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Judgment
T.P. Sharma, J.—By filing following writ petitions under Article 227 of the Constitution of India, the State of Chhattisgarh/petitioner has challenged legality & propriety of the order passed by the Board of Revenue, Chhattisgarh, Bilaspur in appeal u/s 47A(4) of the Indian Stamp Act, 1899 (for short ''the Act'') against the order passed by the Collector of Stamps, Bilaspur u/s 47-A (2) of the Act, whereby the Board of Revenue has quashed/modified the order passed by the Collector of Stamps :--
W.P (Art. 227) No.
Appeal Case No. (u/S. 47A(4)) and Date of order passed by the BOR
Ref. Case No. (u/s. 47A(2)) and Date of order passed by the Collector of Stamps
Property situate at
Nature of order passed by BOR (Quashed/ Modified)
285/2011
No. A/02/SA/B-105/124/09. D/-10-12-2009
No. 336/B-105/2008-09, D/-29-10-2009
Vill. & Tah. Bilha, Distt. Bilaspur
Quashed
287/2011
No. A/02/SA/B-105/123/09, D/- 10-12-2000
No. 335/B-105/2008-09, D/- 29-10-2009
Vill. & Tah. Bilha, Distt. Bilaspur
Quashed
303/2011
No. A/02/SA/B-105/125/09, D/- 10-12-2009
No. 337/B-105/2008-09, D/- 29-10-2009
Vill. & Tah. Bilha, Distt. Bilaspur
Modified
637/2011
No. A/02/SA/B-105/28/09, D/- 9-4-2009
No. 09/B-105/2008-09, D/- 13-3-2009
Vill. & Tah. Bilha. Distt. Bilaspur
Modified
638/2011
No. A/02/SA/B-105/26/09, D/- 9-4-2009
No. 26/B-105/2009-09, D/- 13-3-2009
Vill. & Tah. Bilha, DisttBilaspur
Modified
639/2011
No. A/02/SA/B-105/76/2010, D/-9-7-2010
No. 159/B-105/2009-10 D/- 24-6-2010
Vill. & Tah. Bilha. Distt. Bilaspur
Modified
640/2011
No. A/02/SA/B-105/24/09. D/- 9-4-2009
No. 34/B-105/2008-09. D/- 13-3-2009
Vill. HirriGodpara. Tah. Bilha. Distt. Bilaspur
Modified
642/2011
No. A/02/SA/B-105/27/09, D/- 9-4-2009
No. 23/B-105/2008-09, D/- 13-3-2009
Vill. & Tah. Bilha. Distt. Bilaspur
Modified
645/2011
No. A/02/SA/B-105/78/2010, D/-9-7-2010
No. 158/B-105/2009-10 D/- 24-6-2010
Vill. & Tah. Bilha. Distt. Bilaspur
Modified
1138/2011
No. A/02/SA/B-105/61/09, D/- 13-7-2009
No. 222/B-105/2008-09, D/- 29-5-2009
Vill. Kesla. Tah. Bilha. Distt. Bilaspur
Modified
1139/2011
No. A/02/SA/B-105/60/09. D/- 13-7-2009
No. 198/B-105/2008-09, D/- 29-5-2009
Vill. & Tah. Bilha, Distt. Bilaspur
Modified
1141/2011
No. A/02/SA/B-105/62/09. D/- 13-7-2009
No. 221/B-105/2008-09, D/- 29-5-2009
Vill. Kesla, Tah. Bilha. Distt. Bilaspur
Modified
1699/2011
No. A/02/SA/B-105/73/09. D/- 1-8-2009
No. 262/B-105/2008-09, D/- 26-6-2009
Vill. Mohda.
