1. The petitioner along with one Ajay Jindal sought to purchase 9 kanals 10 marlas of land detailed in para 2 of the petition from Om Parkash for a sum of Rs.40,000/- and for this purpose a regular sale deed was executed between the parties on stamp paper worth Rs.4,004/-. It is not in dispute that as per the value mentioned in the sale deed this was the correct stamp duty payable in terms of Art. 23 of Sch. I of Stamp Act, 1809. When this document was presented before the Sub-Registrar for registration, the same was duly endorsed by the latter in terms of Ss. 58 and 59 of the Registrar Act, 1908. As soon as the procedure for registration of the document was completed the Sub-Registrar impounded it for the reason that the sale consideration had been under valued and forwarded the same to the Registrar, i.e., Deputy Commissioner, Patiala, for such necessary action as he may deem proper.
The Registrar ordered an enquiry through S. D. O. (C) Nabha to determine the market value of the land sold to the petitioner. As a result of the enquiry, he reported that the value of the same came to Rs.25,849.60/- per acre. As per this report the value mentioned in the sale deed obviously was not understated. Somehow, the Registrar did not feel satisfied with the report of S. D. O, (C) and asked him to look into the matter again keeping in view the location and potentiality of the land sold. On reconsideration in of the mater the S. D. O. (C) reported back that the value of the land sold was Rs.41,432/- per acre. On the basis of this report the Registrar ordered the making up of the deficiency in the stamp duty to the extent of Rupees 950/- and further imposed a penalty to the same extent i.e. Rs.950/-. It is this action of the Registrar which is now impugned through this petition.
2. Learned counsel for the petitioner points out that the action and the procedure resorted to by the Registrar discloses a colossal ignorance of the relevant provisions of law and same is wholly unsustainable. According to the learned counsel, the Registrar under no circumstances can determine the market value of the property sold and then to conclude that the price mentioned in a particular sale deed has been understated and then to charge stamp duty on the same. The solitary stand of the Registrar is that the whole action was taken by him under S. 40 of the Stamp Act. What is now being sought to be highlighted by the counsel appearing for him is that under clause (b) of sub-section (1) of S. 40 of the Act whenever the Registrar is of the opinion that an instrument is chargeable with duty and is not duly stamped he shall require the payment of the proper duty or the amount required to make up the same, together with a penalty. A bare reading of this clause indicates that the Collector has to formulate an opinion with regard to the chargeability of the stamp duty and its extent on the basis of the terms settled between the parties and the relevant provision of the statute or as provided for in Sch. 1 to the Act.
As already mentioned in the opening part of the order, the Article governing the case in hand is Art. 23 of the Schedule. If the amount of the sale transaction as mentioned in the sale deed is taken to be the amount settled between the parties then stamp duty already paid by the petitioner is not in any way in derogation to this Article. What the Registrar has sought to do is that the sale consideration mentioned in the sale deed does not represent the market value and that is how the transaction has been undervalued. Learned counsel has not been able to refer to any provision of law under which the Registrar can rely on the market value of any property sold for determining the chargeability of the stamp duty on the same. Undoubtedly, the parties to a transaction are under an obligation in view of the provisions of S. 27 of the Act to mention all facts and circumstances affecting chargeability of stamp duty and if they fail to do so they are liable to be prosecuted or proceeded against under S. 64 of the Act. In fact, to my mind, the case is completely covered by a decision of the Supreme Court in Himalaya House Co. Ltd., Bombay v. Chief Controlling Revenue Authority, (1972) 1 SCWR 739 : (AIR 1972 SC 899), wherein their Lordships after a reference to the provisions of S. 27, Art. 23 of the Schedule and a long list of precedents have observed as follows (at p. 904 of AIR) :
'It is true that in view of this provision, the parties to a document are required to set forth in the document fully and truly the consideration (if any) and all other facts and circumstances affecting the chargeability of that document with the duty or the amount of the duty with which it is chargeable. But a failure to comply with the requirements of that section is merely punishable under S. 64 of the Stamp Act. No provision in the Stamp Act empowers the Revenue to make an independent enquiry of the value of the property conveyed for determining the duty chargeable. Article 23 is the article that governs the charges of the stamp duty on 'conveyance.'
Thus it is patent that the Registrar was acting wholly without jurisdiction while trying to find out the market value of the land sold in order to assess the chargeability of the stamp on the same.
3. In the light of the discussion above, the order and action of the Registrar asking for stamp duty worth Rs.950/- and also imposing penalty to that extent are quashed. As a result of this, the respondents are directed to complete the formalities under S. 61 of the Registration Act and to return the document to the petitioner. Thus this petition is allowed in the manner indicated above with costs. Counsel's fee is determined at Rupees 300/-.
4. Petition allowed.