Andhra HC (Pre-Telangana)
The District Registrar & Collector, ... vs Sri Vasavi Seva Sangam, Kurnool on 17 December, 2012
Equivalent citations: AIRONLINE 2012 AP 29, (2013) 2 ANDHLD 619
Author: M.S.Ramachandra Rao
Bench: M.S.Ramachandra Rao
THE HON'BLE SRI JUSTICE M.S.RAMACHANDRA RAO C.R.P.No.2173 of 2007 DATED:17-12-2012 The District Registrar & Collector, Kurnool and another....PETITIONERS Sri Vasavi Seva Sangam, Kurnool. ...RESPONDENT <GIST: >HEAD NOTE: Counsel for the petitioners: G.P. for Arbitration Counsel for the respondent: Sri KS.K.Reddy ? Cases referred 1 1996 (1) ALT 335 2 AIR 2010 S.C. 1779 3 AIR 2012 S.C. 1140 THE HON'BLE SRI JUSTICE M.S.RAMACHANDRA RAO C.R.P.No.2173 of 2007 ORDER:
This revision is filed by the District Registrar and Collector under Section 47A of Assurance, Registration and Stamps, Nandyal, Kurnool, and thee Sub Treasury Officer, Nandyal, Kurnool, under Article 227 of the Constitution of India challenging the order dt.29-01-2007 in C.M.A.No.5 of 2006 on the file of the Additional Senior Civil Judge, Nandyal (FTC), Kurnool District.
2. The respondent presented a document No.G6/P-21/NDL/05 dt.16-02-2006 where under it had purchased an extent of Ac.0.50 cents in Sy. No.240/3 of Rythunagar village of Nandyal Mandal of Kurnool District from its vendors. The respondent had valued the property @ Rs.128/- and sought to pay stamp duty and registration fee on the said basis. But the Sub Registrar, Nandyal, on a premise that the value of the property would be @ Rs.270/- per sq. yd. referred the case to the Collector under Section 47-A of the Indian Stamp Act, 1899 (for short "the Act") for determination of the market value of the property.
3. The District Registrar and Collector by order R.C.No.G6/P-21/NDL/05, dt.16- 02-2006 determined the market value of the property as Rs.270/- per sq. yd. and directed the Secretary of the respondent to pay deficit stamp duty @ Rs.37,510/- and registration fee of Rs.1,705/-. He relied upon the inspection report dt.17- 11-2005 which contained details of the inspection done by him along with the Revenue Inspector. In the said report it was noted that the above property is situated at a distance of one kilometer from Nandyal town towards Kachiguda Road and that on two sides i.e. eastern side and western side, the said property was bounded by agricultural wet land, on the northern side by Koilakuntla main road and on the southern side by a water channel through which the K.C. canal water was passing. He also noted that nearby some houses and industries were existing. He therefore took into account the potentiality of the property and opined that the property will be useful for "non-agricultural purpose" in future, that it was a developed area and therefore assessed its market value to be Rs.270/- per sq. yd.
4. Challenging the same, the respondent filed an appeal under sub section (4) of Section 47A of the Act to the Court of the Additional Senior Civil Judge, (FTC), Nandyal. The said appeal was numbered as C.M.A.No.5 of 2006.
5. The said Court allowed the appeal C.M.A.No.5 of 2006 by its order dt.29-01- 2007 on the ground that the Sub Registrar, Nandyal has no authority to assess the value and property on future probabilities and relied upon the judgment reported in Maddula Nagasiromani and M.Ramakrishna Rao Vs. Subordinate Judge, Kovvur & Others1.
6. Challenging the same, the present revision is filed by the petitioners.
7. Heard the learned Government Pleader for Arbitration and Sri K.S.K.Reddy, learned counsel for the respondent.
8. The learned Government Pleader contended that:
(a) The difference between the value of the property mentioned in the above document and the value which is assessed by the Collector should be taken into account and the stamp duty and registration fee payable thereon should have been deposited before the trial Court along with appeal; that the respondent has failed to do so when it had filed the appeal C.M.A.No.5 of 2006 before the trial Court; and therefore the said appeal should not have been entertained by the trial Court.
(b) He also contended that the Court below erred in holding that the Sub Registrar, Nandyal has no authority to assess the value basing on future probabilities and relied upon the judgment of the Supreme Court in State of Haryana Vs. ManojKumar2.
9. Per contra, the learned counsel for the respondent relied upon Maddula Nagasiromani's case (1 supra) and State of Uttar Pradesh & Others Vs. Ambrish Tandon and Another3.
10. I have considered the respective submissions.
11. Section 47-A of the Indian Stamp Act, 1899 empowers the Registration Officer appointed under the Registration Act, 1908 to keep the registration of any document presented to him for registration pending and to refer the matter to the Collector for determination of the market value of the property and the proper duty payable thereon, if he has any reason to believe that the market value of the property which is a subject matter of such instrument has not been truly set forth in the instrument. On such reference, the Collector is empowered to hold an enquiry and determine the market value of the property which is the subject matter of the instrument and the duty to be paid thereon after giving an opportunity to the parties to make their representation. There is also the remedy of appeal provided under sub section (4) of Section 47-A to the Court of the Subordinate Judge, having jurisdiction over the area in which the property concerned is situated, and if there is no such Subordinate Judge to the District Judge, having jurisdiction over the said area. The proviso to sub section (2) of Section 47-A states 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 taking the amount already deposited by him. Sub Section (6) of Section 47A states that the market value of any property shall be estimated to be the price which in the opinion of the Collector or the appellate authority, as the case may be, such property would have fetched or would fetch if sold in the open market on the date of execution of any instrument referred to in sub section (1).