Tah. Bilha. Distt. Bilaspur
Quashed
1701/2011
No. A/02/SA/B-105/75/09, D/- 7-9-2009
No. 280/B-105/2008-09, D/- 30-7-2009
Vill. & Tah. Bilha. Distt. Bilaspur
Quashed
1702/2011
No. A/02/SA/B-105/79/09, D/- 7-9-2009
No. 229/B-105/2008-09, D/- 10-8-2009
Vill. Chatidih,
Tah. & Distt. Bilaspur
Quashed
1
2
3
4
5
1703/2011
No. A/02/SA/B-105/874/09, D/- 7-9-2009
No. 253/B-105/2008-09, D/- 24-7-2009
Vill. Chatidh. Tah. & Distt. Bilaspur
Quashed
2196/2011
No. A/02/SA/B-105/78/09, D/- 7-9-2009
No. 282/B-105/2008-09. D/- 6-8-2009
Vill. Sendri, Tah. & Distt. Bilaspur
Quashed
2197/2011
No. A/02/SA/B-105/63/2010, D/- 22-5-2010
No. 152/B-105/2009-10, D/-10-5-2010
Vill. Bodri, Tah. Bilha, Distt. Bilaspur
Quashed
Common question for determination of aforesaid writ petitions is that "whether the Board of Revenue has committed illegality by quashing/modifying the order passed by the Collector of Stamps?" 2. Brief facts necessary for the disposal of these writ petitions are that the respondent seller has executed sale deed of his land in favour of the respondent purchaser, same was produced for registration before the Sub-Registrar, Bilaspur and on examination u/s 47-A of the Act, the registering authority was of the view that the market value of the property which is the subject matter of such instrument has not been truly set forth in the instrument. On the basis of prevailing guidelines for such valuation the Sub Registrar, Bilaspur referred the matter to the Collector of Stamps under sub-section (2) of Section 47A of the Act applicable in the State of Chhattisgarh. The Collector of Stamps. Bilaspur after providing opportunity of hearing to the parties and after inspection of spot, passed the order and found that the parties have not properly stamped and not correctly valued the property for the purpose of registration. The Collector of Stamps directed for payment of additional stamp charges, same was challenged by the respondent purchaser in appeal before the Board of Revenue u/s 47-A(4) of the Act. After providing opportunity of hearing to the parties, the Board of Revenue quashed the order passed by the Collector of Stamps and affirmed the valuation made by the parties, especially on the basis of guidelines issued for valuation of the property for the purpose of registration and stamps.
I have heard learned counsel for the parties, perused the orders impugned, copy of orders of the Collector of Stamps and copies of other documents.
Learned Govt. Advocate appearing on behalf of the State/petitioner vehemently argued that on the reference made by the Sub-Registrar u/s 47-A(1) of the Act, the Collector of Stamps has enquired into the matter and after providing opportunity of hearing to the parties, has arrived at a finding that the respondents have not properly valued the property subject matter instrument and has directed for proper valuation and payment of stamp charges. The Board of Revenue while exercising the appellate jurisdiction has without any ground for interference reversed the reasoned and well-founded order of the Collector of Stamps and thereby committed illegality.
On the other hand, Mr. Somnath Verma, learned counsel appearing on behalf of the purchaser(s). opposed the petitions and submitted that before 6-10-2003. Section 47-A of the Act, as amended by the undivided State of Madhya Pradesh by its Act No. 8 of 1975 with effect from 15-5-1975, and adopted u/s 79 of the M.P. Reorganisation Act, 2000. was in force and applicable. The Collector of Stamps was under obligation to enquire into the matter and after providing opportunity of hearing to the parties pass order in accordance with sub-section (2) of Section 47-A of the Act on the basis of reference made to it under sub-section (1) of Section 47-A of the Act. The order passed by the Collector of Stamps under sub-sections (2) & (3) of Section 47-A of the Act was appealable before the Commissioner under sub-section (4) and second appeal was maintainable before the Board of Revenue as Chief Controlling Revenue Authority under sub-section (5). After abolition of the post of Commissioner, sub-section (4) of Section 47-A of the Act was omitted vide the Indian Stamp Act (Chhattisgarh Amendment) Ordinance. 2003 (Ordinance No. 10/2003) with effect from 6-10-2003 and sub-section (5) was amended. Again the post of Commissioner was created vide the Chhattisgarh Land Revenue Code (Amendment) Ordinance, 2008 (Ordinance No. 1 of 2008) published in the Chhattisgarh Gazette on 5-4-2008. After re-creation of the post of Commissioner sub-sections (4) & (5) of Section 47-A of the Act were amended vide the Indian Stamp (Chhattisgarh Amendment) Act, 2010 (No. 25 of 2010) published in the Gazette on 18-10-2010 and thereby the provisions as stood prior to 6-10-2003 have been restored.
