Andhra HC (Pre-Telangana)
Ramasinghu Buchanna And Anr. vs Joint Sub-Registrar And Anr. on 26 October, 2005
Equivalent citations: 2006(1)ALT97
ORDER B. Prakash Rao, J.
1. This case arises out of a reference made by a learned single Judge Sri Justice P.S. Narayana on the question as to whether the appeal filed by the revision petitioners can be maintainable de hors the proviso to Section 47-A(1) (sic. 47-A(2)) of the Indian Stamp Act, 1899 (for short 'the Act') on the ground that the said provision is not valid.
2. The above aspect is pre-based upon a submission made on behalf of the petitioners herein to the effect that the proviso to Section 47-A of the Act as amended by the Andhra Pradesh Act 8 of 1998 was struck down by this Court as arbitrary and offends Article 14 of the Constitution of India in P. Laxmi Devi v. Government of A.P. and Ors. (D.B.). Therefore, it is the contention of the petitioners that the proviso to Section 47-A(2) of the Act which runs on the same lines both in spirit and substance as that of the proviso to Section 47-A (1) of the Act, necessarily it has to be held as invalid following the very same principles in P. Laxmi Devis1 case. Since the appeal preferred by him was rejected on the ground of non-compliance of the condition imposed therein before the learned single Judge, the learned Government Pleader sought to place reliance on the decision of the Full Bench of this Court in Mohd. Abdul Azeem Zakee and Ors. v. Government of Andhra Pradesh and Ors. (F.B.). It is relevant to note the aforesaid two provisos which read as follows:
47-A Instruments of conveyance, etc. under-valued how to be dealt with:- (1) Where the registering officer appointed under the Registration Act, 1908, (Central Act 16 of 1908), while registering any instruments of conveyance, exchange, gift, partition, settlement, release, agreement relating to construction, development or sale of any immovable property or power of attorney given for sale, development of immovable property, has reason to believe that the market value of the property which is the subject-matter of such instrument has not been truly set forth in the instrument, or that the value arrived at by him as per the guidelines prepared or caused to be prepared by the Government from time to time has not been adopted by the parties, he may keep pending such instrument, and refer the matter to the Collector for determination of the market value of the property and the proper duty payable thereon:
Provided that no reference shall be made by the registering officer unless an amount equal to fifty-per cent of the deficit duty arrived at by him is deposited by the party concerned.
(2) On receipt of a reference under Sub-section (1), the Collector shall, after giving the parties an opportunity of making their representation and after holding an enquiry in such manner as may be prescribed by rules made under this Act, determine the market value of the property which is the subject-matter of such instrument and the duty as aforesaid:
Provided that no appeal shall be preferred unless and until the difference, if any, in the amount of duty is paid by the person liable to pay the same, after deducting the amount already deposited by him:
Provided further that where after the determination of market value by the Collector, if the stamp duty borne by the instrument is found sufficient, the amount deposited shall be returned to the person concerned without interest.
3. Considering the first proviso namely the proviso to Section 47-A(1) of the Act as amended by the Andhra Pradesh Act 8 of 1998, a Division Bench in the aforesaid decision of P. Laxmi Devi's case (1st referred supra) held that the same is unconstitutional and accordingly struck down and while holding so, it was observed that:
The petitioner has got a right to purchase the property and so she has purchased. Of course, she is liable to pay the stamp duty under the Act. The stamp duty so leviable is computed on the basis of the market value prevalent on the date of the execution of the document. Such market value is to be arrived at having regard to the similar property. The Registering Officer receives the document and goes by the guidelines issued in that regard by his superior authority including the Government. Such guidelines bind him and do not bind the person presenting the document like the petitioner. The petitioner can value his document on the basis of the consideration arrived at and pay the stamp duty thereon. But, the same should be acceptable to the Registering Officer. But, then the Registering Officer is not having power to adjudicate as to whether the stamp duty paid is correct or not. He can only tell the party presenting the document that it does not conform to the value prescribed by the guidelines or the Basic Valuation Register, as the case may be. Should be party presenting the document accept the demand of the Registering Officer regarding the stamp duty leviable, the document will be registered and returned to the said person. But, when the person presenting the document does not accept the version of the Registering Officer, the Registering Officer being not the authority to decide the contentious issue regarding proper value, is duty-bound to refer the matter to the Collector. The Collector is the authority to determine the proper market value and the stamp duty leviable thereon. So far as the percentage of stamp duty is concerned, that if fixed under the Act, but the quantum thereof may fluctuate basing upon the market value. At the time of presentation of the document, should there be a dispute regarding the quantum of stamp duty payable, the said quantum will be in a fluid state and