AI Structured Summary
Not yet generated for this judgment
Judgment
Justice Dev Darshan Sud, J.—The petitioner challenges the orders passed by the respondents in this case Annexure P-8, P-11 and P-13. These notices have been issued by the Assistant Collector Ist Grade, Nahan calling upon the petitioner herein to pay a sum of Rs. 5,62,500/- on account of stamp duty. The first notice is dated 1.8.2005, the second 22.11.2006 and the third, which is the attachment order, passed by the respondents dated 25.6.2007 is not dated but calls upon the petitioner to be present on 25.6.2007 to attend further proceedings.
The grievance of the petitioner herein is that demand has been made from the petitioner in contravention and in violation and ultra virus of the provisions of the Indian Stamp Act. The petitioner pleads that for establishing a manufacturing unit at village Shubkhera, it invested a substantial amount of capital. It approached respondent No. 4 for sanctioning a cash credit (hypothecation) limited for Rs. 150 lacs. On this basis, the respondent as aforesaid approached the Sub Registrar, Paonta Sahib but vide his order No. 4677, dated 9.8.1996 ordered creation of charge of Rs. 150 lacs on the land of the petitioner. The parties are at variance as to whether stamp duty is payable on this amount or not.
The stand of the respondents-State is that no mortgage was registered but it was a simple letter on the basis of which the petitioner had got an entry of charge in favour of respondent No. 4 and the petitioner in lieu of this entry has taken the benefit of mortgage which is not permissible. The advance of the cash credit limited etc. is admitted. The reply further proceeds that respondent No. 4 Cooperative Bank had availed the benefit of Rs. 325 lacs without paying the stamp duty and registration fee to the Government of Himachal Pradesh and "as the such petitioner has cheated the Government for a sum of Rs. 5,62,500/- which is still pending against the petitioner. Some audit objections were raised and the Collector declared this as an amount due under the Stamp Act. Learned counsel appearing for the Deputy Advocate General has placed a reliance upon Annexure R-1 which is a statement of arrears of loan signed by the Sub Registrar.
Learned counsel appearing for the petitioner places reliance on the judgment of the Division Bench of this Court in Harcharan Singh Gill vs. State of H.P. and others, 2003(2) Shim.L.C.65 pronouncing on the provision of Section 47-A (as inserted by Indian Stamps/Himachal Pradesh Amendment Act, 1988), this Court was dealing the notice which has been issued by the Sub Registrar-cum-Tehsildar to the petitioner therein calling upon him to pay certain amount and on contest, the Collector proceeded to pass a cryptic order without stating any reason calling upon the petitioner to pay the sum demanded as stamp duty.
Adverting to the provisions of Section 47-A of the Act this Court held:
Section 47-A of the Stamp Act, 1899, as inserted by the Indian Stamp (Himachal Pradesh Amendment) Act, 1988 (H.P. Act No. 7 of 1989), is a provision which relates to the subject matter of under-valued instruments and the procedure to deal with the same, the underlying purpose being to ensure that the instruments do not mention the market value of the property sought to be registered in such a manner as to undervalue the same with an intention to avoid the payment of the requisite stamp duty or the registration charges. While sub-section (1) of Section 47-A of the Act deals with the situation as at the time of the registration (with which we are not concerned in this case), sub-section (3) stipulates that the Collector may either suo motu or on receipt of a reference from the Inspector General of Registration or the Registrar of a District in whose jurisdiction the property in question is situated, shall within three years from the date of the registration of any instrument call for and examine the instrument for the purpose of satisfying himself as to the correctness of its market value etc. etc. and if after such examination he has reasons to believe that the market value or the consideration has not been truly set-forth in the instrument, he may determine market value or consideration and the duty. Accordingly, in accordance with the procedure provided for in sub-section (2), the deficient amount of duty, if any, shall be payable by the person who in law in liable to pay the duty. In so far as procedure adopted for determining the market value and the duty as also the deficient amount of duty, if any, is concerned, sub-section (2) of Section 47-A of the Act provides that the Collector after giving the parties a reasonable opportunity of being heard and after holding inquiry in such a manner as may be prescribed by the rules, determine the market value or consideration and the duty as also the deficient amount of duty, if any, which the person concerned is liable to pay. For ready reference we reproduce hereinbelow sub-sections (2) and
(3) of Section 47-A of the Act:-
(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 market 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) The Collector may, suo motu or on receipt of reference from the Inspector General of Registration or the Registrar of a District, in whose jurisdiction the property, or any portion thereof, which is the subject-matter of the instrument, is situated, appointed under the Registration Act, 1908, shall within three 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 market 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 market value or consideration has not been truly set forth in the instrument, he may determine the market value or consideration and the duty, as aforesaid, in accordance with the procedure provided for in sub-section (2), the deficient amount of duty, if any, shall be payable by the person liable to pay the duty. :
Provided that nothing in this sub-section shall apply to any instrument registered before the date of commencement of the Indian Stamp (Himachal Pradesh Amendment) Act, 1988.
What clearly emerges from the plain reading of the aforesaid provision of law is that with respect to an instrument which has already been registered, Collector alone is the authority, who has the jurisdiction to enquire into any aspect relating to the short payment of duty on the ground of under valuation of the market value or the consideration. The Collector has jurisdiction to do so suo motu or on receipt of an appropriate reference from either the Inspector General of Registration or the Registrar of a District appointed under the Registration Act, 1908. What actually has happened in the present case is that Sub-Registrar, Kasauli, respondent No.3 in this petition took upon himself the burden of issuing the impugned notice dated 17.1.2003 wherein, by making a reference to some audit report he demanded of the petitioner remittance of an amount of Rs.1,26,270 and despite a detailed representation sent by the petitioner by the impugned order dated 5.3.2003 rejecting the said representation directed the petitioner to deposit the amount in question. Sub-Registrar had no jurisdiction whatsoever in either issuing the notice or in passing any order directing the petitioner to pay the amount in question because neither u/s 47-A of the Stamp Act nor under any other provision of the law, he had the power to do so. Actually, as is clearly discernible from Section 47-A of the Stamp Act, Sub-Registrar does not figure anywhere and he has no role to play with respect to any issue or matter relating to the under valuation of the price of the property or its consideration or the duty payable thereon or the deficiency in the duty. The procedure prescribed u/s 47-A being complete does not stipulate any role for sub-Registrar. He cannot even make a reference to the Collector. What he does with the District Registrar internally (with which we are not concerned) but the reference to the Collector can be made either by the Inspector General of Registration or by the District Registrar.
Based on the aforesaid reasons therefor we have no hesitation whatsoever in coming to the conclusion that respondent No. 3 had no jurisdiction in issuing the impugned notice or in passing the impugned order dated 5.3.2003. The jurisdiction, if any, vested in the Collector and that too either in exercise of the su motu power or acting on receipt of a reference from either the Inspector General of Registration or the District Registrar appointed under the Registration Act.
(at p. 66-68)
The law does not require any further elaboration in
In these circumstances, I hold that the demand view of what has been stated above. raised in Annexures P-8, P-11 and P-13 is without jurisdiction when first determination has not been made by the Collector as to how the stamp duty is due and such determination is in accordance with law. This writ petition is accordingly allowed. Annexures P-8, P-11 and P13 are quashed.
This judgment does not pronounce on the legality of the payment raised by the State or the defence raised by the petitioner herein. This would be determined in appropriate proceedings to be determined in accordance with law. No order as to costs. All miscellaneous applications(s) also stands disposed of.