Allahabad High Court
Girjesh Kumar Srivastava And Another vs State Of U.P. And Others on 8 December, 1997
Equivalent citations: 1998(1)AWC403, (1998)1UPLBEC437, AIR 1998 ALLAHABAD 237, 1998 ALL. L. J. 1604, 1998 A I H C 2811, 1998 SCFBRC 110, 1998 (1) ALL CJ 19, 1998 ALL CJ 1 19, 1998 (1) UPLBEC 437, (1998) 3 CIVILCOURTC 627, (1998) 1 UPLBEC 437, (1998) 4 RECCIVR 193, (1998) 33 ALL LR 524, (1998) 1 ALL RENTCAS 337, (1999) 1 CURLJ(CCR) 25, (1998) 1 ALL WC 403
Author: G.P. Mathur
Bench: G.P. Mathur, J.C. Gupta
JUDGMENT G.P. Mathur, J.
1. This is a reference by the Additional Commissioner (Administration), Agra in his capacity as Chief Controlling Revenue Authority under Section 57 of the Indian Stamps Act [hereinafter referred to as the Act).
2. The relevant facts are that Smt. Chandra Prabha Sharma executed a sale deed of a house in favour of the applicants Girjesh Kumar Srivastava and his wife Smt. Surya Kumari on January 1, 1989 for a consideration of Rs. 1.05.000. A stamp duty of Rs. 15,225 was paid and the sale deed was registered in the office of Sub-Registrar Mathura, on February 1, 1989. The instrument (sale deed) was Inspected by the Assistant Inspector General of Registration in his capacity as Assistant Commissioner (Stamps) on June 30, 1992. He was of the opinion that the property had been undervalued, and accordingly, a reference was made to the District Registrar by the Sub-Registrar on August 8. 1992. The Additional District Magistrate (Finance & Revenue) in his capacity as Collector, Issued notice to the applicants (Girjesh Kumar Srivastava and Smt. Surya Kumari) on May 26. 1993 and directed the Tehsildar to submit a report on the valuation of the property. The applicants submitted a reply to the notice on July 28, 1993. The Additional District Magistrate (Finance & Revenue) by his order dated December 13. 1993 held that the instrument had been undervalued and directed the applicants to pay Rs. 8.047.00 towards deficiency in stamp duty and a penally of Rs. 25. Aggrieved, the applicants preferred a revision under Section 56 of the Act before the Addl. Commissioner who is also exercising the powers of Chief Controlling Revenue Authority. It was contended on behalf of the applicants that the instrument having been registered on February 1, 1989, the proceedings initiated by the Collector on May 26, 1993 were beyond limitation and further in proceedings under sub-section (4) of Section 47A of the Act, the Collector had no power to impose penalty. The Additional Commissioner was of the opinion that the contentions raised on behalf of the parties Involved complicated questions of law which arose frequently and, therefore, the same required a decision by the High Court. He accordingly made a reference to this Court under Section 57 of the Act by his Order dated March 27, 1996.
3. The precise questions which require consideration have not been formulated in the order of reference but the issues raised require determination of the following questions ;
(1) Whether in proceedings under sub-section (4) of Section 47A of the Act, penalty can also be imposed if the Collector holds that the market value of the property has not been truly set forth in the instrument and consequently, there is deficiency in stamp duty?
(2) Whether the limitation of four years as provided in sub-section (4) of Section 47A of the Act is for making a reference by a Court or any one of the authorities enumerated in the sub-section or it is for initiation of proceedings by the Collector?
