Allowed

Kinder Women'S Hospital & Fertility Centre Private Limited v. State of Kerala

Kerala HC13 Mar 2018WP(C)/18440/2012

Case brief

AI extract

What is this about?

The High Court quashed orders treating a Ratification Deed as a Conveyance without opportunity to prove the underlying property belonged to the partnership firm. The court remitted the matter for fresh consideration on merits after satisfying the respondents that KVM Hospital is an undertaking of the partnership firm.

What did the court decide?

The impugned orders treating the deed as a conveyance are quashed. The matter is remitted to the Sub-Registrar for fresh consideration after the petitioner submits cogent materials establishing KVM Ho

Kinder Women'S Hospital & Fertility Centre Private Limited… — Property and Title | Kerala HC (2018)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS

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TUESDAY, THE 13TH DAY OF MARCH 2018 / 22ND PHALGUNA, 1939

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WP(C).No. 18440 of 2012

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PETITIONER :

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KINDER WOMEN'S HOSPITAL & FERTILITY CENTRE PRIVATE LIMITED (PREVIOUSLY KVM-KINDER HOSPITAL AND RESEARCH CENTRE PRIVATE LIMITED) HAVING ITS REGISTERED OFFICE AT MARUTHORVATTOM TEMPLE ROAD, NEAR N.H.-47, CHERTHALA, ALAPPUZHA-688539, REPRESENTED BY ITS MANAGING DIRECTOR, SRI.PRAVEEN KUMAR A.

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BY ADVS.SRI.ASWIN GOPAKUMAR SRI.PRAVEEN.H. SRI.ANWIN GOPAKUMAR SMT.KALA G.NAMBIAR SRI.K.AMAL NATH NAIK

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RESPONDENTS :

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1. STATE OF KERALA REPRESENTED BY ITS SECRETARY, DEPARTMENT OF REVENUE, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695001.

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2. THE SUB-REGISTRAR OFFICE OF SUB-REGISTRAR, PUTHANAMBALAM, CHERTHALA, ALAPPUZHA-688551.

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3. THE DISTRICT REGISTRAR (GENERAL) OFFICE OF THE DISTRICT REGISTRAR, IRUMBUPALAM P.O., ALAPPUZHA-688011.

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R1 TO R3 BY SENIOR GOVERNMENT PLEADER SRI.SAIJI JACOB PALATTY

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 13-03-2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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11/4/2018

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WP(C).No. 18440 of 2012

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APPENDIX

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PETITIONER'S EXHIBITS :

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P1:	COPY OF THE REGISTERED ASSIGNMENT DEED DATED 6/4/2009
P2:	COPY OF PARTNERSHIP EXECUTED BY THE PARTNERS OF M/S. TRAVANCORE MATS AND MATTING DATED 01/4/2008
P3:	COPY OF THE REGISTERED ASSIGNMENT DEED DATED DATED 28/2/2008.
P4:	COPY OF THE MINUTES OF THE MANAGING COMMITTEE MEETING OF M/S. TRAVANCORE MATS AND MATTING COMPANY HELD ON 15/3/2009.
P5:	COPY OF JUDGMENT DATED 24/5/2012 IN WPC 8927/2012 PASSED BY THE HONOURABLE HIGH COURT, ERNAKULAM.
P6:	COPY OF RATIFICATION DEED EXECUTED BY ALL PARTNERS DATED 7/6/2012.
P7:	COPY OF THE ORDER DATED 24/7/2012 PASSED BY THE R3
P8:	COPY OF THE RECEIPT DATED 11/7/2012 ISSUED BY THE R2.

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RESPONDENT'S EXHIBITS : NIL.

//TRUE COPY//

P.A. TO JUDGE

bp 11/4/2018

ALEXANDER THOMAS, J.

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==================

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W.P.(C).No. 18440/2012

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==================

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Dated this the 13^th day of March, 2018 J U D G M E N T

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The prayers in this Writ Petition (Civil) are as follows:

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“(i) issue a writ of certiorari or any other appropriate writ, direction or order and quash Ext.P-7 order passed by the 3^rd respondent; and

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(ii) declare that Ext.P-6 Ratification Deed is a perfectly valid document on which proper stamp duty as per the Kerala Stamp Act, 1959 has been paid.

