IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 29.07.2010 CORAM: THE HONOURABLE MRS.JUSTICE CHITRA VENKATARAMAN C.M.A.No.497 of 2006 Ponmaari Trade Pack represented by its Partner G.Vasantha No.474, Sidco Industrial Estate Ambattur, Chennai-600 098. .. Appellant versus 1. The Sub-Registrar Office of the Sub-Registrar Ambattur Chennai-600 053. 2. District Revenue Officer (Stamps) Office of the Collector Singaravelar Maligai, V Floor 32, Rajaji Salai Chennai-600 001. 3. The Inspector General of Registration Office of the Inspector General of Registration 120, Santhome High Road Chennai-600 028. .. Respondents PRAYER: Civil Miscellaneous Appeal filed under Section 47-A(10) of the Indian Stamp Act, 1899 against the order dated 07.04.2004 in Appeal No.32132/N/1/02 on the file of the Inspector General of Registration. For appellant : Mr.O.Padmaprakash For respondents : Mr.R.Muthaian Government Advocate JUDGMENT This appeal is against the order of the Inspector General of Registration dated 07.04.2004. The appellant herein is the purchaser of a property from TANSIDCO, a Government of Tamil Nadu Undertaking, in the Industrial Estate, Ambattur. The area purchased is of an extent of 0.1402 acres. https://hcservices.ecourts.gov.in/hcservices/ 2. It is seen from the facts herein that the appellant herein was allotted a work shed by the Tamil Nadu Small Industries Development Corporation Limited, fixing the price of Shed No.74 at Rs.6,43,290/- and Work Shed No.474 at a price of Rs.6,83,750/-. The proceedings dated 30.12.1992 and 07.07.1993 respectively in respect of the above- mentioned allotment of sheds, directed the appellant herein to make an initial payment as ordered therein and the balance of amount, in terms of the proceedings given therein. It is seen from the proceedings dated 07.07.1993 of SIDCO that as against Rs.6,83,750/-, the appellant had paid a sum of Rs.6,88,950/-. The proceedings dated 07.07.1993 recorded that the excess amount of Rs.5,200/- would be refunded to the appellant herein. The proceedings further pointed out that the sale deed and memorandum of understanding had to be executed before taking possession of the shed through the authorised officer. Admittedly, in terms of the allotment, a sale deed was also executed. By proceedings dated 06.12.2001, TANSIDCO addressed a letter to the Sub Registrar, Ambattur, to register the document and brought to their attention that under G.O.Ms.No.64 dated 19.2.1996, the Government of Tamil Nadu permitted registration of the document at the value fixed under the sale deed irrespective of the market value prevailing at the time of registration. 3. G.O.Ms.No.64, Commercial Taxes and Religious Endowments Department dated 19.2.1996 notified that in respect of industrial plots and sheds allotted by SIPCOT to industrial entrepreneurs, the registration fee on sale deeds and mortgage deeds should be collected on the value determined by SIDCO. G.O.Ms.No.48, Commercial Taxes, dated 06.03.2000 notified the Government's remission of stamp duty in respect of instruments executed between 25.1.2000 and 24.1.2001 relating to sale, lease and lease-cum sale of the industrial plots and industrial sheds in backward and most backward blocks notified in G.O.Ms.No.41, Industries (MIG 2) Department dated 18.03.1996 by the Tamil Nadu Small Industries Development Corporation (SIDCO), State Industries Promotion Corporation of Tamil Nadu Ltd. (SIPCOT), Tamil Nadu Corporation for Industrial Infrastructure Development Limited (TACID) and the industrial estates formed with the assistance of the Government and registered under the Companies Act, 1956 or under the Tamil Nadu Cooperative Societies Act, 1983. 4. By notice dated 28.01.2002, the Special Deputy Tahsildar called upon the appellant herein to produce the necessary details as to the declaration of the contracted value of the property. The notice under Form I issued under Section 4 was sent to the appellant herein on the premise that as against the value mentioned in the document at Rs.6,51,190/-, the value as per the guideline register was Rs.33,12,683/-. Hence, adopting the said value, the notice called upon the claimant/appellant herein to remit the differential stamp duty at Rs.3,46,125/-. https://hcservices.ecourts.gov.in/hcservices/ 5. The appellant herein wrote a letter dated 26.06.2002 and objected to the proceedings, contending that the proposal had ignored G.O.Ms.No.64 dated 18.2.1996. In the circumstances, they requested the first respondent to accept the value as shown in the document. They also relied on the decision reported in 2002 (2) CTC 329 (R.Sukumaran Vs. State of Tamil Nadu) that the sale being by a statutory body, the value as given in the instrument be accepted. 