FIRST QUESTION :
4. Chapter IV of the Act deals with Instrument Not Duly Stamped. Subsection (1) of Section 33 provides that every person having by law or consent of parties authority to receive evidence and every person incharge of a public office, except an officer of police, before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance of his functions, shall, if it appears to him that such instrument is not duly stamped, impound the same. Sub-section (2) of the same section provides that for this purpose every such person shall examine every instrument so chargeable and so produced or coming before him in order to ascertain whether it is stamped with a stamp of the value and description required by the law in force when such Instrument was executed or first executed. Section 35 provides that no instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by . law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such Instrument is duly stamped. Provisos (a) and (b) to this section lay down that if the deficiency in stamp duty and penalty is paid the instrument may be admitted in evidence. Sub-section (1) of Section 38 provides that when the person impounding an instrument under Section 33 has by law or consent of parties authority to receive evidence and admits such Instrument in evidence upon payment of a penalty as provided by Section 35 or of duty as provided by Section 37, he shall send to the Collector an authenticated copy of such Instrument, together with a certificate in writing, stating the amount of duty and penalty levied in respect thereof, and shall send such amount to the Collector, or to such person as he may appoint in this behalf. Under sub-section (2) of this section if the deficiency in stamp duty and penalty is not paid the person impounding the instrument is required to send it in original to the Collector. Section 40 gives power of the Collector regarding the Instrument which have been impounded. It provides that if he is of the opinion that the instrument is duly stamped or is not chargeable with duty he shall certify the same by making an appropriate endorsement to that effect. However, if he is of the opinion that such Instrument is chargeable with duty and is not duly stamped, he shall require the payment of proper duty or the amount required to make up the same, together with a penalty of five rupees or if he thinks fit an amount not exceeding ten times of the amount of proper duty or of the deficient portion thereof. Subsections (4) and (5), of Section 33 lay down that if deficiency in stamp duty is noticed from the copy of any instrument, the Collector may suo motu or on a reference from any Court or from any one of the authorities mentioned in subsection, call for the original instrument, for the purposes of satisfying himself as to the adequacy of the duty paid thereon and if the instrument is not produced he may require payment of deficit stamp duty together with penalty under Section 40 on the copy of instrument. The sections referred to above would show that the Legislature has made a specific provision for payment of penalty in addition to deficiency in stamp duty wherever such a deficiency is noticed from the instrument Itself or a copy thereof.
5. Section 27(1) of the Act provides that the consideration (if any) and all other facts and circumstances affecting the chargeability of any instrument with duty, or the amount of the duty with which it is chargeable, shall be fully and truly set forth therein. This provision came up for consideration before the Supreme Court in Himalaya House Company v. Chief Controlling Revenue Authority. AIR 1972 SC 899 and it was held that a failure to comply with the requirements of the section is merely punishable under Section 65 of the Act and that there was no provision in the Stamp Act which empowered the authorities to make an independent enquiry of the value of the property conveyed for determining the duty chargeable. It was further held that for the purpose of Article 23, the value of consideration must be taken to be one as set forth in the conveyance deed. The effect of this decision was that in case a person did not set forth the true amount for which the transaction had taken place, the authorities had no power to recover the requisite stamp duty which was payable on the real market value. In order to meet this difficulty, large number of States in India amended the Stamp Act. By Section 2 of U. P. Act No. XI of 1969 which came Into force on 1st October, 1969, Section 47A was Inserted after Section 47 in the parent act. Sub-section (I) of this section provides that if the market value of any property which is the subject of any instrument on which duty is chargeable on the market value of the property, as set forth in such Instrument is less than even the minimum value determined in accordance with any rules made under this Act the registering officer appointed under the Indian Registration Act, 1908, shall refer the same to the Collector for determination of the market value of such property and the proper duty payable thereon. Sub-section (2) provides that if the registering officer while registering any instrument on which duty is chargeable on the market value of the property has reason to believe that the market value of the property which ts the subject of such instrument, 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 proper duty payable thereon. Under sub-section (3) of this section, the Collector is required to determine the market value of the property which is the subject of the instrument and the duty payable thereon. This sub-section further provides that the difference, if any, in the amount of duty shall be payable by the person liable to pay duty. Sub-section (4) of Section 47 A which deals with the situation in hand reads as follows :
Section 47A (4) The Collector may. suo motu, or on a reference from any Court or from the Commissioner of Stamps or an Additional Commissioner of Stamps or a Deputy Commissioner of Stamps or an Assistant Commissioner of Stamps or any officer authorised by the Board of Revenue in that behalf within four years from the date of registration of any instrument on which duty is chargeable on the market value of the property not already referred to him under sub-section (1) or sub-section (2), 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 subject of such instrument and duty payable thereon, 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 the market value of such property and the duty payable thereon in accordance with the procedure provided for in subsection (3). The difference, if any. In the amount of duty, shall be payable by the person liable to pay the duty."