Mr. Somnath Verma further submitted that present appeals have been heard and decided prior to 18-10-2010 by the Board of Revenue and, therefore, the first appeal filed before the Board of Revenue was maintainable under the law. Mr. Somanath Verma also submitted that by treating one page letter signed by the Sub-Registrar, Bilaspur as reference u/s 47-A (1) of the Act, the Collector of Stamps has committed illegality. The Collector of Stamps was under obligation to provide complete opportunity of hearing and opportunity of adducing evidence to both the parties. The Sub-Registrar and the Collector of Stamps were under obligation to assess and determine the market value on the basis of Rule 5 of the Indian Stamp Act (Chhattisgarh Prevention of Undervaluation of Instruments) Rules, 1975 (for short ''the Rules''). The Sub-Registrar was not competent to refer the matter without any finding that the respondents have willfully undervalued the subject matter of the property and fraudulently undervalued the property for the purpose of stamp and registration, but without such finding the Sub-Registrar has referred the matter to the Collector of Stamps and thereby committed illegality. Mr. Somnath Verma contended that both the authorities have not followed Rule 4 of the Chhattisgarh Preparation and Revision of Market Value Guidelines Rules, 2000 (for short ''the Guidelines''). The District Committee had never notified the provisional values after following the procedure prescribed. The Sub-Registrar and the Collector of Stamps have not considered the present surrounding circumstances, situation of the land and other factors, and have assessed the property without following the Guidelines and the Rules, and thereby committed illegality.
Mr. Somnath Verma placed reliance in the matter of State of Punjab and Others Vs. Mohabir Singh etc. etc., in which while dealing with the provisions of the Guidelines prescribed by the State Government of Punjab for undervaluation of instrument, the Supreme Court has held that Guidelines prescribed by State for valuation of property on basis of which Registrar satisfies himself as to whether property was valued as per prevailing market rate and if such guidelines prescribe only minimum prices, then the State Government is required to revise guidelines. Learned counsel further placed reliance in the matter of R. Sai Bharathi v. J. Jayalalitha and others, AIR 2003 SCW 6349 in which while dealing with the amended provisions of Section 47A of the Act by the State of Tamil Nadu and the prevailing rules i.e. Prevention of Undervaluation of Instruments Rules, the Supreme Court has held that guideline value will only afford a prima facie basis to ascertain the true or correct market value and is not sacrosanct even for determining stamp duty, guideline value cannot therefore have any higher worth in ascertaining whether sale has resulted in any offence causing loss to one and gain to other.
Mr. Somnath Verma also placed reliance in the matter of Trideshwar Dayal and Another Vs. Maheshwar Dayal and Others, in which the Supreme Court has held that the Collector is authorized to examine the correctness of the valuation of property u/s 47-A of the Act, unless not expressly barred by the law. Learned counsel relied upon the matter of V.N. Devadoss v. Chief Revenue Control Officer-cum-Ins. & Ors., 2009 SAR (Civil) 759 in which the Supreme Court has held that the basis for exercise of power under Sec. 47-A of the Act is willful undervaluation of the subject of transfer with fraudulent intention to evade payment of proper stamp duty. Learned counsel further relied upon the matter of Ramesh Chand Bansal and Others Vs. District Magistrate/Collector Ghaziabad and Others, in which the Supreme Court has held that supply of biennially statement recording circle rate by Collector does not restrict the Collector to give such rate differently for two years. Learned counsel also relied upon the matter of Mohali Club Vs. State of Punjab and Others, in which the High Court of Punjab & Haryana has held that the Registrar can refer the matter after registration to the Collector of Stamps, if he has reason to believe that there is deliberate undervaluation and such reference is not a mechanical act but Registering Officer should have a basis for coming to prima facie finding that there is an under-valuation.
