Lord Sri Venkateswara ... vs The District Registrar
2021 Latest Caselaw 2505 Mad

                                                          1

                                   IN THE HIGH COURT OF JIUDICATURE AT MADRAS

                                                 DATED : 04.02.2021

                                                      CORAM

                                    THE HONOURABLE MR.JUSTICE S.S.SUNDAR

                                          W.P.Nos.4195, 4442 & 4441 of 2011


                Lord Sri Venkateswara Educational Trust,
                Rep.by its Managing Trustee,
                R.Duraisamy,
                No.23B/2. Varadhan Street,
                Salem Main Road, Rasipuram.                                    .. Petitioner in
                                                                          W.P.No.4195 of 2011

                Sri Srinivasa Educational Trust,
                Rep.by its Managing Trustee,
                A.R.DDuraisamy,
                S.R.V.Thottam, Moolakkadu village,
                Masakalipatti Post, Rasipuram Taluk,
                Namakkal District.                                             .. Petitioner in
                                                                  W.P.Nos.4441 & 4442of 2011


                                                         Vs.

                1.The District Registrar,
                  Office of the District Registrar,
                  Namakkal.

                2.The Sub Registrar,
                  Rasipuram.                                                  .. Respondents in

all petitions

https://www.mhc.tn.gov.in/judis/

Common Prayer: Writ Petition filed under Article 226 of the Constitution of India, to issue a writ of Certiorarified Mandamus calling for the records of the 1st respondent relating to his proceedings in Na.Ka.Nos.7961,7962 & 7963/B1/2010 dated 15.12.2010 quash the same and direct the 2nd respondent to register and return the decree in O.S.Nos.8, 1 & 7 of 2010 dated 22.02.2010 on the file of the Principal District Judge, Namakkal.

                                   For Petitioner
                                   In all petitions       : Mr.C.Jagadesh

                                   For Respondent
                                   In all petitions       : Mr.P.P.Purushothaman
                                                            Government Advocate


                                                      COMMON ORDER

These writ petitions have been filed for issuing a writ of certiorarified

mandamus to quash the impugned order passed by the 1st respondent dated

15.12.2010 and to direct the 2nd respondent to register and return the decree in

O.S.NO.8 of 2010 dated 22.02.2010 on the file of the Principal District Judge,

Namakkal.

2. The brief facts necessary for the disposal of the writ petition in

W.P. No. 4195/2011 are as follows:-

https://www.mhc.tn.gov.in/judis/

The petitioner in the writ petition is a trust represented by its

Managing Trustee. It is stated that the petitioner is a public trust having objects

in relation to promotion of education in Rasipuram Town of Namakkal Taluk

and District. The Trust was created under a registered trust deed dated

09.10.2009 by the name Lord Sri Venkateswara Educational Trust.

3. One another trust by name Sri Venkateswara Educational trust was

also created earlier by a registered trust deed dated 08.02.1996. The earlier

trust, purchased certain lands by way of registered sale deed dated 09.02.1996

and had taken on lease vast extent of lands for a period of 30 years from several

persons. The trust also constructed several buildings and running a school by

name S.R.V. Girls secondary school in the properties.

4. It is stated that the previous trust by name Sri Venkateswara

Educational trust found it difficult to run the school and that the objects of the

trust could not be carried forward by the trustees. While so, the erstwhile

trustees passed a resolution on 14.10.2009 dissolving the trust. It is stated that

the resolution was passed by all the 11 trustees.

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5. It is to be noted that Clause 31 of the trust deed dated 18.02.1996,

reads as follows:

“31. In the event, difference of opinion among the Trustees the opinion of the majority shall prevail. If for any reason, the trust is not properly managed, the funds of the trust shall be transferred to another trust having similar objects on a decision by the majority.”

6. Therefore, it is stated that in terms of Clause 31 of the trust deed

dated 08.02.1996, the trustees of the dissolved trust by resolution dated

14.10.2009 resolved to handover the properties of the erstwhile trust to the

petitioner trust. It is stated that the possession of the properties were also

handed over to the petitioner trust on the same day. It is specific case of the

petitioner that the petitioner is running the Higher Secondary school in the

name of S.R.V.Girls Higher Secondary School.

