2009 (4) TMI 832 - SC - Indian Laws

Whether the condition precedent to pass an order under section 47 A of the Stamp Act, as amended by the State of Uttar Pradesh (in short U.P.), was present in the instant case? Whether the said documents were deeds of assignment falling under Article 63 of the Schedule 1-B of the Stamp Act, as applicable to the State of UP or they were deeds of conveyance, as defined in section 2(10) of the Stamp Act to which Article 23 would be applicable? Whether the document dated 22nd of November, 1997, is a deed of assignment or it is a conveyance to which Article 23 applies and if so,whether the order dated 22nd of November, 1997, passed by the Sub-Registrar purporting to make areference under Section 47 A of the Stamp Act, as applicable to the State ofUP is not legal and without jurisdiction? Whether the relevant date for determining the consideration entered in the document would be the market value of the property on the day of entering into the agreement for sale and not the date of presentation of the documents for registration? Held that - Appeal allowed. Setting aside the judgment of the High court we hold that in the instant case Article 63 of Schedule 1-B of the Stamp Act, as applicable to the State of U.P., which deals with transfer of lease by way of assignment will apply to the documents in question. We also hold that the consideration to be mentioned in the document would be the market value of the property on the date when the agreement was entered into and not when it was presented for registration, considering the peculiar facts of this case.

Summary

Issues Involved:
1. Condition precedent to pass an order under Section 47 A of the Stamp Act.
2. Classification of documents as deeds of assignment or deeds of conveyance.
3. Legality and jurisdiction of the Sub-Registrar's order dated 22nd November 1997.
4. Relevant date for determining the consideration in the document.

Detailed Analysis:

1. Condition Precedent to Pass an Order Under Section 47 A of the Stamp Act:
The Supreme Court examined the scope of Section 47 A of the Stamp Act as amended by the State of Uttar Pradesh. Section 47 A empowers the revenue authorities to charge duty based on the market value of the property in cases of evasion of stamp duty. The Court clarified that the registering authority must first register the document and then make a reference to the Collector if it deems the market value is understated. The Court emphasized that the registering officer could not refer the instrument to the Collector before registering it, as mandated by the Act. This was supported by the decision in *State of Punjab vs. Mahavir Singh*.

2. Classification of Documents as Deeds of Assignment or Deeds of Conveyance:
The Court analyzed whether the documents in question were deeds of assignment under Article 63 or deeds of conveyance under Article 23 of the Stamp Act. The Court referred to definitions under the Transfer of Property Act and the Indian Stamp Act, concluding that the documents were assignments of leasehold rights rather than outright sales. The Court noted that the lease deed executed between Noida and the cooperative societies included covenants binding the land and its appurtenances, indicating an assignment rather than a sale.

3. Legality and Jurisdiction of the Sub-Registrar's Order Dated 22nd November 1997:
The Court held that the Sub-Registrar's order, which purported to make a reference under Section 47 A, was invalid and without jurisdiction. Given that the documents were deeds of assignment under Article 63, the registering officer had no jurisdiction to inquire into the market value of the property under Section 47 A. The Court reiterated that Section 47 A applies only to instruments where duty is charged based on market value, which was not the case here.

4. Relevant Date for Determining the Consideration in the Document:
The Court addressed whether the consideration should be based on the market value at the date of the agreement to sell or the date of presentation for registration. The Court concluded that in cases where the delay in execution was not due to the transferee's fault, the relevant date for determining consideration should be the date when the agreement was entered into. This was supported by the decision in *S.P. Padmavati vs. State of Tamil Nadu & Others*, where the consideration was frozen earlier due to no fault of the transferee.

Conclusion:
The Supreme Court set aside the High Court's judgment, holding that Article 63 of Schedule 1-B of the Stamp Act, applicable to Uttar Pradesh, governs the documents in question. The consideration should be based on the market value at the date of the agreement. The appeal was disposed of with no order as to costs.