In accordance with sub-section (1) of Section 47-A of the Act, at the time of registration of instrument the registering authority is competent to refer the matter to the Collector of Stamps, if he has reason to believe that the market-value of the property which is the subject matter of such instrument has not been truly set forth in the instrument, then he may, after registering such instrument, refer the matter to the Collector of Stamps for determination of the market-value of such property and the proper duty payable thereon. In accordance with sub-section (2) of Section 47-A of the Act, on receipt of a reference under sub-section (1), the Collector is required to hold an enquiry in such manner as may be prescribed and after providing opportunity of being heard, determine the market-value of the property which is the subject matter of such instrument and the duty as aforesaid.
For the purpose of valuation of property for proper stamps and registration, the State of Chhattisgarh has made the Indian Stamp Act (Chhattisgarh Prevention of Undervaluation of Instruments) Rules, 1975. Rule 5 of the Rules provides principles for determination of market value. The Collector of Stamps is required to determine market value of the property on the basis of the points given in Rule 5 of the Rules.
At the lime of making reference, the Sub-Registrar has considered inadequacy of stamps and valuation on the basis of the Guidelines notified under the Chhattisgarh Preparation and Revision of Market Value Guidelines Rules. 2000. It appears from the reference made by the Sub-Registrar that on the basis of the Guidelines, the Sub-Registrar was of the view and was having reason to believe that market value of the property which was the subject matter of instrument has not been properly set forth in the instrument. Therefore, he has made reference to the Collector for determination of such market value and the duty. The order passed by the Collector of Stamps reveals that notice has been served upon the respondents and opportunity has been provided to them.
Both the private respondents have adduced their evidence. The Collector has inspected the spot and the respondents have not valued the property for the purpose of registration in accordance with the Guidelines notified under the Chhattisgarh Preparation and Revision of Market Value Guidelines Rules, 2000.
As per the affidavits of seller and purchaser, the land in question was not fertile land, not fit for agriculture, far away from residential locality, no municipal revenue approach road was connected to it and the lands were surrounded by the lands of others. There is no facility of drainage, electricity or other facilities. Most of the lands were not fit for agriculture and cultivation. Seller was eager and willing to sell his land, but no purchaser was ready to purchase the land. Finally, the present purchaser became ready to purchase the land.
The Collector of Stamps has rejected the aforesaid contentions of the parties (purchaser & seller) and determined market value of the land on the basis of the points given in Rule 5 of the Rules and the Guidelines notified under the Chhattisgarh Preparation and Revision of Market Value Guidelines Rules, 2000.
For determination of market value of the lands at Village Bilha. the Collector has obtained average value of land on the basis of sale in different years and on the basis of such transaction, the Collector has arrived at finding that average cost of land at Bilha in the year 2004-05 was Rs. 4,10,553/- per acre, in the year 2005-06 Rs. 3,13,611/- per acre, and in the year 2006-07 Rs. 4,05,321/-. Likewise, average cost of land in the year 2005-06 was Rs. 7,04,082/- per hectare and in the year 2007-08 was Rs. 7,34,681/- per hectare. However, no average value has been assessed for the years 2006-07 and 2008-09. Considering aforesaid market value of previous years and other circumstances required to be considered under Rule 5 of the Rules, the Collector of Stamps has determined market value of the land and directed for payment of additional stamp charges/duties.
W.P. (Art. 227) No. 2196/2011 is related to the land situate at Village Sendri, Tah. & Distt. Bilaspur. While passing order, the Collector of Stamps has not considered the submissions of seller and purchaser.
In W.P. (Art. 227) Nos. 1702/2011 and 1703/2011 the property is situate at Chatidih. Tah. & Distt. Bilaspur. In addition to the findings recorded by the Collector of Stamps, the Collector of Stamps has held that respondent Atal Shrivastava is a builder and has purchased the property for construction of buildings. Before arriving to such finding the Collector of Stamps was under obligation to provide opportunity of hearing to the parties.
The order of the Collector and evidence/affidavits of the respondents reveal that the land was not fit for agriculture. Virtually, it was deserted land having no facility, far away from residential locality and no approach road. These facts show that virtually, the land was useless for the seller. If the land was virtually useless for the seller having no value, then why the purchaser will purchase the land and what were the compelling circumstances for the purchaser to purchase the land.