6. The first respondent passed an order dated 22.07.2002 holding that the document presented for registration was an outright purchase and as such, G.O.Ms.64 dated 19.2.1996 had no relevance to the appellant. He pointed out that G.O.Ms.No.64 dated 19.2.1996, relied on by the appellant herein to follow the value as given by SIDCO and the allotment of developed plots and industrial sheds to entrepreneurs, did not enure to the benefit of the appellant herein, he having purchased the property as an outright purchase. The respondents herein pointed out that the same would be applicable to a case of hire purchase and thus called upon the appellant to make the payment as proposed. The first respondent also rejected the reliance on G.O.Ms.No.48 dated 06.03.2000, which granted remission of stamp duty in respect of sale deeds and mortgage deeds from 25.01.2000 to 24.01.2001 for industrial plots and industrial estates allotted by SIDCO, SIPCOT and TACID, situated in the backward and most backward areas. 7. The first respondent pointed out to the inspection of the Special Deputy Tahsildar (Stamps) and to the fact that the shed was allotted to the appellant on 30.12.1992 and the sale price was remitted to SIDCO on 29.6.1993. As regards the reliance placed on the decision of this Court, the Sub Registrar referred to the stay granted in W.A.No.1552 of 2002. Consequently, the proceedings confirmed the above-said demand and called upon the appellant to pay a sum of Rs.2,59,597/- being the differential duty payable on the instrument of sale. 8. The proceedings before the second respondent dated 28.4.2003, however, ended in fixing of the value at Rs.327/- per sq.ft. The second respondent pointed out that the property was inspected by the District Revenue Officer and on an enquiry, it was learnt that the property could be sold at a price of not less than Rs.325/- per sq.ft. Based on the said enquiry, he fixed the value at Rs.19,96,989/- towards the land price and Rs.6,51,030/- towards the building value, thereby the total amount was Rs.26,48,019/-. The second respondent demanded payment of Rs.2,59,597/- as deficit stamp duty payable by the appellant. Aggrieved by this, the appellant went on a further appeal before the third respondent. By order dated 07.04.2004, the value of Rs.357/- per sq.ft. was reduced to Rs.295/- per sq.ft. Aggrieved by the same, the present appeal has been filed. https://hcservices.ecourts.gov.in/hcservices/ 9. Learned counsel appearing for the appellant pointed out that while G.O.Ms.No.48 dated 13.01.1989 stipulates levy of stamp duty on the value fixed by the SIDCO on the lands which are sold on lease- cum-sale basis, G.O.Ms.No.64 dated 19.02.1996 is on similar lines that the registration fee should be levied only on the land value fixed by the Tamil Nadu Small Industries Development Corporation. The admitted case herein is that the appellant got the lands from SIDCO under outright purchase and not as lease-cum-sale. Given the fact that the appellant had paid the full consideration and had not availed of the hire purchase scheme, learned counsel submitted that it stands to reason that he cannot be put in a worse position than a case of a hire purchaser of the property. Secondly, he pointed out that the entire proceedings were issued on the premise that there is an under-valuation of the property given in the deed. When the Act itself specifies that the assumption of the authority under Section 47-A of the Act is available only if and when there is a failure to declare the true value of the property, in the absence of any materials indicating under-valuation, the assumption of jurisdiction is contrary to law. 10. Learned counsel appearing for the appellant placed reliance on the decision of the Division Bench of this Court reported in 2009 (1) CTC 305 (The Government of Tamil Nadu Vs. S.Jayalakshmi) as well as the decision reported in 2008 (5) CTC 239 (A.J.Mapillai Mohadeen Vs. The Sub-Registrar, Registration Department) to submit that when the sale is by a statutory body viz., TANSIDCO, a Government of Tamil Nadu organisation, and there being no ground at all to doubt the truthfulness of the value stated in the sale deed, the authorities below erred in misreading the Government Orders. Consequently, in the light of the law declared by this Court, the impugned order has to be set aside. 