Rajasthan High Court - Jodhpur

Harish Sharma vs State Of Rajasthan on 2 March, 2021

Bench: Pushpendra Singh Bhati

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HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR (1) S.B. Civil Writ Petition No. 14058/2019

1. Narendra Sharma S/o Bhagwati Lal Sharma, Aged About 53 Years, Udaipur.

2. Bhagwati Lal Sharma S/o Banshi Lal, Aged About 79 Years, Both Are Resident Of Village Rahkampur Tehsil Badgaon District Udaipur.

----Petitioners Versus

1. State Of Rajasthan, Through The Principal Secretary, Finance Department, Govt. Of Raj. Jaipur.

2. The Dig - Stamp And Collector (Stamps), Registration And Stamps Department, Udaipur (Raj)

3. The Sub Registrar I, Udaipur.

----Respondents Connected With (2) S.B. Civil Writ Petition No. 15741/2019 Naresh Sharma S/o Shri Bhagwati Lal Sharma, Aged About 50 Years, Resident Of Village Rahkampur, Tehsil Badgaon, District Udaipur.

----Petitioner Versus

1. State Of Rajasthan, Through The Principal Secretary, Finance Department, Govt. Of Rajasthan, Jaipur.

2. The Dig Stamp And Collector (Stamps), Registration And Stamps Department, Udaipur (Raj.).

3. The Sub Registrar-I, Udaipur.

----Respondents (3) S.B. Civil Writ Petition No. 15808/2019 Harish Sharma S/o Shri Bhagwati Lal Sharma, Aged About 47 Years, Resident Of Village Rahkampur Tehsil Badgaon District Udaipur.

----Petitioner Versus

1. State Of Rajasthan, Through The Principle Secretary, Finance Department, Govt. Of Raj. Jaipur.

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2. The Dig - Stamp And Collector (Stamps), Registration And Stamps Department, Udaipur (Raj)

3. The Sub-Registrar I, Udaipur.

----Respondents (4) S.B. Civil Writ Petition No. 15898/2019 Lokesh Sharma S/o Bhagwati Lal Sharma, Aged About 41 Years, Village Rahkampur Tehsil Badgaon District Udaipur.

----Petitioner Versus

1. State Of Rajasthan, Through The Principal Secretary, Finance Department, Govt. Of Raj. Jaipur.

2. The Dig - Stamp And Collector (Stamps), Registration And Stamps Department, Udaipur (Raj)

3. The Sub-Registrar I, Udaipur.

----Respondents (5) S.B. Civil Writ Petition No. 16088/2019 Mukesh Sharma S/o Shri Bhagwati Lal Sharma, Aged About 45 Years, Resident Of Village Rahkampur Tehsil Badgaon District Udaipur.

----Petitioner Versus

1. State Of Rajasthan, Through The Principal Secretary, Finance Department, Govt. Of Raj. Jaipur.

2. The Dig- Stamp And Collector (Stamps), Registration And Stamps Department, Udaipur (Raj.).

3. The Sub -Registrar I, Udaipur.

----Respondents (6) S.B. Civil Writ Petition No. 16628/2019 Kailash Sharma S/o Shri Bhagwati Lal Sharma, Aged About 55 Years, Resident Of Village Rahkampur Tehsil Badgaon District Udaipur.

----Petitioner Versus

1. State Of Rajasthan, Through The Principle Secretary, Finance Department, Govt. Of Raj. Jaipur,

2. The Dig - Stamp And Collector (Stamps), Registration And Stamps Department, Udaipur (Raj)

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3. The Sub-Registrar I, Udaipur.

----Respondents

For Petitioner(s) : Mr. Prashant Tatia For Respondent(s) : Ms. Akshiti Singhvi

JUSTICE DINESH MEHTA

Judgment

02/03/2021

1. By way of these writ petitions, petitioners have challenged

various orders passed by the Collector (Stamps), Udaipur, on the

Gift deed executed in favour of petitioners (Petitioner No.1 in

SBCWP No.14058/2019).

2. For the sake of clarity, facts from Mr. Narendra Sharma Vs.

State of Rajasthan (SBCWP No.14058/2019) are taken into

consideration.

3. Petitioner No.2-Bhagwati Lal executed a gift deed in favour

of petitioner No.1-Narendra Sharma on 09.03.2016, whereby a

land situated in village Bedwas, Tehsil Badgaon, District Udaipur

was conveyed to the petitioner No.1-Narendra Sharma.