Both sub-sections (3) and (4), provide for payment of difference in the amount of duty as a result of determination of the market value of the property by the Collector. The sub-sections make no reference to payment of penalty as has been done in sub-section (5) of Section 33, sub-section (1) of Section 38 and in clause (b) of Section 40(1) of the Act. The Legislative intent is very clear and it shows that if after accepting the market value of the property as given in the instrument the same is found to be deficiently stamped the person liable to pay stamp duty shall not only be liable to pay the deficiency therein but shall also be liable to pay penalty. However, the legislature has deliberately made a difference in a case where on the market value of the property as shown in the instrument, there is no deficiency in stamp duty but such deficiency is revealed as a result of a fresh determination of its market value by the Collector under sub-section (3) or sub-section (4) of Section 47A of the Act. If the Legislature wanted that in such a case also where deficiency in stamp duty has been revealed as a result of a fresh determination of market value of the property a penalty should be Imposed, a specific provision to that effect would have been made. The Stamp Act was enacted in the year 1899 and Section 47A was inserted by the U. P. Legislature seventy years later in the year 1969. The Legislature was fully aware of the fact that the Act makes provision for payment of penalty of an amount not exceeding ten times of the amount of proper duty or the deficient portion thereof. However, while enacting Section 47A, the Legislature has deliberately refrained from making any provision for payment of penalty whatsoever. The only inference which can be drawn is that while exercising power under Section 47A of the Act if the Collector, after determination of the market value of the property, comes to the conclusion that its value has not been correctly set forth in the instrument, he can only require payment of difference in the amount of duty as a result of such determination but he cannot Impose any penalty on account of the deficiency in stamp duty which may have been revealed as a result of such redeterminatton of market value of the property.
6. This very question has been considered by a Division Bench in Kaka Singh v. Addl. Collector, AIR 1986 All 107 and it was held as follows in Para 17 of the report:
"We find force also in the argument of the petitioner's learned counsel that since Section 47A does not empower the Collector to Impose penalty in the event of his finding that the market value was not truly set forth in the instrument, such an order imposing the same would be beyond Section 47A. For imposing penalty in a case like the present, power was specifically to be conferred. In the absence of a specific provision made in that respect. It is not possible to uphold the contention of the standing counsel that penalty could be imposed whenever and wherever the Collector under Section 47A finds that the value set forth was not true. Section 47A as stated above, was brought in recently to cover a case of evasion. While enacting Section 47A, the Legislature although empowered the Collector to determine the market value of the property, which is the subject of conveyance and the duty payable thereon, it did not make any provision empowering the Collector to impose penalty."
The same question was again considered by another Division Bench in Jugul Kishore v. State of U. P., AIR 1992 All 194 which after expressing agreement withi the view taken in Kaka Singh (supra) held as follows in Paras 4 and 5 of the report :
"From a mere glance at sub-section (4) of Section 47A it is apparent that the Collector (A.D.M. Finance in the present case) does not have any power to Impose penalty in these proceedings.....
It is worthy of note that while enacting Section 47A, the Legislature did not authorise the Collector to impose any penalty. Under this provision the only power vested in the Collector was to determine the market value of the property and if he ftnds that the duty paid on the instrument in question is less than that payable on the correct market value of the property, he may order that the difference may be realised from the party to the Instrument."
