1 Civil Writ Petition No. 2662 of 2010 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH --- . 2662 2010 Civil Writ Petition No of : 16, 2010 Date of Decision February Rajeev Kishore --- Petitioner Versus State of Haryana and others --- Respondents : CORAM . HON’BLE MR JUSTICE AJAY KUMAR MITTAL *** : PRESENT . . . , , Mr S S Walia Advocate . for the petitioner --- , . AJAY KUMAR MITTAL J In this petition filed by the petitioner under Articles 226/227 , of the Constitution of India the prayer is for issuance of a writ of certiorari for quashing the order dated 27.8.2007, -5, , Annexure P passed by the Collector , ( .3); Ballabgarh District Faridabad respondent No the 2 Civil Writ Petition No. 2662 of 2010 47- proceedings initiated under Section A of the Indian Stamp , 1899 ( “ ) Act in short the Act” and also the order dated 7.8.2009, -7, , Annexure P passed by the Commissioner , ( .2) Gurgaon Division Gurgaon respondent No whereby the petitioner was required to pay stamp duty at Collector’s rate 25, . on the purchase of a plot situated in Sector Faridabad The petitioner has further prayed for a writ in the nature of mandamus directing the respondents to charge stamp duty on . 1,44,710.50 , the sale deed on the valuation of Rs which , according to him was the market value of the plot at the . time of execution of the agreement to sell , In brief the facts of the case are that the owners 1315.55 , of the industrial plot measuring square yards . 169, 25, , , bearing No Sector Industrial Area Tehsil Ballabgarh 13.4.1987, District Faridabad entered into an agreement dated -1, . Annexure P with the petitioner to sell the said plot to him , As per averments made in the petition the vendors received the entire sale consideration and delivered the physical . possession of the plot to the petitioner It was agreed that 3 Civil Writ Petition No. 2662 of 2010 the sale deed in respect of the said plot would be got . , executed later on After taking possession the petitioner constructed an industrial shed on the plot at his own . expenses , In due course of time the sale deed was got , prepared and presented before the Sub Registrar Ballabgarh ( .4) respondent No for registration by paying a stamp duty of . 11,600/- . 1,44,710.50. Rs on the sale consideration of Rs , , The Sub Registrar however refused to register the sale deed and instead impounded the same on the ground that as per , calculations made by them the sale consideration of the plot . 48,46,650/- , , would be Rs and thus there was a . deficiency in payment of the stamp duty to the extent of Rs 3,76,132/- . 14,000/-, and the registration fee of Rs totalling . 3,90,132. , , Rs The Sub Registrar thus made a reference 47- , 30.5.2007, under Section A of the Act vide letter dated -3, , , Annexure P to the Collector Ballabgarh observing as : under 4 Civil Writ Petition No. 2662 of 2010 “ 25 Collector’s rate of Industrial Area in Sector is . 3,000/- . Rs per square yards Its covered area 3000 is square feet and Collector’s rate for . 300/- covered area is fixed at Rs per square . feet According to which the total consideration of . 48,46,650/- the above sale comes to Rs on . 3,87,732/- which total stamp of Rs and . 14,000/- . registration fee of Rs is assessed ” The petitioner thereafter submitted his stand , -4, by means of reply to the reference Annexure P but the same did not find favour with the Collector who vide his 27.8.2007, -5, order dated Annexure P concurred with the assessment made by the Sub Registrar and accordingly ordered that the vendors would deposit the deficient stamp . duty and the registration charges to the tune of Rs 3,90,132/- 30 . within days from the date of the order It was further ordered that in case the petitioner did not deposit the amount within the stipulated time the same would be . recovered as per the provisions of the Land Revenue Act 5 Civil Writ Petition No. 2662 of 2010 The petitioner preferred appeal against the order of . , , the Collector Finding no force the Commissioner Gurgaon , , Division Gurgaon dismissed the appeal vide order dated 7.8.2009, -7. Annexure P It was observed by the appellate , -5, authority that the order Annexure P of the Collector was . based on facts and no fault could be found therewith It is how the petitioner has challenged the . aforesaid two orders by means of the present writ petition Learned counsel for the petitioner has assailed the orders passed by the authorities below on the ground that Kamla Kaila and Suwarsha Manocha had on 13.4.1987 entered into an agreement to sell the plot in .1,44,710.50, question for a sale consideration of Rs and it was on this amount that the stamp duty was payable and . accordingly paid by the petitioner According to the learned , counsel the demand for stamp duty on the value of the , . . property i e the plot and the construction standing thereon at , . the time of registration of the sale deed is not justified The counsel relied upon / . , M s Residents Welfare Association 6 Civil Writ Petition No. 2662 of 2010 . . , Noida versus State of U P and others 2009(3) . . . R C R ( ) 87 Civil and Sushil Kumar versus Haryana State and , another 1990(2) 290 Recent Revenue Reports in support of . his submission I do not find any force in the contention of the . learned counsel for the petitioner The authorities below had recorded that Collector’s rate of the plot at the time of 29.5.2007 . 3,000/- registration of the sale deed on was Rs per square yard whereas that of the construction standing . 300/- . thereon was Rs per square feet The area of the 1315.55 , plot being square yards and the constructed area 3000 , being square feet the market value of the property in question at the time of registration of the sale deed on 29.5.2007 . 