Kerala High Court
Abid vs The Revenue Divisional Officer on 19 July, 2010
Author: S.Siri Jagan
Bench: S.Siri Jagan
IN THE HIGH COURT OF KERALA AT ERNAKULAM
WP(C).No. 22417 of 2010(B)
1. ABID, S/O. PULIKATHODI MUHAMMED,
... Petitioner
2. NISHANA, W/O ABID,
Vs
1. THE REVENUE DIVISIONAL OFFICER,
... Respondent
2. THE SUB REGISTRAR, THE SUB REGISTRAR'S
3. THE VILLAGE OFFICER, ALANALLUR-III
For Petitioner :SRI.BABU S. NAIR
For Respondent : No Appearance
The Hon'ble MR. Justice S.SIRI JAGAN
Dated :19/07/2010
O R D E R
S. SIRI JAGAN, J.
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W.P.(C) No.22417 OF 2010
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Dated this the 19th day of July, 2010
J U D G M E N T
The question posed by the petitioners in this writ petition is as to whether a registering authority under the Indian Registration Act has power to refuse registration on the ground that a document presented for registration does not bear stamp duty payable in accordance with the Schedule to the Kerala Stamp Act. The facts are not in dispute. The petitioners want to execute sale deeds in respect of certain properties purchased by them. In respect of those properties, the Government of Kerala has fixed fair value by virtue of powers under Section 28A of the Kerala Stamp Act. According to the petitioners, the market value of the property is less than the fair value so fixed. Against the fixation of fair value, the petitioners have already filed Exts.P3 and P4 appeals before the appellate authority. Their contention is that they are entitled to get the documents registered on payment of stamp duty as per the consideration fixed and on presentation of the same paying stamp duty on the W.P.(c)No.22417/10 2 basis of the consideration fixed in the sale deeds, the registering authority is bound to register the document in accordance with the Indian Registration Act and if he is opinion that appropriate stamp duty payable thereon has not been paid, his power is to take proceedings under Section 45B of the Kerala Stamp Act. According to the petitioners, this position has been abundantly made clear by this Court in the decision of Periyar Real Estates v. State of Kerala [2002(1) KLT 806] and All Kerala Document Writers and Scribes Association v. State of Kerala [2005(3) KLT 234-]. The petitioners therefore seek the following reliefs:
"i) Issue a writ of mandamus or any other appropriate writs, orders or directions commanding the second respondent, not to refuse the registration of the sale deed of the properties owned by the petitioner in R.S.No.208/1 of the Alanallur-III, Village, for the reason of in sufficiency of payment of stamp duty, in view of the amendment to Article 22 to the Kerala Stamp Act, 1959;
ii) Issue a writ of mandamus or any other appropriate writs, orders or directions commanding the first respondent to consider and pass orders on Exhibits P3 and P4 applications submitted by the petitioners under Section 28A of the Kerala Stamp Act, forthwith, without any further delay;
iii) Declare that the second respondent has no powers to refuse the registration of a document presented before him by saying the insufficiency of stamp duty payable on a document, on the basis of fair value fixed by the government on the properties".
W.P.(c)No.22417/10 3
2. The learned Government Pleader submits that Section 45B of the Kerala Stamp Act has nothing to do with the issue involved in this writ petition. The question of undervaluation to which only Section 45B relates, has no application here. He points out that the documents in question are admittedly conveyances as defined under Section 2(d) of the Kerala Stamp Act. Under Section 3 of the Kerala Stamp Act, instruments mentioned therein shall be chargeable with duty of the amount indicated in that Schedule as the proper duty thereof, meaning thereby that every instrument mentioned in the Schedule which, not having been previously executed by any person, is executed in the territories of the State of Kerala, shall bear the stamp duty as chargeable under the Schedule to the Act. He further points out that Article 22 of Schedule 1 has been recently amended, whereby for conveyance as defined under Section 2(d) of the Kerala Stamp Act, stamp duty is chargeable on the fair value of the land or the amount or value of the consideration for such conveyance, whichever is higher. Section 28A gives powers to the Government to fix the fair value of the land. Once fair value of the land is fixed under Section 28A, the stamp duty payable is W.P.(c)No.22417/10 4 at the appropriate rate fixed in Article 22 of the Schedule on the fair value so fixed or the consideration mentioned in the document, whichever is higher. He also points out that Section 45A prescribes the procedure to be followed by the registering authority in cases where the fair value has been fixed. According to the learned Government Pleader, once the registering officer finds that the value of the land or the consideration set forth in the instrument is less than the fair value of the land fixed under Section 28A, he is statutorily bound to direct payment of proper stamp duty on the fair value of the land fixed under Section 28A within a period of seven days from the date of the order and on payment of the deficit stamp duty alone he is liable to register the instrument. Therefore, according to the learned Government Pleader, unless the petitioners pay stamp duty payable as per the Article 22 of the Schedule to the Stamp Act on the fair value fixed under Section 28A, the registering authority is not bound to register the document.