4. At the time of registration, the Sub Registrar found that

lesser stamp duty has been paid by the petitioner hence, he

demanded payment of additional duty, which was readily paid by

the petitioner and gift deed was registered on 09.03.2016 itself.

5. According to the petitioners, since the land covered by the

Gift deed dated 09.03.2016 was not in accordance with the actual

possession, i.e. instead of 0.1600 hectare, land admeasuring

0.2600 was indicated in the deed, a supplementary/rectification

gift deed dated 23.09.2019 came to be executed, by which

measurement of the land was corrected.

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6. According to the petitioner No.1, without receiving any notice

of the proceedings, he abruptly came to receive an order dated

22.01.2018 passed by the Collector (Stamps) under Section 51 of

the Rajasthan Stamp Act 1998 (hereinafter referred to as "Act of

1998").

7. Upon learning about the order aforesaid, petitioner No.1

moved a review application dated 22.05.2019 and requested the

Collector (Stamps) to review his order and pass a fresh order in

light of the facts brought on record by him. It was also stated that

the impugned order was passed without giving him an opportunity

of hearing, and requisite facts thus could not be brought to his

notice.

8. The Collector (Stamps)-respondent No.3 heard petitioner

No.1 and passed an order dated 19.07.2019; maintained the

demand of stamp duty, registration charges and surcharge, (as

has been levied in order dated 22.01.2018) but raised additional

amount as interest, on the subject gift deed dated 06.03.2016.

Petitioner's contention regarding rectified gift deed did not find

favour with the respondent No.3, as the same was executed after

passing of the order dated 22.01.2018.

9. The present writ petition has been preferred by the

petitioners inter alia raising various grounds, however, considering

the jurisdictional issue, viz. - before making a reference to the

Collector (Stamps), the Sub-Registrar neither intimated the

parties concerned nor did he call for the original gift deed, on

which the stamp duty was sought to be recovered, matter was

entertained and interim order was passed.

10. Mr. Tatia, learned counsel for the petitioners submitted that

as per sub-section (2) of Section 51 of the Act of 1998, the

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registering authority is required to call for the original instrument

from the party by giving him a notice in writing to pay the deficit

stamp duty and on failure of the party to pay the amount, he may

make a reference to the Collector (Stamps).

11. Inviting Court's attention towards para No.4 of the writ

petition, Mr. Tatia, argued that petitioner No.1 has specifically

pleaded that before making reference, the Sub-Registrar has not

issued any notice stipulated under Section 51 or 54 of the Act of

1998 and thus, entire proceedings are void and vitiated.

12. In support of his arguments, learned counsel relied upon a

Division Bench Judgment dated 11.04.2016 rendered in case of

Kuri Chand Vs. DIG (Stamps) Udaipur & Anr. Civil Special Appeal

(W) No.105/2010 in Civil Writ Petition No.1327/2008 and argued

that the present case is squarely covered by Division Bench

judgment aforesaid and the impugned orders deserve to be

quashed and set aside.

13. Learned counsel also made submissions on the merit of the

order and raised grounds concerning determination or quantum of

stamp duty.

14. Ms. Akshiti Shighvi, learned counsel appearing for the

respondents, at the very outset, submitted that the petitioner

No.1 has an efficacious remedy available under the Act itself; and

that he has brought a false case of non-observance of principles of

natural justice, by stating that the respondents had not issued any

notice to him.

15. She alternatively submitted that the petitioner No.1 in any

case had filed a review petition before the Collector (Stamps) and

after noticing and dealing with all his contentions, a reasoned

order dated 19.07.2019 has been passed. She thus argued that

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petitioner's grievance that he was not served with a notice or

heard by the Sub Registrar, or Collector (Stamps) stands duly

addressed. No prejudice, as such has been caused to him, was her

stand.

16. Though, the fact that Sub Registrar had not issued any

notice, has not been specifically denied in the reply, learned

counsel nevertheless argued that neither any notice is required to

be given nor is the document in original needs to be summoned.

17. In support of the contention aforesaid, Ms. Singhvi submitted

that the Sub Registrar has made a reference under Section 51(4)

of the Act of 1998, which does not require any notice to be given

to the concerned person.

18. She further submitted that Section 51 contains two parallel

provisions - one in the form of sub-section (2) and another in the

form of sub-section (4). According to her, in light of the facts of

the present case, it should be held that the Sub Registrar has

made a reference in exercise of powers under Section 51(4) and

thus, petitioner's argument of non-issuance of notice cannot be

accepted.

19. She added that the duty as determined and demand as

raised, is perfectly valid and legally sustainable, hence, no

interference is warranted in the instant case.

