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[Cites 30, Cited by 0]

Delhi District Court

Appellant M/S Advent Hospitality ... vs 4 on 7 June, 2013

                                           1

IN THE COURT OF SHRI V K MAHESHWARI  : ADJ ­04: SAKET COURTS :
                                     NEW DELHI


MCA No. 01/13. 
M/S Advent Hospitality Pvt Ltd.
Vs.
Govt of NCT of Delhi  


O R D E R

AVERMENTS OF APPELLANT:

1 Appellant M/S Advent Hospitality Private Limited, is a company incorporated under the Companies Act, 1956 engaged in the business of Hospitality having its registered office at 135, First Floor ,Devika Tower, 6 Nehru Place New Delhi . Present Appeal has been filed by Sh Devender Kumar Mittal, Director of Appellant who has been duly authorised to file the same vide board resolution dated 28.06.2012 passed by Board of Director of the Appellant. M/S Select Infrastructure Pvt Ltd being the highest bidder purchased the commercial plot No.A­3, in the District Centre, Saket New Delhi from DDA vide perpetual lease deed dated 14.10.2004 registered with the office of Sub Registrar­VII, Vikas Sadan, New Delhi 2 M/S Select Infrastructure thereafter got the building plans sanctioned from DDA and developed a mixed use commercial complex MCA No.01/13 Page No. 1 of 30 2 at the plot No.A­3, District Centre, Saket New Delhi comprising of retail/ shopping centre, office tower, multiplex, hotel/ service apartment etc alongwith three basement parking and service spaces under the name and style of "Select City Walk".
3 M/S Tristar Hotels Private Limited pursuant to agreement to sell dated 08.11.2007 entered into a registered sale deed with M/S Select Infrastructure Pvt Ltd and acquired right, title and interest in the Hotel/Service Apartment consisting of five independent floors in a separate tower with service floor and lift lobbies with independent separate entrance from rear roads situated in and forming inseparable part of the building known as Select City Walk, Saket N Delhi alongwith proportionate undivided ownership rights in the land underneath which were developed and constructed by M/S Select Infrastructure in accordance with the sanctioned plans and technical specifications. 4 Appellant subject to the restrictions, covenants, undertakings, term and conditions as agreed/inherited /assumed by M/S Tristar Hotels Pvt Ltd entered into the Agreement to Sell dated 20.03.2012 with M/S Tristar Hotels Private Limited whereby M/S Tristar Hotels Private Limited affirming itself to be absolute and registered owner and in possession of free hold property comprising of Hotel/Service Apartment building consisting of five independent floors in a separate tower with service floor and lift lobbies with independent separate entrance from rear roads, commonly referred as ' Svelte Hotel and Personal Suites' situated in an forming inseparable part of the building known as Select City Walk,Saket N Delhi and build upon at Plot MCA No.01/13 Page No. 2 of 30 3 No. A­3 District Centre, Saket New Delhi alongwith proportionate undivided ownership rights in the land underneath and having been built by M/S Select Infrastructure Pvt Ltd agreed to sell the same for a total sale consideration of Rs.121,50,00,000/­. 5 After the execution of the agreement to sell dated 20.03.2012 disputes and differences arose between the aforesaid parties. Appellant in view of the disputes and differences preferred an application under Section 9 of the Arbitration and Conciliation Act 1996 against M/S Tristar Hotels Private Limited before the Hon'ble Delhi High Court , New Delhi OMP No.619 of 2012. Ultimately the litigation resulted into the order dated 06.08.2012 passed by the Hon'ble Divison Bench of the Hon'ble Delhi High Court in FAO(OS) No.351/2012 and FAO(OS) No. 349/2012 titled M/S Tristar Hotels Private Limited (TH) Versus M/S Advent Hospitality Private Limited (AH) and M/S Advent Hospitality Private Limited Versus M/S Tristar Hotels Private Limited .Learned Divison Bench of the Hon'ble Delhi High Court of Delhi disposed off the cross Appeals being FAO(OS) No.351/2012 and FAO(OS) No.349/2012 . 6 Appellant in view of the order dated 6.8.2012 passed by the Hon'ble Divison Bench of the Hon'ble Delhi High Court proceeded for execution of the sale deed . Appellant acting through its director, and in view of the order of Hon'ble Division Bench of the Hon'ble High Court of Delhi intending to execute the sale deed vide letter dated 17.09.2012, approached the Collector of Stamp, Hauz Khas, New Delhi ­Mehrauli under Section 31 of the Indian Stamp Act 1899 so as to adjudicate upon the proper stamp duty payable in respect of the execution of the sale MCA No.01/13 Page No. 3 of 30 4 deed of the afore described property. Vide the aforesaid letter, the Collector of Stamps was duly intimated that the Appellant intends to purhase a service Apartment building consisting of five independent floors in a separate tower with service floor and lift lobbies with independent separate entrance from rear roads situated in and forming inseparable part of the building known as Select City Walk, Saket N Delhi . Appellant annexed all the relevant documents such as the sale deed registered in favour of M/S Tristar Hotels Private Limited the completion drawings issued by DDA, valuation report and also a draft conveyance deed thereby duly bringing to the notice of Collector of Stamps all the relevant facts which were relevant to adjudicate the stamp duty payable on the proposes conveyance . Vide letter dated 20.09.2012, the Collector of Stamps intimated the Appellant that they have examined the matter and since the matter involves adjudication of stamp duty involving huge amount hence they require more time so as to properly examine the documents and relevant facts. 7 Collector of stamp deputed his valuation team comprising of Naib Tehsildar and four subordinate revenue staff to physically examine and evaluate the property. Valuation team so deputed physically measured the property and checked the authenticity with the completion drawing issued by DDA. Collector of stamps after detail inquiry and investigation as aforesaid and having satisfied vide its letter dated 11.10.2012 issued its certificate dated 11.10.2012 to the Appellant informing that the sale consideration amount of Rs.83,00,00,000/­ was duly set forth on the proposed sale deed in respect of Service Apartment MCA No.01/13 Page No. 4 of 30 5 building with permissible coverage of five independent floors at Plot No.A­3 District Centre,Saket New Delhi commonly referred as ' Svelte Hotel and Personal Suites' situated in an forming inseparable part of the building known as Select City Walk,Saket N Delhi and that an amount of Rs.4,98,00,000/­ would be the require / requisite stamp duty for the execution of the sale deed acknowledged and endorsed the e­stamp paper dated 14.9.2012 bearing Registration No. IN­ DL­22291128725706K.
8 Appellant had purchased the stamp papers for an amount of Rs. 4,98,00,000/­ executed a sale deed thereon and duly presented the same for registration to the office of Sub­Registrar, Hauz Khas, Mehrauli, New Delhi on 16.10.2012 together with the original Adjudication order dated 11.10.2012. Total registree fee of Rs.83,00,100/­ as also paid towards the sale deed. However the sub Registrar vide letter dated 16.10.2012 addressed to Collector of Stamps , Hauz Khas, Mehrauli, New Delhi that the sale deed presented for registration has been impounded under section 33 of the Indian Stamp Act 1899. Collector of Stamp, Hauz Khas, Old Tehsil Building Mehrauli vide its letter dated 11.10.2012 informed the Appellant that an amount of Rs.4,98,00,000/­ consisting of 6% of the sale consideration was the requisite amount of the stamp duty charges of stamp duty chargeable for the registration of the sale deed, vide letter dated 31.10.2012 informed the Appellant that the sale deed, of Service Apartment building with permissible coverage of five independent floors at Plot No.A­3 District Centre, Saket New Delhi commonly referred as ' Svelte Hotel and Personal Suites' situated in an MCA No.01/13 Page No. 5 of 30 6 forming inseparable part of the building known as Select City Walk,Saket N Delhi in favour of Appellant impounded by Sub­ Registrar V­A under section 33 of Indian Stamp Act, 1899 has been sent in original to it for the recovery of deficient stamp duty who thereby called upon the Appellant to show cause as to why action under section 40 of the Indian Stamp Act 1899 be not initiated against the Appellant for recovery of deficient stamp duty.
9 Appellant vide letter dated 31.10.2012, addressed to Sub­ Registrar V­A raised objection to the impounding of the Sale Deed in view of the adjudication dated 11.10.2012 made by the Collector of Stamps and intimated that the letter dated 11.10.2012 formed the basis for the Appellant to present the Sale Deed for registration having requisite amount of stamp Duty as adjudicated and requested to the Sub Registrar V­A to cancel the order impounding the sale deed. 10 Vide reply dated 05.11.2012, the Appellant besides lodging its protest with the Sub ­Registrar gave a reply to the show cause notice as issued by the Collector of Stamp duly bringing to light that the Appellant had executed the sale deed on the basis of the adjudication order dated 11.10.2012 issued by the Collector of Stamps itself hence order dated 31.10.2012 be set aside in terms of the adjudication order dated 11.10.2012 passed by the Collector of Stamps itself. Appellant with its reply also submitted the valuation report of a Government approved valuer .
11 Appellant received another show cause notice dated 29.12.2012 issued by Collector of Stamp/Sub Divisional Magistrate, MCA No.01/13 Page No. 6 of 30 7 Hauz Khas, New Delhi calling upon the Appellant to show cause as to why action under section 40 of the Indian Stamp Act 1899 be not initiated against the Appellant for recovery of deficient stamp duty.

