Madras High Court
M/S.Southern Ceramics Pvt. Ltd vs The Sub-Registrar on 27 August, 2014
Author: S.Vaidyanathan
Bench: S.Vaidyanathan
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED :27.08.2014
CORAM
THE HONOURABLE MR.JUSTICE S.VAIDYANATHAN
W.P.No.6964 of 2010
and M.P.No.1 of 2010
M/S.SOUTHERN CERAMICS PVT. LTD [ PETITIONER ]
11B/1(S/P) 1ST CROSS ROAD
AMBATTUR INDUSTRIAL ESTATE
CHENNAI-58
REP. BY ITS DIRECTOR
MR.S.BADRINATHAN
Vs
1 THE SUB-REGISTRAR
REGISTRARION DEPARTMENT
AMBATTUR CHENNAI-53
2 THE SPECIAL TAHSILDAR (STAMPS)
CHENNAI-1
3 INSPECTOR GENERAL OF REGISTRATION
GOVT. OF TAMIL NADU
120 SANTHOME HIGH ROAD SANTHOME CHENNAI-4.
4 THE TAMIL NADU SMALL INDUSTRIAL
DEVELOPMENT CORPORATION LTD
NO.5 GREAMS RD CH-6.
(R4 IMPLEADED SUOMOTU BYORDER DT 15/7/10
BY NKKJ IN WP 6964/10)
[ RESPONDENTS ]
Prayer:- Writ Petition filed under Article 226 of the Constitution of India for the issuance of a writ of certiorarified mandamus to call for the records of the 2nd respondent pertaining to Notice bearing Ta.Ka.No.2365/09 and Ci.Pa.No.47/09 dt.17.8.2009 and quash the same and consequently directing the respondents to return the Registered Document No.1188/09 pertaining to the Scheduled Property mentioned in the Writ Petition to the petitioner.
For Petitioner : Mr.T.K.Bhaskar
For Respondents : Mr.R.M.Muthukumar, GA (R1&3)
Mr.B.Manoharan (R2)
Mr.Kamalanathan for SIDCO
O R D E R
The petitioner has come forward with this writ petition challenging the Notice dated 17.8.2009 and to direct the respondents to return the Registered Document No.1188/09 pertaining to the Scheduled Property mentioned in the Writ Petition to the petitioner.
2. The case of the petitioner is that in the year 1981, the property in question was allotted to the petitioner Company through SIDCO and a deed of assignment was executed by SIDCO on 04.01.1983. By G.O.Ms.No.87 dated 11.10.2007, SIDCO was permitted to execute a sale deed in favour of the petitioner and a sale deed was also executed on 02.03.2009 in favour of the petitioner company and the consideration was Rs.54,000/-, which was already paid by the petitioner to SIDCO at the time of allotment in the year 1981. It is the further case of the petitioner that when the sale deed was duly stamped and submitted for registration on 15.05.2009, during the course of registration, the 1st respondent informed the petitioner orally that the sale deed was being impounded and would be referred to the 2nd respondent under Section 47A(1) of the Indian Stamp Act, 1899. Subsequently, by a communication dated 21.05.2009, the 1st respondent informed the petitioner that the registered sale deed No.1188/09 has been referred to the 2nd respondent under Section 47-A(1) of the Indian Stamp Act. Whileso, the impugned notice under Form I under Rule 4 of the Tamil Nadu Stamp (Prevention of Undervaluation of Instruments) Rules, 1968 was issued on 17.08.2009. After sending a reply to the said notice on 21.09.2009, the petitioner has come up with this writ petition seeking the relief stated supra.
3. The learned counsel for the petitioner relying on the following decisions, viz:-
(i)V.N.Devdoss v. Chief Revenue Control Officer-cum-Inc. and Others (2009) 7 SCC 438
(ii) The Government of Tamil Nadu rep. by Special Secretary to Govt., Commercial Taxes Department & Others vs. S.Jayalakshmi & Ors. (2009) 5 MLJ 391.
(iii) Thiru.M.D.Dilli Babu vs. The Chennai Metropolitan Development Authority & Ors. (W.P.No.35402 of 2006)
(iv) T.Chidambaram vs. The Chennai Metropolitan Development Authority & Ors. (W.P.No.354024 of 2006) (viMaraimalai Nagar Welfare Association vs. The State of Tamil Nadu, Secretary to Govt., Commercial Taxes and Charitable Endowment Department & Ors. (W.P.No.15275 of 2001) and submitted that reference made by the 1st respondent on the ground of undervaluation to the 2nd respondent is bad. He also referred to paragraph Nos.7 and 8 of the decision of this Court made in W.P.No.33211 of 2007 dated 11.08.2008 (Minnica Services Private Limited vs. The Sub Registrar, Registration Department & Ors), which read as follows:-
"7.In my considered opinion, the question which is raised in this writ petition is no more available for adjudication by this Court as the said question has already been decided by a Division Bench of this Court in S.P.Padmavathi v. State of Tamil Nadu (1997 (II) CTC 617). In paragraph Nos.22 and 31, of the said judgment, the Division Bench has held as follows:-
"22.It is not in each and every case, the Registering Officer is expected to deal with the instrument under Sec.47-A of the Act, but it is only when the instrument has been undervalued or has not been truly set forth in the instrument. In the case of instrument executed pursuant to the decree, there is no scope for doubting the bona fides of the parties. Of course, we do not rule out the possibility of unscrupulous persons, with a view to evade payment of proper stamp duty, creating agreements to sell for a very low sum and then proper stamp duty, creating agreements to sell for a very low sum and then approaching the Court for specific performance by mutual consent or without much contest, and thereafter presenting the documents for registration pursuant to the decree passed for specific performance. In such cases, under valuation would be apparent and it would also be open to the Registering Officer, after being satisfied as to lack of bona fides and fraudulent attempt on the part of the parties to undervalue the subject of transfer, to invoke the power under Section 47A of the Act. But such a process or proceedings cannot, in the normal course, be pursued in all cases. It is only if the Registering Officer has reason to believe that the consideration about has not been truly set forth in the document.
