Punjab-Haryana High Court
Staffy Goyal vs State Of Punjab And Others on 26 July, 2022
CWP-21495-2018 -1-
210
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-21495-2018
Decided on: 26.07.2022
STAFFY GOYAL
Petitioner
VERSUS
STATE OF PUNJAB AND OTHERS
Respondents
CORAM: HON'BLE MS. JUSTICE JAISHREE THAKUR
Present: Mr. Siddharth Gupta, Advocate
for the petitioner.
Mr. Pawan Sharda, Senior DAG, Punjab.
JAISHREE THAKUR J.
1. The instant petition has been filed seeking to challenge the order
dated 06.10.2016 (Annexure P-3) passed by the Additional Deputy
Commissioner-cum-Collector, Bathinda (hereinafter referred to as the
Collector) whereby the petitioner has been directed to pay an additional amount
of Rs.1,40,000/- along with interest @12% from the date of registration of the
sale deed till the deposit of the amount towards deficient stamp duty and
registration fee pertaining to sale deed registered on 10.09.2010, besides order
dated 21.02.2018 (Annexure P-5) passed by the Commissioner, Faridkot
Division, Faridkot, affirming the order of the Collector, in appeal.
2. In brief, the facts are that the petitioner purchased land measuring
400 square yards, being 8/618 share of land mearuing 30 bighas 18 biswas
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kham comprising of Khasra No.5264/4765 (30-18), Khewat No.1036/6118, as
per jamabandi for the year 2002-2003, situated in the area of Patti Jhatti,
Bathinda in the shape of vacant plot situated ahead of Tale Manganian Dian
Jhuggian, near Canal Bathinda, for a total sale consideration of Rs.8,00,000/-.
A sum of Rs.48,000/- was paid towards stamp duty, registration fee etc. The
sale deed was registered by the Sub-Registrar, Bathinda and at that time, the
sale deed was not impounded on account of inadequate stamp duty. The sale
deed was returned to the petitioner after registration. The office of the Deputy
Controller (Finance and Accounts), Internal Audit Institute (Revenue), Bathinda
sent an audit memo to Tehsildar-cum-Sub Registrar, Bathinda pointing out that
there was a loss of Rs.1,40,000/- towards deficiency of stamp duty and
registration fee on the sale deed in question. On the basis of the audit report, the
Sub-Registrar-cum-Tehsildar made a reference vide letter No.840/RC dated
01.08.2013 to the Collector intimating him that an amount of Rs.1,40,000/- is to
be recovered as deficient stamp duty. Thereafter, the Additional Deputy
Commissioner, while exercising the power of Collector under Section 47-A of
the Indian Stamp Act, issued a notice dated 31.10.2013 to the petitioner
regarding the deficient stamp duty detected during audit.
3. In the proceedings under Section 47-A of the Indian Stamp Act, a
reply was filed, taking a plea that the stamp duty had correctly been affixed,
however, the Collector by impugned order dated 06.10.2016 agreed with the
objection raised by the audit party and directed that deficiency of
stamp/registration fee be recovered from the vendee along with interest @12%
per annum. The appeal filed against the said order was also dismissed, which
has led to the filing of the instant writ petition.
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4. Learned counsel appearing on behalf of the petitioner herein would
contend that the impugned orders are unsustainable, as the Sub-Registrar while
registering the instrument did not impound the sale deed nor was any reference
made to the Collector at his own instance. The sale deed was handed over to the
petitioner after registration of the same. It is also argued that there are
judgments to the effect that the reference can be made by the Sub-Registrar to
the Collector immediately after registration of an instrument or in the course of
registration. It is submitted that in the judgment rendered in Abhinav Kumar
Vs. State of Haryana 2001 (1) RCR (Civil) 91, a reference had been made by
the Sub Registrar to the Collector after a period of 8 days and it was held to be
not in accordance with law. It is also argued that in the case of Iqbal Singh and
others Vs. State of Haryana and others 2011 (3) RCR (Civil) 365, it has been
held that an audit party is not authorized under any provisions of the Indian
Stamp Act to assess and determine the nature of any document or the stamp
duty payable thereon.
5. Per contra, learned counsel appearing on behalf of the respondents-
State would submit that on the basis of audit report, it had been found that there
was deficient stamp duty affixed on the sale deed that was executed on
10.09.2010 and pursuant to that, notice was issued to the petitioner herein to
pay the additional amount of Rs.1,40,000/- towards deficient stamp duty and
registration charges.
6. I have heard learned counsel for the parties and have perused the
pleadings of the case as well as the case laws cited. The facts are not in dispute.