7. Shri Prabodh Gaur, learned chief standing counsel has submitted that in exercise of powers conferred by Section 75 of the Act, the State Government has made U. P. Stamps Rules and Rule 350 provides that if as a result of the enquiry relating to market value of the property, the instrument appears to be undervalued and not duly stamped, it shall be Impounded by the Collector and necessary action taken in respect of it according to the relevant provisions of the Act. It is urged that the expression "relevant provision" used in this rule would show that Sections 33, 38 and 40 would also apply and penalty can be imposed. We are unable to accept the submissions made by learned counsel. Rule 350 finds place in Chapter XV which is headed as follows :
"Rules for determining the market value of certain documents."
It basically forms part of the Rules made for determining the market value of certain instrument and it is not concerned with the action which is to be taken regarding payment of deficiency in stamp duty or penalty. Even otherwise when the expression "relevant provisions of the Act" has been used, it can only mean Section 47A which alone deals with such a situation and not other sections of the Act. That apart, Section 75 gives power to the State Government to make rules to carry out generally the purposes of the Act and in a matter relating to revenue the aid of the Rules cannot be taken to empower an authority to levy penalty specially when they also do not contain any provision for imposing penalty under such circumstances.
8. It is well-settled that a taxing statute is to be strictly construed. In Canadian Eagle Oil Co. Ltd. v. R., (1945) 2 All U.R. 499, Viscount Simon quoted with approval the following passage of Rowlatt J. In Cape Brandy Syndicate v. IRC (1921) 1KB 64 (at 71) :
" In a taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to tax. Nothing is to be read in. nothing is to be Implied. One can only look fairly at the language used."
In Russel v. Scott, (1948) 2 All ER (at 5), Lord Slmonds puts it more succinctly by stating "the subject is not to be taxed unless the words of the taxing statute unambiguously Impose the tax on him". This principle has been accepted by the Supreme Court in a catena of decisions (See Cursahaiv. CTT, AIR 1963 SC 1062, Banarsidas v. TTO, AIR 1964 SC, 1742, Controller of Estate Duty v. KantUal, AIR 1976 SC 1935, and SutleJ Cotton Mills v. Commissioner Income Tax. AIR 1991 SC 218). The principle that the language of the Statute was the decisive factor was reiterated in M/s. Goodyear India Ltd. v. State offiaryana, AIR 1990 SC 781 where in para 21 it was held as follows ;
".....It has been said and said on numerous occasions that fiscal laws must be strictly construed, words must say what they mean, nothing should be presumed or implied, these must say so. The true test must always be the language used."
9. The law regarding fiscal matters being well settled, power to impose penalty must be conferred by the Statute itself. The language of Section 47A alone can be seen and such a power cannot be inferred by implication or by reference to some general words contained in the Rules. In absence of a specific provision to that effect the Collector is not empowered to impose penalty. The question is, therefore, answered in favour of the applicants and against the State.
SECOND QUESTION :
10. There is no dispute from either side that the starting point of limitation is the date of registration of the instrument and the period of limitation is four years. According to learned Chief Standing Counsel, if a reference from any Court or Commissioner of Stamps or Additional Commissioner of Stamps or a Deputy Commissioner of Stamps or any officer authorised by the Board, of Revenue in that behalf is made within four years from the date of registration of the Instrument, whether any action is taken by the Collector or not, the proceedings would be within limitation. Shri Rajiv Joshi, learned counsel for the applicants has, on the other hand, contended that the limitation of four years is for the Collector to initiate action and the date on which a reference is made by a Court or authorities enumerated in the opening part of sub-section (4) of Section 47A is irrelevant. The question which arises for consideration is whether the period of four years qualifies the action of the Collector or the making of reference. Under sub-section (1) of Section 47A the registering officer is required to make a reference to the Collector before registering the instrument,, while under subsection (2) a discretion has been given to him to register the Instrument and then make a reference to the Collector for determination of market value. In normal course of events this reference would be made immediately after registering the Instrument and, therefore, the enquiry under sub-section (3) is likely to commence soon as the person in whose favour the instrument has been executed would forthwith come to know about the reference and would be interested to get the matter concluded. In the first case the Instrument would remain unregistered and in the second case he will not get back the instrument after registration on account of it having been referred to the Collector. Therefore, in cases covered by sub-section (1) and sub-section (2) at least the factum of reference would be immediately known to the person in whose favour instrument has been executed and he is bound to take all proceedings expedttlously in order to secure his title or get the benefits of the instrument. Under sub-section (4) power has been conferred on the Collector to call for and examine the instrument after it has been registered for the purpose of satisfying himself as to the correctness of the market value of the property which is subject of such instrument and the duty payable thereon. This action can be taken either suo motu or on a reference from any Court or any one of the authorities enumerated in the sub-section. In our opinion, the language of the sub-section shows that the period of four years qualifies the action which may be taken by the Collector. If the Interpretation suggested by learned Chief Standing Counsel was correct, the sub-section would have read like this :
"The Collector may, suo motu or on a reference from any Court or from the Commissioner of Stamps or a Deputy Commissioner of Stamps or an Assistant Commissioner of Stamps or any officer authorised by the Board of Revenue in that behalf made within four years from the date of registration of any instrument."
