.2007];
(k)Conveyance under a decree or final order of any Civil Court has reason to believe] having regard to the estimated market value published -8- NC: 2024:KHC:37607 WP No. 46450 of 2016 by the Committee constituted under section 45B, if any or otherwise, that the market value of the property which is the subject matter of such instrument has not been truly set forth, he shall 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 property and the proper duty payable thereon.]
(l)[ Agreement [Article 5(f)] [Inserted by Act 7 of 2007 w.e.f. 1.4.2007]
(m)Award [Article 11(a)]
(n)Trust [Article 54 (A) (iii)]
(o) Transferable Development Rights (Article 20(7)).
Having regarding to the estimated market value published by the Committee constituted under Section 45-B, if any, or otherwise, that the marker value pf the property which is the subject- matter of such instrument has not been truly set forth, he shall 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 theron.] (2)On receipt of a reference under sub-section (1), the Deputy Commissioner shall, after giving the parties a reasonable opportunity of being heard and after holding an inquiry in such manner as the State Government may by rules prescribe, determine by order [as for as may be within ninety days from the date of receipt of such -9- NC: 2024:KHC:37607 WP No. 46450 of 2016 reference] [Inserted by Act 24 of 1999 w.e.f. 18.8.1999] the market value of the property which is the [subject matter of instrument specified in sub-section (1) and the duty payable thereon.] [Substituted by Act 8 of 2003 w.e.f. 1.4.2003] The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty. [with interest at twelve percent per annum if he does not pay within ninety days from the date of order of the Deputy Commissioner] [Inserted by Act 7 of 2006 w.e.f. 1.4.2006] [Provided that the payment of interest is not applicable to instruments executed prior to 31st day of March, 2006.] [Inserted by Act 7 of 2006 w.e.f. 1.4.2006] ''(3) The Deputy Commissioner may, suo-motu within two years from the date of registration of [any instrument specified in sub-section (1)] 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 the market value of the property which is the 1[subject matter of any instrument specified in sub-section (1) and the duty payable thereon]1 and if after such examination he has reason to believe that the market value of such property has not been truly set forth in the instrument, he may determine by order the market value of such property and the duty payable thereon in accordance with the procedure provided for in sub-section (2). The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty [with interest at twelve percent per annum if he does not pay within ninety days from the date of order of the Deputy Commissioner] ''
10. Section 45(B) of the Act, 1957 which reads as under;
''45B. Constitution of Central Valuation Committee.-
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NC: 2024:KHC:37607 WP No. 46450 of 2016 (1) The State Government shall by notification, constitute a Central Valuation Committee, under the chairmanship of Inspector General of Registration and Commissioner of Stamps, for estimation, publication and revision of market value guidelines of properties in any area in the State at such intervals and in such manner as may be prescribed, for the purpose of section 45-A. (2) The Central Valuation Committee is the final authority for the formulation of policy, methodology and administration of the market value guidelines in the State and may for the said purpose constitute market valuation sub- committees in each sub-district and district comprising of such members as may be prescribed, for estimation and revision of the market value guidelines in the State. (3)Sub-committees so constituted shall function under the Central Valuation Committee and shall follows such procedures as may be prescribed and shall be subject to reconstitution whenever found necessary.]''
11. Thus, perusal of the aforesaid provisions would indicate, notwithstanding the value of the property mentioned in the deed of conveyance listed under Section 45-A(1) (A-O) of the Act, 1957, the stamp duty and incidental charges are payable based on estimated market value that is published by the Central Valuation Committee constituted by the State Government under Section 45-B of the Act, 1957.
12. It is also relevant to refer to Section 17 of the Act, 1957 which reads as under;
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NC: 2024:KHC:37607 WP No. 46450 of 2016 ''17. Instruments executed in the State of Karnataka-All instruments chargeable with duty and executed by any person in the State of Karnataka shall be stamped before or at the time of execution.
Provided that nothing in this section shall apply to an instrument in respect of which stamp duty has been paid under Section 10-A''
13. The aforesaid provisions makes it clear that notwithstanding the date on which the transaction entered into between the parties, it is the market value of the period during which the document is presented for execution and registration would be taken into consideration.
14. In the instant case, though it is contended that the agreement was entered into on 25.06.1979 and decree for specific performance was passed on 29.10.2014 and the deed of sale was executed on 03.09.2015. It is the market value of the property subject matter of the instrument as on the date when it was executed and presented for registration needs to be taken into consideration. Lest, the same may lead to uncertainty as in many of the cases, parties would have entered into an agreement several years or decades ago as in the instant case before finalizing the deed of absolute conveyance. That alone cannot be a ground to seek the valuation of the property as on the date when the parties had
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NC: 2024:KHC:37607 WP No. 46450 of 2016 originally entered into agreement/transaction. That is not the purport and intent of the provisions of Section 17, 45-A and 45- B of the Act, 1957 as extracted hereinabove.
15. As such the grounds urged to hold that the market value of the property as reflected in the document to be taken, cannot be countenanced. Needless to state, it is for the parties to sell/buy their properties for the value/consideration of their choice. Nonetheless, when it comes to payment of stamp duty and registration fee, the guidance value published by the Committee constituted under Section 45-B of the Act, 1957 alone has to be taken into consideration.
16. As regards the determination of the market value for the instant case is concerned, it is not in dispute that the subject property is surrounded by three roads namely Mission Road, Rama Mandir road and Sampangiramanagara road. However in the impugned order the respondent No.2 seem to have taken the market value of the property situated on Mission Road which is shown at Rs.8,900/- while the market value situated on Rama Mandir road is Rs.5,930/-. As rightly pointed out by the learned senior counsel appearing for the
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NC: 2024:KHC:37607 WP No. 46450 of 2016 petitioner no reasons are assigned by the respondent No.2 to have come to the conclusion to opt the market value of the property situated on the Mission Road, instead of other roads abutting the subject property.
17. In view of the submissions made by the learned HCGP appearing for the respondents and for the reasons noted herein above, this Court deems it appropriate to show limited indulgence. Therefore, the following:
ORDER
(a). Petition is allowed in part.
(b). Order dated 11.08.2016 produced at Annexure-F passed by the respondent No.2-
District Registrar is set-aside.
(c). The matter is remitted to the respondent No.2-District Registrar for fresh adjudication. The petitioner is at liberty to furnish her response/explanation for the purpose of considering the market value of the particular road which may be taken into consideration by the respondent No.2- District Registrar before passing the final order.
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NC: 2024:KHC:37607 WP No. 46450 of 2016
(d). Since the market value now determined by the respondent No.2-District Registrar is at Rs.29,99,000/- which is the revenue to the State, subject to further determination, this Court deem it appropriate that the petitioner be directed to deposit a sum of Rs.10,00,000/- within a period of four weeks from the date of receipt of certified copy of this order. The said sum be deposited before the respondent No.2-District Registrar who shall treat/set-off the same against the order that may be passed as directed hereinabove.
(e). Such determination of the market value of the property in question be done within an outer limit of 12 weeks from the date of receipt of certified copy of this order. All contentions are kept open.
SD/-
(M.G.S. KAMAL) JUDGE RL List No.: 1 Sl No.: 11