Case: THE INSPECTOR GENERAL OF REGISTRATION Vs. K. BASKARAN

3. The appeal arising out of Special Leave Petition (Civil) No.15790 of 2019 is taken as the lead matter and facts pertaining to said appeal are set out in detail for facility. The facts involved in other appeals are almost identical except for details such as the case numbers, dates of orders and the details of properties in question4. The appeal from Special Leave Petition (Civil) No.15790 of 2019 arises out of the final judgment and order dated 02.02.2018 passed by the High Court in CMA No. 2666 of 2012 in following circumstances: -A. The Respondent purchased two properties comprised in R.S. No.372/2A – Sidharavuthanpalayam Village, Tiruppur Taluk, Erode District, (i) admeasuring about 46216 sq.ft. through Sale Deed dated 21.02.2000 registered as Doct. No.2647 of 2000 of Book 1 valued at Rs.4,78,000/- and (ii) admeasuring about 47960 sq. ft through Sale Deed dated 18.02.2000 registered as Doct. No.2648 of 2000 of Book 1 valued at Rs.4,96,000/- (i.e. Rs.10.34 per sq.ft.).B. As the value in said Sale Deeds was less than the Guideline Value of Rs.58.30 per sq.ft., the Sub-Registrar, Dharapuram, Appellant No.5 herein, referred the matter to the Special Deputy Collector (Stamps), Coimbatore i.e. Appellant No.2 herein, under Section 47-A of the Act.C. On 13.9.2000 Appellant No. 2 issued Form No. 1 notices in Mu.Pa. (S.R.) No.3667 of 2000 D and Mu.Pa. (S.R.) No. 3668/2000 D seeking explanation from the Respondent why the deficit stamp duty of Rs.2,66,088/- and Rs.2,76,132/- respectively should not be collected. Thereafter, Appellant No. 2 issued Form No. II notices on 04.02.2003 to the Respondent, whereby the provisional value of the property was determined at the rate of Rs.58.30/- per sq.ft. as against the value of Rs.10.34/- per sq.ft. set forth in the Sale Deeds in question.D. Appellant No.2 issued Final Orders on 30.04.2003 in Mu.Pa. (S.R.) Nos. 3667 and 3668 of 2000 D. In Mu.Pa. (S.R.) No.3667 of 2000 D, it was observed: -With reference to the Form I notice no representations received from the registrant and he never turned for hearing in spite of several reminders and notices issued and no objections filed.Hence, provisional order in Form II was issued. Neither the objections received from the purchaser nor appeared for the hearing. It is learnt that the registrant has no objection regarding the valuation of the document. It is hereby ordered confirming the provisionally determined value as noted in the Form II cited in the reference 3.It is hereby ordered that the open market value is finally determined at Rs.26,95,400/- purchased through the document as per details noted in the pre page.With reference to the above value the stamp duty leviable at Rs.3,23,448/- excluding the stamp duty already paid Rs.57,360/- the deficit stamp duty to be paid Rs.2,66,088/- (Rupees Two Lakhs Sixty Six Thousand Eighty Eight Only).The registrant is requested to remit the deficit stamp duty Rs.2,66,088/- under the head of account 0030 stamps Registration 030G Fee deficit stamp duty ABAA0202 in the State Bank of India or in the Sub Treasury office and the original Challan shall be sent to this office within 2 weeks from the date of this order.In Mu.Pa. (S.R.) No.3668 of 2000 D, the market value was assessed at Rs.27,97,100/- and similar consequential directions were passed.E. The Respondent filed statutory appeal which was rejected by the Inspector General of Registration i.e. Appellant No. 1 vide order dated 05.08.2005. At the appellate stage, a report was called for from District Registrar, Erode, which was referred to in the order dated 05.08.2005 as under:-…This Appeal was admitted and the Deputy Inspector General Kovai appointed as the enquiry officer and to inspect the document property premises and to recommend determination of the true market value of the document property as per enquiry. The original file was also required from the District Revenue Officer (Stamps). On perusal of the original file of the District Revenue Officer (Stamps) office and it was found that, since the appellant not turned for enquiry and considered that there are no objections, the guideline value was confirmed.In the report of the District Registrar Erode enclosed with the letter received from the Deputy Inspector General Kovai he has recommended that while conducting the spot Inspection of the Survey field the properties lying in the village on the date of registration on 21.02.2002 were not incorporated with the municipality and it was incorporated with the municipality only on 01.04.2003, since the document properties were incorporated in the Municipality area at present value is fixed at Rs.200/- per sq.ft. and it is apt to determine the value at Rs.58.30/- per sq.ft., on the date of registration.F. The Respondent, being aggrieved, filed CMA No. 2666 of 2012 in the High Court challenging the said order dated 05.08.2005 which was allowed by the High Court by its judgment and order dated 02.02.2018. The High Court observed that Appellant No.1 had delegated his duty to the Deputy Inspector General of Registration, which was against the decision of the High Court in the case of S. Santhi vs. Chief Revenue Controlling Authority (CMA No. 2820 of 2012) decided on 05.06.2015. It was also observed