Appellant again submitted a detailed reply to the Collector of Stamps dated 08.01.2013, who once again duly brought to light that the fair market value as per the approved valuer works out of Rs.56,12,00,000/­ than the accepted sale consideration of Rs.83,00,00,000/­ 12 Appellant receive order dated 11.01.2013 issued by the Collector of Stamps, Hauz Khas, New Delhi whereby the Collector of Stamps in clear contrast with its previous order calculated the stamp duty chargeable at an arbitrary and unreasonable figure who impose an exorbitant and unreasonable penalty upon the Appellant to the tune of Rs.7,19,04,120/­ 13 Aggrieved by aforesaid order appellant filed the present appeal on the following grounds that collector of Stamps after giving his opinion and determining the stamp duty payable for the immovable property under section 31 of the Indian Stamp Act 1899 became functus officio and the provision of Section 33 to impound the Sale Deed dated 15.10.2012 could not be applied to the Appellant; order dated 10.01.2013 passed by the Collector of Stamps is directly in conflict with the order dated 11.10.2012 passed by the Collector of Stamp whereby not only the appellant was informed that the sale consideration amount of Rs. 83,00,00,000/­ was truly set forth on the proposed sale deed in respect of Service Apartment Building with permissible coverage of 5 independent floors at A­3, District Centre,Saket N Delhi commonly referred as "Svelte MCA No.01/13 Page No. 7 of 30 8 Hotel & Personal Suites". An amount of Rs.4,98,00,000/­ consisting 6% of 83,00,00,000/­ would be the required / requisite stamp duty for the execution of the sale deed Section 31 of the Indian Stamp Act 1899 as contained in Chapter III is a complete code in itself and not only operates as estoppel . Order dated 11.1.2013 is illegal and has been passed in complete violation of law; order dated 11.01.2013 passed by the Collector of Stamps is void and non set as Collector of Stamps once having adjudicated the value of stamp duty becomes functus officio who cannot review his own order dated 11.10.2012; power to give opinion/adjudicate under Section 31 of the Indian Stamp Act 1899 is given only to the Collector of Stamps the Sub Registrar had erred in impounding the sale deed engrossed upon the value of stamp papers as adjudicated by the Collector of Stamps under Section 31 of the Indian Stamp Act, 1899; Collector of Stamps arbitrarily and whimsically vide order dated 11.1.2013 revised his own order and also imposed penalty illegally and unjustly the subsequent valuation of the property subject matter of the Sale Deed is bad in law and the same also is in direct conflict with the order dated 6.08.2012 passed by the Hon'ble Division Bench of the High Court of Delhi; the action of the Respondent of impounding the Sale Deed presented by the Appellant for Registration to Sub Registrar V­A under section 33 of Indian Stamp Act 1899 is illegal and show cause notice issued to appellant to show cause as to why action under section 40 of the Indian Stamp Act 1899 is violative of the order dated 11.10.2012; Impounding the sale Deed by the Sub Registrar under section 33 of the Act is mala fides and arbitrary act without any MCA No.01/13 Page No. 8 of 30 9 basis when the sale deed had been presented for Registration on the basis of adjudication under section 31 of the Act ; Order dated 11.01.2013 as passed by the Ld Collector of Stamp pursuant to the reference by the Sub Registrar is completely non­speaking and an unreasoned order does not even refer to the previous adjudication order dated 11.10.2012; Ld Collector in its impugned order has erroneously asses the value of the property . He has failed to appreciate that the Appellant has purchased the Property as a whole alongwith proportionate indivisible rights in the plot bearing No.3 District Center, Saket New Delhi on which the entire mixed use development comprising of hotel/service apartments, multiplex, offices and retail have been built; Collector in its impugned order has wrongly determined that the Property under transfer fall under the category of Flats for computation of Stamp duty and the multiplication factors prescribed for commercial use and private builder are to be applied in the instant case; Collector failed to appreciate that the Appellant has purchased the Property without any sub­division/fragmentation of the Hotel/Service Apartments and shall always remain indivisible and impartdible.