As mentioned in W.P. (Art. 227) Nos. 638/2011.642/2011, & 1139/2011, a factory namely M/s. Mangat Sponge Steel Private Limited is coming near Bilha. Before the decision of starting of said factory or other companies, the lands situate near Bilha were only agricultural lands for agricultural use. At present, the cultivators /agriculturists were not using the land for agricultural purposes, but installation of factory by itself is a major factor for increase of market value of the lands which has not been considered by the Board of Revenue while passing the order impugned and same is a special feature having a bearing on valuation of property which will effect the price of lands situate near Bilha or its surrounding areas. At the time of determination of market value of land, the Collector of Stamps is required to hold enquiry and give complete opportunity of hearing to the parties. As per claim of the private respondents, complete opportunity of hearing has not been given to the parties.
As held by the Supreme Court in Mohabir Singh''s case (supra) and R. Sai Bharathi''s case (supra), guidelines are the basis for assessing prima facie true or correct market value and not sacrosanct. In the present case, the Collector of Stamps was required to examine the true or correct market value and for the purpose of such enquiry/ examination, aforesaid Guidelines may be used, but not as a conclusive.
As held by the Supreme Court in the matter of Trideshwar Dayal (supra), the Collector of Stamps is authorized to examine the correctness of the valuation of property and for the same, the Collector of Stamps was required to conduct a detailed enquiry. In the present case, the Collector of Stamps has not conducted detailed enquiry and has not provided complete opportunity to both the parties.
As held by the Supreme Court in the matter of V.N. Devadoss (supra), the basis for exercise of power u/s 47-A of the Act is willful under valuation of the subject of transfer with fraudulent intention to evade payment of proper stamp duty. Deliberate undervaluation of the property by Itself is not fraudulent intention.
As held by the Supreme Court in the matter of Ramesh Chand Bansal (supra), the Collector of Stamps is empowered to assess different values shown in biennially statement recording circle rate. As held by the High Court of Punjab & Haryana in the matter of Mohali Club (supra), the registering authority can refer the matter after registration of the document to the Collector of Stamps, if he has reason to believe that there is deliberate under-valuation and reference is not a mechanical act but the Registering Officer should have a basis for coming to prima facie finding that there is an undervaluation.
In the present case, the Sub-Registrar has referred the matters after considering the Guidelines and average market value of the lands. In the light of aforesaid judgments of the Supreme Court and the High Court of Punjab & Haryana, and the provisions of law, the Collector of Stamps was under obligation to enquire into the matter relating to undervaluation of the property for the purpose of stamps & registration, and was also under obligation to provide complete opportunity of hearing/adducing evidence to both the parties i.e. also to the State Government who may be the loser if proper stamp duty is not paid, and also provide opportunity to the parties before arriving at any finding relating to a particular finding ignoring the finding that the builder/person has purchased the property for construction of building or colony.
For the foregoing reasons, in my considered view, the Collector of Stamps has not provided complete opportunity of hearing to the parties and has not enquired into the matter, and thereby committed illegality. By reversing/modifying the order passed by the Collector of Stamps, the Board of Revenue has also committed illegality.
While passing the order impugned, the Board of Revenue has not considered the aforesaid facts and has also not considered the grounds which have been considered by the Collector of Stamps and thereby committed illegality. For determination of value of lands for the purpose of stamp duty and registration, complete opportunity of hearing to the parties would be just and proper. Consequently, the order passed by the Board of Revenue and the Collector of Stamps deserve to be set aside.
Accordingly, the writ petitions are allowed. The orders passed by the Board of Revenue, Chhattisgarh, Bilaspur, and the orders passed by the Collector of Stamps, Bilaspur are hereby set aside. No order as to costs.
The cases are remitted back to the Collector of Stamps who shall provide complete opportunity of hearing to the parties to adduce evidence and after holding enquiry under the provisions of the Indian Stamp Act (Chhattisgarh Prevention of Undervaluation of Instruments) Rules, 1975 and the guidelines notified under the Chhattisgarh Preparation and Revision of Market Value Guidelines Rules, 2000, pass order afresh.
Parties are directed to present before the Collector of Stamps, Bilaspur on 18-10-2011 for further hearing. It is made clear that the order passed by the Collector of Stamps shall be subject to first appeal and second appeal in accordance with the provisions of the Indian Stamp (Chhattisgarh Amendment) Act, 2010 (No. 25 of 2010).