20. Heard.

21. As far as the fact that, prior to making reference no notice

was served upon petitioner No.1, is concerned, it practically

remains undisputed as the respondents have not given any

specific reply in response to the petitioner's assertion made in

para 4 of the writ petition, that Sub-Registrar has not issued any

notice, prior to making a reference to the Collector (Stamps).

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22. The moot question involved in the present case is, "whether

the Sub-Registrar can make a reference without issuing a notice

and obtaining the original document."

23. For examining this issue, it will be apt to reproduce Section

51 of the Act of 1998.

"51. Instruments under valued, how to be valued. -

(1) Notwithstanding anything contained in the Registration Act, 1908 (Act No. 16 of 1908) and the rules made thereunder as in force in Rajasthan where, in the case instrument relating to an immovable property chargeable with an advalorem duty on the market value of the property as set forth in the instrument, the registering officer has, while registering the instrument, reasons to believe that the market value of the property has not been truly set forth in the instrument, he may either before or after registering the instrument, send it in original to the Collector for taking action under sub-section (3).

(2) When through mistake or otherwise any instrument which is undervalued and not duly stamped is registered under the Registration Act, 1908, the registering officer may call for the original instrument from the party and, after giving the party liable to pay stamp duty an opportunity of being heard and recording the reasons in writing and furnishing a copy thereof to the party, impound it and on failure to produce such original instrument by the party, a true copy of such instrument taken out from the registration record shall, for the purposes of this section, be deemed to be original of such

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instrument and send it to the Collector for taking action under sub-section (3).

[(3) On receipt of the instrument under sub- section (1) or (2), the Collector shall, after giving the parties a reasonable opportunity of being heard and after holding an enquiry in the prescribed manner, determine the market value and stamp duty including the penalty at the rate of two percent of the amount of the deficient duty per month or part thereof for the period-during which the instrument remained unstamped or insufficiently stamped or twenty five percent of the deficient stamp duty, whichever is higher, but not exceeding two times of the deficient stamp duty, and surcharge, if any, payable thereon and if the amount of stamp duty including penalty and surcharge, if any, so determined exceeds the amount of stamp duty including penalty and surcharge, if already paid, the deficient amount shall be payable by the person liable to pay the stamp duty including penalty and surcharge, if any.] (4) Where it appears to a person having by law or consent of parties authority to receive evidence or a person incharge of a public office, during the course of inspection or otherwise, except an officer of a police, that an instrument is undervalued such person shall forthwith make a reference to the Collector in that matter. [(5) The Collector may, suo motu or on a reference made under sub-Section (4) call for and examine any instrument not referred to him under sub-section (1) or (2), from any person referred to in sub-section (4) or the executant or any other person for the purpose of satisfying himself as to correctness of the market value of the property, and if after such examination, he

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has reason to believe that the market value of such property has not been truly set forth in the instrument, he may determine in accordance with the procedure provided in sub-section (3) of the market value and the amount of stamp duty, if any, payable thereon together with a penalty at the rate of two percent of the amount of the deficient duty per month or part thereof for the period during which the instrument remained unstamped or insufficiently stamped or twenty five percent of the deficient stamp duty, whichever is higher, but not exceeding two times of the deficient stamp duty, which shall be payable by the person liable to pay the stamp duty and penalty.] (6) Where for any reason the original document called for by the collector under sub-section (5) is not produced or cannot be produced, the Collector may, after recording the reasons for its not production, call for a certified copy of the entries of the document from, the registering officer concerned and exercise the powers conferred on him under sub-section (5). (7) For the purpose of inquiries under this section, the Collector shall have power to summon and enforce the attendance of witnesses, including the parties to the instrument or any of them, and to compel the production of documents by the same means, and so far as may be in the same manner, as is provided in the case of civil court under Code of Civil Procedure, 1908 (Act 5 of 1908).

24. A perusal of the provisions of Section 51 of the Act of 1998,

particularly sub-section (2) thereof reveals that in case an

instrument, which was undervalued or not duly stamped, has been

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registered under the Registration Act, 1908, the registering officer

may call for the original document from the party and, after

providing an opportunity of hearing, can make a reference.

25. As against this, sub-section (4) provides that where a person

having by law or consent of parties, authority to receive evidence

or a person in-charge of a public office, during the course of

inspection or otherwise, is of the opinion that an instrument is

undervalued, such person can make a reference to the Collector.