11. Per contra, learned Government Pleader supported the reasoning of the order passed by the third respondent herein. 12. Heard both sides and perused the material available on record. 13. A reading of G.O.Ms.No.48 dated 13.1.1989 shows that the Government accepted the recommendation of the Inspector General of Registration, Madras and permitted the industrialists who had purchased the developed plots/sheds on hire purchase (lease-cum-sale deed) basis from the Small Industries Development Corporation/State Industries Promotion Corporation of Tamil Nadu to pay stamp duty at the value fixed by the Small Industries Development Corporation/ State Industries Promotion Corporation of Tamil Nadu, irrespective of the market value prevailing at the time of registration. G.O.Ms.No.64 dated 19.2.1996, issued under Section 78 of the Registration Act, 1908, states that in respect of plots and instruments to be executed for the sale as well as lease of developed https://hcservices.ecourts.gov.in/hcservices/ plots and industrial sheds, allotted by SIDCO to entrepreneurs in various industrial estates, the registration fee shall be levied only on the land value fixed by the Tamilnadu Small Industries Development Corporation at the time of registration. Going by the above-said notification, it is clear that the decision of the Government is that where the sale/lease-cum-sale deed had been executed on the plots allotted by the Government agency like SIDCO, it stands to reason that there being no scope of any undervaluing of a document for stamp duty purpose or for registration, the declared value in the instrument shall be accepted as such. That being the case, the distinction that is now sought to be made by the respondents is that the purchase by the appellant being an outright purchase and not a hire purchase transaction, it is open to the respondents to adopt the guideline value and the Government Orders relied on have no relevance to the appellant herein. 14. A perusal of the order of the third respondent herein shows that based on the results of the inquiry as well as the locational advantages therein, going by the guideline value, the value declared in the instrument, as given by the appellant, was considered as not true. Section 47-A of the Act contemplates assumption of jurisdiction by the Collector only on his satisfaction that the instrument does not set forth the consideration truly. Thus the jurisdiction to go for a determination of the market value of the said property depended on the subjective satisfaction recorded based on materials that the document does not reflect the true value. The mere fact that the valuation in the document did not match the guideline value, per se, would not make the value given in the instrument, an untrue declaration. 15. The proceedings of the Special Deputy Tahsildar (Stamps) reveals that the entire exercise under Section 47-A of the Act is purely based on the guideline value. Immediately on the issue of notice, the appellant preferred a writ petition in W.P.No.22279 of 2002 before this Court and sought for a direction to be issued to the Sub Registrar to accept the value fixed by TANSIDCO for registering the document. By order dated 24.06.2002, this Court directed the Sub Registrar to consider the representation in the light of G.O.Ms.No.64 dated 19.02.1996. Thereupon, in the order dated 22.07.2002, the Sub Registrar considered the objection from the appellant based on the Government Order, only to reject the objection. Once again, the appellant herein preferred a writ petition in W.P.No.36940 of 2002. By order dated 30.10.2002, this Court directed the appellant herein to exhaust the remedies available under the Act. On a writ appeal preferred in W.A.No.380 of 2002, by judgment dated 08.01.2003, the Division Bench of this Court confirmed the order of the learned single Judge but directed the respondents to consider the objection in the light of G.O.Ms.No.866 dated 28.07.1987, regardless of the market value. In the order dated 28.04.2003, the second respondent pointed out that he had personally inspected the property. Secret https://hcservices.ecourts.gov.in/hcservices/ enquiries