Kerala High Court
State Of Kerala vs Cherthala Government Servants ... on 22 November, 2019
Equivalent citations: AIRONLINE 2019 KER 753, (2020) 1 KER LJ 438 (2020) 1 KER LT 245, (2020) 1 KER LT 245
Bench: S.Manikumar, A.M.Shaffique
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE
FRIDAY, THE 22ND DAY OF NOVEMBER 2019 / 1ST AGRAHAYANA, 1941
WA.No.1710 OF 2015
AGAINST THE JUDGMENT IN WPC 12686/2015 DATED 09-06-2015 OF HIGH
COURT OF KERALA
APPELLANTS/RESPONDENTS:
1 STATE OF KERALA
REPRESENTED BY THE SECRETARY TO GOVERNMENT,
CO-OPERATIVE DEPARTMENT,
SECRETARIAT,THIRUVANANTHAPURAM-695001.
2 THE DISTRICT REGISTRAR (GENERAL),
OFFICE OF THE DISTRICT REGISTRAR,
ALAPPUZHA-688001.
3 THE SUB REGISTRAR
OFFICE OF THE SUB REGISTRAR,
PATTANAKKAD,ALAPPUZHA -688531.
BY SR GOVERNMENT PLEADER SRI.SURIN GEORGE IPE
RESPONDENTS/PETITIONERS:
1 CHERTHALA GOVERNMENT SERVANTS CO-OPERATIVE BANK
(LTD) NO.235, CHERTHALA
REPRESENTED BY ITS PRESIDENT V.SHEBU,MALICHIRA
NIKARTHIL,CHERTHALA.P.O.
2 THE ALAPPUZHA DISTRICT CO-OPERATIVE HOSPITAL
SOCIETY LIMITED NO.A 805
PATTANAKKAD.P.O,CHERTHALA,ALAPPUZHA DISTRICT,
REPRESENTED BY ITS SECRETARY.
BY ADV. SRI.P.C.SASIDHARAN, SC
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 22-11-2019,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WA No.1710/15
-:2:-
"C.R."
JUDGMENT
Dated this the 22nd day of November 2019 Shaffique, J.
The State of Kerala and its officers have preferred this appeal challenging the judgment dated 9/6/2015 in WP(C) No.12686/2015. Writ petition was filed by the respondents inter alia seeking the benefit of stamp duty exemption under Section 40(i)(a) of the Kerala Co-operative Societies Act, 1969. The parties are described as shown in the writ petition unless otherwise stated.
2. Petitioners 1 and 2 are Co-operative Societies. The first petitioner Society has entered into an agreement with the 2 nd petitioner Society to purchase certain item of property. As per the byelaw of the first petitioner Society, one of the object of the Society is to establish and engage in business of clinical laboratories and medical shops with prior permission of the Joint Registrar of Co-operative Societies. Such a permission had been obtained as per Ext.P1 dated 28/3/2015 from the Joint Registrar, Co-operative Societies. They also sought permission as per Ext.P2 WA No.1710/15 -:3:- order dated 26/3/2015 from the Joint Registrar to purchase the property of the 2nd petitioner Society. Though a document was presented for registration seeking remission of stamp duty, registration was not permitted and accordingly, the petitioners had to approach this Court seeking the following reliefs:
"i) declare that the petitioners are entitled to get stamp duty exemption and that the action of the 3rd respondent insisting payment of stamp duty is unjust and illegal.
ii) issue a direction directing the 3 rd respondent to register the sale deed presented by the petitioners as evidenced by Exhibit P3 without insisting stamp duty by extending the stamp duty exemption."
3. Learned Single Judge by the impugned judgment allowed the writ petition based on the Full Bench judgment of this Court in Sub Registrar v. Kerala State Co-operative Consumers Federation Ltd. [2015 (1) KLT 443 (F.B)].
4. The learned Government Pleader raised two specific contentions. One is that the purpose for which the land was purchased by the first petitioner was not for the purpose of the Society and secondly the executant alone is entitled for the benefit of remission. He tried to distinguish the decision of the WA No.1710/15 -:4:- Full Bench judgment in Kerala State Co-operative Consumers Federation Ltd. (supra) on facts.