26. In considered opinion of this Court, the Sub-Registrar is an

authority encaste with the duty to determine appropriate stamp

duties, while registering a document. Sub-Registrar, who is an

authority under the Registration Act, is also an authority under the

Stamp Act and, therefore, he is an officer duly empowered under

the provisions of the Act of 1998. He should normally resort to

specific provision given under the Act, which clothes him with the

power to send the document in original or its copy to the Collector

for determination of proper stamp duty.

27. But then, sub-section (4) equally empowers the registering

authorities, being public officers to make a reference. It is

noteworthy that sub-section (2) of Section 51 does not use the

expression - 'reference', whereas sub-section (4) does. Hence, a

registering authority, without impounding the documents and

having original with him can make a reference in exercise of

power under sub-section (4) of Section 51. Therefore, the sheet-

anchor of the argument advanced by the petitioner that, in

absence of original document neither reference can be made, nor

the Collector (Stamps) can determine the duty, does not hold

much water.

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28. A close and conjoint reading of sub-section (2) and (4) of

Section 51 of the Act of 1998 brings it to fore that expression -

'reference' has been used only under sub-section (4) and not in

sub-section (2) of the Act and, therefore, the Sub-Registrar or

registering authority can resort to power available to him under

sub-section (4) and make a reference to the Collector (Stamps)

for determination of appropriate stamp duty, even if the original

instrument is not with him.

29. But then, in that case, if the Sub-Registrar chooses to make

a reference to the Collector while invoking powers available under

sub-section (4), he cannot give a go-by to the provisions

contained in Section 54 of the Act of 1998, which enjoins upon

him a duty to intimate the party about the reference being made.

30. Section 54 of the Act of 1998 reads thus:

"54. Intimation of reference and payment of duty before reference-

(1) Notwithstanding anything herein before contained, the registering officer shall, before making reference to the Collector under this Act, intimate to the parties concerned about the reference proposed to be made by him.

(2) In case the person liable to pay the duty offers to pay the amount of duty chargeable on such instrument, the registering officer shall, on payment of such duty, certify it on the instrument by endorsement and shall not make the references."

31. Sub-section 1 of Section above referred, clearly requires

registering authority to intimate the parties concerned about the

reference proposed to be made. This has admittedly not been

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done in the present case and, hence, there is a clear violation of

statutory requirement.

32. Adverting to the judgment in the case of Kuri Chand

(supra), it is noteworthy that the case before the Division Bench

seems to be a case under sub-section (2) of Section 51. That

apart, provisions of sub-section (4) of Section 51 of the Act were

not placed for consideration of the Court. Hence, though holding

that it is not mandatory to summon the document in original, as

the powers are traceable under sub-section (4) of Section 51, this

Court finds that the orders impugned are otherwise illegal for

breach of mandate of law and for non-observance of principles of

natural justice.

33. Aforesaid view is fortified by the Division Bench Judgment in

case of Kuri Chand (supra) more particularly the following

observation made therein:-

"Be that as it may, even the Collector (Stamp) also does not appear to have extended a reasonable opportunity of hearing to the appellant as per the mandate of provisions of sub-section (3) of Section 51. Though, the order impugned makes a reference of the notice being issued to the appellant, but, there is nothing on record suggesting that the same was duly served upon the appellant. In any case, before determining the market value of the property and the deficient duty included the penalty payable, the Collector (Stamp) was required to make an enquiry in the prescribed manner to determine the market value. A perusal of the order impugned reveals that no such enquiry worth the name was made by the Collector (Stamp) and while recording the absence of the appellant, accepting the market value of the property as proposed by the Sub Registrar and determined the deficient duty,

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registration charges and penalty, by merely recording its ipse dixit, which as a matter of fact, is in excess of the deficient duty and registration charges, as determined by the Sub Registrar, while making the reference. In the considered opinion of this Court, the order impugned in the writ petition passed by the Collector (Stamp) without recording any reasons, justifying the levy of deficient stamp duty, registration charges and penalty, is a cryptic and non-speaking order, which is not sustainable in the eyes of law."

34. These writ petitions, therefore, succeed. The reference

made and orders passed by the Collector (Stamps) dated

22.01.2018 (Annex.5) and 19.07.2019 (Annex.7) in all the cases

are hereby quashed. The matters are remanded back to the

Collector (Stamps) for determination of appropriate stamp duty.

35. The petitioners shall appear before the Collector (Stamps) on

22.03.2021 and file their objection(s) to the reference made

and/or contentions they wish to raise.

36. The Collector (Stamps) shall provide appropriate opportunity

of hearing to the petitioners/their counsel and pass fresh order(s),

in accordance with law.