AVERMENTS OF RESPONDENT:

14 Respondent filed its reply submitting that this appeal is presented under the provisions of Section 47 A (4) of the Indian Stamp Act . Proceedings under reference were under the provisions of Section 31,33,38 and 40 of the Indian Stamp Act . These provisions are referred to by the appellant at numerous places in the appeal itself . As per the MCA No.01/13 Page No. 9 of 30 10 provision of Section 56(i) of the Indian Stamp Act, 1899 under Chapter VI, captioned "Reference and Revision" it is clearly stated that " the power exercisable by a Collector under chapter IV and chapter V shall in all cases be subject to the control of the Chief Controlling Revenue Authority ." A specific provision for Revision of an order passed by the Collector of Stamps under Section 40 of the Indian Stamp Act is provided by the Act itself by way of filing a Revision Petition before the Chief Controlling Revenue Authority. Despite the specific provision, the Appellant has filed the present Miscellaneous Civil Appeal under a different and non­applicable provision of law .
15 When an independent efficacious and direct remedy is provided for by the Act, the present Appeal is ex­facie barred by law and deserved to be dismissed in­limine on this ground alone. Opinion given by the previous Collector of Stamps under Section 31 of the Indian Stamp Act has no binding value upon the subsequent proceedings conducted by the Sub Registrar/ Registering Authority, or upon the Collector of Stamps when the instrument is presented for registration ;