5. On the other hand, the learned counsel appearing for the respondents while placing reliance on the Full Bench judgment in Kerala State Co-operative Consumers Federation Ltd. (supra) also placed reliance on the judgment in District Registrar v. Peringandoor Service Co-operative Bank Ltd. (2019 (4) KLT 265). S.40(1)(a) of the Kerala Co- operative Societies Act reads as under:-
"40. Exemption from certain taxes, fees and duties - (1) The Government may, by notification in the Gazette, remit in respect of any class of societies-
(a) the stamp duty chargeable under the Kerala Stamp Act, 1959 (17 of 1959), in respect of any instrument executed by or on behalf of a society or by an officer or member thereof and relating to the business of such society, or any class of such instruments, or in respect of any award or order made under the Act, in cases where, but for such remission the society, officer or member, as the case may be, would be liable to pay such stamp duty."
6. Ext.P1 is the proceedings of the Joint Registrar of Co- operative Societies. The General Body of the 2nd petitioner WA No.1710/15 -:5:- Society had taken a decision to effect sale of their property in its meeting held on 14/8/2011 in order to settle the liabilities which was allowed as per Ext.P1 order dated 28/3/2015. By Ext.P2 order dated 26/3/2015 of the Joint Registrar (General), the 1 st petitioner Society was permitted to purchase the aforesaid property. Ext.P3 is the sale deed. In the writ petition itself, the contention of the petitioners is that the petitioners were empowered by the byelaw of the Society to acquire properties for its business purpose and Clause 2(vii) of the byelaws enable the Society to engage in the business of clinical laboratories and medical shops. In so far as the business of the Society is to conduct clinical labs and medical shops, purchase of property for the said purpose is definitely for the business of the Society.
7. With reference to the second question, the argument of the learned Government Pleader is that in so far as the first petitioner Society is not the executant of the document, they cannot claim the remission under S.40(1)(a). This question had been considered by the Full Bench at paragraphs 20 and 21 which reads as under:
"20. It is true that when a property is purchased in WA No.1710/15 -:6:- terms of the provisions contained in section 30 of the Kerala Stamp Act, unless otherwise so provided in an agreement between the parties, the liability to pay stamp duty is that of the grantee who is the purchaser. Therefore, in a case where a society purchases an immovable property, in terms of the provisions contained in section 30 of the Stamp Act, the liability to pay stamp duty is that of the society and as provided in section 40 of the Kerala Act, to get the benefit of remission, the society should be liable to bear the stamp duty.
21.However, both under section 40 (1)(a) of the Kerala Act and clause 1(a) of SRO.No.75/60, the benefit of remission is allowed only in respect of documents executed by or on behalf of the society or by its officer or member. In cases where societies purchase properties, in view of section 55 of the Transfer of Property Act, since the executant of the instrument is not the society but the vendor of the property, the requirement of execution of the instrument by or on behalf of the society as provided in section 40 (1)(a) of the Kerala Act and clause 1(a) of SRO.No.75/60 is not satisfied".
8. Apparently, this is a case in which the vendor and the vendee are Societies. The executant is a Society and the purchaser who is bound to pay the stamp duty is also a Society. Therefore, in the particular set of facts, the contention that the benefit cannot be extended to the first petitioner is not WA No.1710/15 -:7:- sustainable. Learned Government Pleader placed reliance on a Division Bench judgment of this Court in District Registrar (General) v. Kozhikode District Co-operative Travel and Tourism Development Society and Centre for Professional Education Ltd. (WA No. No.1835/2016 decided on 28/6/2018). That was a case in which sale was by a company in favour of a Society. The facts of the said case are easily distinguishable with the facts of the present case. Therefore, we do not find any error being committed by the learned Single Judge in arriving at a finding that the fist petitioner Society is entitled for remission in terms of S.40(1)(a) in so far as the seller/executant is also a Society under the Co-operative Societies Act. If such an interpretation is not taken, S.40(1)(a) will become unworkable.
Appeal is, therefore, dismissed.
Sd/-
S.MANIKUMAR CHIEF JUSTICE Sd/-
A.M.SHAFFIQUE
Rp True Copy JUDGE
PS to Judge