crystallizes only after the adjudication by the Collector. The above act of Registering Officer is only administrative in nature with no element of adjudicatory powers on the aspect as to whether the document is duly stamped or not. The only part which can be played by the Registering Officer is to indicate that in his opinion, the document is not duly stamped and if the party disputes, then it is incumbent upon the Registering Officer to refer the document for the decision as to the proper market value by the Collector. The Collector shall then have to afford opportunity to both the parties and after holding enquiry, has to determine the market value of the property sought to be conveyed or transferred, as the case may be, by such document. If the Collector decides that there is a deficit duty, then the same has to be paid by the party and if it is not agreeable to him then he has to file an appeal to the judicial authority. However, if the Collector finds that market value has been correctly depicted and the stamp duty has been duly paid, there is no exception, but to register the document. This is the main purport of the above statutory provision and is not objectionable. But, what is objectionable is the imposition of deposit of 50% of the differential stamp duty as per the provisional valuation made by the Registering Officer, as a condition precedent for referring the matter to the Collector. If a statute confers power upon the Registering Officer to decide for himself placing him in the capacity of a quasi-judicial authority and if the said authority adjudicates the issue with regard to proper valuation of the document after following the fair procedure, the party is bound to take the said decision and either to honour it or to challenge it by way of an appeal. Of course, no litigant can demand as of right for a provision of appeal and such provision regarding appeals, revisions etc., are always creatures of the statute and if statute prescribes some conditions for availment of such an appeal or revisional remedies, then the litigant cannot agitate against such imposition, as there is no fundamental right to have appeal or revisional remedies under a statute. But, the situation here is entirely different as the Collector does not stand in the status of appellate authority. He is a quasi-judicial authority to determine the proper market value of the subject-matter of the document and the said decision may either go against the Registering Officer or the party presenting the document. Such a procedure always satisfies the equal protection of laws enshrined in Article 14 of Indian Constitution. But, the imposition of deposit of 50% of the differential stamp duty for referring the document to the Collector runs beyond the object and intendment of the above statutory provision. The object and intendment of the Stamp Act is to collect the proper stamp duty and such proper stamp duty is dependent upon the determination of market value of the subject-matter of the document and such determination is only made by the Collector and until such determination is made by the Collector, the document which is received for registration even after collection of whatever stamp duty deposited and the registration fee is paid by the party, is not released to the party, but is kept pending registration and such document kept pending registration is not having any evidentiary value and is not entered into the books of registration and no certified copy of the same can be granted and no rights flow from such document, be it sale, exchange, gift, mortgage, lease etc. By keeping the document pending registration, there is enough safeguard for collecting the deficit stamp duty, as in the event of the Collector accepting the valuation suggested by the Registering Officer and the party not paying the said stamp duty, the document remains under pending registration and even may be returned to the party for want of the payment of the differential stamp duty. This being the aim and intendment of the stamp duty protecting the public exchequer, there is absolutely no nexus for calling upon the party to deposit 50% of the differential stamp duty as a condition for making reference. It is not that a party seeks a reference on his own, but the Registering Officer is duty-bound to refer the moment party does not accept the valuation suggested by him. The party presenting a document is the master of his choice as to whether he should deposit the deficit stamp after determination of the Collector or not. If he feels that the market value determined by the Collector is exorbitant, then he may resile from going ahead with the registration of the document and may take return of the document. There is nothing to stop him from doing so. Stamp duty is not akin to a compulsory tax such as, property taxes levied upon the house properties, sales-tax levied upon the turn-over, income tax levied upon the income prescribed etc. If a party wants to have his document registered, he should pay stamp duty and should he feel that it is exorbitant and he cannot bear the same, he can resile from the same even after presenting the document. The authority under the Stamp Act cannot force upon the party to compulsorily pay the stamp duty. Such compulsion is imposed only upon the party's insistence for registration of the document and not otherwise. In such circumstances, the imposition of deposit of 50% of the amount towards the differential stamp duty as a condition for referring the matter to the Collector runs beyond the scope, intendment and object of the Act and, thus, offends equal protection of laws guaranteed under Article 14 of Indian Constitution and thus, is arbitrary.