From the language in which the sub-section has been couched, it is not possible to hold that the period of four years qualifies the reference.
11. It may be noticed that the language used in the opening part of subsection (4) of Section 33 is exactly similar to the language used in the opening part of sub-section (4) of Section 47A. The proviso to sub-section (5) of Section 33 says that no action under sub-section (4) or sub-section (5) shall be taken after a period of four years from the date of execution of the Instrument. Here the bar of limitation applies to the action which may be taken by the Collector and not to a reference. There is no reason why similar interpretation should not be given to sub-section (4) of Section 47A specially when both the sections namely Section 33 and Section 47A find place in same Chapter IV of the Stamp Act which deals with Instrument Not Duly Stamped.
12. It has been held by a Full Bench of Seven Judges of our Court in Mata Badal Pandey and others v. Board of Revenue, 1974 U. P. Tax Cases 570 that where there is some dgubt or ambiguity in any provision in the authoritative English text, it is permissible to look Into the Hindi text to remove the doubt or ambiguity. Sub-section (4) of Section 47A as given in the Hindi version of the Act reads as follows :
^^4 dysDVj lo;eso ;k fdlh U;;ky;] ;k LVkEi vk;qDr ;k vij LVkEi vk;qDr] ;k LVkEi mi&vk;qEr] ;k lgk;d LVkEi vk;qDr] ;k jktLo ifj"kn~ }kjk blds fy;s vf/kd`r fdlh vf/kdkjh ds lanHkZ ij fdlh foys[k ds] ftl ij 'kqYd lEifRr ds cktkjh ewY; ij] izHkkj.kh; gS] tks mi&/kkjk 1 ;k mi&/kkjk 2 ds v/khu igys mldks lanfHkZr u gqvk gks] jftLVhdj.k dh rkjh[k ls pkj o"kZ ds vUnj ml lEifRRk dk tks ,sls foys[k dk fo"k; gks] cktkjh ewY; vkSj ml ij ns; 'kqYd ds ckjs esa viuh larqf"V djus ds iz;kstu ls foys[k dks ryc dj] mldk ijh{k.k dj ldrk gS] vkSj ;fn ,sls ijh{k.k ds ckn mls fo'okl djus dks dkj.k gks fd ml lEifRRk dk cktkjh ewY; foys[k esa lR;rkiw.kZ O;Dr ugha fd;k x;k gS] rks o+g mi&/kkjk 3 esa fu/kkZj.k izfdz;k ds vuqlkj lEifRRk dk cktkjh ewY; vkSj ml ij ns; 'kqYd fuf'pr dj ldrk gSA 'kqYd dh jkf'k esa vUrj ;fn gks ml O;fDr }kjk ns; gksxk ftl ij 'kqYd vnk djus dk nkf;Ro gksA** The Hindi version is quite clear and there can be no two opinion on the matter that the period of limitation applies to the action which may be Initiated by the Collector and not to a reference which may be made to him by a Court or other authority.