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(iii) issue a writ of mandamus or any other appropriate writ, direction or order commanding respondents 2 and 3 to register Ext.P-6 Ratification Deed.”

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Heard Sri.Aswin Gopakumar, learned counsel appearing for

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the petitioner and Sri.Saigi Jacob Palatty, learned Senior Govt. Pleader appearing for the respondents.

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The brief of the facts leading to this Writ Petition (Civil) is as follows:- By Ext.P-3 registered sale deed No.557 of 2008 dated 28.2.2008 of SRO Puthanambalam, Alappuzha district, KVM Hospital, represented by its Chief Medical Officer (CMO) and Director, Dr.V.V.Haridas, had purchased 3 items of properties from one Smt.Asha Anil Kumar, Sri. Anil Kumar and Smt.Aswathy Pavithran respectively. Dr.V.V.Haridas, is stated to be the chief medical officer and director of KVM Hospital. It is further stated that Dr.V.V.Haridas, is one of the partners of M/s. Travancore Mats & Matting Company, a registered partnership firm constituted under the provisions of the Indian Partnership Act, 1932. Further that KVM Hospital is an undertaking of the abovesaid partnership firm, M/s. Travancore Mats

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W.P.(C).18440/12 - : 2 :-

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& Matting Company.

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That by Ext.P-4 minutes dated 15.3.2009, M/s. Travancore Mats & Matting Company (the abovesaid partnership firm) had authorised Dr.V.V.Haridas, one of the partners of the firm, who also happens to be the chief medical officer of the partnership's firm's undertaking KVM Hospital, to execute sale deeds in respect of the above properties covered by Ext.P-3 to M/s. Kinder Hospital & Research Centre Pvt. Ltd. Cherthala.

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It is the further case of the petitioner that pursuant to Ext.P-4 minutes dated 15.3.2009, by Ext.P-1 sale deed No.551/2009 dated 6.4.2009 of SRO Puthanambalam, Dr.V.V.Haridas, on behalf of M/s. KVM Hospital, had conveyed the properties concerned (covered by Ext.P-3 registered sale deed) to M/s.KVM Kinder Hospital & Research Centre, Pvt. Ltd. represented by its Director Dr.V.V.Haridas. It appears that the petitioner company, M/s.Kinder Women's Hospital & Fertility Centre Pvt. Ltd. was previously known by name M/s.KVM Kinder Hospital & Research Centre Pvt. Ltd. as shown in the cause-title of this Writ Petition.

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That when the petitioner company had approached the bank concerned for grant of loan, the said bank had insisted that all the partners of M/s.Travancore Mats & Matting Company should execute a release deed so as to clear the title as per Ext.P-1. That thereupon, the partners of M/s. Travancore Mats & Matting Company had prepared a release deed for the subject property in favour of the petitioner's company. That then

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the 2^nd respondent SRO had refused to register the said release deed. That thereupon the petitioner company had filed a Writ Petition (Civil) as W.P. (C).No. 2897/2012, wherein all the seven partners of the said partnership firm including Dr.V.V.Haridas were arrayed as contesting respondents 1 to 7 and the present R-2, Sub Registrar and R-3 District Registrar (General) were arrayed as R-8 and R-9 therein. The petitioner company has sought the main prayer in W.P.(C).No. 8927/2012 by way of a direction to official respondents 8 and 9 therein to register the original of Ext.P-5 therein (release deed) if produced before them on payment of duty. The learned Senior Govt. Pleader on instructions had then submitted before this Court that document concerned was yet to be produced for registration before the Sub Registrar and that the representation as per Ext.P-6 was addressed to the District Registrar. Thereupon, this Court had disposed of W.P.(C).No. 8927/2012 as per Ext.P-5 judgment dated 24.5.2012 by directing that the petitioner will produce the document for registration which will be dealt with by the Sub Registrar in terms of provisions of the Act and the Rules and if everything is in order, it will be duly registered.

