P.V. Varghese and Others vs Sub-Registrar and Another

C.N. Ramachandran Nair, J.—The petitioner is challenging exhibit P6 issued by the Sub Registrar, Muvattupuzha, demanding stamp duty for filing sale certificate issued by the second respondent u/s 89(4) of the Registration Act, 1908. The petitioner has relied on a Division Bench decision of this court in W.A. No. 1086 of 2006 dated June 23, 2006, produced as exhibit P7, wherein the Division Bench has held that the Sub Registrar is bound to file the sale certificate issued by the sale officer in book No. 1 u/s 89(4) of the Registration Act, 1908, as it is not a document compulsorily registrable. The judgment of the Division Bench was in fact rendered based on the decision of the Supreme Court in Shanti Devi L. Singh Vs. Tax Recovery Officer and Others, . On going through the judgment of the Division Bench I find the question of stamp duty payable on the sale certificate issued under the Kerala Stamp Act, 1959, was not considered by the Division Bench. The Supreme Court has left open the question of stamp duty and all what is decided is that no registration is required for filing sale certificate u/s 89(4) of the Registration Act.

The sale certificate granted to the purchaser for any property sold by public auction by a civil or revenue court or by the Government, collector or other revenue officer attracts stamp duty under Article 16 of the Schedule to the Kerala Stamp Act at the same rate as on a conveyance. Section 30(e) of the Kerala Stamp Act provides as follows:

Duties by whom payable.-- In the absence of an agreement to the contrary the expense of providing the proper stamp shall be borne,--....

(e) in the case of a certificate of sale--by the purchaser of the property to which such certificate relates;

The procedure for sale of property by a Recovery Officer under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, is the same as provided under Rule 65 of the Second Schedule to the Income Tax Act, 1961, and Rule 21 of the Income Tax (Certificate Proceedings) Rules, 1962. The certificate of sale issued by the sale officer is covered by Article 16 of the Schedule to the Kerala Stamp Act and therefore it should be issued on the stamp paper of the value referred to in the said Act. By virtue of Section 30(e) of the Kerala Stamp Act the liability to pay stamp duty for the sale certificate to be issued by the Recovery Officer is on the purchaser of the property. Therefore, purchasers are bound to furnish stamp paper for the value in terms of Article 16 of the Schedule to the Stamp Act and sale certificate should have been issued by the Recovery Officer on such stamp paper. The first respondent therefore rightly demanded stamp duty on the certificate issued by the second respondent for filing it in book No. 1 referred to u/s 89(4) of the Registration Act. The petitioner is therefore directed to produce stamp paper applicable to conveyance before the second respondent for issuing fresh certificate and there will be direction to the first respondent to register such certificate issued on sufficient stamp paper without collection of any registration fee as filing it in book No. 1 u/s 89(4) of the Registration Act does not amount to registration.

W.P. is disposed of as above.