Inderjit Singh and Another vs Punjab State and Another

Ashok Bhan, J.—This petition has been filed for issuance of a writ of certiorari quashing the impugned order dated 29.4.1994 passed by Collector, Bhatinda Annexure P2 and order dated 10.9.1996 Annexure P5 passed by Additional District Judge, Bhatinda, vide which petitioners have been ordered to pay Rs. 32,500/- as stamp and registration fee in proceedings u/s 47-A of the Indian Stamp Act, 1899.

Petitioner purchased a plot measuring 645 square yards in Khasra No. 2049 for Rs. 1,29,000/- situated in Ganesha Basti, Bhatinda. Sale deed No. 4753 dated 3.11.1993 was executed in favour of the petitioners by the owner of the land. The same was presented for registration before Sub Registrar, Bhatinda, who after registration of the sale deed submitted report to the Collector, Bhatinda, that the sale seed is insufficiently stamped as the value of the plot has not been correctly mentioned as per Chandra Committee report. According to Chandra Committee report, the price of the land in that locality was fixed Rs. 500/- per square yards. According to the Chandra Committee report, the price of plot would come to approximately Rs. 3,22,500/-. In that way, stamp duty purchased by the parties was deficient.

On the basis of the report of Sub Registrar, Bhatinda, notice u/s 47-A of the India Stamp Act, 1899, was issued to the vendor and the vendee. After service, vendor and vendee presented themselves before the Collector but during the pendency of the proceedings vendor died. Vendee filed his reply to the notice and pleaded that price of the plot had been correctly fixed; that Sub Registrar had issued the notice after attestation of the deed which could not be done. Apart from this, on merits, vendee in proof of his claim produced on record sale deed No. 5064 dated 24.11.1994 according to which a plot of 100 square yards in Khasra No. 2063 in the same locality was sold in the sum of Rs. 20,000/- Another sale deed in which the plot measuring 210 square yards was sold for Rs. 35,000/- on 29.12.1995 in Khasra No. 2045 in the same locality was also placed on record.

Collector did not agree with the objections filed by the vendor and concluded that prevailing price in this locality was at least Rs. 600/- per square yards. Calculated at this rate, the price of the plot comes to Rs. 3,87,000/:. Stamp duty on Rs. 1,29,000/had already been fixed and he was directed to pay stamp duty on the balance amount of Rs. 2,85,000/-

Petitioner filed an appeal before the Additional District Judge, Bhatinda. Order of the Collector was affirmed in appeal by the Additional District Judge by the impugned order Annexure P5.

Present petition has been filed impugning the orders Annexures P2 and P5 inter alia on the ground that price of the land had been correctly mentioned in the sale deed on which the requisite stamp duty had been affixed; that there was evidence on the record to show that subsequent to the sale in favour of the petitioners, some other sale deeds were registered at a much lesser price. Without making a reference to the sale deeds produced by the petitioners and in the absence of any other evidence, Collector in an arbitrary manner fixed the price at Rs. 600/per square yards; that the instructions issued by the government fixing price at Rs. 500/- per square yards in the locality where the plot was situated based on Chandra Committee report was non (sic) in view of the judgment of this Court in Chamkaur Singh and another Vs. The State of Punjab and another, .

Written statement has been filed refuting the averments as well as the allegations made by the petitioners. It has been reiterated that correct price of the plot had not been mentioned in the sale deed which resulted in affixing a less amount of stamp duty.

Counsel for the parties have been heard.

Collector after visiting the spot and observing that the disputed plot was situated in a populated area which is fully developed concluded that the rate of the land could not be less than Rs. 600/- per square yards. On this basis he calculated the total price to be Rs. 3,87,000/- out of which on a sum of Rs. 1,29,000/- stamp duty had already been paid. Petitioner was held liable to pay stamp duty on the remaining amount of Rs. 2,85,000/- Accordingly, a direction was issued to recover the stamp duty on the balance amount of Rs. 2,85,000/-. No instance of sale was discussed. On behalf of the revenue none was cited. Petitioner cited two instances showing the sale of plot subsequent to the sale deed of the petitioner in the same locality at a lesser price which had been duly registered by the Sub Registrar. Sub Section (2) of Section 47(A) provides that on receipt of a reference under sub section (1) the Collector, shall after giving the parties reasonable opportunity of being heard and after holding an enquiry in such manner as may be prescribed by rules under the Act shall determine the value or consideration of the property sold. The value of the property can be determined by leading evidence by the parties. Petitioners had cited two instances to which there was no rebuttal. Primarily on the basis of reference made by the Sub Registrar in which Chandra Committee report had been cited fixing the price at Rs. 500/- per square yards and after spot inspection, the price was fixed by the Collector at Rs. 600/- per square yard on estimate basis. Price of the land cannot be fixed on estimated basis in such a fashion. Explanation to Section 47(A) provides that value of property shall be fixed by determining the price which the property would have fetched if sold in the open market. On the date of the execution of the sale deed. The price fixed by the Collector which was upheld by the appellate authority was not determined by keeping in view the market price which the property would have fetched if sold in the c pen market on the date of the execution. The price fixed was not in accordance with the provisions of Section 47-A of the Indian Stamp Act. Market price could be fixed on the basis of evidence. The only evidence present on the record were the instances of sale produced by the petitioner. There is no contrary evidence. Authorities below have erred in fixing the price of land on estimate basis based on Chandra Committee report.

A Division Bench of this Court in Chamkaur Singh''s case (supra) has held that any guidelines laying down the floor or the minimum prices of different kinds and qualities of land on the basis of their situation or location for purposes of registration of instruments relating to transferring any property are violative of Section 47-A. Instructions issued by the State of Punjab were struck down. It was held that such executive instructions fixing price of the land on the basis of situation of the land were not sustainable in law. Regarding the holding of enquiry u/s 47-A(2) it was observed as under :-

".........Similarly, the jurisdiction of the Collector under sub section (2) of Section 47A was jeopardised. As per the same, he, on a reference, had to hold an enquiry in such manner as might be prescribed by the rules under the Act for determining the true value or consideration on which the stamp duty had to be paid. This enquiry and determination of the value has essentially to be an independent, fair and quasi judicial decision of the Collector in the light of the facts established before him. He cannot possibly record any stereotyped or mechanical conclusions in this regard. The natural effect of the instructions which were sought to be mellowed down as guidelines was that the same bound the Collector even more than the Sub Registrar or the Registering Officer appointed under the Registration Act, he being author of the same. It was, therefore, abundantly clear that the guidelines completely ran contrary to the plain language and intendment of sub sections (1) and (2) of Section 47-A. The instructions clearly nullified and obliterated the explanation added to the section. The instructions hardly left anything open to the Registering Officer and the Collector to determine the estimated value or price of the property, the subject matter of a particular transaction. Further, these guidelines ran counter to the mandate of law contained in the last lines of the explanation. "If sold in the open market on the date of execution of the instrument relating to the transfer of such property."

We find ourselves in agreement with these observations.

For the reasons stated above, we accept this writ petition and quash the impugned orders Annexures P2 and P5. No costs.