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Thereafter the petitioner secured legal advice that in the facts of this case, the proper course is not to present and register a release deed and that the correct course of action is for all the partners of the said partnership firm to execute and present for registration a ratification deed, stating that all of them have ratified the action of the one of the partners,

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Dr.V.V.Haridas, in conveying the property covered by Ext.P-3 to the petitioner company as per Ext.P-1 registered sale deed and that for registering such a ratification deed, the stamp duty is Rs. 100/- as per the relevant provisions. That thereupon, all the seven partners of the registered partnership firm, M/s.Travancore Mats & Matting Company had executed and presented Ext.P-6 ratification deed in favour of the petitioner company. Ext.P-6 ratification deed, inter alia, also speaks about Ext.P-4 minutes dated 15.3.2009 of the registered partnership firm, M/s. Travancore Mats & Matting Company, etc.

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On presentation of Ext.P-6 ratification deed, the 2^nd respondent Sub Registrar, SRO, Puthanambalam, Cherthala, Alappuzha, has taken the view that the aspect that M/s.KVM Hospital was only a undertaking of the partnership firm M/s.Travancore Mats & Matting Company, etc. has not been disclosed either in Ext.P-3 deed or in Ext.P-1 sale deed and that therefore what is sought to be transacted as per Ext.P-6 deed is a new transaction between the partners of M/s. Travancore Mats & Matting Company vis-a-vis the petitioner company and that the transaction covered by Ext.P-6 deed could be a conveyance as envisaged in Sec.2(d) of the Kerala Stamp Act, 1959 and that it cannot be treated to be a ratification deed, for which the stamp duty is only Rs. 100/- as envisaged in Sec. 4(1) of the Kerala Stamp Act, etc. Thereupon, the 2^nd respondent SRO had impounded Ext.P-6 deed and had forwarded the matter to the

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competent authority, viz., the 3^rd respondent District Registrar (General), for completing the impounding procedures. It appears that due to the insistence of the 2^nd respondent, the petitioner was also constrained to pay stamp duty of Rs.1,81,200/- on Ext.P-6 deed as per Ext.P-8 dated 11.7.2012 [incidentally it may be noted that in Ground E of page 8 of the W.P.(C) it is stated that the amount paid as per Ext.P-8 for registration of Ext.P-6 deed was Rs.1,51,200/-, whereas the hand written figure shown in the photocopy of Ext.P-8 as produced in this Writ Petition (Civil) is Rs. 1,81,200/-].

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Thereafter the 3^rd respondent District Registrar (General) has issued the impugned Ext.P-7 proceedings dated 24.7.2012 stating that Ext.P-6 deed cannot be treated as a ratification deed, for which only stamp duty of Rs. 100/- is to be levied in terms of Sec.4(1) of the Act, but that the said deed is to be treated as a conveyance as defined in Sec. 2(d) of the Stamp Act and that therefore the stamp duty payable on the said Ext.P-6 deed is Rs. 5,29,200/- (7% of the value of the property of Rs.75,60,000/as shown in Ext.P-1 sale deed) along with penalty of Rs. 100/- as per Sec. 39(1)(b) of the Kerala Stamp Act. It is this order at Ext.P-7 that is under challenge in this Writ Petition.

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The 2^nd and 3^rd respondents have filed counter affidavit dated 2.11.2012. Therein the reasonings shown in the impugned Ext.P-7 proceedings are reiterated.

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W.P.(C).18440/12 - : 6 :-

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On the one hand, it is contended in para 3 of the said counter affidavit that as a matter of fact there was no necessity for the parties concerned to execute such a ratification deed at all, as it cannot be said that there is any cloud in the title of the petitioner company over the property conveyed as per Ext.P-1 on the basis of Ext.P-3 and that the ratification of the sale deed by the partners of the partnership firm as per Ext.P-6 ratification deed is meaningless as the said partnership firm has no title over the property. Therefore, the said contention taken up by official respondents 2 and 3 is to the effect that the whole exercise as per Ext.P-6 ratification deed is meaningless, etc., which clearly implies that even as per stand of respondents 2 and 3, no element of fraud, etc. was even remotely sought to be perpetrated by the parties to Ext.P-6 deed. On the other hand, it is contented in the counter affidavit that there is no mention whatsoever that the property that was conveyed by Ext.P-6 sale deed to KVM Hospital, represented by Chief Medical Officer, Dr.V.V.Haridas, is a property that was actually purchased for and on behalf of the registered partnership firm, M/s.Travancore Mats and Matting Company Ltd. and that this aspect is also conspicuously omitted to be stated, not only in the prior deed as per Ext.P-3 but also in the subsequent Ext.P1 sale deed on the basis of which, the petitioner company was conveyed the property. That in Ext.P-3 the recitals were only to the effect that the properties therein were purchased by KVM Hospital, through its chief medical officer and director,