stamp duty is chargeable on the instrument according to the contents thereof; there is no bar on the reassessment of the value of the property set forth in the instrument, for the purpose of assessment of the value , or consideration by the Collector of Stamps under the provision of the Indian Stamp Act. Respondent No.2 assessed the value of the property set forth in the instrument in the light of the Notification dated 16.11.2011 relating to the rates of flats more than four stories high, and for commercial use; the valuation report of the Government approved MCA No.01/13 Page No. 10 of 30 11 valuer is not binding upon the Respondent No.2; when the document in question was presented before the Sub Registrar, he impounded the document in question under the provision of Section 33 of the Indian Stamp Act on the grounds that the instrument was not duly stamped. Thereafter the concerned officer sent the said document under the provision of Section 38 of the Act to the office of the Respondent No.2 for realization of the deficient stamp duty and appropriate penalty under the provision of Section 40 of the Act; Respondent No.1 is improperly arrayed /described in the appeal; Govt of NCT of Delhi is capable of being sued through its Chief Secretary. 16 It is denied that there has been any violation of the adjudication order dated 11.10.2012 as alleged. It is submitted that an opinion given under the provision of Section 31 of the Indian Stamp Act is neither binding not conclusive and does not preclude/debar the Registering Authority or the Collector of Stamps from assessing the value or consideration set forth in the instrument for the purpose of charging the stamp duty thereon. It is denied that there has been any such arbitrary increase in the value or wrongful penalty imposed as alleged . It is submitted that order of Hon'ble High Court is not applicable to the facts and circumstances of the present case, the Hon'ble High Court was not dealing with the issue of valuation of the property for the purpose of registering the same under the Indian Stamp Act, 1899 . There is also no finding of the honourable High Court on the above issue. The Sub Registrar/ Registering authority is the appropriate authority who is competent to assess the stamp value as per the Indian MCA No.01/13 Page No. 11 of 30 12 Stamp Act, and the same would be done when the document would be presented before it. Appellant is trying to mislead this Court by referring to the judgment/order of the Hon'ble High Court . The order passed by the respondent No.2 under the provision of section 40 of the Indian Stamp Act is proper in all respects and deserve to be upheld. The same was passed by the Respondent number No.2 after considering all the relevant facts. The opinion given by the previous Collector of Stamps was neither binding nor conclusive, impugned order has been passed as per law by the Collector of Stamps. The proceeding as regards section 31 of the Act , and the proceedings as envisaged under section 33,38,40 of the Act are separate proceedings. The opinion if any given under the provision of Section 31 does not preclude/debar the Revenue Department from proceeding steps as per the provision of Section 33,38,40 of the Act . There is nothing on the official record as regards any report submitted by any officials of the Revenue Department, that would form the basis of the opinion given by the then Collector of Stamps vide order dated 11.10.2012 . Registering Authority is empowered by the Indian Stamp Act to assess the value of the property and the consideration and also the stamp duty chargeable thereupon. The property under question was undervalued by the parties concerned and the order dated 06.08.2012 passed by the Honorable High Court was not binding upon the Sub Registrar/ Registering Authority or the Collector of Stamps. Sub Registrar/Registering Authority and the Collector of Stamps are duly empowered as per the Indian Stamp Act to assess/value the document.

MCA No.01/13 Page No. 12 of 30 13

16 Arguments heard. File perused.

17 Ld counsels for both the parties have addressed their arguments in detailed. However on account of brevity I am not incorporating their entire arguments in this order. ARGUMENTS OF APPELLANT 18 Sum and substance of the arguments of Ld counsel for appellant in nutshell is that the appellant applied to the collector of Stamps . Hauz Khas, Mehrauli N Delhi for adjudication of stamp duty in respect of service Apartments Building with permissible Coverage of 5 independent Floors at A­3, District Centre, Saket, N Delhi U/S 31 of the Indian Stamp Act vide letter dated 17.9.2012 . Mr Rajiv Singh the then Collector of Stamp ( Hauz Khas ) vide his adjudication order dated 11.10.12 has conveyed that duty chargeable on the instrument is Rs. 4,98,00,000/­ on the consideration amount of Rs.83 crore. Appellant purchase e­stamp paper certificate No. IN­DL­22291128725706K dated 14/09/12 for the execution of sale deed . On 15.10.2012 Sale deed was executed between M/S Advent Hospitality Private Limited and Tristar Hotels Private Limited for Service Apartment Building with permissible coverage of 5 independent floors at A­3, District Center, Saket, N Delhi and presented for registration . However Sh Sanjeev Kumar Sub Registrar (V­A) Hauz Khas Mehrauli has impounded the instrument under Section 33 of Indian Stamp Act and forwarded the same to the Collector of Stamp vide letter dated 16.10.2012 on the false and flimsy ground that only a portion of property has been transferred.

MCA No.01/13 Page No. 13 of 30 14

19 Collector of Stamp issued the notice dated 31.10.12 to the appellant calling upon to show cause to why action U/S 40 of Indian Stamp Act be not initiated against the appellant for the recovery of deficient stamp paper directing to appear before him on 5.11.12 at 2.00 pm. Appellant has lodged the objection against the illegal and unjust action of Sub Registrar V­A Hauz Khas. Detailed reply dated 5.11.12 to the so cause notice dated 31.10.12 was given by the appellant. Appellant has also annexed valuation report of the property . Collector of Stamp issued second notice dated 29.12.12 to the appellant directing to appear before him on 8.1.13 at 11.00 am detailed reply of that notice dated 8.1.13 was given by the appellant . On 11.01.13 collector of stamp Sh S K Gupta wrongly and illegally passed impugned order . He has wrongly seat the value of the property to be Rs.2,02,84,02,000/­ and furthermore wrongly and illegally adjudicated the stamp duty payable thereupon to be Rs.12,17,04,120/­ .The collector of Stamps vide the impugned order further arbitrarily imposed a penalty equivalent to the allegedly deficient stamp duty i e Rs. 7,19,04,120/­ . The alleged total amount payable was stated to be Rs.14,38,08,240/­ to be paid within 10 days. 20 Ld counsel for appellant referring Section 26 argued that when Collector of stamp Rajiv Singh after due examining the matter, which is clear from letter dated 20.09.12, passed the adjudication order dated 11.10.12 under Section 31/32 of the Stamp Act assessing the chargeable duty on the instrument as Rs.4,98,00,000/­ i e 6% of the sale consideration amount of Rs.83,00,00,000/­, Sub Registrar V­A Hauz Khas has no authority to impound the instrument U/S 33 of Stamp Act MCA No.01/13 Page No. 14 of 30 15 because after the adjudication order U/S 31 /32 of Stamp Act Collector becomes fuctus officio . Sub Registrar V­A being subordinate to Collector of Stamp has no authority to impound the instrument his act of impounding the instrument u/s 33 and forwarding the same to Collector of Stamp U/S 38 is absolutely illegal and void. 21 It is argued by Ld counsel for appellant that after the execution of the agreement dispute arose between the parties whereby the Petitioner moved an application under section 9 of the Arbitration and Conciliation act before the Hon'ble High Court. Learned Single Judge of High Court vide its order reduce the sale consideration on account of less area being sold to Rs.115,59,00,000/­ instead of Rs. 121,50,00,000/­. Both the parties filed cross appeals challenging the single Judge order passed on 19.07.2012. Division Bench of the Hon'ble High Court ordered the Appellant / Petitioner to pay 114.00 crores instead of 121.5 crore. Thus the value of the property cannot be assessed more than Rs.114 crore.