The sale deed came to be registered on 10.09.2010 by the Sub-Registrar but at
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that point of time, he did not impound the sale deed nor did he send a reference
to the Collector as envisaged under Section 47-A (1) of the Indian Stamp Act,
as applicable to the State of Punjab. Section 47-A of the Indian Stamp Act is
reproduced as under:-
"47-A. Instruments under-valued how to be dealt with. - (1) If the
Registering Officer appointed under the Registration Act, 1908,
while registering. instrument transferring any property has reason
to believe that the value of 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 Collector for
determination of the value or consideration, as the case may be;
the proper duty payable thereon.
(2) On receipt of reference under sub-section (1), the Collector
shall, after giving the parties a reasonable opportunity of being
heard and after holding an enquiry in such manner as may be
prescribed by rules made under this Act, determine the
consideration and the duty as aforesaid and the deficient amount
of duty, if any shall be payable by the person liable to pay the duty.
(3) The Collector may, suo moto, or on the receipt of a reference
from the Inspector General of Registration or Registrar of a
District appointed under Registration Act, 1908 (Central Act No.
16 of 1908), in whose jurisdiction property or any portion thereof
which is the subject matter of the instrument is situated or on the
receipt of a report of audit by the Comptroller and Auditor
General of India or by any other authority authorised by the State
Government in this behalf or otherwise within a period of three
years from the date of the registration of an instrument, call for
and examine any instrument for the purposes of satisfying himself
as to the correctness of the value of the property or of the
consideration disclosed and of all other facts and circumstances
affecting the chargeability of the instrument or as to the true
character and description thereof and the amount of the duty with
which it was chargeable and if after such examination, he has
reason to believe that proper duty has not been paid, he may, after
giving the person concerned reasonable opportunity of being
heard and after holding an enquiry in the manner provided under
sub- section (2), determine the value of the property or the
consideration or the character or description of instrument and
the duty with which it was chargeable and the deficient amount of
duty, would be payable by the person liable to pay the duty.
(4) Any person aggrieved by an order of the Collector under sub
section (2) or sub-section (3) may, within thirty days from the date
of that order, prefer an appeal before the Commissioner and all
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such appeals shall be heard and disposed of in such manner as
may ·be prescribed by rules made under this Act.
Explanation. - For the purpose of this section, value of any
property shall be estimated to be the price which in the opinion of
the Collector or the appellate authority, as the case may be, such
property would have fetched if sold in the open market on the date
of execution of the instrument relating to the transfer of such
property."
7. As per Section 47-A, if the Registering Officer as appointed under
the Registration Act, 1908, while registering any instrument relating to the
transfer of any property, has reason to believe that the property has been under-
valued, he may after registration, refer the same to the Collector for
determination of value of the property or the consideration, as the case may be,
and the proper duty payable thereon. On receipt of the reference, the Collector
shall give reasonable opportunity to the parties to be heard and after holding an
enquiry in such manner as may be prescribed, determine the value and if
amount of duty is found to be deficient, it shall be payable. As per Section 47-A
(3), the Collector may suo motu or on receipt of the reference from the
Inspector General of Registration or Registrar of a District in whose jurisdiction
the property or any portion thereof, which is subject matter of the instrument, is
situated or on the receipt of a report of audit by the Comptroller and Auditor
General of India or by any other authority authorized by the State Government
in this behalf or otherwise, within a period of three years from the date of
the registration of any instrument, call for and examine any instrument and
satisfy himself whether or not, instrument had been valued correctly. If the
Collector has reason to believe that proper duty had not been paid, he may give
the person concerned reasonable opportunity of being heard and hold an
enquiry as provided under sub-section (2) and if it is found that the instrument
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has not been properly valued, such person shall be liable to pay the duty.
8. A reading of sub-section (1) of the aforesaid Section enjoins a
responsibility on the Registering Officer to refer to the Collector any such
instrument for determination of the value of the property in case he believes,
while registration of the instrument that the correct valuation of the property has
not been truly set forth. On receipt of the reference under sub-section (1), the
procedure is prescribed under sub-section (2) of Section 47-A whereas the
Collector may suo motu or on receipt of reference from the Inspector General of
Registration or Registrar of a District or on the receipt of a report of audit by
the Comptroller and Auditor General of India or by any other authority
authorized by the State Government in this behalf or otherwise, within a period
of three years from the date of the registration of the instrument, call for and
examine said instrument for the purposes of satisfying himself as to the
correctness of the value of the property.
