2015 (4) TMI 1367 - HC - Indian Laws

Demand towards the deficient stamp duty and registration charges - HELD THAT - The market value of the land subject matter of an instrument produced for registration has to be assessed on the basis of the nature of the land as on the date of execution of the instrument and the possible future use of the land for any other purpose is hardly of any relevance and no assessment of the market value of the land can be made keeping in view the intended use of the land by the beneficiary of the instrument. A bare perusal of the order impugned reveals that the market value of the land in question has been assessed by the Collector (Stamp) on the basis of the value of the adjacent land sold after due conversion of the land for residential purpose whereas indisputably the land in question was agriculture land as on the date of execution of the sale deed. In Ambrish Tandon s case 2012 (1) TMI 197 - SUPREME COURT where the market value of the property in question a residential house was assessed on the basis of its intended use for commercial purpose in future the Hon ble Supreme Court held that merely because the property is being used for commercial purpose at the later point of time may not be relevant criterion for assessing the value for the purpose of stamp duty. Conclusion - The Collector s assessment of market value as residential land relying on adjacent land sales was deemed incorrect as the subject land was agricultural at the time of execution. Petition allowed.

Summary

1. The core legal issue in this case is the legality of the order passed by the Collector (Stamp) under the Rajasthan Stamp Act, 1998, creating a demand for deficient stamp duty and registration charges. Specifically, the petitioner challenges the assessment of market value of agricultural land as residential land, leading to the imposition of additional charges.

2. The court analyzed the relevant provisions of the Rajasthan Stamp Act, 1998, and considered the petitioner's argument that the assessment of market value based on the potential future use of the land is incorrect. The court referred to the Supreme Court decision in 'State of U.P. & Ors. Vs. Ambrish Tandon & Anr.' to support the petitioner's contention.

3. The court found that the market value of the land should be assessed based on its nature at the time of execution of the instrument, not on its potential future use. The Collector's assessment of market value as residential land, relying on adjacent land sales, was deemed incorrect as the subject land was agricultural at the time of execution.

4. The court concluded that the writ petition should be allowed, setting aside the Collector's orders dated 26.9.08 and 21.1.10, and ruling in favor of the petitioner.