22 Consequently order dated 11.1.2013 passed by Sh S K Gupta ,Collector of Stamp Hauz Khas N Delhi assessing the deficient stamp duties of Rs.7,19,04,120/­ and imposing a penalty of equal amount thereby assessing the total amount of Rs.14,38,08,240/­ payable by appellant is illegal therefore liable to be set aside. 23 In support of his argument ld counsel for appellant place reliance on following authorities:

Govt of UP & Ors Vs Raja Mohammad Amir Ahmad Khan 1961 AIR 787.
MCA No.01/13 Page No. 15 of 30 16
Orissa Cement Pvt Ltd Vs Chief Controlling Revenue Authority 2004 ALL. L.J 277.
State of Rajasthan Vs Maharaja Shri Karni Singhji AIR 1983 Rajasthan 90 Satyavir Singh Vs Collector of Stamps CM (M) 845/2006. Seema Grover Seth Vs Govt of NCT of Delhi &Ors .
Himalaya House Co; Ltd Bombay Vs Chief Controlling Revenue 1972 AIR 899.
State of Punjab & Ors Vs Mohabir Singh 1996 (1) SCC 609.
ARGUMENTS OF RESPONDENT

24 Sum and substance of the argument of Ld counsel for respondent in nutshell is that appellant had participated in the proceedings u/s 33, 38 and 40 of Stamp Act before the Collector of Stamp from the time of impounding of the document till passing of the impugned order therefore in view of section 56 of Stamp Act present appeal U/S 47­A of Stamp Act in this Court is not maintainable. Appellant has erroneously placed reliance on Section 26 of Stamp Act because it deals where the value of subject matter is indeterminate . Section 26 applies only in cases where the value or amount of the subject matter of the instrument could not have been ascertain on the date of execution. However, in this case the value of the subject matter of the instrument have been determinable at the time of execution of the instrument. Second proviso of Section 26 states that in such case MCA No.01/13 Page No. 16 of 30 17 documents would be deemed that the amount certified by the Collector of stamp, in case the same has been duly paid, was the correct and proper amount.

25 Ld counsel for respondent argued that provision of Section 31 of Stamp Act only applies when the original document brought before the Collector . An opinion given by Collector of Stamp merely upon a copy cannot be regarded as a final adjudication. At the most it can only be taken as expression of opinion . In this case only a draft sale deed had been sent to collector of stamp for his opinion but not the original document itself. Since the original document itself was not produced before the collector of stamp at the stage of obtaining opinion u/s 31 of Stamp Act . There was no question of collector having endorsed / certified on the same under the provision of Section 32 . Stamp duty has to be paid on a particular document and the same cannot be stated to have been paid unless and until the document has been executed. Until the document itself come into existence it cannot be stamp therefore it was not possible for the collector to give a certificate U/S 32 regarding the stamp duty chargeable having already been paid since the document had not even been executed. The opinion given in the present case is not binding upon the Revenue Authority and it was open to the Revenue Authority to reassess and examine the document as and when it was executed and produced before the Sub Registrar for the purposes of registration.

MCA No.01/13 Page No. 17 of 30 18

26 It is argued by Ld counsel for respondent that the issue of valuation of the property qua the registration of the sale deed for assessing the stamp duty was never in question before the Hon'ble High Court as such there was no occasion for the Hon'ble High Court to comment upon the correctness of the value of the property for assessing stamp duty for the registration of sale deed. Thus the valuation of property as decided by the parties by their own will, which is clear from the order of Hon'ble High Court, does not, has the stamp of approval from the Hon'ble High Court of Delhi for assessing stamp duty for the purpose of registration of sale deed. It is further argued by Ld counsel for respondent that in any event, it is matter of fact that the question of ascertaining the proper valuation of the consideration/subject matter of the instrument, and the appropriate stamping is under the jurisdiction of the Revenue authorities, no other authority can serve the said function of the State.

