Kerala High Court

Educational Empowerment And Welfare ... vs The District Registrar on 20 May, 2024

Author: Murali Purushothaman

Bench: Murali Purushothaman

                 IN THE HIGH COURT OF KERALA AT ERNAKULAM
                                     PRESENT
            THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN
          MONDAY, THE 20TH DAY OF MAY 2024 / 30TH VAISAKHA, 1946
                            WP(C) NO. 23227 OF 2015
PETITIONER:

                EDUCATIONAL EMPOWERMENT AND WELFARE CO-OPERATIVE
                SOCIETY, VICHITHRA COMPLEX, KALTEX, KANNUR-2,
                REPRESENTED BY ITS SECRETARY.

                BY ADVS.
                     SRI.SURESH KUMAR KODOTH
                     SRI.K.P.ANTONY BINU


RESPONDENTS:

     1          THE DISTRICT REGISTRAR
                KANNUR, KANNUR DISTRICT.
                PIN - 670 001.

     2          SUB REGISTRAR
                KANNUR, KANNUR.P.O.
                PIN - 670 001.

     3          STATE OF KERALA
                REPRESENTEDBY ITS SECRETARY, DEPARTMENT OF
                REGISTRATION, THIRUVANANTHAPURAM.
                PIN - 695 001.

     4          REGISTRAR OF CO-OPERATIVE SOCIETIES
                THIRUVANANTHAPURAM.
                PIN - 695 001.


         THIS   WRIT   PETITION   (CIVIL)   HAVING   BEEN   FINALLY   HEARD   ON
12.04.2024, THE COURT ON 20.05.2024 DELIVERED THE FOLLOWING:
 WP(C) NO. 23227 OF 2015

                                : 2 :




                           JUDGMENT

The petitioner is a Co-operative Society registered

under the Kerala Co-operative Societies Act, 1969 (for

short 'the Act'). One of the members of the Society, Smt.

Kizhakkedath Krishnakumari, agreed to sell 4.54 Ares of

land in RS No.54 in Kannur amsham desam in favour of

the Society for a total consideration of Rs.9,00,000/-.

It is stated that the said rate is lesser than the then

prevailing market value. The Joint Registrar of Co-

operative Societies, by Ext.P2, granted permission to

the Society to purchase the property for the said

consideration. Accordingly, Ext.P3 sale deed was

executed and the same was presented for registration WP(C) NO. 23227 OF 2015

before the 2nd respondent, Sub Registrar, Kannur.

However, the 2nd respondent insisted for payment of

Stamp Duty for instrument and referred the matter to the

1st respondent for consideration on the question of

exemption of stamp duty. The petitioner claimed the

benefit of remission of stamp duty in terms of Ext.P4

Government Order and by virtue of Section 40 of the

Act, before the 1st respondent. The same was rejected by

the 1st respondent as per Ext.P5 order stating that in

Ext.P3 Sale Deed, it is not stated that the sale was

conducted for the purpose of the business of the

petitioner Society. Referring to Section 40 of the Act,

it is stated that the benefit of exemption of Stamp Duty

is available only if the instrument is signed by the officer

or member of the Society on behalf of the Society and WP(C) NO. 23227 OF 2015

also in relation to the business of the Society. Ext.P3

document is executed by the vendor in her personal

capacity. Accordingly, the 1st respondent held that Ext.P3

instrument impounded is not eligible for exemption as

per Ext.P4 Government Order and directed that the

deficit Stamp Duty of Rs.5,29,200/- shall be paid.

Challenging Ext.P5 order, the petitioner has filed this

writ petition.

2. According to the petitioner Society, Ext.P5 is

contrary to the provisions under Section 40 (1)(a) of the

Act and Ext.P4 Government Order. It is contended that

the transfer of the property was made by the vendor as

a member of the Society and for and on behalf of the

Society and therefore the petitioner is entitled for

remission of Stamp Duty.

WP(C) NO. 23227 OF 2015

3. Heard the learned Counsel for the petitioner

and the learned Government Pleader for respondents.

4. The question as to whether a member of the

Society executing a document in his own capacity is

entitled for the benefit of remission of stamp duty was

set at rest by the Hon'ble Supreme Court in Kerala Land

Reforms & Development Co-operative Society Limited v.

District Registrar (General) and Another [2022 KHC

7093]. The Apex Court held that, Sale Deed executed by

members in favour of the society or by the society in

favour of respective member in their own capacity or in

the capacity of a guardian of a minor shall not be

entitled to the benefit of remission of stamp duty as it is

available only in respect of instruments executed by or

on behalf of the society. Paragraphs 8 and 9 of the said WP(C) NO. 23227 OF 2015

judgment read as follows:-

"8. From the aforesaid, it is apparent that the instruments executed by a member in his own capacity or/and in the capacity of a Guardian of a minor, which was in clause 1(a) of SRO 75/60 is missing insofar as S.40 of the Kerala Act, 1969 is concerned. S.40 of the Kerala Act, 1969 further provides that only in cases where, but for such remission the society, officer or member, as the case may be, would be liable to pay such stamp duty. As per S.40 (1)(a), the stamp duty chargeable under the Kerala Act, 1959 in respect of any instrument executed by or on behalf of a society or by an officer or member thereof and relating to the business of such society and in cases where, but for such remission the society, officer or member, as the case may be, would be liable to pay such stamp duty, there shall be remission of stamp duty. Thus, as clause 1(a) of SRO 75/60 is inconsistent with the relevant provisions of WP(C) NO. 23227 OF 2015

the Kerala Act, 1969, more particularly S.40 thereof, the said order is not saved and cannot be said to be deemed to have been issued under the Kerala Act, 1969 (S.110(2) of the Kerala Act, 1969) as has been contended on behalf of the appellants. Therefore, considering the express provision contained in S.40(1)(a) of the Kerala Act, 1969, a member of the society executing the document in his own capacity or in the capacity of a Guardian or a minor shall not be entitled to the benefit of remission of stamp duty.

9. In view of the above and for the reasons stated above, the appellants herein shall not be entitled to the benefit of remission of stamp duty on the instruments /sale deeds in question. Such instruments/sale deed in question cannot be said to be executed by or on behalf of a society or by an officer or member thereof relating to the business of the society. We are in complete agreement with the view taken by the Full Bench of WP(C) NO. 23227 OF 2015

the High Court."

5. The Sale Deed is executed by the member of

the Society in her own capacity. The instrument cannot

be said to be executed by or on behalf of the Society

relating to the business of the Society. In the said

circumstances, the petitioner is not entitled to seek

exemption or remission from the payment of stamp duty

in view of the law laid down by the Apex Court in the

decision cited (supra).

6. This Court, on 31.07.2015, passed an interim

order directing respondents 1 and 2 to register and

release Ext.P3 Sale Deed in favour of the petitioner

Society, provided it pays the necessary Stamp Duty