7. The transfer of property is stated to have been duly recorded in the

books of both the trust. It appears that the erstwhile trustees of the previous

trust raised certain claims regarding certain properties and questioned the right

of the petitioner trust to hold the properties which were conveyed to the

petitioner by the resolution of the erstwhile trust. A suit came to be filed in

https://www.mhc.tn.gov.in/judis/

O.S.No.8 of 2010 on the file of Principal District Court, Namakkal, for

declaration of the petitioner's title in respect of certain land and properties

which were the properties that came from the erstwhile trust. A consequential

relief of injunction was also claimed by the petitioner. It is admitted that the

suit was decreed as prayed for by judgment and decree dated 22.02.2010. As a

matter of facts, it is seen that the defendants in the suit submitted to the decree.

8. Later the petitioner presented the decree in O.S.No.8 of 2010 for

registration on 26.04.2010. Though the 2nd respondent accepted the document

for registration, however, insisted that the petitioner should pay a sum of

Rs.22,14,632/- towards deficient stamp duty and further a sum of Rs.2,76,829/-

towards the deficiency in registration charges. It was specifically mentioned

that upon determination of the amount payable towards deficient stamp duty

and charges on the basis of guide line value, further amount will be collected

from the petitioner.

9. Challenging the order passed by the 1st respondent directing the

petitioner to pay a sum of Rs.24,00,000/- and informing the petitioner that a

further sum will be collected from the petitioner, the above writ petition has

been filed.

https://www.mhc.tn.gov.in/judis/

10. The learned counsel appearing for the petitioner submitted that

the impugned order is passed without even issuing a show cause notice to the

petitioner. It is stated that the order though styled as a notice, is infact an order

demanding payment and therefore, the impugned order is liable to quashed on

the short ground of violation of principles of natural justice. The learned

counsel then submitted that the 1st respondent cannot treat the decree of Court

as a conveyance. He referred to Section (2) (10) of the Indian Stamp Act and

contended that the decree cannot be termed as conveyance and that in the

absence of transaction between two parties, the judgment and decree of Court

cannot be treated as conveyance. Since the nature of decree clearly indicates

that the property has been recognized as the property of the petitioner by

judgment of the Court and that there is no instance of transfer inter vivos, he

submitted that the demand is not authorised and that the 1st respondent has

raised demand without any jurisdiction or authority. The counsel also submitted

that a sum of Rs.2,76,829/- has already been collected from the petitioner and

that further demand towards registration charges is unauthorised and without

any application of mind.

https://www.mhc.tn.gov.in/judis/

11. The learned counsel appearing for the respondents relied upon

the counter affidavit filed by the respondents 1 and 2. In the counter affidavit,

the respondents have supported the demand by stating that a new right is

created in favour of the petitioner by way of conveyance and therefore, the 2nd

respondent kept the document pending registration and referred the same to the

1st respondent who is the Collector to decide the amount towards deficit stamp

duty. The respondents further stated that there is no other document to prove

any pre existing right and that the decree obtained from the Civil Court is the

only document by which the transfer was effected and possession was handed

over.

12. Stating that the decree should be construed as a document or

instrument under 2(14) of Stamp Act, the respondents contends that as per

Article 33 r/w. Article 23 the decree should be construed as a conveyance

(settlement of Gift). In the counter affidavit, justifying the stand taken by the

1st respondent to treat the decree as conveyance it is also stated that the property

has been conveyed without any formal document which would prove the title or

possession of the transferee. Since the decree has come into existence to

recognize that the title had passed on from the erstwhile trust, it is contended

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that the decree should be treated as a conveyance as it was obtained collusively

for the purpose of avoiding stamp duty and to avoid the execution of Gift deed.

The respondents further stated that under Section 40 of the Indian Stamp Act,

no notice is required to be given to the petitioner. The respondents are not

required to give notice or personal hearing to the petitioner and that the order of

the 1st respondent treating the decree as an instrument is in accordance with

judgment of the Apex Court in Hindustan Lever and Anr. Vs. State of

Maharashtra reported in [2004 AIR (SC) 326.]

13. Section (2)(10) of Indian Stamp Act defines "Conveyance" as follows:-

"Conveyance" includes a conveyance on sale and every instrument by

which property whether movable or immovable, is transferred inter vivos and

which is not otherwise specifically provided for by Schedule I. From the

statutory definition a conveyance refers to an instrument by which the

properties are transferred inter vivos. "Instrument" under Section 2(14) of the

Indian Stamp Act includes every document by which any right or liability is, or

purports to be, created, transferred, limited, extended, extinguished or record;

https://www.mhc.tn.gov.in/judis/

14. Article 23 of the Indian Stamp Act refers to conveyance.

15. It is relevant to refer to Section 17 (2) (VI) of Registration

Act,1908. Section 17 (2) refers to transactions which are exempted. A decree or

order of Court, except a decree or order made on a compromise and comprising

immovable property is not required to be registered. In this case the relief was

on the basis of a prior transaction (A resolution) and the decree cannot be

construed as one based on a compromise.

