Allowed

Smt. Safiya Khatoon and Another v. State of U.P. Thru. Addl. Chief Secy. of the Stamp and Registration Deptt. Lko. and Others

Allahabad HC14 Jun 2022/3654/2022

Case brief

AI extract

What is this about?

In this writ petition, the High Court of Judicature at Allahabad allowed the petition and quashed an order under Section 47-A of the Indian Stamp Act. The court held that proceedings were impermissibly initiated as neither suo motu nor referred, and that mandatory personal inspection was not conducted.

What did the court decide?

The impugned orders dated 3.2.2022 and 28.4.2022 and the recovery citation dated 12.5.2022 are quashed. The Collector is permitted to initiate fresh proceedings strictly in accordance with the law.

Smt. Safiya Khatoon and Another Vs State of U.P. Thru. Addl. Chief Secy. of the Stamp and Registration Deptt. Lko. and Others — Allahabad HC (2022) — LawSathi Research

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Court No. - 7

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Case :- WRIT - C No. - 3654 of 2022

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Petitioner :- Smt. Safiya Khatoon And Another Respondent :- State Of U.P. Thru. Addl. Chief Secy. Of The Stamp And Registration Deptt. Lko. And Others Counsel for Petitioner :- Pt. S. Chandra,Surya Kumar Counsel for Respondent :- C.S.C.

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Hon'ble Subhash Vidyarthi,J.

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Heard Pt. S. Chandra, learned counsel for the petitioners and Sri Indrajit Shukla, learned Additional Chief Standing Counsel for the respondents.

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By means of the instant writ petition filed under Article 226 of the Constitution of India, the petitioners have assailed the validity of the order dated 3.2.2022 passed by the Collector, Shrawasti in Case No. 2 of 2021, under Section 47A of the Indian Stamp Act, 1989 (herein referred to as the Act), whereby the petitioners have been directed to make good the alleged deficiency in stamp duty and also to pay penalty in respect thereof.

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The learned counsel for the petitioners has submitted that on 1.10.2018, the petitioners had purchased a piece of land bearing Gata No.4064 having an area of 0.112 Hectare and 4092 having an area of 0.300 Hectare in village Ikauna Dehat, Pargana Ikauna, District Shrawasti. On 28.12.202, i.e. after the expiry of more than two years since execution of the sale deed, the Additional District Magistrate (Finance / Revenue), Shrawasti submitted a spot inspection report to the Collector, Shrawasti stating that the land bearing Gata No. 4092 measuring 0.300 hectare is situated on bypass road and is of residential nature. Upon his report, the Collector, Shrawasti has passed the

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aforesaid order.

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The submission of the learned counsel for the petitioners is that the action under Section 47-A can be taken by the Collector on receipt of a Reference under sub-section (1) after giving the parties a reasonable opportunity of being heard and after holding an inquiry in such manner as may be prescribed by Rules made under the Act. Sub-section (3) of Section 47-A provides " the Collector may, suo motu, or on a reference from any Court or from the Commissioner of Stamps or an Additional Commissioner of Stamps or a Deputy Commissioner of Stamps or an Assistant Commissioner of Stamps or any officer authorized by the State Government in that behalf ", call for and examine the instrument for the purpose of satisfying himself as to the correctness of the market value of the property which is the subject matter of such instrument and the duty payable thereon, and if after such examination, he has reason to believe that the market value of such property has not been truly set forth in such instrument, he may determine the market value of such property and the duty payable thereon.

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Rule 7 of the U.P. Stamp (Valuation of Property) Rules, 1997 lays down the procedure to be adopted on receipt of a Reference or when suo motu action is proposed under Section 47-A(3) of the Act and this Rule provides as follows:-

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"The Collector may-

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(a) call for any information or record from any public office, officer or authority under the government or a local authority;

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(b) Examine and record the statement of any public officer or authority under the government or the local authority; and

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The learned counsel for the petitioners has submitted that a bare perusal of the provisions contained in the statutory mandate contained in Section 47-A makes it manifest that the Collector can initiate proceedings under Section 47-A in the circumstances mentioned in sub-section (3) thereof, whereas in the present case the proceedings have neither been initiated suo motu nor have the same been initiated on a reference made by any court or authority mentioned in sub-section (3) of Section 47-A and, therefore, the proceedings have been initiated without any sanction of law. He has further submitted that a reference to the Collector and the proceedings under Section 47-A could not have been initiated on the reference made by the Additional District Magistrate (Finance / Revenue).

