Kerala High Court

A.C.Xavier vs State Of Kerala on 2 July, 2021

WP(C) NO. 20734 OF 2020      1



            IN THE HIGH COURT OF KERALA AT ERNAKULAM
                            PRESENT
        THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V
     FRIDAY, THE 2ND DAY OF JULY 2021 / 11TH ASHADHA, 1943
                    WP(C) NO. 20734 OF 2020
PETITIONER/S:

          A.C.XAVIER
          AGED 56 YEARS
          S/O.A.K.CHACKO, ANANTTHURUTHY HOUSE,
          JUNIOR JANATHA ROAD, VYTTILA, KOCHI-682019.

          BY ADVS.
          SUNIL KUMAR A.G
          SRI.SUDEESH KUMAR RAMAKRISHNA



RESPONDENT/S:

    1     STATE OF KERALA
          REPRESENTED BY ITS SECRETARY,
          DEPARTMENT OF REGISTRATION, GOVERNMENT SECRETARIAT,
          THIRUVANANTHAPURAM-695001.

    2     THE DISTRICT COLLECTOR,
          COLLECTORATE, KAKKANAD-682030.

    3     THE INSPECTOR GENERAL OF REGISTRATION,
          DEPARTMENT OF REGISTRATION, VANCHIYOOR P.O.,
          THIRUVANANTHAPURAM-695035.

    4     THE DISTRICT REGISTRAR (GENERAL),
          OFFICE OC THE DISTRICT REGISTRAR (GENERAL),
          SOUTH RAILWAY STATION ROAD, KOCHI-682016.

    5     THE SUB REGISTRAR,
          OFFICE OF SUB REGISTRAR MARADU, KOCHI-682304.




          SMT A.C VIDHYA, GOVERNMENT PLEADER
 WP(C) NO. 20734 OF 2020      2



     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
02.07.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 WP(C) NO. 20734 OF 2020              3



                                  JUDGMENT

Challenging the proceedings initiated by the respondents under the

Kerala Stamp (Prevention of Undervaluation of Instruments) Rules, 1968,

('Rules' for short) the instant writ petition is filed. Ext.P1 notice dated

12.12.2019 would reveal that proceedings under the Rules were initiated

against the petitioner for undervaluing the sale consideration shown in

Document No.2300 of 2008 of the Maradu SRO, as per which the petitioner had

purchased property having an extent of 4.680 Ares in Sy. No.239/7 of the

Poonithura Village, Kanayannoor Taluk. The respondents have concluded that

the actual value of the land was Rs.29 lakhs instead of Rs.17,34,000/- shown in

the document and the deficit stamp payable was Rs.1,50,000/- together with

balance registration fees of Rs.23,320/-. Later, by Ext.P3 communication, the

petitioner was requested to avail the One Time Settlement Scheme and to

remit 30% of the deficit stamp and close the proceedings. The petitioner

contends that the proceedings initiated by the respondents are in blatant

violation of the provisions of the Kerala Stamp Act and the Rules framed

thereunder. According to the learned counsel, a clear procedure is

contemplated under the Act and Rules. At no point in time, was any notice in

Form No.II of the Rules was issued to the petitioner. The petitioner was never

heard and a copy of the final order was also not issued to the petitioner. It is

in the afore circumstances that the petitioner is before this Court seeking to

quash Exts. P1 and P3, and for incidental reliefs.

2. In the counter affidavit filed by the 4th respondent it is stated as

follows in paragraph Nos.5 & 6.

"5. It is submitted that on the receipt of the reference from the Sub Registrar, the District Registrar issued Form II notice as per the Kerala Stamp (Prevention of Undervaluation of Instruments) Rules, 1968 to the petitioner on 17.08.2008 through ordinary post, intimating the reference received from the Sub Registrar, Maradu and also giving opportunity for the petitioner to prove that the value of the property/consideration has been truly and correctly set forth in the document within 21 days of the receipt of the notice. There was no response from the petitioner.

6. It is submitted that as per Section 28 of the Kerala Stamp Act, the consideration should be fully and truly set forth in the document. As per the Section 45B, if the registering officer, while registering any instrument transferring any property, has a reason to believe that value of the property or the consideration, as the case may be, has not been truly set forth in the instrument, he may, after registering such instrument refer the same to the Collector for determination of the value or the consideration, as the case may be, and the proper duty payable there on. On receipt of the reference from the 5th respondent, District Registrar issued Form II notice on 17/08/2008. Since there was no response from the petitioner, this office issued provisional order and the same was communicated to the petitioner by ordinary post on 05.10.2019. At this time also there was no response from the petitioner and finally this office issued final order and the same was communicated to the petitioner by ordinary post on 04.11.2019."

3. Thus, it is obvious from the counter itself that the Form No. II

notice, the provisional order as well as the final order was communicated to the

petitioner by ordinary post.

4. The procedure to be followed for determination of value or

consideration and the proper duty is provided in Rule 4 of the Rules 1968. Rule

4, 6 and 7 reads as follows:

"4. Procedure for determination of the value or consideration and

the proper duty under Section 45B.-

(1) A reference under sub-section (1) of Section 45B from a Registering Officer

shall be accompanied by a statement in Form IA.