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Dr.V.V.Haridas. Further that it is stated in Ext.P-1 sale deed that the said property which was purchased by KVM Hospital, through its chief medical officer as per Ext.P-3 sale deed, was sought to be conveyed to the petitioner company as per Ext.P-1 sale deed. That neither in Ext.P-3 nor in Ext.P-1 is there any mention that KVM Hospital is an undertaking of the registered partnership firm M/s.Travancore Mats & Matting Company and that therefore, the present attempt sought to be made by Ext.P-6 deed could be an attempt made by the partners of the firm to duly convey the rights of the property to the petitioner company and that therefore, it would amount to conveyance as specified under Sec. 2(d) of the Act and that it cannot be understood as a ratification deed for which a lesser stamp duty of Rs.100/- alone is to be paid as per the provisions contained in Sec. 4(1) of the Act.

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Sec. 2(d) of the Kerala Stamp Act, 1959, reads as follows:

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"Sec. 2: Definitions. - In this Act, unless the context otherwise requires,--

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(a) ...

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(d) " 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 the Schedule.”

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Sec. 4(1) of the Kerala Stamp Act, 1959, reads as follows:

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"Sec.4: Several instruments used in single transaction of sale, mortgage or settlement. (1) Where, in the case of any sale, mortgage or settlement, several instruments are employed for completing the transaction, the principal instrument only shall be chargeable with the duty prescribed in the Schedule for the conveyance, mortgage, or settlement, and each of the other instruments shall be chargeable with a duty of Five hundred rupees instead of the duty, if any, prescribed for it in the Schedule.”

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Having heard both sides, this Court is of the considered view that respondents 2 and 3 have clearly misdirected themselves in jumping into the conclusion as arrived in the impugned Ext.P-7 order. It is true that in Ext.P-3 sale deed, it is only stated that the property therein was purchased by KVM Hospital through its Chief Medical Officer and Partner, Dr.V.V.Haridas. So also, it is only stated in Ext.P-1 sale deed that the said property purchased as per Ext.P-3 by M/s.KVM Hospital, represented by its Chief Medical Officer, Dr.V.V.Haridas, that is sought to be conveyed by that hospital to the petitioner company as per Ext.P-1 sale deed. Both in Ext.P-3 and Ext.P-1, the drafters of the deed have not cared to mention the crucial aspect that, as a matter of fact M/s.KVM Hospital is only an undertaking of the registered partnership firm M/s.Travancore Mats & Matting Company Ltd. and that the property is vested with the said registered partnership firm, as per Ext.P-3 sale deed and it was the said property, which was actually vested with the said registered partnership firm, that has been conveyed by the undertaking of the partnership firm, M/s. KVM Hospital to the petitioner company as per Ext.P-1 sale deed. Therefore, in the absence of clear recitals in Exts.P-3 and P-1 to that effect, certainly respondents 2 and 3 cannot be found fault with for observing about the absence of recitals in that regard as stated herein above and that therefore the said registered partnership firm M/s. Travancore Mats & Matting Co. Ltd., could be an entity, which could possibly be different from

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M/s.KVM Hospital. Having said so, it should also be equally observed by this Court that both respondents 2 and 3 have totally ignored and excluded from their effective consideration of the crucial aspects mentioned in Ext.P-6 ratification deed, the details of which are dealt with hereinafter.

