R. Venkatesan vs The District Registrar

N. Paul Vasanthakumar, J.—The prayer in the writ petition is to issue a writ of Prohibition, restraining the respondent from conducting any

enquiry pursuant to the notice dated 29.12.2006.

The case of the petitioner is that one K. Krishnaswamy, grandfather of the petitioner executed a Will in favour of the petitioner and his brother

by name Suryanarayana, in respect of the property at No. 14/7, I Floor, B-Block, Rajkamal Apartment, IV Trust Cross Street,

Mandavelipakkam, R.A. Puram, Chennai-600028. Subsequently petitioner''s brother Suryanarayana relinquished his 50% of his share in the

property in favour of the petitioner by executing a release deed on 8.7.2002 and the same was registered as Document No. 2144 of 2002 on the

file of the Sub-Registrar, Mylapore, Chennai.

The share of property of the petitioner''s brother was valued at Rs. 10,000/-. Stamp duty of Rs. 400/- was paid and the document was also

released. On 15.7.2005 a notice was issued by the respondent demanding Rs. 91,600/- claiming to be the differential stamp duty for the said

release deed stating that the said document is falling under Article 55(c) of Schedule-I of the Indian Stamp Act, 1899. Petitioner''s contention is

that no enquiry was conducted to assess the value of the property and to arrive at the said amount and according to the petitioner, the claim itself is

time barred u/s 33A of the Indian Stamp Act. Petitioner gave a reply on 30.7.2005 and disputed the correctness of the valuation as well as the

jurisdiction of the respondent to make the demand beyond the time and without enquiry. Another demand notice was issued to the petitioner on

3.11.2006 stating that a sum of Rs. 45,295/- is payable by the petitioner as the petitioner''s brother was having only 50% share in the property.

For arriving at such a sum also no enquiry was conducted and the same is also made beyond the time. The petitioner sent a reply on 16.11.2006

by stating the above reasons. However, the respondent issued a notice on 29.12.2006 and called upon the petitioner to appear for an enquiry on

22.1.2007, which according to the petitioner is time barred. Hence the petitioner filed this writ petition seeking a writ of prohibition.

The respondent has filed counter affidavit contending that as per Article 55(c) of Schedule-I of the Indian Stamp Act, stamp duty payable is

13% of the value of the property and non-payment of the said stamp duty while executing release deed was pointed out by the Audit Officers and

accordingly action was initiated u/s 33A of the Indian Stamp Act to recover the loss of stamp duty. Notices were issued to pay the difference in

stamp duty on 15.7.2005 and after considering the reply of the petitioner a sum of Rs. 45,295/- was demanded, considering the value of the 50%

share of the property. Thereafter further notice was issued on 29.12.2006 calling the petitioner for personal enquiry on 22.1.2007 and the

petitioner has not appeared.

Insofar as the legal contention raised by the petitioner that Section 33A was enacted to recover the deficit stamp duty from the party, the

petitioner is bound to appear for personal enquiry and if any order is passed and if the petitioner is aggrieved, he can very well file an appeal before

the Chief Controlling Revenue Authority and Inspector General of Registration, Chennai-28, and therefore this writ petition is not maintainable. It is

further stated in the counter affidavit that the document was presented on 8.7.2002, registered on 2.8.2002 and the statutory period lapsed only on

1.8.2005, and the action having been initiated on 15.7.2005, i.e., within three years, the same is not barred by limitation u/s 33A of the Act as

contended in the affidavit.

Heard the learned Counsel for the petitioner as well as learned Government Advocate for the respondent.

The points for consideration in this writ petition is as to whether the respondent can initiate action u/s 33A of the Indian Stamp Act, 1899

without conducting enquiry on the Document No. 2144 of 2002 registered on 2.8.2002 and whether the action of the respondent is barred by

limitation.

The notice issued to the petitioner demanding a sum of Rs. 90,982/- and penalty of Rs. 618/- is dated 15.7.2005. The said amount was

reduced to Rs. 45,295/- by notice dated 3.11.2006. An enquiry notice was issued on 29.12.2006 for appearance of petitioner on 22.1.2007.

Section 33A of the Stamp Act reads as follows:

33-A. Recovery of deficit stamp duty.- (1) Notwithstanding anything contained in Section 33 or in any other provisions of this Act, if, after the

registration of any instrument under the Registration Act, 1908 (Central Act XVI of 1908), it is found that the proper stamp duty payable under

this Act in respect of such instrument has not been paid or has been insufficiently paid, such duty or the deficit, as the case may be, may, on a

certificate from the Registrar of the district under the Registration Act, 1908 (Central Act XVI of 1908) be recovered from the person liable to pay

the duty, as an arrear of land revenue:

Provided that no such certificate shall be granted unless due inquiry is made and such person is given an opportunity of being heard:

Provided further that no such inquiry shall be commenced after the expiry of three years from the date of registration of the instrument.

From the perusal of the above provision viz., Section 33A, particularly second proviso to Section 33A(1), it is evident that no enquiry for the

recovery of the amount shall be commenced after expiry of three years from the date of registration of the instrument. In this case, the document

was presented on 8.7.2002 and registered on 2.8.2002.

Similar issue was considered by this Court in the decision reported in R.M. Ebrahim Vs. The District Registrar, Office of the District Registrar,

In the said decision this Court quashed similar recovery notice holding that recovery proceedings for stamp duty can be issued only after due

enquiry and the same can be issued within three years from the date of registration.

In this case, the document having been admittedly registered on 2.8.2002, the first demand notice issued on 15.7.2005 was without conducting

any enquiry. A perusal of the registered release deed shows that the deed was presented on 8.7.2002 and registered as Document No. 2144 of

2002 on 2.8.2002. The respondent has got time to initiate proceedings till 2.8.2005, admittedly demand dated 15.7.2005 was issued without

conducting any enquiry. For conducting enquiry, for the first time notice was issued only on 29.12.2006 by fixing the date of enquiry as 22.1.2007.

Thus, enquiry notice issued to the petitioner on 29.12.2006 is beyond the period of three years and therefore the action of the respondent is barred

by limitation. The notice dated 15.7.2005 cannot be treated as notice for conducting enquiry as it is only a demand to recover the amount. The

said notice is not in accordance with the first proviso to Section 33A(1), which clearly states that certificate to recover amount shall be granted

unless due enquiry is made and such person is given opportunity of being heard.

In view of the said undisputed facts and having regard to the statutory provision and the judgment cited supra, the respondent is not having any

jurisdiction to proceed further in the matter as the same is not within the time as contemplated u/s 33A(1) of the Indian Stamp Act. For the loss of

revenue to the State, the respondent alone is responsible. If the respondent was vigilant and aware of the statutory provision viz., Section 33A of

the Indian Stamp Act, 1899, he could have initiated enquiry before the expiry of three years from the date of registration on 2.8.2002. Section

33A being prohibitory in nature, the petitioner is entitled to succeed in this writ petition. Consequently, the writ petition is allowed. No costs.