13. There is another reason for not accepting the submission made by the learned Chief Standing Counsel. If the period of limitation is held to be applicable only to the making of a reference, a very anomalous situation may arise. There will be no limitation where the Collector chooses to take suo motu action and he may do so at any time at his sweet will. Even where a reference is made within limitation i.e., within four years either by a Court or any of the authorities enumerated in the sub-section, the Collector may not proceed forthwith and the matter may be kept pending for years. He may commence proceedings after a long period, may be after decades. The property may change hands several times during this period which may create complications for the present owner who may not even be aware of the circumstances attending the execution of the instrument which is alleged to be undervalued and may not be in a position to lead evidence. The value of immovable property changes fast. There has been a meteoric rise in the value of Immovable property in the recent past, if the proceedings are taken after a long period it may become very difficult to give evidence regarding the market value of the property at the time the instrument was executed. Therefore, the Legislature in Its wisdom thought it proper to fix a period of limitation within which the Collector must Initiate action so that the enquiry may not be unnecessarily delayed. In this connection, it may be pointed out that after the decision of Himalaya House Co. Ltd. v. Chief Controlling Revenue Authority (supra) many States inserted Section 47A by amendment in the Stamp Act and the Collector was conferred power to suo motu call for and examine the instrument for the purpose of satisfying himself is to the correctness of the market value of the property. In Andhra Pradesh, Bihar. Orissa, Tamil Nadu, Goa Daman and Diu and West Bengal the period of limitation for the Collector to suo motu call for and examine the Instrument is two years while in Haryana, Punjab, Himachal Pradesh it is three years. This shows that the intention of the Legislature is that the entire exercise should be concluded within a reasonable period and may not be kept pending for long.
14. Learned Chief Standing Counsel vehemently urged that Rule 346 of the U. P. Stamp Rules showed that the period of limitation of four years is provided for making a reference to the Collector. Rule 346, no doubt, provides that the Inspector of Stamps and Registration shall make a reference to the Collector within four years from the date of registration of the instrument. But this rule cannot be read in isolation and has to be read along with Rule 352, Rule 352 shows that the period of limitation applies to the action which may be taken by the Collector and not to a reference. As observed earlier, the Rules are always subservient to the Act under which they have been made and they cannot override or amend the provisions of the Act itself. Rule 346 cannot change the meaning of sub-section (4) of Section 47A. Learned Chief Standing Counsel also referred to a Supreme Court decision rendered in Trfdeshwar Dayal v. Maheshwar Dayal 1990 (1) SCC 377 and urged on its basis that the period of limitation does not apply to the action of the Collector. We do not think that in the aforesaid case the Supreme Court has held as a proposition of law that the period of limitation does not apply to the action which may be initiated by the Collector but applies only to a reference by a Court or other authority enumerated in the sub-section. In this case, order for Impounding the award of the arbitrator had been passed by the civil court itself and subsequent order of the Collector was held to have been passed merely as a follow-up step in pursuance of the civil court's order.
15. Our answers to the questions referred are as follows :
(1) While exercising power under sub-section (4) of Section 47A, the Collector can determine the market value of the property and the duty payable on the instrument as a result of such determination but he has no power to impose penalty.
(2) The period of limitation of four years in sub-section (4) of Section 47A applies to the action which may be initiated by the Collector and not to a reference from any Court or other authorities enumerated in the sub-section.
RESERVED J. C. Gupta, J.
16. I have the advantage of reading the judgment prepared by my learned brother Hon. G. P. Mathur. J. and I entirely agree with answers given, by him to the two questions involved in this reference made to this Court under Section 57 of the Indian Stamp Act. I shall, however, like to add a few words of my own.
17. It was only after the decision in the case of Himalaya House Company v. Chief Controlling Revenue Authority, AIR 1972 SC 899 that Section 47 A was introduced in the Indian Stamp Act in U. P. State also, like other States where almost similar provisions were enacted.