27 Ld counsel for respondent placed reliance on following authority in support of his arguments:

The Chief Controlling Revenue Authority Board of Revenue Vs Dr K Manjunatha Rai, AIR 1977 Madras 10.
Murugaya Pillai Vs Rajagopal Pillai AIR (29) 1942 Madras 381 Jt Sub Registrar ­I Vs Prasanth Chandran AIR 2005 Mad 354. Sudeer Associates Vs Union of India 2009(159) DLT 726. FACTUAL AND LEGAL ANALYSIS OF ARGUMENTS OF BOTH THE PARTIES

28 I have gone through the letter No.9173 dt 11.10.12 vide MCA No.01/13 Page No. 18 of 30 19 which SDM /Collector of Stamp Hauz Khas has assessed the duty chargeable on the instrument in question,the same is as under:

OFFICE OF THE COLLECTOR OF STAMPS HAUZ KHAS OLD TEHSIL BUILDING MEHRAULI, NEW DELHI ­30 No. 9173 Dated: 11.10.12 To M/S Advent Hospitality 135, First Floor, Devika Tower, 6, Nehru Place, New Delhi­19 Sub: Opinion on valuation of Service Apartment Building with permissible coverage of 5 (five) independent floor at A­3, District Centre, Saket New Delhi for purposes of Stamp Duty.
This is with reference to your letter dated 17/09/2012, it is informed that consideration amount of Rs.83,00,00,000/­ has been truly set forth on the instrument styled as Sale Deed in respect of property No. Service Apartment Building with permissible coverage of 5 (five) independent floor at A­3, District Centre, Saket New Delhi commenly referred as " Svelte Hotel & Personal Suites" situated in and an inseparable part of the building commonly referred as " Select Citywalk"
A­3, District Centre Saket, New Delhi.
Accordingly duty chargeable on the instrument is Rs. 4,98,00,000/­ i e 6% of Rs.83,00,00,000/­( consideration amount ) which had already been purchased by the applicant vide e­stamp paper certificate No. IN­DL­22291128725706K dated 14/09/12 for the execution of sale deed accordingly.
( Rajeev Singh ) SDM/Collector of Stamps( Hauz Khas) MCA No.01/13 Page No. 19 of 30 20

29 Accordingly sale deed was executed between M/S Advent Hospitality Private Limited and Tristar Hotels Private Limited for Service Apartment Building with permissible coverage of 5 independent floors at A­3, District Centre, Saket New Delhi commonly referred as ' Svelte Hotel and Personal Suites' situated in an forming inseparable part of the building commonly referred as " Select City Walk, A­3, District Centre,Saket New Delhi . It was presented before Sub Registrar V­A for registration however Sub Registrar V­A impounded the sale deed U/S 33 of Indian Stamp Act and forwarded the same to Collector of stamp as per following order for necessary action:

"Sub­ Impoundments of document u/s 33 of Indian Stamps Act 1899.
Sir, Whereas, this office has received one instrument for registration vide Serial No 2432 dated 15.10.2012 under title Articles 23 of the property mentioned as A­3, District Centre,Saket New Delhi .
And whereas, on scrutiny of the document it is revealed that only the portion of the property in question has been transferred. In such cases, stamp duty is chargeable at the flat rate of Rs. 60,000x1.25x3( please see Clause 4 of Notification for new Circle Rates Applicable to NCT of Delhi wef 16.11.2011) Hence document is impounded u/s 33 of Indian Stamps Act, 1899 and forwarded herewith for further necessary action at your end.
SANJIV KUMAR MCA No.01/13 Page No. 20 of 30 21 SUB­REGISTRAR(V­A) HAUZ KHAS , MEHRAULI.

30 Collector of stamp issued a show cause notice dated 31.10.12 to the appellant as to why action U/S 40 of Indian Stamp Act should not be initiated for the recovery of deficient stamp duty directing the appellant to appear on 5.11.12 at 2.00 pm. Appellant filed his objections . Second show cause notice dt 29.12.12 was issued to appellant by the Collector directing for appearance on 8.1.13 at 11.00 am which was also replied by the appellant .

31 After considering the objection/ reply of the appellant Sh S K Gupta, collector stamps , Hauz Khas vide his order dated 11.01.13 held that actual plinth area under transfer is 9015.12 sq meter ( 8179.02+836.10) of C category locality . He has taken up minimum built up rate as Rs.60,000/­ per sq meter and multiply the same by 3x1.25 for commercial as well as for multistoryed flat by private builder and assessed the value of the property as 2,02,84,02,000/­ and chargeable stamp duty at a rate of 6% as Rs.12,17,04,120/­ thus assessing deficiency in stamp duty as Rs.7,19,04,120/­ and imposed a penalty of equal amount to the deficient stamp duty thereby calculating total amount of Rs.14,38,08,240/­ payable by the appellant. 32 From the above discussion it is well establish on the judicial file that appellant had participated in all the proceedings conducted under section 33,38 and 40 of Indian Stamp Act . It is also established MCA No.01/13 Page No. 21 of 30 22 that sale deed (instrument ) in question was impounded by the Sub Registrar (V­A), Hauz Khas, Mehrauli prior to registering the same and forwarded to the Collector of Stamp Mehrauli U/S 38 of Indian Stamp Act for initiated action U/S 40 of Indian Stamp Act. 33 Present appeal has been filed under Section 47A of Indian Stamp Act. Section 47­A (1) is as under:

" If the 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."