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Learned counsel for the petitioners has placed reliance on a decision rendered by Coordinate Bench of this Court in case of Ganga Ram Vs. State of U.P. & others 2020 (38) LCD 1991 in which this Court was pleased to hold as follows :-

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"25. Under the U.P. Stamp Valuation of Property Rules, 1997, Rule-7 provides the procedure on receipt of a Reference or when suo motu action is proposed under Section 47-A of the Act. Rule 7(2)(c) provides that the Collector may inspect the property after due notice to parties to the instrument.

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26. The complete reading of the aforesaid Rule clearly indicates that while deciding the proceedings under Section 47-A of the Act, the Collector or any other officer authorized to determine stamp duty, is required to make an inspection after due notice to the parties to the instrument. The proceedings under Section 47-A of the Act shall not be decided merely placing reliance on the ex-parte report of the Sub Registrar or the Tehsildar for that purpose."

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Learned counsel for the petitioners has further submitted that the nature of land which was the subject matter of the transaction in question was agricultural as per the entries made in the Khasra and the allegation made in the inspection report that the property in residential, is wrong.

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On the other hand, the learned State Counsel has submitted that the Additional District Magistrate is empowered to carry out an inspection and submit a report to the Collector.

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A perusal of the order dated 3.2.2022 passed by the Collector, Shrawasti indicates that the Collector has proceeded to pass the order on the basis of a report dated 16.10.2021 submitted by the Tehsildar, Ikauna and the Collector did not make the inspection of the property in question herself. As has been stated above, Rule 7(3)(c) of the U.P. Stamp Act (Valuation of Property) Rules, 1997 mandates the Collector to inspect the property himself after due notice to the parties to the instrument. The order passed on the basis of some report of the Tehsildar and an inspection made without any notice to the petitioners, indicates that the basis of passing of the order i.e. the report submitted by the Tehsildar, is not known to the law.

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The petitioners had challenged the aforesaid order dated 3.2.2022 by filing a revision under Section 56(1) of the Indian Stamp Act before the Additional Commissioner, Devi Patan Mandal, Gonda which has been rejected without going into the aforesaid legal issues.

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Keeping in view the aforesaid discussion, I find that the order dated 3.2.2022 passed by the Collector, Shrawasti in Case No. 2 of 2021 under Section 47-A of the Indian Stamp Act, 1899 and the order dated 28.4.2022 passed by the Additional Commissioner, Devi Patan Mandal, Gonda in Case No. 254 of 2022 under Section 56(1) of the Indian Stamp Act, 1899 are not sustainable in law.

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Accordingly, the instant writ petition is allowed .

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The aforesaid orders dated 3.2.2022 passed by the Collector, Shrawasti in Case No. 2 of 2021 under Section 47-A of the Indian Stamp Act, 1899 and the order dated 28.4.2022 passed

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by the Additional Commissioner, Devi Patan Mandal, Gonda in Case No. 254 of 2022 under Section 56(1) of the Indian Stamp Act, 1899 are hereby quashed. Consequently, the recovery citation dated 12.5.2022 issued by the Tehsildar for recovery of the amount in furtherance of the order dated 03.02.2022 is also quashed.

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However, the Collector Shrawasti will be at liberty to take fresh action against the petitioners strictly in accordance with the provisions of Indian Stamp Act, 1899 and the U.P. Stamp Act (Valuation of Property) Rules, 1997.

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Order Date :- 14.6.2022 Arif

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Digitally signed by MOHAMMAD ARIF Date: 2022.06.15 11:34:54 IST Reason: Location: High Court of Judicature at Allahabad, Lucknow Bench

Smt. Safiya Khatoon and Another v. State of U.P. Thru. Addl. Chief Secy. of the Stamp and Registration Deptt. Lko. and Others

Case brief

What is this about?

What did the court decide?

Smt. Safiya Khatoon and Another v. State of U.P. Thru. Addl. Chief Secy. of the Stamp and Registration Deptt. Lko. and Others

Case brief

What is this about?

What did the court decide?

What the court decided

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