18. A plain reading of sub-section (4) of Section 47A makes it clear that the Collector may. suo motu or on a reference from any Court or other authorities as mentioned in the said sub-section, call for and examine the instrument for the purposes of satisfying himself as to the correctness of the market value of the property which is subject of such instrument and duty payable thereon 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 the market value of such property and the duty payable thereon in accordance with the procedure provided for in sub-section (3) and then the difference, if any. In the amount of duty shall be payable by the person liable to pay the duty. What procedure is to be adopted by the Collector for determining the market value of the property Involved and the duty payable thereon is laid down in sub-section (3) of Section 47A. Sub-section (3) embodies in itself a right of hearing based on the principle of natural justice and an Inquiry is then to be held in the manner prescribed under the rules made under the Act. This enactment thus provides for framing of rules only for the purposes of the manner of holding the inquiry. Neither sub-section (3) nor sub-section (4) makes any reference to the imposition of penalty or any other penal consequence, even if it is ultimately found that the market value of the property was not truly set forth in the instrument. It merely speaks of the liability of the person concerned to pay the difference, if any, in the amount of duty payable on the correct market value of the property involved.
19. Before the Amendment was brought on the statute book there existed no provision in the Act empowering the Revenue Authorities to make inquiry for determining the correct market value of the property conveyed and the duty chargeable thereon. In order to meet this situation Section 47A has been inserted which empowers the Revenue Authorities to determine the market value of the property involved and the duty chargeable thereon. The object of enacting Section 47A was obviously to keep a check on evasion of stamp duty in all those cases where the parties by their arrangement clandestinely undervalued the property which is the subject-matter of transfer with a view to deprive the government of legitimate revenue by way of stamp duty. The object behind this section has been well brought out by the Madras High Court in the Division Bench case of State of Tamil Nadu v. Chandra Shekharan. AIR 1974 Mad 117.
20. Sri Prabodh Gaur, learned Chief Standing Counsel submitted that to a reference made to Collector under Section 47A (4) of the Act, Rule 352 of the U. P. Stamp Rules, 1942 is applicable which reads as under:
"The Collector may also, suo motu, or on a reference from any Court or from the Chief Inspector of Stamps Uttar Pradesh or any officer of the Stamp Department of the Board of Revenue within four years from the date of registration of any Instrument mentioned in Rule 340, call for and examine the instrument for the purpose of satisfying himself as to the correctness of the market value of the property forming the subject-matter thereof and shall follow the same procedure as laid down in Rules 347. 349, 350 and 351 and, after taking such action as may be necessary, return the instrument to the authority from which it was received."
21. The learned Chief Standing Counsel argued that for holding an Inquiry, the Collector has to follow the procedure as laid down in Rules 347. 349, 350 and 351. He then invited the attention of the Court to Rule 350 which says that if after the inquiry the market value as expressed in the instrument appears to be undervalued and not duly stamped, it shall be Impounded by the Collector and necessary action will be taken in respect of it according to the relevant provisions of the Act. According to him when an instrument is impounded, the Collector is empowered to impose penalty under the provisions of Section 40 of the Act, Therefore, the Collector, when he impounds the undervalued instrument under Rule 350, he has the power to impose penalty under Section 40. A plain reading of Section 40, however, negatives this argument of the learned Chief Standing Counsel. This section speaks of an instrument which is impounded under Section 33 of the Act and not to an Instrument Impounded under Section 47A of the Act read with Rules 350 and 352.
