THE HON’BLE Dr. JUSTICE G.YETHIRAJULU Writ Petition No.22059 of 2004 ORDER: This Writ Petition has been filed by the petitioner seeking to issue a Writ of Certiorari by way of calling of records relating to proceedings dated 29-10-2004 of the first respondent and to quash the same and consequently direct the respondents to register and release the document No.P-197 of 2000 pending before the Second respondent. 2. The petitioner in the affidavit filed in support of the writ petition pleaded that the petitioner is a company incorporated under the Companies Act. It is dealing with manufacture and sale of non- alcoholic beverages like soft drinks. The petitioner agreed to buy the business of M/s.Vijayawada Bottling Company for a consideration of Rs.14,04,00,000/- through a business purchase agreement entered on 10-06-1998. The business purchase agreement was a broad agreement on various steps and procedures required for the intended business and dealt with various items. An indenture of conveyance is the subject matter of registration, which was executed on 28-05-2000. On the date of execution of indenture of conveyance of property at the site belonged to the petitioner, no other asset was lying at the site in which the seller had ownership, except land and building. An indenture of conveyance was executed on 29-05-2000 in respect of land and buildings and the same was presented before the second respondent for registration. The subject matter of the indenture of conveyance was valued at Rs.3.30 crores and stamp duty of Rs.36.30 lakhs was paid. Though the value of the property mentioned in the document is much higher than the market value as per the basic value register, the document was wrongly detained without effecting registration. The first respondent issued a notice dated 30-12-2002 under Section 40 of the Stamp Act proposing to impound the document and fixing the stamp duty at Rs.1,82,52,000/-. After deducting the stamp duty paid, the deficit stamp duty is arrived at Rs.1,46,22,000/- and deficit registration fee is Rs.5,36,900/-. The first respondent without proper consideration of the objections and written submissions filed on behalf of the petitioner and without giving a notice under Section 41-A of the Act, passed the impugned order. Therefore, it is liable to be set aside. 3. The respondents filed a counter affidavit contending that the petitioner has entered into a business purchase agreement on 10-06- 1998 for a total consideration of Rs.14.04 crores. The petitioner presented a document, which was executed on 28-05-2000. As per the recitals of the said document, the consideration mentioned in the business purchase agreement has to be taken as the consideration under the documents and the petitioner is liable to pay the stamp duty on that amount. The Sub-Registrar has referred the document to the first respondent herein for impounding and reference was made under Section 38 (2) in Form No.V. Therefore, there is no illegality in keeping the document pending. A notice was issued under Section 40 of the Indian Stamp Act, that the consideration covered by the agreement was Rs.14.04 crores and the document was chargeable under Schedule I-A of the Indian Stamp Act. The first respondent has the power and jurisdiction to levy the deficit stamp duty and the orders were passed by the first respondent only after giving notice and opportunity to the petitioner. Therefore, there is no illegality in the order. The document was impounded taking into consideration of the recitals in the document. Therefore, the writ petition is liable to be dismissed. 4. In the light of the submissions made by both parties, the point for consideration is whether the property covered by the indenture of conveyance was properly valued and whether it is required to be impounded demanding to pay the deficit stamp duty and registration fee under the relevant rules? 5. Section 41-A of the Indian Stamp Act is the relevant provision in the context and it reads as follows: “41-A. Recovery of Stamp Duty not levied or short levied:-- (1) Whereafter the commencement of the Indian Stamp (Andhra Pradesh Amendment) Act, 1986, any instrument chargeable with duty has not been duly stamped and registered by any Registering Officer by mistake and remarked as such by the Collector or any audit party, the Collector may, within five years from the date of registration serve a notice on the person by whom the duty was payable requiring him to show cause why the proper duty or the amount required to make up the same should not be collected from him: Provided that where the non-payment was by reason of fraud, collusion or any willful misstatement or suppression of facts or contravention of any of the provisions of this Act or the rules made thereunder with intent to evade payment of duty, the Collector may, within ten years from the date of registration, serve a notice on such person to show cause why the amount required to make up the deficit stamp duty should not be collected from him along with a penalty of three times of deficit stamp duty. (2) The Collector or any officer specially authorized by him in this behalf shall, after considering the representation if any, made by the person on whom notice is served under sub-section (1), determine by an order, the amount of duty and the penalty due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount as determined. On payment of the amount the Collector shall add a certificate under Section 42. (3) Any person aggrieved by an order under sub- section (2) may prefer an appeal before the Chief Controlling Revenue Authority, Andhra Pradesh, Hyderabad within three months from the date of such order; (4) Any amount payable under this section shall be recovered as an arrear of land revenue.” The above section contemplates that any instrument chargeable with duty has not been duly stamped and registered by the Registrar’s office by mistake and remarked as such by the Collector or any audit party, the Collector may within five years from the date of registration, serve notice on the person by whom