31.For all the above reasons, we answer pursuant to the decree for specific performance passed by the Civil Court, in which there is no allegation of deliberate under-valuation or lack of bona fides in valuing the subject of transfer with a view to evade payment of proper stamp duty, the mere fact that there is a time gap between, the agreement of sale and the execution of the document by itself is not sufficient for the Registering Officer to invoke his power under Section 47A of the Stamp Act, unless there are reasons to believe that there is an attempt on the part of the parties to the instrument to undervalue, with a view to evade payment of proper stamp duty.
8.As held by the Division Bench of this Court, if only the Registering Officer has reason to believe that the consideration has not been truly set out in the document, then only, he can refer the document for adjudication under Section 47-A of the Act. In this case, when the fifth respondent who is the Governmental Organisation has sold away the property to the petitioner, there can be no valid reason to disbelieve the Government Organisation namely, the fifth respondent to hold that he has not sold the property for correct consideration. Under Section 114 (g) of the Evidence Act, it has to be presumed that the valuation made in the document is the correct valuation unless the said presumption is rebutted".
4. No counter has been filed in this Case. However, the learned Government Advocate appearing for respondents 1 and 3, contended that if the property is under valued, they are entitled to take action against SIDCO.
5. The short point for consideration in this writ petition is as to whether the reference made by the 1st respondent to the 2nd respondent under Section 47A(1) of the Indian Stamp Act, 1989 is valid or not?
6. Section 47-A (1) of the Indian Stamp Act reads as follows:-
"47-A Instruments of conveyance etc. undervalued how to dealt with:-
(1) If the registering officer appointed under the Indian Registration Act, 1908 (Central Act XVI of 1908) while registering any instrument of conveyance, exchange, gift, release of benami right or settlement has reasons to believe that the market value of the property of which is the subject matter of conveyance, exchange, gift, release of benami right or settlement, 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 market value of such property and the property duty payable thereon".
7. It is not in dispute that if the property is under valued, then the authority concerned is entitled to take action. As far as the case on hand is concerned, the Tamil Nadu Small Industries Corporation Limited, which was suo-motu impleaded as party respondent in this writ petition, was permitted to execute a sale deed in favour of the petitioner by G.O.Ms.No.87 dated 11.10.2007, and it was also executed on 02.03.2009 in favour of the petitioner company and the consideration was Rs.54,000/- which was already paid by the petitioner. The relevant portion of the sale deed is also extracted below:-
"Whereas the Government is the absolute owner of the property more fully described in the schedule hereunder, hereinafter called THE PROEPRTY and offered to sell THE PROPERTY through the Vendor for a consideration of Rs.54,000/- (Rupees fifty four thousand only) Whereas THE PURCHASER herein applied for the allotment of THE PROPERTY and the Government has allotted the property through the Vendor vide order No.49722/80 dated 11.09.1981 for a sum of Rs.54,000/- (Fifty four thousand only) subject to the reasonable restrictive covenants contained herein for the preservation and homogeneity as an Industrial Estate which is to be maintained by THE VENDOR.
Whereas THE PURCHASER has paid the said sum and executed a Memorandum of Understanding.
Whereas THE VENDOR has been permitted to execute sale deed for the said PROPERTY by the Government in G.O.Ms.No.87 dated 11.10.2008 issued by Small Industries (SIC) Department in favour of the purchaser, subject to certain conditions".
When that being the case, the act of the 1st respondent in referring the registered sale deed to the 2nd respondent on the ground of undervaluation is not sustainable. Even though the argument of the learned Government Advocate appears to be reasonable, no documents have been produced before this Court to show that action has been taken against SIDCO.
8. Further, in view of the observations made by this Court in the case of Minnica Services Private Limited vs. The Sub Registrar, Registration Department & Ors, the relevant portions of which are extracted supra, when the Governmental Organisation sold the property, there can be no genuine reason to disbelieve the Governmental organisation to hold that they have not sold the property for correct consideration. The decision of this Court mentioned supra squarely applies to the facts of this case.
9. Hence, the impugned notice dated 17.08.2009 is set aside and the writ petition is allowed. The respondents are directed to release document No.1188/09, pertaining to the property in question, to the petitioner as expeditiously, preferably, within a period of four weeks from the date of receipt of a copy of this order. No costs. Connected miscellaneous petition is closed.
27.08.2014 rg Index:Yes/ To 1 THE SUB-REGISTRAR REGISTRARION DEPARTMENT AMBATTUR CHENNAI-53 2 THE SPECIAL TAHSILDAR (STAMPS) CHENNAI-1 3 INSPECTOR GENERAL OF REGISTRATION GOVT. OF TAMIL NADU 120 SANTHOME HIGH ROAD SANTHOME CHENNAI-4.
4 THE TAMIL NADU SMALL INDUSTRIAL DEVELOPMENT CORPORATION LTD NO.5 GREAMS RD CH-6.
S.VAIDYANATHAN, J rg W.P.No.6964 of 2010 27.08.2014