9. In the instant case, it is on the objection raised by an audit party
that the reference was made by the Sub-Registrar to the Collector regarding
deficiency in stamp duty on the sale deed executed on 10.09.2010. In a catena
of judgments it has been held that the Sub-Registrar would become functus
officio after registration of the sale deed and in case he is to make reference, it
has to be done immediately after registration of the instrument, as has been held
in the case of Abhinav Kumar's case (supra). It would be pertinent to add here
that in case of Abhinav Kumar, reference had been made by the Sub-Registrar
to the Collector within a period of 8 days, which was held to be invalid.
Therefore, by relying upon the said judgment, this Court can hold that there was
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a delay in sending the reference to the Collector. However, this Court is also
aware of a judgment rendered by a Coordinate Bench rendered in Seema Vs.
State of Haryana and others in CWP No.27881 of 2017 decided on
10.12.2019, where the question posed was if the Sub-Registrar maintains
silence by inaction on the date of registration and accepts the stamp duty and
after the registration of sale deed still does not make any reference, would the
Collector have the power to initiate suo motu action and determine the proper
stamp duty by calling for and examining the record and upon hearing the
vendee and the likely to be affected parties, pass an order. The Coordinate
Bench came to hold that the act of the Sub-Registrar in registering a sale deed is
an administrative act and not judicial or quasi- judicial. His quasi-judicial
jurisdiction starts with notice of under-valuation by party avoiding payment of
proper stamp duty. In Seema's case (supra), the sale deed was registered on
19.07.2012 and the Sub-Registrar made reference to the Revenue Officer-cum-
Collector, Karnal on 21.09.2012 i.e. within a period of less than three months.
But in the instant case, reference was made by the Sub-Registrar to the
Collector on receipt of the audit report on 01.08.2013. Pursuant to the said
reference, the petitioner herein vide notice dated 31.10.2013 was called upon to
appear in proceedings before the Additional Deputy Commissioner-cum-
Collector, Bathinda, which notice was well beyond the period of three years.
Even if the argument of the respondent-State is taken into consideration, that
the registering authority does not become functus officio as has been held in
Seema's case, this Court cannot lose sight of the fact that the Collector took
cognizance of reference received well beyond the period of three years. Even if
Section 47-A (3) of the Indian Stamp Act permits Collector to issue notice suo
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motu, it has to be done within a period of three years from the date of
registration of the instrument. It is settled law that communication of the order
alone confers on a paper the status of an order as has been postulated by Article
166 of the Constitution (see Vikas Vs. State of Haryana and others, 2008(2)
RCR (Civil) 526). The Division Bench in Vikas's case (supra) has held as
under:-
"The only argument raised by the respondents is that an audit
objection was raised vide Audit Note dated 12.6.2002 and on the
basis of the audit objection it was sought to be contended that
within the period of three years objections have been taken (R-1).
Therefore, the period of three years would not come in the way of
the respondents as audit objection was raised on 12.6.2002. We
find that the argument is totally absurd because there was no
communication of the audit objection to the petitioner so as to
constitute a basis for argument that the action was taken within
period of three years. The real action was initiated only on the
issuance of show cause notice, which admittedly was issued on
7.12.2005. It is well settled that the communication of the order
alone confer on a paper the status of an order as has been
postulated by Article 166 of the Constitution. The aforementioned
provision was interpreted by a Constitution Bench of Hon'ble the
Supreme Court in the case of Bachhitar Singh v. State of Punjab,
AIR 1963 Supreme Court 395. In that case the Constitution Bench
had held that till an order is communicated it would not assume
the character of executive action. A similar view has been taken by
Hon'ble the Supreme Court in the case of Laxminarayan R.
Bhattad v. State of Maharashtra, (2003) 5 SCC 413. Therefore, we
have no hesitation to reject the argument."
10. The argument raised by the petitioner while relying upon the
judgment rendered in Iqbal Singh's case that the audit party is not authorized to
assess and determine the nature of any document or the stamp duty payable
thereon has no force, as in that case the document executed in respect of the
property was the relinquishment deed on which stamp duty was not payable and
not the sale deed as in the instant case. Therefore, the ratio decidendi culled out
in Iqbal Singh is not applicable to the present case.
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11. Therefore, in view of the finding rendered above, the impugned
orders dated 06.10.2016 (Annexure P-3) passed by the Additional Deputy
Commissioner-cum-Collector, Bathinda and dated 21.02.2018 (Annexure P-5)
passed by the Commissioner, Faridkot Division, Faridkot are quashed and the
instant writ petition stands allowed.
(JAISHREE THAKUR)
JUDGE
26.07.2022
Chetan Thakur
Whether speaking/reasoned : Yes/No
Whether reportable : Yes/No
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