Satyawan vs Govt. Of Nct Of Delhi And Ors.
2004 Latest Caselaw 1170 Del

JUDGMENT

Sanjay Kishan Kaul, J.

1. The petitioner has impugned the orders dated 14.7.2004 and 16.6.2004 issued by the respondents in respect of the requirement of registration of a General Power of Attorney.

2. The impugned circular dated 16.6.2004 is in the following terms:

"Government of National Capital Territory of Delhi Office of the Divisional Commissioner : Delhi 5 Sham Nath Marg : Delhi

No. EPS/DCW/03/SR/1027/3087-3157

Dated 16.6.2004

ORDER

It has been observed that instruments of General Power of Attorney are being used for transfer of immovable property. Such instruments are being made between unrelated persons and allow widespread delegations including power to sell or otherwise alienate immovable property. Such instruments are irrevocable and are also accompanied by a Will which makes it clear that the intention of executing such instruments is to effectively transfer the complete interest in the immovable property as per the meaning of a conveyance. Such instruments of General Power of Attorney are being used to evade payment of stamp duty as applicable to an instrument of conveyance. To prevent such misuse of General Power of Attorney instruments for stamp duty evasion, it is hereby ordered that all Sub-Registrars/Registrars within the NCT of Delhi shall, on presentation of any instrument of Power of Attorney without consideration in respect of immovable property which meets any of the following conditions advise the parties presenting the document to rewrite it as a deed of conveyance or an instrument as per Article 48(f) of Schedule 1A of the Indian Stamp Act, 1899 and on refusal of the parties to do so shall, after registering the instrument as in instrument as per Article 48(f) of the Schedule of the Indian Stamp Act, 1899, refer the same to the Collector for determination of the market value of such property and the property duty payable thereon:

1. The instrument empowers the donee to sell, gift, exchange or permanently alienate the immovable property.

2. The instrument is irrevocable in nature.

3. The instrument is accompanied by a Will from the principal in respect of the same property in favor of the donee or the spouse or children of the donee.

It is hereby directed that no such instrument, which is accompanied by a deed of agreement to sell, duly stamped as per the market value of the property and executed between the same parties, as per parties to the instrument of power of attorney, shall be referred to the Collector but shall be registered as an instrument as per Article 48(c) of the said Schedule 1A of the Indian Stamp Act, 1899.

It is hereby further directed that no such instrument which is made or purported to be made between blood relatives and/or their spouses shall be registered by the Sub-Registrar in the first place. In such a case the parties shall be asked to present the instrument before the Registrar, who may after determining the fact of relation between the parties either register it or direct the Sub-Registrar to register instrument as an instrument as per Article 48(c) of Schedule 1A of the Indian Stamp Act, 1899 if the instrument is between blood relatives and/or between their spouses, or as per Article 48(f) of the said Schedule 1A if it is not so. In the latter case, the same procedure, as has been prescribed above for documents executed between persons who are not blood relatives shall be followed.

Sd/-

(G.K. Marwah) Inspector General of Registration and Chief Controlling Revenue Authority, Government of NCT of Delhi"

3. The communication dated 14.7.2004 is in the following terms:

"Office of Sub-Registrar-VI Pitam Pura, Delhi

Ref. : SR-VI/2004/424 Dated 14.7.2004

To

The S.D.M. (Saraswati Vihar) Kanjhawala, Delhi-110 081

Sub: Impounding of document titled as G.P.A.

Sir,

Please find enclosed herewith one G.P.A. submitted for registration on 25.6.2004, vide Receipt No. 408.

In view of the Order Nos. PS/DCW/03/SR/1022/3087-3175 dated 16.6.2004, all the G.P.As. are required to be duly stamped and without consideration no G.P.A. is to be accepted thereafter. But it is held that it is under-stamped. However, the same has been registered vide Registration No. 32386, Book No. IV, Volume No. 5971, on paras from 13 to 17, on 30.6.2004, is forwarded to you for proper adjudication in view of the Orders referred above.

Yours faithfully,

Sd/-

(Sheo Shanker) S.R. No. VI, Pitam Pura, Delhi"

4. A reading of the aforesaid circulars shows that the respondents have taken action to prevent misusers of General Power of Attorney for stamp duty evasion since such Power of Attorneys are often part of the transaction of sale coupled with Agreement to Sell and Will. It is in such circumstances that the parties presenting the documents are to re-write it as a Deed of Conveyance or Instrument as per Article 48(f) of Schedule 1A of the Indian Stamp Act, 1899 (hereinafter to be referred to as, 'the said Act'). The three situations have been set out in the order itself. The real grievance of the petitioner is on account of the fact that the order contains requirement of such a Power of Attorney being treated as a Deed of Conveyance in the eventuality it meets any of the following conditions. The grievance, thus, is that even a case of genuine Power of Attorney made for convenience of the Executant, which is not part of the transaction of sale is sought to be treated as a Deed of Conveyance.

5. In the case of the petitioner the General Power of Attorney was submitted for registration and in terms of the impugned letter dated 14.7.2004, the same has been forwarded for adjudication to the SDM by the Sub-Registrar.

6. The counter affidavit filed by the respondents shows that there are a large number of cases of registration of General Power of Attorneys and Wills while the registration of Sale Deeds are much less and it has been found that such documents have been executed in respect of the Deeds of Conveyance, thus, avoiding stamp duty.

7. Learned Counsel for the respondents has referred to the counter affidavit to contend that in cases of General Power of Attorney involving immovable property, the burden of proof with regard to the fact that no consideration is involved is on the Executor of the General Power of Attorney.

8. In my considered view, the object is abundantly clear, which is in the interest of revenue. However, this cannot imply that a General Power of Attorney, which is unaccompanied by other related documents and is really for the convenience of the Executor is also bound to be treated as a Deed of Conveyance. In fact, learned Counsel for the respondents contends that the three conditions as set out in the impugned order dated 16.6.2004 cannot be read in isolation and they have to be read with the preamble part of the order, which shows that these requirements have been so provided for.

9. The aforesaid being the position, I am of the considered view that the said three conditions cannot be read in isolation and have to be read along with the preamble. The mere fact that it is provided that if any of the three conditions is met, the same has to be a Deed of Conveyance can only imply that there would be a presumption raised in respect of such General Power of Attorney being a Deed of Conveyance, but in each case, it can certainly be shown that a General Power of Attorney is not necessarily a part of such a larger transaction and has been made only for the convenience of the Executor.

10. It is also to be appreciated that in case the Executors file affidavits and undertakings saying that it is not part of the transaction of sale, there are certain consequences, which flow on the Executors. The averments of the Executors in affidavits and undertakings cannot be just disbelieved, though it is always open to the concerned authorities to make an inquiry to find out whether the document in question is part of the larger transaction.

11. In view of the aforesaid, I am of the considered view that the impugned order dated 16.6.2004 need not be set aside, but has to be read in the manner as aforesaid. Insofar as the impugned order dated 24.7.2004 is concerned, the SDM will make an inquiry and submit that necessary report to the SDM for necessary decision in terms of the order dated 16.6.2004 as clarified by this judgment. The needful be done within a period of three months from today.

12. The writ petition is disposed of in the aforesaid terms.