3. The learned counsel for the petitioners heavily relies on the Division Bench decision in Periyar Real Estates' case (supra) in support of his contention. According to him, that W.P.(c)No.22417/10 5 decision squarely covers the issue involved in this writ petition.
4. I have considered the rival contentions in detail. At the out set, I must state that the decision in Periyar Real Estates' case (supra) does not deal with the issue involved in this writ petition at all. On the other hand, the following sentence in paragraph 8 of the judgment shows otherwise:
"................If the value of the land or the consideration set forth in the instrument is not the fair value of the land fixed under Section 28A, the Registering Officer is empowered to make an order directing payment of proper stamp duty on the fair value of the land fixed within the prescribed period and register it only upon payment of such deficit stamp duty"
That decision was one dealing with the question as to whether for the purpose of proceeding under Section 45B of the Kerala Stamp Act, the registering officer can after registering the document retain the document. Considering that issue, the Division Bench held that the registering officer cannot retain the document after registration for the purpose of proceeding under Section 45B. In fact, that decision although Section 45A is referred to therein, the Division Bench did not consider the question as to whether in view of Section 45A the registering officer can refuse to register the document, which does not bear stamp duty payable as per the Schedule to the W.P.(c)No.22417/10 6 Kerala Stamp Act. Therefore I am of opinion that the reliance by the counsel for the petitioners on the decision in Periyar Real Estates' case (supra) is misplaced.
5. Section 2(d) of the Kerala Stamp Act defines 'conveyance' thus:
"Conveyance" includes a conveyance on sale and every instrument by which property whether movable, or immovable is transferred inter vivos and which is not otherwise specifically provided for by the Schedule"
Section 3 of the Kerala Stamp Act is the charging Section which reads thus:
"3. Instruments chargeable with duty.- subject to the provisions of this Act and the exemptions contained in the Schedule, the following instrument shall be chargeable with duty of the amount indicated in that Schedule as the proper duty therefor, respectively, that is to say-
(a) every instrument mentioned in the
Schedule which, not having been previously
executed by any person, is executed in the territories of the State of Kerala on or after the commencement of this Act; and
(b) every instrument mentioned in that Schedule which, not having been previously executed by any person, is executed out of the State of Kerala on or after that day, relates to any property situate, or to any matter or thing done or to be done, in the territories of the State of Kerala and is received in the territories of the State of Kerala:
Provided that no duty shall be chargeable in respect of-
(1) any instrument, executed by, or on behalf of, or in favour of, the Central Government or W.P.(c)No.22417/10 7 this or any other State Government , in cases where, but for this exemption, the Central Government or the State Government , would be liable to pay the duty chargeable in respect of such instrument;
(2) any instrument for sale, transfer or other disposition either absolutely or by way of mortgage or otherwise of any ship or vessel or any part, interest, share or property of or in any ship or vessel".
Amended Article 22 of Schedule to the Kerala Stamp Act (amended in 2010) reads thus:
"22 Conveyance as defined by section 2(d), not being a transfer charged or exempted under No.55 of immovable property situated,-
(i) within the Eight rupees for every
Municipalities/ rupees 100 or part
Townships/Cantonments thereof of the fair
other than value of the land or
Corporations' the amount or value
of the consideration
for such conveyance,
whichever is higher.
(ii) within the Municipal Nine rupees for every
Corporations. rupees 100 or part
thereof of the fair
value of the land or
the amount or value
of the consideration
for such conveyance,
whichever is higher
Section 28A of the Kerala Stamp Act reads as follows:W.P.(c)No.22417/10 8
"[28A. Fixation of fair value of land.- (1) Every Revenue Divisional Officer shall, subject to such rules as may be made by the Government in this behalf, fix the fair value of the lands situate within the area of his jurisdiction, for the purpose of determining the duty chargeable at the time of registration of instruments involving lands.
(2) The Revenue Divisional Officer shall, in fixing the fair value of a land under sub-section (1), have regard inter alia to the following matters, namely:-
(a) development of the area in which the land is situate such as the commercial importance, facilities for water supply, electricity, transport and communication;
(b) proximity of the land to markets, bus stations, railway stations, factories, educational institutions or other institutions;
(c) the geographical lie of the land, the nature of the land such as dry, waste, wet or garden land, fertility nature of crop, yielding capacity and cost of cultivation; and
(d) such other matters as may be provided in the rules made under this Act.