(1A) On receipt of such reference by the collector or where the Collector

proposes to take action suo motu under sub-section (3) of

[Section 45B], he shall issue a notice in Form II or Form IIA, as

the case may be.

(a) to every person by whom, and

(b) to every person in whose favour the instrument has been

executed, informing him of the receipt of the reference from

the Registering Officer or, as the case may be, the

Collector's proposal to take suo motu action, and asking him

to submit to the Collector representations, if any, in writing

to show that the value of the property or the consideration

has been truly set forth in the instrument and also to

produce all evidence that he has in support of his

representation, within twenty-one days from the date of

service of the notice].

(2) The Collector, may, if he thinks fit, record a statement from any person to

whom a notice under [sub-rule (1A)] has been issued.

(3) The Collector, may, for the purpose of his enquiry,-

(a) call for any information or record from any public office,

officer or authority under the Government or a local

authority; and

(b) examine and record statements, from any member of the

public, officer or authority under the Government or a local

authority; and

(c) inspect the property after due notice, to the parties

concerned.

(4) After considering the representations, if any, received from the person to

whom notice under [sub-rule (1A)] has been issued and after examining

the records and evidence before him, the Collector shall pass an order in

writing provisionally determining the value of the properties or the

consideration and the duty payable. The basis on which the provisional

value or consideration was arrived at shall be clearly indicated in the

order."

"6: Procedure after arriving at provisional value or consideration.-

The Collector shall communicate a copy of his order provisionally

determining the value of the properties for the consideration thereof

and the duty payable to all the persons who are liable to pay the

duty along with a notice in [Form III or Form IIIA, as the case may

be] and call upon the parties to lodge their objections, if any, to such

determination of the value or consideration within the time specified

in the notice. The Collector shall also hear the parties on the date

specified in the notice or on such other day as may be fixed by him."

"7: Final order determining the value or consideration.--

(1) The Collector shall, after considering the representations received in writing and those urged at the time of hearing or in the absence of any representation from the parties concerned or their failure to appear in person at the time of hearing, in any case, after careful consideration of all the relevant facts and evidence available with him, pass an order within 3 months from the date of first notice, issued under Rule 6, determining the consideration or value of the properties, as the case may be, and the duty payable on the instrument, and communicate the order so passed to the parties and take steps to collect the difference in the amount of stamp duty, if any.

(2) A copy of the order shall be communicated to the Registering Officer

concerned for his record.

(3) the difference in the amount of duty payable on the value/consideration,

as the case may be, determined by the Collector and the duty already

paid shall be paid within 2 months from the date of final order passed

under sub-rule (1).

(4) the Sub Registrar after collecting the deficit of stamp duty payable, if any,

under sub-rule (3) shall endorse a certificate in Form IV on the

instrument.

5. Rule 15 provides for manner of service of notice to the parties,

which reads as follows:

15. Manner of service of notice and orders to the parties.- Any

notice under Rule 4 or Rule 6 and any order under Rule 4 or Rule 7 shall be

served in the following manner, namely:-

(a) in the case of any company, society or association of individuals,

whether incorporated or not, be served-

(i) on the Secretary or any director or other principal officer of

the company, society or association of individuals, as the

case may be: or

(ii) by leaving it or sending it by registered post

acknowledgement due, addressed to the company, society,

or association of individuals, as the case may be, at the

registered office, or if there is no registered office, then at

the place where the company, society or association of

individuals, as the case may be, carries on business.

(b) in the case of any firm, be served,-

(i) upon anyone or more of the partners;

(ii) at the principal place at which the partnership business is

carried on, upon any person having control or

management of the partnership business at the time of

service;

(c) in the case of a family, be served upon the person in management

of such family or of the property of such family, in the manner

specified in Clause (d)

(d) in the case of an individual person, be served,-

(i) by delivering or tendering the notice or order to the person

concerned or his counsel or authorised agent; or

(ii) by delivering or tendering the notice or order to some adult

member of the family; or

(iii) by sending the notice or order to the persons concerned by

registered post acknowledgement due; or

(iv) if none of the aforesaid modes of service is practicable, by

affixing the notice or order in some conspicuous part of the last

known place of residence or business of the person concerned.

6. As is evident from the Rules, at every stage, after the reference is

received, notice has to be issued to the parties and they are to be heard. The

manner of service of notice is provided under Rule 15 of the Rules. It has to be

in either of the four modes as provided under Rule 15 (d) in the case of

individuals. Sending Form II and further communications as well as the orders

by ordinary post is not one of the modes prescribed under the Rules. In the

case on hand, it is admitted by the respondents in their counter that notice was

served by ordinary post and nothing is produced before this Court to show

actual service of notice. Furthermore, records would reveal that the sale deed

was executed on 17.7.2008, the Form II notice under ordinary post was

issued on 17.8.2008, the provisional order was passed on 5.10.2019 and the

final order was passed on 4.11.2019. The contention of the petitioner that

Exts.P1 and P3 notices were issued without complying with the mandatory

safeguards and against the provisions of law is on solid footing. In that view of

the matter, I am of the considered opinion that the impugned notices having

been issued without any authority of law are liable to be quashed.