34 Hon'ble High Court of Madras in Jt Sub Regitarar­I Vs Prasanth Chandron AIR 2005 Mad 354 in this regard has held as follows:

" Under Section 31 of the Indian Stamp Act, the Collector has been empowered to determine the duty ( if any) with which in his judgment, the instrument that is brought before him is chargeable whether such instrument was executed or not and whether properly stamped or not . Under Section 33(1) (b), irrespective of what is provided under Section 31, the Collector before whom any instrument is brought for determining the duty with which the instrument is chargeable can impound the same if such instrument is not duly stamped. Under Section 40 (1) (b) of the Act, the Collector, who after impounding an instrument under section 33 is of the opinion that such MCA No.01/13 Page No. 22 of 30 23 instrument is chargeable with duty is not duly stamped, can 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 things fit, an amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof, whether such amount exceeds or falls short of five rupees. While Section 33, 38 and 40 falls under Chapter IV of the Act. Section 56 of the Act prescribes that the powers exercisable by a Collector under Chapter IV and V would be subject to the control of the Chief Controlling Revenue Authority."

35 From the provision of Section 47­A (1), quoted above, it is clear that it is applicable only after the registration of instrument. As discussed above, in the case in hand, instrument has been impounded u/s 33 prior to registration of the same .

36 Section 56 (1) states as follows:

" The power exercisable by a Collector under Chapter IV and Chapter V under clause (a) of the first proviso to section 26 shall in all cases be subject to the control of the Chief Controlling Revenue­ authority."

37 Section 26 deals with the instruments where value of subject matte is indeterminate, thus it implies only in cases where the value of the subject matter of an instrument chargeable with ad­valorem duty cannot be or could not have been ascertained . Thus section 26 or its proviso is not applicable to the fact and circumstances of the case in hand.

MCA No.01/13 Page No. 23 of 30 24

38 Ld counsel for appellant relied upon State of Rajasthan Vs Maharja Shri Karni Singhji, AIR 1983 Rajasthan 90, Satyavir Singh Vs Collector of Stamps CM(M) 845/2006 and Seema Grover Seth Vs Govt of NCT of Delhi & Ors WP (C) 13122/2009 of Delhi High Court , ratio of law laid down in these authorities is not applicable to the facts and circumstances of the present case. In State of Rajasthan Vs Maharja Shri Karni Singhji, AIR 1983 Rajasthan 90, has been held that revision u/s 56 of Stamp Act would not lie against an order passed under section 47­A of Indian Stamp Act . It has been held in this case that provision of 47­A provided for an appeal against an order passed under this provision and revisional jurisdiction under the provision of 56 cannot be invoked. In the case in hand, impugned order was not passed by the Collector u/s 47­A but it has been passed u/s 40 of Indian Stamp Act against which revision lies u/s 56 of the Indian Stamp Act. Satyavir Singh Vs Collector of Stamps CM(M) 845/2006 and Seema Grover Seth Vs Govt of NCT of Delhi & Ors WP (C) 13122/2009 of Delhi High Court deals with appeal filed before the Court of District Judge against order passed by Collector of Stamp u/s 47A but not u/s 40 of Indian Stamp Act, as in the present case. In Seema Grover's case Hon'ble High Court of Delhi relied upon Abhinav Kumar Vs State of Haryana has also observed that provision of Section 47A came in force after the registration of document . Even in State of Punjab Vs Mohar Singh 1996 (1) SCC 609 relied upon on behalf of appellant it has been held that provision 47­A will be applicable after registration of instrument and forwarding the same to collector subsequently. Ratio of law laid down in Himalaya House Co; Vs The MCA No.01/13 Page No. 24 of 30 25 Chief Controlling Revenue (1972) 1 Supreme Court Cases 726 does not apply to the facts and circumstances of the present case . 39 Ld counsel for appellant strongly argued that when Collector of Stamps U/S 31 of Stamp Act determines the duty which is payable on an instrument and such instrument presented with such stamp duty chargeable on the same, the instrument shall deemed to be fully stamp . Section 31 does not postulates anything further to be done by the Collector . It is argued after giving an adjudication / opinion under the provision of Section 31 Collector becomes functus officio . In support of his argument Ld counsel for appellant placed reliance on a full bench judgment of Hon'ble High Court of Allahabad Govt of UP & Ors Vs Raja Mohammad Amir Ahmad Khan 1961 AIR 787 .

40 Ld counsel for respondent placing reliance on a special bench judgment of three Judges of Hon'ble High Court of Madras, The Chief Controlling Revenue Authority, Board of Revenue Madras Vs Dr K Manjunatha Rai AIR 1977 Madras 10 argued that the law laid down in Raja Mohammad's judgment, is not good law, as the same has been distinguished by the Hon'ble High Court of Madras in the above cited cases after considering in detail.

41 In Para No.4 of Dr K Manjunatha Rai's case Hon'ble High Court of Madras has observed as follows:

" It seems to us that for this provision to operate in favour of any given instrument, the Collector's adjudication under S. 31 must be followed up by a relative certificate by the Collector endorsed on the instrument itself, to the effect that the full duty as adjudicated by him MCA No.01/13 Page No. 25 of 30 26 has in fact been paid on the instrument. What makes the adjudication by the Collector as to stamp duty on an instrument final and conclussive is not the opinion which he expresses under Sec 31 but his adjudication under that section followed by a certificate entered by him under S.32 (1) on the instrument itself to the effect that the full duty has been paid on it. A mere opinion of the Collector under Sec. 31 on an unstamped instrument not followed by certification under Sec. 32 which was what happened in the present case is not covered by the rule of finality enacted in Sec. 32(3) of the Act."