(3) The fair value of land fixed under sub-
section (1) shall be published in such manner as may be provided in the rules made under this Act.
(4) Any person aggrieved by the fixation of fair value under sub-section (1) may, within thirty days of its publication under sub-section (3), appeal to the Collector]"
Again Section 45A of the Act reads thus:
"[45A. Instrument not bearing stamp of sufficient amount as per fair value of land how to be dealt with.- (1) Notwithstanding anything contained in this Act, the registering officer shall, while registering an instrument transferring any land, other than an instrument of partition, settlement or gift among the members of a family, chargeable with duty verify whether the value of land or the consideration set forth in the instrument is the fair value of that land.
(2) Where on such verification, the registering officer is satisfied that the value of the land or the consideration set forth in the instrument is not less than W.P.(c)No.22417/10 9 the fair value of the land, he shall duly register the instrument.
(3) Where, on verification the registering officer finds that the value of the land or the consideration set forth in the instrument is less than the fair value of the land fixed under Section 28A, he shall, by order, direct the payment of proper stamp duty on the fair value of the land fixed under Section 28A within a period of seven days from the date of the order and on payment of the deficit stamp duty, the instrument shall be duly registered.
(4) Any person aggrieved by an order under sub-section (3) may, within thirty days from the date of that order, appeal to the Collector within whose jurisdiction the land is situate.
(5) The Collector shall hear and dispose of the appeal in such manner as may be prescribed by rules made under this Act in that behalf and his decision thereon shall be final.] Reading these Sections together, I find that once the fair value of the land is fixed by virtue of powers under Section 28A of the Kerala Stamp Act, then every conveyance as defined under Section 2(d) of the Act should bear the stamp duty payable as per Article 22 of Schedule I of the Act. That Schedule prescribes that the amount of stamp duty payable is to be computed on the fair value fixed under Section 28A or the consideration whichever is higher. In view of the above provisions, the question of undervaluation does not arise any more. Consequently the question of proceedings under Section 45B also does not arise. Under Section 45B, if the W.P.(c)No.22417/10 10 Registering Officer, while registering any instrument transferring any property, has reason to believe that the value of the property or the consideration, as the case may be, 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 value or consideration as the case may be, and the proper duty payable thereon. After amendment of Article 22 of Schedule I of the Kerala Stamp Act, the value of the property or the consideration set forth in the instrument is not relevant after the fixation of the fair value of the land under Section 28A, since stamp duty is payable on the fair value or the consideration, whatever be that consideration, whichever is higher. Therefore after the amendment in 2010, Section 45B practically loses its relevance at least in respect of conveyances as defined under Section 2
(d) of the Kerala Stamp Act. Once the fair value is fixed under Section 28A, what the registering officer has to do, is only to look at the fair value and the consideration mentioned in the sale deed and to see whether the conveyance is stamped with stamp duty payable on the higher of the two. If it does not, then the Section 45A demands that he should direct payment W.P.(c)No.22417/10 11 of proper stamp duty on the fair value of the land fixed under Section 28A or the consideration fixed in the instrument, within a period of seven days from the date of the order and only on payment of deficit stamp duty, he can statutorily register the document. Therefore, going by the above provisions of the Kerala Stamp Act, I have no doubt in my mind that the registering officer is bound to see that the conveyance bears the stamp duty at the rate fixed in Article 22 of the Schedule to the Kerala Stamp Act on the fair value of the land or the consideration whichever is higher. If it does not, the registering officer cannot register the document at all. This power has been recognised by the Division Bench in Periyar Real Estates' case (supra), the relevant sentence from which I have quoted supra. Therefore, I do not find any merit in the contentions of the petitioners that even if the conveyance does not bear the stamp duty on the fair value of the land, the registering officer is bound to register the document and then take proceedings under Section 45B of the Kerala Stamp Act for undervaluation.
6. The learned counsel for the petitioners submits that they have already filed Exts.P3 and P4 appeals against the fair W.P.(c)No.22417/10 12 value fixed. They seek a direction to dispose of Exts.P3 and P4 expeditiously.
7. The learned Government Pleader points out that Exts.P3 and P4 have been filed before the first respondent, Revenue Divisional Officer and under Section 28A(4) appeals lie to the District Collector.
In the above circumstances, I do not think that I can direct the first respondent to consider the appeals. However, the first respondent shall forward the appeals to the District Collector, who shall dispose of the same as expeditiously as possible, at any rate, within a period of one month from the date of receipt of the appeals from the first respondent. The first respondent shall forward the appeals to the District Collector within one week from the date of receipt of a copy of this judgment.
The writ petition is disposed of as above.
S. SIRI JAGAN, JUDGE acd W.P.(c)No.22417/10 13 W.P.(c)No.22417/10 14