the duty was payable requiring him to show cause why the proper duty or the amount to make up the deficit should not be collected from him. In the present case, the property described in the schedule was the land and the buildings thereon and they were valued and stamp duty was paid on that. 6. The learned counsel for the petitioner submits that if the first respondent come to a conclusion that the instrument sought to be registered is undervalued, he ought to have followed the procedure contemplated under Section 47-A of the Act and the Rules made there under by registering the document first and then referred for determination of the market value. The learned counsel for the petitioner further submitted that at no point of time any notice was given to the petitioner under Section 41-A of the Act. The first respondent ought not have taken into consideration the business purchase agreement entered between the parties, which does not transfer any property and it is not the subject matter of the deed of conveyance presented for the purpose of registration. Though several items were mentioned in the business purchase agreement, they were not required to be conveyed by way of registered sale deed. The market value of the property covered by the conveyance deed has to be taken into consideration for the purpose of levying the stamp duty, but not the properties, which are not referred in the instrument. The counsel for the petitioner further submitted that the first respondent did not take into consideration various objections raised by the petitioner from time to time, including the written submissions and the impugned orders are not speaking orders, as there is no reason mentioned for overruling the objections raised by the petitioner. Therefore, he requested to set aside the orders of the respondent. 7. The learned Government Pleader submitted that there was a competition between the vendor and the vendee by way of business purchase agreement for Rs.14,04,00,000/-, whereas the petitioner failed to include that property in the conveyance deed and the conveyance deed refers only to the land and the buildings and nothing more. Therefore, the first respondent was justified in directing the petitioner to pay stamp duty on the amount referred in the business purchase agreement. 8. In the order dated 29-10-2004, the Collector mentioned that the District Registrar, Vijayawada, has examined the document and opined that the party has made business agreement for Rs.14,04,00,000/- as consideration of the document. After careful examination of the recitals of the said document along with the papers enclosed to it and other connected material, he came to a conclusion that the document under reference is a sale chargeable to a stamp duty of Rs.1,82,52,000/- under Section 47-A of the Stamp Act, 1899 and the petitioner is required to make up the deficit stamp duty within thirty days from the date of receipt of the order. 9. Under Section 47-A of the Act, the Collector is required to examine whether the market value of the property, which is the subject matter of the instrument submitted for registration, is sufficient or not. If one party decides to sell three or four properties to the other party and if a deed of conveyance is executed in respect of one property, it has to be examined whether the value of the said property is proper, whether it is undervalued and whether there is any deficit stamp duty, but the Collector cannot include the value of other properties covered by the agreement when any one of them is not the subject matter of the conveyance deed. Though there was an agreement between the parties to transfer movable and immovable properties, what is actually transferred through the conveyance deed has to be taken into consideration, but not all the properties covered by the agreement. Though it is mentioned by the first respondent that the value of the properties of the business sale agreement has to be taken into consideration in the conveyance deed, it is not mentioned under what provision of law the collector is authorized to require the party to pay the stamp duty on the properties referred in the business agreement which is not the subject matter of the conveyance deed. It is not the contention of the respondents that the property covered by the schedule is undervalued. There is no observation whether the value of the machinery embedded in the earth, which can also be treated as immovable property, is not properly valued. It is also not the contention of the respondents that the property fetches more value as per the basic value register or any other document relating to property similar to the schedule property, but they opined that the property which is not the subject matter of the sale deed should also be valued for the purpose of registration on the basis of the value referred in the business sale agreement and the deed of conveyance cannot be impounded under Section 33 of the Stamp Act, but when a document is presented for registration, the power under Section 33 cannot be invoked by the registering authority. Section 40 read with Section 2 (9) of the Indian Stamp Act gives power to the Collector to stamp instruments impounded and in the absence of any notification authorizing any other Officer other than the District Collector to exercise the power. The respondents cannot take the value of those properties covered by the agreement, when they are not the subject matter of the conveyance deed. In the light of the above circumstances, I find sufficient force in the contention raised by the petitioner and the orders passed by the respondents are liable to be quashed. 10. In the result, Writ Petition is allowed and the order of the first respondent dated 29-10-2004 is quashed and the respondents are directed to register and release the document No.P-197 of 2000, without insisting for any additional stamp duty, pending before the second respondent, within one month from the date of receipt of a copy of this order. No order as to costs. ____________________ Dr.G.YETHIRAJULU, J. Dated -04-2008. SKMR