42 It is further held in para No.6 of this authority as follows:

" A close examination of the judgment in the above case would show that what makes the Collector's determination final is the endorsement made by him on the instrument under Sec. 32 and not the the adjudication as to stamps considered in itself."

43 In para No.7 of this authority it is observed as follows:

" It might even be said that with reference to his duties under S. 31, he becomes functus officio the moment he delivers his opinion . Then follows Sec 32 but the Collector does not properly enter upon his task under this section unless the person executing the document produces it before him for certification."

44 Finally in para No.11 it has been held as follows:

" The Collector's determination under Sec. 31 of the Stamp Act as to the stamp duty payable on an instrument would be final and conclusive only in cases where the Collector follows up his adjudication under Sec. 31 by a relative endorsement on the instrument itself under MCA No.01/13 Page No. 26 of 30 27 Sec 32 to the effect that proper duty has been fully paid or in cases where he has expressed the opinion that no duty is payable, makes an endorsement to that effect on the instrument itself. Where, however the Collector has not certified by endorsement on the instrument either in terms of Sec 32 (1) or in terms of Sec 32 (2) his adjudication as to stamp duty on the instrument brought before him under Sec 31 cannot be a bar to other authorities competent under the Stamp Act to examine or re­examine the question of proper stamp duty paid on it."

45 Ld Counsel for appellant argued that procedure lapse or irregularities does not effect the legality and validity of an order, a party cannot be made to suffer for the lapses of authority. He has placed reliance in support of his arguments on Orissa Cement Pvt Ltd Vs Chief Controlling Revenue Authority 2004 ALL. L.J 277, wherein it is held as follows:

" Stamp Act ( 2 of 1899), Ss 31, 32 - Re­determination of stamp duty­ Challenge as to - Re­determination merely on ground that endorsement by competent authority was not made on the deed itself but order was transcribed on application to which deed was annexed - Not proper­ Order passed and noted on application which was annexed to deed in part of deed and sufficient compliance of S.32."

46 The above referred case is by a single judge of Hon'ble High Court of Allahabad. It does not hold good in view of a full bench judgment of Hon'ble High Court of Madras in Dr Manjunath Rai's case referred above.

47 Hon'ble High Court of Madras, in Murugayya Pillai Vs MCA No.01/13 Page No. 27 of 30 28 Rajagopal Pillai AIR (29) 1942 Madras 381 with regard to endorsement on the instrument u/s 32 (2) has held as follows:

" Section 32(2) contemplates an endorsement on the instrument itself and not on separate letter. The endorsement on separate letter therefore would not bind a civil Court."

48 In view of above discussion, this Court is of view that letter dated 11.10.12 vide which Sh Rajiv Singh Collector of Stamps Hauz Khas assessed the chargeable on the instrument as Rs.4,98,00,000/­ is only an opinion and not an adjudication order, thus not binding on the Revenue authority to accept as it is.

49 I have also gone through the order of Hon'ble High Court in FAO No.349/12 and 351/12 . Parties have reached to a compromise and fixed the sale consideration by mutual agreement which is clear from the following portion of the order:

" In the course of hearing with the assistance of learned Counsels for the parties an endeavor was made to see that an agreed interim directions can be passed which has resulted in further discussion inter se the parties as the matter was held over and fortunately with the assistance of the counsels over all disputes inter see the parties stand resolved in the following terms:­ i It is agreed that the appellant will pay to the respondent consideration of Rs.114.00 crore instead of Rs.121.5 crore under the agreement dated 23.3.2012 with all other terms and conditions MCA No.01/13 Page No. 28 of 30 29 remaining the same."

ii iii iv v vi The conveyance Deeds will be executed in favour of AH by TH after clearing all the liabilities on or before 14.9.2012.

50 From the above quoted portion of the judgment of the Hon'ble High Court, it clear that issue of the valuation of property qua the assessment of chargeable stamp duty on the instrument was not before the Hon'ble High Court and the Hon'ble High Court has not given any finding in this regard. It is also clear from the above quoted portion of the order that parties agreed for the sale consideration by mutual consent.

CONCLUSION 51 In view of above discussion this Court of view that present appeal under 47­A of Indian Stamp Act is not maintainable in this Court because more efficacious remedy is available to the appellant U/S 56 of Indian Stamp Act of filing of revision before the Chief Controlling Revenue Authorities . In the facts and circumstances of this case, letter dated 11.10.12 issued by collector of stamp Rajiv Singh assessing duty chargeable on the instrument as Rs.4,98,00,000/­ was not binding on the revenue authority i e Sub Registrar (V­A) Hauz Khas, Mehrauli, Delhi, MCA No.01/13 Page No. 29 of 30 30 therefore, he had the authority to impound the instrument U/S 33 of Indian Stamp Act and can refer to Collector Stamp u/s 38 of Indian Stamp Act for initiating necessary action U/S 40 of Indian Stamp Act. Collector of Stamps Sh S K Gupta has duly passed the order dated 1.11.2013. Accordingly, appeal is dismissed. Decree sheet be drawn accordingly. File be consigned to R.R. (V.K. MAHESHWARI) ADJ­04 : SOUTH DISTRICT NEW DELHI : 6.6.2013 MCA No.01/13 Page No. 30 of 30