that Rule 6 was not followed. The High Court thus concluded:-8. Therefore, the first Respondent is not empowered to delegate the powers conferred on him. Similarly, the procedure contemplated under Rule 6 of the Rules is also not followed by the authorities while determining the market value of the property. As such, the entire proceedings are vitiated, in view of violation of Rules 6 and 11-A of the Rules. Accordingly, the impugned order passed by the first Respondent is not sustainable in law and the same is set aside. The authorities are directed to release the document to thet was, however, not stated how the procedure contemplated by Rule 6 was not followed.G. The decision in S. Santhi (supra) which was relied upon, had observed as under:-17. The Authority conferred with certain functions under a statute has to carry out the same on its own such function and cannot delegate the same to another in the absence any contemplation for such delegation under the Act. In the present case, under rule 4(3)(c) and rule 11-A of the rules, 2nd respondent-Collector and the 1st respondent-Inspector General of Registration respectively, have to inspect the property and there is no enabling provision under the rules or under the Act to delegate such power. Therefore, inspections by other officers at the behest of the respondents vitiate the entire proceedings18. The failure on the part of the 2nd respondent to pass a final order within 3 months from the date of Form-I notice as mandated under rule 7 of the rules vitiates the entire proceedings. Form-I notice was issued on 17.05.2005 and the final order was passed on 05.12.2006, after 11/2 years, i.e., after 3 months and hence the entire proceedings are vitiated19. The impugned order has been passed by the 1st respondent purely based on inspection reports of the District registrar /Deputy Thasildar, who are not authorised under the Act and hence the said inspection reports are not materials collected by the authorities, entitled under the Act. Hence the proceedings of the 2nd respondent and 1st respondent are vitiated.. Similar orders were passed by the High Court in other matters which orders are presently under appeal in companion matters. Since the matters arise in the backdrop of provisions contained in the Rules, Rules 4 to 7 and 11A of the Rules are quoted hereunder: -4. Procedure on receipt of reference under Section 47-A. (1) On receipt of a reference under sub-Section (1) of Section 47-A, from a registering officer, the Collector shall issue a notice in Form I.(a) to every person by whom, and(b) to every person in whose favour the instrument has been executed.Informing him of the receipt of the reference and asking him to submit to him his representations, if any, in writing to show that the market value of the property has been truly set forth in the instrument, and also to produce all evidence that he has in support of his representation, within 21 days from the date of service of the notice.(2) The Collector may, if he thinks fit, record a statement from any person to whom a notice under sub-rule (1) has been issued.(3) The Collector may for the purpose of his enquiry –(a) call for any information or record from any public office, officer or authority under the government or any local authority;(b) examine and record statements from any member of the public, officer or authority under the Government or the local authority; and(c) inspect the property after due notice to the parties concerned.(4) After considering the representations, if any, received from the person to whom notice under sub- rule (1) has been issued, and after examining the records and evidence before him, the Collector shall pass an order in writing provisionally determining the market value of the properties and the duty payable. The basis on which the provisional market value was arrived at shall be clearly indicated in the order5. Principles for determination of market value.- The Collector shall, as far as possible, have also regard to the following points in arriving, at the provisional market value,(a) In the case of lands –(i) classification of the land as dry, manavari, wet and the like;(ii) classification under various tarams in the settlement register and accounts;(iii) the rate of revenue assessment for each classification;(iv) other factors which influence the valuation of the land in question;(v) points if any, mentioned by the parties to the Instrument or any other person which requires special consideration.;(vi) value of adjacent lands or lands in the vicinity;(vii) average yield from the land, nearness to road and market, distance from village site, level of land, transport facilities, facilities available for irrigation such as tank, wells and pumpsets.(viii) The nature of crops raised on the land; and(ix) The use of land, domestic, commercial, industrial or agricultural purposes and also the appreciation in value when an agricultural land in being converted to a residential, commercial or an industrial land.