IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HON'BLE THE CHIEF JUSTICE MR.J.CHELAMESWAR & THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN TUESDAY, THE 10TH AUGUST 2010 / 19TH SRAVANA 1932 WA.No. 1341 of 2010 --------------------- AGAINST THE JUDGEMENT IN WPC.20235/2010 DATED 15/07/2010 .................... APPELLANTS/PETITIONERS: ------------------------------ 1. PAREEKKUTTY, S/O. ENIKKUTTY, AGED YEARS, CHERAKKAKKUDY HOUSE, VENGOLA KARA, VENGOLA VILLAGE, ALLAPRA.P.O., KUNNATHUNADU TALUK. 2. RASHEED S/O ENIKKUTTY, CHERAKKAKKUDY HOUSE, VENGOLA KARA, VENGOLA VILLAGE, ALLAPRA.P.O., KUNNANTHUNADU TALUK. 3. RAZAK, S/O.MOOSA, THELAMPURAM HOUSE, VENGOLA KARA, VENGOLA VILLGE, ALLAPRA.P.O., KUNNATHUNADU TALUK. BY ADV. SRI.SIRAJ KAROLY RESPONDENTS/RESPONDENTS: ---------------------------------- 1. THE SUB REGISTRAR, PERUMBAVOOR, SUB REGISTRAR'S OFFICE, PERUMBAVOOR.P.O PERUMBAVOOR - 682 054. 2. THE DISTRICT REGISTRAR, ERNAKULAM DISTRICT REGISTRAR'S OFFICE, COCHIN-16. 3. THE DISTRICT COLLECTOR, ERNAKULAM, CIVIL STATION, KAKKANAD- 682 030. BY SENIOR GOVT. PLEADER, SRI.BENNY GERVASIS. THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 10/08/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: J.Chelameswar, C.J. & P.N.Ravindran, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - W.A.No. 1341 OF 2010 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 10th day of August, 2010 JUDGMENT J.Chelameswar, C.J. Aggrieved by judgment dated 15.07.2010 in W.P.(C) No.20235 of 2010, the unsuccessful writ petitioners have preferred the instant appeal. 2. The case of the appellants is that they purchased certain properties covered by Ext.P3 sale deed dated 22.06.2010. When the said document was presented for registration, the 1st respondent herein refused to register the document stating that the consideration for the sale indicated in the document was less than the fair value of the property fixed under the provisions of Section 28A of the Kerala Stamp Act, 1959. 3. The further case of appellants is that though the fair value of the land in question is fixed as contemplated under Section 28A and published in the Extraordinary Gazette dated 06.03.2010, the same is the subject matter of an appeal WA No.1341 of 2010 -:2:- preferred by the vendor of the appellants herein. It may be stated here that Section 28A of the Kerala Stamp Act contemplates the fixation of fair value of a land and also sub-section (4) of Section 28A creates an appellate remedy in favour of any person aggrieved by the fixation of fair value under Section 28A. Section 28A reads as follows: “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 WA No.1341 of 2010 -:3:- (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.” 4. It was argued before the learned Judge by the appellants that whenever a document is presented for registration, the registering authority is bound to register the document so presented irrespective of the fact whether he is satisfied about the sufficiency of the stamp duty paid for the registration of the document. It was further argued before the learned Judge that whenever the registering authority is of the opinion that the stamp is insufficient having regard to the value of the property as assessed by the registering authority, the registering authority can only refer the document for adjudication to the Collector under the provisions of Section 45B after registration of the document. Sections 45A and 45B read as follows: WA No.1341 of 2010 -:4:- “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 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. 45B. Instruments undervalued how to be dealt with.- (1) If the Registering Officer, while registering any WA No.1341 of 2010 -:5:- 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. (2) On receipt of a 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, by order, determine the value of the property or the consideration and the duty aforesaid; and the deficient amount of duty, if any, shall be payable by the person liable to pay the duty and, on the payment of such duty, the Collector shall endorse a certificate of such payment on the instrument under his seal and signature. (3) The Collector may, suo motu, within two years from the date of registration of any instrument not already referred to him under sub-section(1), call for and examine the instrument for the purpose of satisfying himself as to the correctness of its value or consideration, as the case may be, and the duty payable thereon, and if after such examination, he has reason to believe that the value or consideration has not been truly set forth in the instrument, he may determine the value or consideration and the duty aforesaid in accordance with the procedure provided for in sub-section(2); and the deficient amount of duty, if any, shall be payable by the person liable to pay the duty and, on the payment of such duty, the Collector shall endorse a certificate of such payment on the instrument under his seal and signature. WA No.1341 of 2010 -:6:- (4) Any person aggrieved by an order of the Collector under sub-section (2) or sub-section(3) may appeal to the District Court within whose jurisdiction the property transferred is situate. (5) An appeal under sub-section(4) shall be filed within thirty days of the date of the order sought to be appealed against. (6) The District Court shall hear and dispose of the appeal in such manner as may be prescribed by rules made under this Act. ” 5. The scheme of Sections 45A and 45B appears to us, to be as follows. Under both the Sections the registering officer is authorised to verify the value of the land or the consideration set forth in the instrument (presented for registration). If the registering officer upon the verification