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On the top of page 5 of Ext.P-6 deed, it is clearly stated that the property covered by Ext.P-3 was in fact purchased in the name of K.V.M. Hospital, which is only an undertaking of the registered partnership firm, M/s.Travancore Mats & Matting Company, Cherthala, registered under the Indian Partnership Act, 1932 as per Ext.P-3. Further it is also stated in the next paragraph on page 5 of Ext.P-6 that in Ext.P-4 minutes of the said registered partnership firm, M/s.Travancore Mats and Matting Company, held on 15.3.2009 that the said partnership firm had decided to sell the abovesaid property covered by Ext.P-3 to the petitioner company and had authorised Dr.V.V.Haridas, the Chief Medical Officer of KVM Hospital, to execute the sale deed on behalf of the said registered partnership firm in favour of the petitioner company. These crucial aspects have fully escaped the proper consideration of both respondents 2 and 3. Of course, even if those aspects were properly taken into consideration, the petitioners should have established, on the basis of some reliable materials that, as a matter of fact, KVM Hospital is only an undertaking of the registered partnership firm, M/s.Travancore Mats & Matting Company Ltd. and that therefore the purchase of the property made in the so-called name of KVM

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Hospital as per Ext.P-3 was in substance and essence in the name of the registered partnership firm and that it is this property, the title of which was vested with the registered partnership firm as per Ext.P-3 that was conveyed to the petitioner company as per Ext.P-1 sale deed. If such cogent and relevant materials were given to 2^nd and 3^rd respondents for their consideration in that line and if the said respondents were so satisfied about the correctness of such materials, then certainly the partnership firm as well as the petitioner company are fully right in contending that the so-called cloud in Ext.P-1 title could be properly rectified by executing a ratification deed in the nature of Ext.P-6, by which all the other partners of the partnership firm have ratified the action of Dr.V.V.Haridas, one of the partners of the partnership firm in having conveyed the property of the partnership firm to the petitioner company as per Ext.P-1. Thus respondents 2 and 3 have fallen into a great legal error in coming into the conclusion as stated herein above by ignoring the abovesaid crucial relevant aspects borne out Ext.P-6 ratification deed. The petitioner has also lapsed in not producing proper and cogent materials to convince respondents 2 and 3 about the abovesaid crucial aspect that the title to the property as per Ext.P-3 is actually vested with the registered partnership firm, inasmuch as KVM Hospital is only a undertaking of the partnership firm, which is not having any separate legal existence. Therefore, the matter requires a remit for serious reconsideration at the hands of the 2^nd

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respondent.

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In this connection, it is relevant to note that if the abovesaid crucial aspects could be established satisfactorily by the petitioner that the title to the property as per Ext.P-3 really belongs to the registered partnership firm, then there was no necessity for initially presenting a release deed, as all the rights of the partners were already conveyed by them to the petitioner company and all what really required was only a ratification deed as in the nature of Ext.P-6. Therefore, though the petitioner had initially presented a release deed, that too, before the 3^rd respondent District Registrar (General), the petitioner company and the partnership firm had later secured legal advice that the correct course of action is not to present and register a release deed, but to present and get registered a ratification deed as in Ext.P-6.

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It is relevant to note that after the consideration of Ext.P-6 deed, the 2^nd respondent (SRO) has come to the considered decision that it is a matter one which requires impounding of the document and thereupon forwarded the matter to the 3^rd respondent District Registrar for adjudication of the matters in regard to impounding as envisaged in Sec. 33 of the Kerala Stamp Act, 1959. Before the 2^nd respondent had taken such a decision, in all fairness he should have afforded a reasonable opportunity of being heard to the partnership firm through their authorised representative as well as the petitioner company and should have directed

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the said party concerned to provide necessary materials with them in regard to the abovesaid factual aspects made out in Ext.P-6 and thereafter, should have afforded an opportunity of personal hearing to the said parties. It is only thereafter that the 2^nd respondent should have taken a decision whether or not the matter requires impounding steps and consequently, whether the matter is to be forwarded to the 3^rd respondent for taking impounding steps as envisaged in Sec. 33 of the Kerala Stamp Act. The 2^nd and 3^rd respondents have not averred anywhere in the counter affidavit that the said procedural fairness was afforded to the said affected parties as stated herein above. Therefore, it is only to be held that the basic decision taken by the 2^nd respondent in arriving at the conclusion that the matter in relation to Ext.P-6 requires invocation of impounding procedures and consequently the matter should be forwarded to the 3^rd respondent DR for such impounding measures as per Sec.31 is vitiated by violation of principles of fairness and natural justice. Further it is also to be noted that before the 3^rd respondent-DR had taken the decision as the one in Ext.P-7 he ought to have given a fair opportunity to the abovesaid parties in the matter of production of necessary materials as stated herein above and also an opportunity for personal hearing before arriving at the decision as in the impugned Ext.P-7 proceedings. It is urged in the grounds in this petition that such a reasonable opportunity has not been granted to the parties and the said contention has not been denied in the counter affidavit of the