(b) In the case of house sites –(i) the general value of house sites in the locality;(ii) nearness to roads, railway station, bus route;(iii) nearness to market, shops and the like;(iv) amenities available in the place like public offices, hospitals and educational institutions;(v) development activities, industrial improvements in the vicinity;(vi) land tax valuation of sites with reference to taxation records of the local authorities concerned;(vii) any other features having a special bearing on the valuation of the site; and(viii) any special feature of the case represented by the parties.(c) In the case of buildings –(i) type and structure;(ii) locality in which constructed;(iii) plinth area;(iv) year of construction;(v) kind of materials used;(vi) rate of depreciation;(vii) fluctuation in rates;(viii) any other features that have bearing on the value; (ix) property tax with reference to taxation records of local authority concerned;(x) the purpose for which the building is being used and the income if any, by way of rent per annum secured on the building; and(xi) any special feature of the case represented by the parties.(d) Properties other than lands, house sites and buildings –(i) The nature and condition of the property;(ii) Purpose for which the property is being put to use; and(iii) Any other special features having a bearing on the valuation of the property6. Procedure after arriving at provisional market value.- The Collector shall communicate a copy of his order provisionally determining the market value of the properties and the duty payable, to all the persons who are liable to pay the duty along with the notice in Form II and call upon the parties to lodge their objections, if any, to such determination of the market value within the time specified in the notice. The Collector shall also hear the parties on the date specified in the notice or on such other day as may be fixed by him7. Final Order determining the market value.- (1) The Collector shall, after considering the representations received in writing and those urged at the time of hearing or in the absence of any representation from the parties concerned or their failure to appear in person at the time of hearing in any case after careful consideration of all the relevant factors and evidence available with him pass an order within three months from the date of first notice determining the market value of the properties and the duty payable on the instrument, and communicate the order so passed to the parties and take steps to collect the difference in the amount of stamp duty, if any.(2) A copy of the order shall be communicated to the registering officer concerned for his record.(3) The difference in the amount of duty determined by the Collector shall be paid within two months from the date of final order passed under sub-Section (2) or sub-Section(3) of Section 47-A(4) The Collector shall, after collecting the difference in amount of stamp duty and interest, if any, under Section 47-A, give a certificate in Form III by endorsement on the instrument.… … …11-A. Decision of the appellate authority. The appellate authority may, for the purpose of deciding an appeal, -(a) call for any information or record from any public office, officer or authority under the government or any local authority(b) examine and record statements from any member of the public officer of authority under the government or the local authority; and(c) inspect the property after due notice to the parties concerned

Court's reasoning:
The order of the appellate authority does not disclose any ground of such violation being raised. We, therefore, find that there was no violation of the procedure prescribed under Rule 6. Similar situation obtains in appeals arising of Special Leave Petition (Civil) Nos.17103 of 2019 and 31633-31637 of 2018.14. The following principles can thus be culled out from the decisions of this Court: (i) A statutory functionary exercising a power cannot be said to have delegated his functions merely by deputing a responsible and competent official to enquire and report, as that is the ordinary mode of exercise of any administrative power; (ii) If a statutory authority empowers a delegate to undertake preparatory work, and to take an initial decision in matters entrusted to it, but retains in its own hands the power to approve or disapprove the decision after it has been taken, the decision will be held to have been validly made if the degree of control maintained by the authority is close enough for the decision to be regarded as the authoritys own; (iii) Even in cases of sub-delegation, so long as the essential function of decision making is performed by the delegate, the burden of performing the ancillary and clerical task need not be shouldered by the primary delegate and it is not necessary that the primary delegate himself should perform the ministerial acts as well; and (iv) Practical necessities or exigencies of administration require that the decision-making authority who has been conferred with statutory power, be able to delegate tasks when the situation so requires15. Rule 11A of the Rules empowers the appellate authority to call for any information or record from any public office, officer or authority or to examine and record statements from any member of the public office or authority. In line with the principles laid down by this Court, it can therefore be said that in exercise of such power, if the appellate authority calls for any information or calls for any record or any inputs, that by itself, will not amount