48,46,650/-. was determined at Rs The - question that falls for consideration in this petition is whether stamp duty shall be payable on the amount of sale , consideration shown in the agreement to sell or on the market value of the property on the date of presentation of ? sale deed for registration 7 Civil Writ Petition No. 2662 of 2010 In order to appreciate the aforesaid question in , correct perspective it is advantageous to reproduce the . statutory provisions on the subject Section 2(14) of the Act defines “Instrument” which reads thus: “2. Definitions.- In this Act, unless there is something repugnant in the subject or context- Xxx xxx xxx (14) “Instrument”.- “instrument” includes every document by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded;” Sub sections (1) and (2) of Section 47-A of the Act, as applicable in Haryana, provide for how to deal with instruments which are undervalued, and read as under:- “47-A. Instruments under-valued how to be dealt with. (1) If the Registering Officer appointed under the Registration Act, 1908, 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 8 Civil Writ Petition No. 2662 of 2010 consideration, as the case may be, and the proper duty payable thereon. (2) On receipt of reference under sub-section (1), the Collector shall, after giving the parties a reasonable opportunity of being heard and after holding an enquiry in such manner as may be prescribed by rules made under this Act, determine the value or consideration and the duty as aforesaid and the deficient amount of duty, if any, shall be payable by the person liable to pay the duty. (3) xxx xxx xxx xxx (4) xxx xxx xxx xxx” Sub-section (1) of Section 47-A of the Act empowers the registering officer, that if at the time of registration of an instrument relating to the transfer of any property, he has reason to believe that the value of the property or consideration, as the case may be, has not been truly depicted in the said instrument, then the registering officer after registering the instrument, refer the same to the Collector for determination of the value of the property or the consideration, as the case may be, and the duty payable thereon. Under sub-section (2) of Section 47-A of the Act, the Collector, on reference having been made to him under sub-section (1), shall afford a reasonable opportunity of being heard and after holding an enquiry in such manner as may be prescribed by the rules made under the act, determine the true value or consideration and the duty payable thereon and in case there is any deficient 9 Civil Writ Petition No. 2662 of 2010 amount of duty, the same shall be payable by the person liable to pay the duty. However, according to Section 23 of the Indian Registration Act, 1908, subject to provisions of Sections 24, 25 and 26, the document which is required to be registered shall be presented within four months of its execution, for registration except in the case of Will. The statutory language clearly indicates that the Sub Registrar is required to satisfy himself before registering the document whether true price is reflected in the instrument as it prevails in the locality. It would, thus, mean that the valuation of the property is to be assessed at the time of presentation of instrument for registration and not on any other basis. However, there may be few exceptions like in cases where the instrument is presented for registration in pursuance to a decree for specific performance of an agreement to sell or where the agreement to sell had been registered but instrument for transfer could not be executed owing to certain circumstances beyond the control of the vendor/vendee etc. In view of the above, the answer to the question posed is that it is the market value of the property on the date of presentation of the instrument for its registration which is material for the purpose of paying the stamp duty. , In all fairness reference is made to . judgments cited by learned counsel for the petitioner The reliance of the counsel for the petitioner on / . M s Residents 10 Civil Writ Petition No. 2662 of 2010 , Welfare Association Noida’s case ( ) supra is of no assistance . to the petitioner In that case the issue before the apex Court was in respect of a case where the agreement of sale was registered but there was delay in registering the sale . , deed It was on the basis of this factual position the apex - Court had held that no strait jacket formula can be devised . , in such cases However where the purchaser himself or , herself was at fault for getting the sale deed registered it was held that the market value should be determined on the date when the sale deed is executed and not when agreement for sale of the property or lease has been , , registered but where the delay was by the seller the market value should be determined on the date when the agreement . for sale was entered This is not the position in the present . case Here the agreement for sale of the property was never got registered by the parties and the sale deed is being got 20 registered after a period of years of the alleged . agreement to sell The petitioner could not explain the time 2007. taken for getting the sale deed registered in 11 Civil Writ Petition No. 2662 of 2010 The issue before the learned Single Judge of this Court in Sushil Kumar’s case ( ) supra was that the Court had , come to the conclusion on the basis of facts of that case that the value of the land shown in the instrument of sale . . was correctly reflected This is again not the position here , , The decision of the learned Single Judge thus is also of no . help to the petitioner , In view of the above there is no merit in the writ . petition and the same is accordingly dismissed ( ) AJAY KUMAR MITTAL 16, 2010 February JUDGE * * RKMLAIK