12. Therefore, what is relevant to be considered while determining the market value of the any property for purpose of calculation of stamp duty and registration charges is the price which it would fetch if it were to be sold in the open market on the date of execution of the instrument which is presented before the registering authority in respect of that property.
13. In Maddula Nagasiromani's case (1 supra), it was held as follows:
"A perusal of Section 47-A shows that it is only the market value which is to be determined and that the potential value based on nature of the land and the future possibilities, is irrelevant. How the purchaser may put it to use subsequent to the purchase or develop the land is of no consequence for valuing the land as on that date. Moreover the price at which the transaction was concluded between the petitioner and his vendor being at arms length generally denotes the market value by itself, unless there is evidence to show that the said value was either a fancy price or a concession granted because of certain relationship between the parties to the transaction."
14. Thus market value of property is determined in the manner specified in sub section (6) of Section 47A on basis of prevailing value based on nature of the land only and not future possibilities. This Court also held that the purchaser may wish to develop the land but that is of no consequence for valuing the land as on that date. In the absence of any evidence to show that the value mentioned in the document was not true or that it was a fancy price or a concession was granted because of certain relationship between the parties to the transaction, the price on which the transaction was concluded between the parties, being at length, would generally denote the market value.
15. In Ambrish Tandon's case (3 supra), the Supreme Court also held that nature of user which is relatable to the date of purchase only is relevant for the purpose of calculation of stamp duty under Section 47A of the Stamp Act and not the user of the property for a different purpose at a later point of time.
16. If we apply the above tests to the facts of the present case, admittedly, the land which was subject matter of the document presented for registration before the petitioners by respondent was an agricultural land admeasuring Ac.0.50 cents in Sy.No.240/3 of Rythunagar village in Nandyal Mandal and it was purchased by the respondent. It is not disputed that on the eastern side and western side of the property, there is agricultural wet land, on the northern side, Koilakuntla main road and on the southern side, Kalava and the property is irrigated by K.C. canal water. These facts are recorded in the enquiry report of the District Registrar and Collector. This shows that the land continues to be agricultural land as on the date of execution of document. It may be that the land is proximate to Nandyal town and some houses and industries are existing nearby and there is a possibility of the land being used for non- agricultural purpose subsequently. But the said factors cannot be taken into account in arriving at the market value of the property. In this view of the matter, I am of the opinion that the District Registrar and Collector in his order R.C.No.G6/P-21/NDL/05 dt.16-02-2006 erred in fixing the market value of the property @ Rs.270/- per sq. yd. on the basis of its probable future use for non-agricultural purpose and that the said order was rightly reversed by the Additional Senior Civil Judge, Nandal (F.T.C.) dt.29-01-2007 in C.M.A.No.5 of 2006.
17. The learned Government Pleader cited the judgment in Manoj Kumar's case (2 supra), wherein the purchaser paid the entire sale consideration in respect of a plot and the actual possession was also given to him, but the sale deed was not executed. So he filed a suit for specific performance of the agreement to sell executed by vendor for the sale of the property without impleading the State as a party. The suit was decreed in favour of the purchaser and when the document was to be registered, it was suspected that the property was under valued and a reference was made to the District Registrar/ Collector. The Collector held that the value shown in sale deed is less than the circle rate notified by him and directed to recover the difference. This was confirmed by the Commissioner in appeal. The High Court in exercise of its jurisdiction under Article 227 set it aside. The Supreme Court held that the genuineness of the sale price entered into by the buyer and seller can be questioned and that the High Court was not correct in interfering with the concurrent finding of the fact in exercise of its powers under Article 227 of the Constitution of India.
18. The said judgment is not applicable to the present case because it was not laid down in the said case that the potential value of the property can be taken into account. Therefore, the contention of the petitioners that the said decision should be followed is not tenable.
19. As regards the contention of the petitioner that the respondent when it filed the appeal had not made pre deposit of the difference in the amount of duty calculated on the basis of the amount admitted by the respondent and the amount fixed by the Collector and that the appeal should not have been entertained, I am of the opinion that this point was not urged by the petitioner before the Senior Civil Judge's Court nor was the point urged in the grounds of the revision filed before this Court. It is unlikely that the Senior Civil Judge would have entertained the appeal filed by the respondent if there was no compliance of the deposit requirement as mentioned in the proviso to sub section (2) of Section 47A of the Indian Stamp Act 1899. Even if it were to be true, I am of the view that setting aside the order of the Additional Senior Civil Judge, Nandyal dt.29-01-2007 in C.M.A.No.5 of 2006 on the said ground would result in the revival of the order dt.16-02-2006 in R.C.No.26/3/21/NDL/05 of the District Registrar and Collector which is clearly erroneous and contrary to law. Therefore this Court declines to exercise jurisdiction under Article 227 to interfere with the impugned order on the said ground. (see Gadde Venkateswara Rao Vs. Government of Andhra Pradesh4).
20. For the above reasons, the Civil Revision Petition fails and is dismissed. No costs.
__________________________________ JUSTICE M.S.RAMACHANDRA RAO Date:17-12.2012