to delegation of essential functions. If, in terms of such power, the appellate authority deputes a responsible official to enquire into certain facets and calls for a report, that would be an ordinary mode of exercise of the power vested in the appellate authority. Practical necessities and exigencies of administration demand that the appellate authority must be able to delegate certain tasks such as collecting information after causing inspection. So long as the essential function, that is to say of considering all the necessary factors and inputs and thereafter arriving at an informed decision is done by the appellate authority, the burden of performing ancillary tasks need not be shouldered by the appellate authority16. The submission based on Section 76-A of the Act is completely misplaced and does not deserve acceptance.17. Therefore, in observing that the inspection ought to have been carried out by the Inspector General of Registration himself, and such function could not have been delegated, the High Court failed to appreciate the principles laid down by this Court. Any report that was called for was essentially in the nature of rendering assistance to the appellate authority in discharge of its functions. The final order passed by the appellate authority, after considering all the necessary material, must be taken to be one rendered by the appellate authority on its own, and there was no delegation of any essential functions vitiating exercise of power. We do not, therefore, find any impropriety or invalidity touching upon the exercise of power by the appellate authority. We, thus, accept the contentions raised by the learned counsel for the Appellants, and set aside the view taken by the High Court in that behalf.18. The ground with respect to delegation of power under Rule 11-A was taken in all these matters, on the basis of which the High Court set aside the determination made by the appellate authority.19. We now turn to question no. 2, in respect of which the High Court in six of these appeals, had concluded that the stipulation of period of three months in Rule 7 being mandatory, the orders passed after the expiry of said period would be invalid.20. Under sub-section (1) of Section 47-A of the Act, if there is reason to believe that the market value has not been truly set forth in the Instrument tendered for registration, a reference can be made to the Collector, who (i) after giving the parties reasonable opportunity of being heard; and (ii) after holding an enquiry in such manner as may be prescribed by Rules, has to determine the correct value of the concerned property. The Section by itself does not lay down any period within which the entire process is to be completed by the Collector. It simply states that the enquiry be held in such manner as may be prescribed by Rules. In this backdrop the manner in which the enquiry must be held as set out in the Rules, is required to be considered.21. The expression within three months from the date of first notice is crucial. Is the description first notice referable to notice in Form I issued in terms of Rule 4(1)? The answer would obviously be in the negative. Form I notice itself must give twenty-one days to the concerned persons to respond. Depending upon their response, their statements would be recorded and/or certain information may be required to be called for, whereafter the Order in Form II is to be issued provisionally determining the market value. The concerned persons are entitled to raise objections in writing and must be afforded hearing. After fulfilling these requirements, the order in terms of Rule 7 can be passed. All these stages may not be completed in three months.Further, the reference in Rule 7 is to the first notice and not to notice in Form I. Considering the context and various stages preceding the stage of passing of the Order under Rule 7, the reference has to be to the first notice in Form II. There could possibly be more than one notices in Form II, specially when the hearing is to take place on an adjourned date and that is why the period must be reckoned from the first notice in Form II. The expression immediately following first notice in Rule 7 is determining the market value of the properties…. That is also indicative that the reference to the notice is one in Form II in the immediately preceding Rule 6.25. As noted above, Section 47-A by itself does not prescribe any timeline. If the stipulation or fixation of period of three months from the first notice in terms of Rule 6 or from notice in Form II is taken to be mandatory it would lead to a situation of incongruity. The fact that Form II notice had been issued, would mean that on a prima facie view of the record and material, the value stated in the instrument was not the correct value; which in turn would mean that prima facie the Government Coffers were being denied the rightful dues. If for any reason the proceedings are not completed within three months and, therefore, must be held to be vitiated, the public interest would suffer, and the persons who were prime facie responsible for suppressing the real value, would stand to gain. The amendment of Rule 7 incorporating the period of three months was essentially to guide the public officials to complete the process as