22. The word "penalty" is of wide significance. Some time it means recovery of an amount as a penalty measure even in civil proceeding and exaction which is not compensatory in character is also termed as penalty. When "penalty" is imposed by adjudicating officer, it is done in the adjudicating proceeding and not by way of fine as a result of prosecution of an accused for commission of an offence in a criminal court. But even in adjudicating proceedings, the penalty clause should be found contained in the enactment itself. In the absence of the same, the adjudicating authority cannot be deemed to possess such a power. Mere use of the expression "after taking such action as may be necessary" in Rules 350 and 352 cannot be construed to empowering the Collector to impose penalty especially when such a power is lacking in the main enactment. Law is to be interpreted as it is contained in the enactment made by the legislation. The Court cannot add or subtract any word or words while Interpreting a particular provision. The Court's function is to interpret the law, that is to explain/or to translate into intelligible language. It is the function of the Legislature to enact laws and the duty of the judiciary is to interpret and enforce them. It is well-settled that the Courts have to construe the Acts of Legislature as found therein, whether they approve of them or not and they cannot alter or amend them. They have no power to read into the enactment a sentence or words which it does not contain. It is for the Legislature and not for the Court to consider whether the words employed in framing an enactment will give effect to the object and policy which the Statute may have in view.
23. In the absence of any express provision contained either in Section 47A or the rules empowering the Collector to Impose penalty even in cases of clandestine transfers, the Court cannot confer that power on him with a view to keep a check on such transactions and to give effect to the object which the Statute may have in view. It is the domain of the Legislature and Courts cannot' trespass therein.
24. In this connection. 1 may refer to some Interesting observations which are to be found on page 271 in the Full Bench decision in Khudabux v. Panjo. AIR 1930 Sind 265 :
"It is the function of the Legislature to enact the laws and the duty of the Judiciary to interpret and enforce them. It is no doubt the characteristic of a good Judge to amplify his Jurisdiction where the words of the statute conferring the jurisdiction can reasonably be interpreted as giving him jurisdiction. Where, however jurisdiction can only be snatched by a strained Interpretation of the law I am of the opinion that the good Judges become a bad citizen."
25. There is a clear distinction between the Judicial function of Court and legislative function. The former consists in-the Court to decide the rights of the parties who appear before ft. but the rights are to be determined and decided according to taw framed by legislation. The Court cannot enact law for deciding a particular issue involved in a case. The legislative function of the legislation on the other hand is to lay down law which will govern parties and transaction and direct the Court to give effect to that law. Interpretation is the act of making intelligible what was before not understood. It is the method by which the meaning of the language is ascertained. Resort of interpretation is never to be had where the meaning of the language used in the enactment is free from doubt.
26. Sri Prabodh Gaur. learned Chief Standing Counsel argued that unless the Collector is vested with the power to impose penalty in such cases, the object behind the amended enactment will not be achieved and the private parties by arrangement may well be encouraged to clandestinely undervalue the property involved in the instrument with a view to deprive the government of its legitimate revenue. Therefore, the Collector must be deemed to be possessing implicitly such a power. Though this submission of the learned counsel appears to be rational but has to be rejected as it is not open either for the Courts or the authorities to read in between the lines of an enactment, a thing which it does not contain. Thus, it may not be possible to hold that the Collector under the existing provisions of the Stamp Act does possess power to impose penalty in cases of such transfers.
27. In the case of State of Himachal Pradesh v. A Parent of a Student of Medical College, Shimla and others, AIR 1985 SC 910, the Apex Court observed that "it is entirely a matter for the executive branch of the Government to decide whether or not to introduce any particular legislation. Of course, any member of the Legislature can also Introduce legislation but the Court certainly cannot mandate the executive or any member of the Legislature to Initiate legislation. howsoever necessary or desirable the Court may consider it to be. That is not a matter which is within the sphere of the functions and duties allocated to the judiciary under the Constitution."
28. It is, therefore, for the legislation to decide whether any amendment be made in the existing provisions of the Stamp Act so as to introduce specifically and in express term a penalty clause in Section 47A of the Act empowering the Collector to Impose a penalty once after holding inquiry it is found that the market value of the property as set forth in the Instrument was not correct and the same was deliberately undervalued. In this regard it is not desirable for this Court to issue any "direction or suggestion and the matter is left in the sole discretion of the legislation.
29. With the above discussion and concurring with the view expressed by brother Hon. G. P. Mathur, J. I conclude.