16. When a decree contains the verdict in a lis between two parties, it

cannot be termed as a voluntary transfer between two parties. In such

circumstances, it cannot be treated as a document of conveyance between two

parties. Absolutely no provision is relied upon to show that the petitioner is

required to pay the stamp duty. In the present case, by the impugned order the

petitioner is directed to pay a sum around Rs.25,00,000/- when the petitioner,

went to Sub-Registrar to register a decree. In a partition suit, if there is a

compromise by which the parties have agreed to share the properties, it is

possible for the parties to agree to give some property even to the person who

has no pre-existing right. However, when a Civil Court decides the lis between

two different parties, it cannot be said that there is transfer of interest from one

https://www.mhc.tn.gov.in/judis/

party to another so as to attract the Stamp Duty or compulsory Registration.

The suit in O.S.No.8 of 2010 on the file of the District Court, Namakkal is for

declaration of title and consequential injunction against certain individuals. The

relief is based on a resolution dated 14.10.2009 passed by the trustees of the

trust which was dissolved. The plaintiff in the suit relied upon the resolution of

the Trust which is a transaction according to the plaintiff to vest the property in

the plaintiff Trust. The plaintiff Trust is the successor in interest of the

transferor trust as permissible.

17. In the case on hand, the decree is a decision by Court in a lis and

by no stretch of imagination, by construing or interpreting any of the Provisions

of Act, it is possible to make the petitioner liable to pay the stamp duty or

penalty for registering a decree which is between the trust on the one side and

other private parties on the other side. The impugned order is illegal and

unconstitutional. The 1st respondent has limited jurisdiction under the statute to

scrutinize the decree as in the present case whether it attracts deficit stamp duty

or penalty. He cannot interpret the decree for declaration as conveyance like

other instruments.

https://www.mhc.tn.gov.in/judis/

18. In the present case by the impugned order, the respondents have

also threatened the petitioner that the petitioner may have to pay not only the

charges that are demanded, but also further charges which may be found due

from the petitioner towards under-valuation. When an order of demand

directing the petitioner to pay a substantial amount by referring to a statute is

passed, it is to be noted that the petitioner's Civil rights will be effected. Hence,

the impugned order without issuing a show cause notice is certainly in violation

of principle of natural justice and such an order is not only unconstitutional but

should be treated as void. It has now become the order of day that the statutory

authorities and Revenue Officials are passing orders affecting the rights of the

individual without even observing principles of natural justice. The impugned

order demanding a substantial amount from the petitioner is casually made

without reference to any provision of law and without issuing prior notice or

show cause notice. The conduct of the 1st respondent is determined and the

attitude of the Officials in circumstances like this makes this Court to think that

orders are passed with corrupt motive without adherence to the statute or

following the principles of natural justice just to harass the public. This practice

has to be deprecated. Hence the impugned order is liable to be quashed on

merits and also for violation of principles of natural justice.

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19. The quasi judicial authority and the Government servants

exercising statutory function are not liable to be prosecuted for their actions in

official capacity as there is a statutory presumption in favour of the respondents

that they have done their duty in good faith. This Court is unable to see any

good faith in the proceedings initiated. The stand taken by the respondents in

the counter affidavit is again unsustainable and this Court is unable to

countenance the stand taken by the respondents after passing an illegal and

unconstitutional order behind the back of the petitioner.

20. In the other two writ petitions, namely, W.P. Nos.4441 & 4442

of 2011 similar order that is impugned in the W.P.No.4195 of 2011 is under

challenge. The facts are similar and therefore it is not necessary to elaborate.

Having regard to the fact that this Court has elaborately considered the issues in

W.P.No.4195 of 2011, the same reasoning squarely applies to petitions in

W.P.Nos.4441 & 4442 of 2011.

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21. Accordingly, these writ petitions are allowed. However no costs.

04.02.2021

bri

Index: Yes Internet: Yes Speaking Order

To

1.The District Registrar, Office of the District Registrar, Namakkal.

2.The Sub Registrar, Rasipuram.

https://www.mhc.tn.gov.in/judis/

S.S.SUNDAR,J.

bri

W.P.Nos.4195, 4442 & 4441 of 2011

04.02.2021

https://www.mhc.tn.gov.in/judis/