early as possible but was not intended to create a right in favour of those who had prime facie conducted themselves prejudicing public interest.In keeping with the principles laid down in State of Mysore and others v. V .K. Kangan and others (1976) 2 SCC 895 , if the subject matter of the provision as well as the inter-relation of the period of three months to the general object of the provision are considered, the fixation of period has to be taken to be directory. Otherwise, the very object of sub-serving public interest and securing public revenue would get defeated. Pertinently, the concerned provision has not spelt out any consequence for non-adherence to said period of three months.27. We now turn to question No.3, which incidentally arises only in one appeal viz. one arising from SLP(C) Nos.31633-31637 of 2018.The limitation in sub-section (8) of Section 47-A, was high-lighted in paragraphs 33 to 36 of the judgment of the High Court in Rajendran v. The Inspector General of Registration, Tamil Nadu and others (supra). In the present case, adequate notice was issued to the concerned persons and, therefore, there was no infirmity on that count. It is nobodys case that as on the date when the proceedings were initiated in exercise of the power under sub-section (6) of Section 47-A, the period for preferring the appeal had not expired, or that more than five years had expired after the passing of the order under sub-section (2) or sub-section (3). In the circumstances, none of the limitations which the statute has imposed upon the exercise of power were present31. The observations of the High Court in the instant case indicate that while dealing with an appeal preferred by the registrant against an order passed under Section 47-A(2), no suo motu exercise of power could be initiated. It is the correctness of that view which is now in issue.33. The essence of revisional jurisdiction is thus accepted to be in the duty of the superior tribunal or officer to ensure that the subordinate tribunal or officers remain within the bounds prescribed by law and discharge their functions in accordance with law.35. For exercising revisional power suo motu or on its motion, the concerned authority must be satisfied that an order has been passed by the authority or officer subordinate to it. which may be prejudicial to the interest of the revenue. As indicated in some of the hypothetical instances noted in the decisions quoted hereinabove, the error may have crept in unknowingly, or there may be a genuine mistake, or in some cases there could be a deliberate attempt to prejudice the interest of revenue. If an infirmity or illegality is brought to the notice or knowledge of the revisional authority, through normal and regular process of reporting by the subordinate officer or authority, the power of revision can certainly be exercised. The requisite knowledge enabling the revisional authority to exercise the power vested in it, can also be gathered from the appeal preferred by the registrant himself. That may only be an occasion or a source which enables the authority to gather information about the possible infirmity or illegality in the process. Upon being so aware, the revisional authority would thereafter be exercising power vested in it. Qualitatively, it makes no difference as to what was the source of the information or knowledge, so long as the power is exercised within the confines of the limitations or restrictions imposed by the statute, and is in accordance with law. Apart from the restrictions imposed by the statute, none can be read into the exercise of power on the ground as to the nature or source of information.While entertaining an appeal, if an obvious illegality is noticed by the revisional authority, it can certainly exercise suo motu power to undo the mistake, or rectify an error committed by the subordinate officer or authority, subject to such restrictions as are imposed on the exercise of the power by the statute36. There is nothing in the scheme of the Act which purports to restrict the exercise of suo motu power under Section 47-A, and confines it to cases where knowledge of any illegality or infirmity in the proceedings undertaken by the subordinate officers must be gathered from sources other than through a pending appeal. Unless the statute expressly or even by necessary implication restricts the exercise of power, there would be no occasion to read into the power, any other limitations. The High Court has not found the exercise of power to be invalid on any count, nor was any such submission advanced before the High Court. The High Court had simply gone on the existence of power rather than on the exercise of power. It is not as if the assessment made by the appellate authority was either opposed to principles of natural justice, or was so palpably incorrect, that it could never be sustained. In our view, the High Court completely erred in setting aside the exercise of power undertaken by the concerned authority. The exercise of power was definitely designed to obviate an obvious illegality and prejudice to the interest of the revenue. The exercise was, thus, absolutely correct, and there was no occasion to set aside the orders passed in pursuance thereof. We, therefore, answer question No.3 accordingly.