2010 (3) TMI 1207 - SC - Indian Laws

Summary

Issues Involved:

1. Jurisdiction of the High Court under Article 227 of the Constitution.
2. Interpretation and application of Section 47-A of the Haryana Amendment to Stamp Act.
3. Validity of the sale deed and the evasion of stamp duty.

Summary:

1. Jurisdiction of the High Court under Article 227 of the Constitution:

The High Court set aside the concurrent findings of the lower courts while exercising its extraordinary jurisdiction under Article 227 of the Constitution. The Supreme Court emphasized that the jurisdiction conferred under Article 227 is limited to ensuring that the courts below function within the bounds of their authority and not to correct errors of fact or law. The High Court's interference with the findings of fact was deemed unsustainable as it exceeded its limited jurisdiction.

2. Interpretation and application of Section 47-A of the Haryana Amendment to Stamp Act:

Section 47-A of the Haryana Amendment to Stamp Act deals with under-valued instruments. The District Collector, Faridabad, determined that the sale deed was under-valued and directed the respondent to pay the deficient stamp duty. The High Court erroneously presumed the genuineness of the sale price based on the decree for specific performance, which was not in consonance with the notified circle rates. The Supreme Court held that the interpretation of Section 47-A must align with the circle rates to prevent evasion of stamp duty.

3. Validity of the sale deed and the evasion of stamp duty:

The sale deed for the commercial plot was executed for a consideration significantly lower than the circle rate, indicating an attempt to evade stamp duty. The District Collector's order, which was upheld by the Commissioner, directed the respondent to pay the balance stamp duty. The High Court's observation that the authenticity of the decree and the sale price cannot be questioned was found to be flawed. The Supreme Court restored the order of the District Collector, emphasizing that the sale deed must reflect the true value as per the circle rates to ensure proper stamp duty payment.

Conclusion:

The Supreme Court set aside the High Court's judgment, restored the order of the District Collector, and directed the respondent to pay the balance stamp duty within four weeks. The appeal was allowed, and the parties were directed to bear their respective costs.