is satisfied that the value of the land or the consideration set forth in the instrument is not less than the fair value of the land, he is bound to register the instrument under Section 45A. The expression 'fair value' of the land is defined under Section 2(ff)*. It may be mentioned here that the definition ---------------------------------------------------------------------- *(ff) “fair value of land” means the fair value of land fixed under Section 28A. WA No.1341 of 2010 -:7:- of the expression 'fair value' of the land was introduced to the Registration Act with effect from 01.04.1994 by the Kerala Finance Act, 1994. Sub-section (3) of Section 45A authorises the registering authority (in all those cases where he has reason to believe that the value of the land or the consideration set forth is less than the fair value of the land), to direct by an order payment of proper stamp duty, payable on the fair value of the land within a period of 7 days from the date of the order and only on payment of such stamp duty, he is obliged to register the document presented for registration. Sub-section (4) of Section 45A provides for an appeal in favour of a person aggrieved by the decision of the registering authority under sub-section (3) mentioned earlier. 6. On the other hand, Section 45B authorises the registering authority (in all those cases where he has reason to believe that the value of the property or consideration as the case may be, has not been truly set forth in the instrument presented for registration) to refer the document WA No.1341 of 2010 -:8:- to the Collector for determining the correct value of the property or the consideration as the case may be after registering such document. 7. The scope of enquiry under Section 45B is whether the value of the land or the consideration set forth for transfer of property covered by the document presented for the registration is truly stated or not. For example, in a given case, it is possible that a document states the value or the consideration for the transfer which is not less than the fair value of the property or something more than the fair value of the property, but it may so happen having regard to the various facts and circumstances such value may not be the actual value of the property. Section 45B authorises the registering authority to make an enquiry in such cases. However, the registering authority is bound to register the document, though he is satisfied that the document does not reflect the true value of the property. It is only after the registration the registering authority can refer the document to the Collector for appropriate further action contemplated WA No.1341 of 2010 -:9:- under sub-section (2) of the said Section. 8. It may be mentioned that both the sections, Sections 45A and 45B, speak about the value of the land or the consideration set forth, obviously to cover the various kinds of documents presented for registration. It is well known that some of the documents evidencing the transfer of land do not have the element of monetary consideration such as gift, partition etc. Nonetheless the property sought to be conveyed does have a value. 9. In the case on hand, admittedly the fair value is fixed and published in the Gazette. But the vendor of the appellant is said to have preferred an appeal under sub-section (4) of Section 28A and the same is said to be pending with the concerned Collector(the appellate authority). It is also the case of the appellants that the registering authority has not passed any order under Section 45A calling upon the appellant to make good the deficit stamp duty as assessed by the registering authority having regard to the fair value of the land already fixed. The appellants allege that the registering WA No.1341 of 2010 -:10:- authority simply declined to register the document without passing any order contemplated under Section 45A(3). In our view, such a practice is not allowed by law. Though we are not recording the finding that as a matter of fact the registering authority resorted to such a practice, in view of the allegation made by the appellants, we deem it appropriate to direct the registering authority to receive the document in question from the appellants and verify the sufficiency of the stamp in the light of this order and the scheme of Sections 45A and 45B discussed earlier. If the registering authority is of the opinion that the stamp is deficient having regard to the fair value of the land already fixed under Section 28A of the Act, he shall pass an order in terms of Section 45A(3) of the Act directing payment of proper stamp duty on the fair value of the land within a period of seven days from the date of the order and shall, if the appellants remit the same, register the instrument. It will be open to the appellants, if they are aggrieved by the order, to challenge the same before the Collector as provided under Section 45A(4) of the Act. The WA No.1341 of 2010 -:11:- Collector shall, in the event of the appellants filing such an appeal, consider the same along with the appeal stated to have been filed by the appellants' vendor from the order determining fair value and dispose of both the appeals together after affording the appellants and their vendor, a reasonable opportunity of being heard. On the other hand, if the registering authority is of the opinion that the stamp duty paid is sufficient having regard to the fair value of the land, but the actual value of the land is higher than the fair value, he must state his reasons for such conclusion and refer the case to the Collector under Section 45B after duly registering the document. The appeal is accordingly disposed of. J.Chelameswar, Chief Justice. P.N.Ravindran, Judge. ttb WA No.1341 of 2010 -:12:-