were made to ascertain the value locally, which revealed that as against the value of Rs.436/- per sq.ft., the subject property therein would go for Rs.325/- per sq.ft. Hence, the above guideline value was fixed. The third respondent – Inspector General of Registration, pointed out to the locational advantages to hold that the enquiry revealed that wide gap existed between the guideline valuation and the value declared. Hence, based on the enquiring officials' valuation, the third respondent accepted Rs.295/- as the value and hence passed the order fixing Rs.295/- as the value per sq.ft. and Rs.7,32,308/- towards the value of the building based on the recommendation of the Assistant Executive Engineer, Chennai Zone, in his report dated 05.11.2003. A reading of the proceedings of the respondents leaves no manner of doubt that the assessment of the value based on enquiries done by the respective authorities gave different valuation making the decision totally unreliable. The only issue on which they all agreed was that G.O.Ms.No.48 dated 06.03.2000 did not apply to the petitioner who made an outright purchase. There are no details as to the local enquiry made. 16. The proceedings of the respondents do not show whether any attempt was made by the respondents to find out that the declaration of value made by the appellant was an untrue statement. In any event, as rightly pointed out by the learned counsel appearing for the appellant, having regard to the status of the vendor, namely, a Government of Tamil Nadu organisation, the claim of the respondents on untrue value declared has to be rejected outright. Section 47-A of the Act confers jurisdiction on the authority only when there is an untrue declaration of the value in the instrument. A mere difference between the guideline value and the value declared in the instrument does not automatically raise a presumption of untrue statement as to the valuation of the subject property to assume jurisdiction under Sec 47-A of the Act. There are no merits at all in the demand made under Section 47-A of the Indian Stamp Act, as none of the orders of the the respondents satisfy the requirement of Section 47-A of the Act; hence, the same have to fail. 17. As regards the reliance placed on the decision of the Division Bench of this Court reported in 2009 (1) CTC 305 (The Government of Tamil Nadu Vs. S.Jayalakshmi), I agree with the submission of the learned counsel appearing for the appellant that the decision would squarely come to the aid of the appellant herein and in the absence of any material to substantiate that the value declared by the appellant was not true, the question of assumption of jurisdiction under Section 47-A of the Indian Stamp Act, does not arise. This Court pointed out that under Section 47-A of the Indian Stamp Act, the Collector is vested with the authority to assume jurisdiction as regards exemption for the purpose of satisfying himself as to the correctness of the market value of the property, which is the subject matter of the findings on the duty payable thereon. When the subject matter of jurisdiction of the sale is a https://hcservices.ecourts.gov.in/hcservices/ property conveyed by the Government of Tamilnadu organisation, I fail to understand the reasoning of the respondents herein that the value disclosed in the instrument is against the guideline value. It may further be noted that the consistent view of this Court as well as that of the Apex Court is that the guideline value is merely a guide in the matter of ascertaining whether the valuation is truly disclosed in the instrument. Given the fact that the transaction is one at arms-length and given the peculiarity of the land allotted that the appellant had to incur further expenditure on development, I do not find any material to support the orders of the respondents to reject the value stated in the instrument of transfer. Consequently, the order passed by the third respondent stands set aside and the appeal is allowed. No costs. Sd/- Asst.Registrar /True Copy/ Sub.Asst.Registrar ksv To The Inspector General of Registration Office of the Inspector General of Registration 120, Santhome High Road Chennai-600 028. Copy to: The Section Officer VR Section, Madras. + 1 cc to M/s. O. Padmaprakash, Advocate SR.55190 + 1 cc to Special Government Pleader SR.55542 C.M.A.No.497 of 2006 RK(CO) EU 19.10.10 https://hcservices.ecourts.gov.in/hcservices/