4. On a bare reading of both the aforesaid provisos, no-doubt it looks similar since both contemplate a condition precedent for deposit of the stamp duty while preferring an appeal by the aggrieved party. However, it is to be noticed that there is an ample difference in regard to both the proceedings as contemplated under the aforesaid two provisos since the reference is at the instance of the Registering Authority whereas the appeal is at the instance of the aggrieved party. Doubting the correctness of this decision in fact it was assailed before the Full Bench of this Court in Mohd. Abdul Azeem and Ors. (2nd referred supra). However, ultimately having regard to the facts of the case involved therein, the plea was restricted only to the effect that the amending Act will not have retrospective operation since the documents in question were prior to the amendment and the said plea was accepted by holding that the amendment imposing a pre-condition of deposit of differential amount of stamp duty as determined by the Collector for preferring an appeal under Sub-section (2) does not apply to cases where the matter was referred to the Collector prior to the commencement of the Act, though the Collector passed the order after the said commencement the right to file an appeal gets crystallized on the date of referring the matter to the Collector and hence, the subsequent amendment will not have any significance. While considering the said question, the Full Bench of this Court has taken note of the actual reference assailing the correctness of the said decision. However, it was held in that having regard to the submissions made by the learned counsel for the petitioner, it is not necessary to consider the constitutionality or otherwise of the amended provisions of Section 47-A of the Act and the only question which arises for consideration is that the reference by the 3rd respondent to 2nd respondent under Sub-section (1) of Section 47-A of the Act having been made in January, 1997 i.e., prior to the coming into force of the Amendment Act, 1998, wherein the order was passed on 27-3-2000, whether the unamended provisions of Section 47-A should apply and ultimately it was held that it has no such retrospective operation. Thus, it is evident in the said decision that the question as to whether the later proviso to Section 47-A (2) can be held to be bad on the self same lines as that of Section 47-A (1) of the Act was not considered.
5. In regard to the principle as to the right of appeal as contemplated under the statute and the conditions imposed therein, it necessitates as to consider some of the well laid principles. In Lal Ram v. Supreme Court of India the Apex Court while considering Order XL, Section 2(2) and Order XLVII Rule 1 of the Supreme Court Rules 1966, held that furnishing of security as precondition for filing of review petition does not offend Article 14, and the same cannot also be declared invalid on ground that in certain circumstances pre-condition is highly prejudicial to interest of petitioner. Further, it was held that in exercise of powers under Order XLVII Rule 1, the Court can excuse the petitioner from compliance with Rule 2(2). In R. Srikant v. Govt. of A.P. (D.B.) a Division Bench of this Court while considering squarely the very same question as referred to in this case as to the competence and correctness of the proviso to Sub-section (2) of Section 47-A of the Act and after considering the same, it was held that in exercise of powers under Entry 44 of List III, the State Legislature is competent to legislate on any subjects enlisted therein and thus, the provisions relating to appeals and other related matters cannot be said to be outside the purview of the main subject. Further, it was held that the requirement under the Proviso to deposit difference of the amount of stamp duty as a condition precedent to prefer an appeal, however onerous and burdensome may be, is not violative of Article 14 of the Constitution of India. In the said decision, the principles laid down in Gujarat Agro Industries Co. Ltd. v. Municipal Corporation of the City of Ahmedabad were followed. In Gujarat Agro Industries Co. Ltd. case5, the Supreme Court while considering the appeal against the rateable value or tax, Bombay Municipal Corporation Act, 1949, held that the right to appeal is created by statute and is not an inherent right whereas right to bring suit is inherent. Further, right of appeal is a creature of a statute and it is for the legislature to decide whether the right of appeal should be unconditionally given to an aggrieved party or it should be conditionally given. Right of appeal which is a statutory right can be conditional or qualified and therefore, it cannot be said that such a law would be violative of Article 14 of the Constitution of India. In Vijay Prakash D. Mehta v. Collector of Customs while considering Section 129-E of the Customs Act, 1962, provides a conditional right to appeal in respect of an appeal against the duty demanded or penalty levied, the Supreme Court held that the same is obligatory. Further, when such statutory right of conditional appeal is obligatory, all such conditions have to be satisfied. In Seth Nand Lal v. State of Haryana 1980 (Supp.) SCC 574 while considering the provisions of Haryana Ceiling on Land Holdings Act, 1972 and appeal provided under Section 18(7) thereof in regard to the condition imposed for filing appeal or revision, it was held that the right of appeal is a creature of a statute and there is no reason why the legislature, while granting the right cannot impose conditions for the exercise of such right so long as the conditions are not so onerous as to amount to unreasonable restrictions rendering the right almost illusory.
6. Having regard to the aforesaid principles as laid down, it is now well established that it is always open for the Legislature to provide a right of appeal with any conditions under a statute and the same cannot be held to be violative of Article 14 of the Constitution of India and unconstitutional. Further, it is quite amply clear that there is ample difference as pointed out in the very decision of P. Laxmi Devi's case (1st referred supra) where the Division Bench of this Court has taken note of the difference between the nature of proceedings under proviso to Section 47-A(1) and proviso to 47-A(2) of the Act. As pointed out while holding that situation is entirely different as the Collector does not stand on the state of appellate authority. Therefore, it cannot be said that the nature of proceedings under these two provisos are akin to each other and the contention that the principles in the decision aforesaid reported in P. Laxmi Devi's case (1st referred supra) are also applied to the proceedings of appeal under Section 47-A (2) of the Act cannot be accepted. In the circumstances, we hold in answer to the reference that the appeal filed by the petitioners cannot be maintained de hors the proviso of Section 47-A (2) of the Act and further the said provision cannot be held to be invalid.
7. The Reference is answered accordingly.