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respondents. Therefore, it is also to be held that there has been patent violation of the principles of fairness and natural justice even at the hands of the District Registrar at the time of rendering of Ext.P-7 proceedings. For these grounds also, the impugned proceedings are liable to be quashed and the matter is to be remitted to the competent authority concerned.

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In the light of the abovesaid discussion, it is only to be held that the basic decision taken by the 2^nd respondent in taking the view that the matter in Ext.P-6 deed requires invocation of impounding steps and consequent forwarding of the matter to the 3^rd respondent District Registrar for impounding measures as per Sec. 31 of the Kerala Stamp Act will stand quashed. So also, it is ordered that the impugned proceedings at Ext.P-7 issued by the 3^rd respondent DR as well as Ext.P-8 receipt will stand quashed. Consequently, it is ordered that the matter will stand remitted to the 2^nd respondent SRO, Puthanambalam, Cherthala, Alappuzha, for consideration afresh. The petitioner company and/or the registered partnership firm through its authorised representative will produce cogent and relevant materials before the 2^nd respondent to show that KVM Hospital is only an undertaking of the registered partnership firm, M/s.Travancore Mats and Matting Company and that Dr.V.V.Haridas was one among the partners of the said partnership firm and that thus what was conveyed to the KVM Hospital as per Ext.P-3 sale deed was actually in favour of the said partnership firm concerned. If this crucial

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aspect that KVM Hospital is only an undertaking of the said registered partnership firm could be satisfactorily established by the petitioner or the said registered partnership firm before the 2^nd respondent, then certainly the stand of the petitioner and that of the registered partnership firm that all what is required is only a ratification deed in nature of Ext.P-6 is fully correct and tenable and it cannot be treated as a conveyance as envisaged in Sec. 2(d) of the Act. It is for petitioner to properly satisfy the 2^nd respondent about this crucial aspect that KVM Hospital is only an undertaking of the registered partnership firm, M/s.Travancore Mats & Matting Company, etc. The petitioner company and/or partners of the partnership firm may be given a reasonable opportunity to submit their written submissions before the 2^nd respondent SRO and they should also be given reasonable opportunity to produce such materials as stated herein above and thereafter, they may be given a reasonable opportunity of being heard either in person or through authorised representative/counsel and after such hearing, the 2^nd respondent may take a considered and reasoned decision thereon. The petitioner will produce necessary relevant materials and the written submission along with a certified copy of this judgment within a period of one month from the date of receipt of a certified copy of this judgment and further formalities in that regard should be duly completed by the 2^nd respondent within six weeks thereafter by taking a considered decision in the matter as directed herein above. If, as a matter

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of fact, the petitioner or the registered partnership firm is in a position to produce proper materials to show that KVM Hospital is an undertaking of M/s. Travancore Mats & Matting Company at the time of registration of Ext.P-3 sale deed, then it is only to be held that the registration of Ext.P-3 ratification deed is in order and only a stamp duty for such ratification deed should be imposed and in such an eventuality, the amounts already paid as per Ext.P-8 should then be returned back to the party concerned after deducting any stamp duty that is actually payable in respect of the ratification deed. The entire formalities in this regard should be completed within the abovesaid time limit. If, on the other hand, the 2^nd respondent comes to the considered decision that the matter requires further steps for impounding, he will proceed so, strictly in accordance with law. In such eventuality, it will be open to the petitioner to work out their remedies in accordance with law.

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With these observations and directions, the above Writ Petition (Civil) stands finally disposed of.

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sdk+

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Sd/- ALEXANDER THOMAS, JUDGE ///True Copy///

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P.S. to Judge

Kinder Women'S Hospital & Fertility Centre Private Limited v. State of Kerala

Case brief

What is this about?

What did the court decide?

Kinder Women'S Hospital & Fertility Centre Private Limited v. State of Kerala

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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