TMI Blog1991 (10) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioners that as per the extant instructions, the sale-deeds can be registered only if the property is valued as house sites at ₹ 120/- per square yard. The documents were treated as pending documents. The petitioners have, therefore filed the writ petitions. 3. It is the case of the petitioners that in the revenue records, the land in question is classified as dry lands and dry crops and fodder grass are being grown on the lands. The petitioners say that there are two wells irrigating the lands. According to the petitioners, lands are quite far away from the village and there are no residential houses in and around S. Nos. 8 and 9. It is stated that the land has been reserved for 'conservation use' by the Hyderabad Urban Development Authority. 4. By A. P. Act 22 of 1971, Section 47 was inserted in the Indian Stamp Act and this amendment was brought into effect from 16-8-1975. Section 47-A was further amended by A. P. Act 17 of 1986. Section 47-A provides that if the registering officer has reason to believe that the market value of the property which is the subject-matter of any instrument of conveyance, gift, partition, etc., has not been truly set forth i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his remarks as to how the details in Column 8 are arrived at. Under this Column, the registering officer has stated that as per M.V. ₹ 120/- per sq. yard . The abbreviation 'M.V.' obviously denotes 'Market Value'. The learned Government Pleader then invited my attention to the averments in the counter. In the counter, it is stated that in the year 1989-90, the lands in S. Nos. 7 and 9 of Mansoorabad village were sold as house sites and the value mentioned in the sale-deeds was ₹ 80/- per sq. yard. It is stated that as per the basic vaule register, the lands in S. Nos. 8 and 9 were being treated as house sites from the year 1975 onwards. Between 1975 and 1980, the value of the lands was noted in the register as ₹ 2/- per sq. yard and thereafter up to 1987, the value was noted as ₹ 15/- per sq. yard. During the years 1988 to 1990, the value was increased to ₹ 80/- per sq. yard and from 16-8-1990 onwards, the value of the lands in the said S. Nos. was further increased to ₹ 120/- per sq. yard. It 'is then explained as to how the basic value register is prepared. The 1st respondent states that after taking into ,consideration a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o earlier. According to the learned Judge, these instructions are not mere guidelines issued to guide and help the registering officers in forming the requisite opinion but they are more in the nature of a command leaving no room for discretion. The learned Judge, therefore, held that the values stated in the register cannot be treated as binding upon the registering officers or upon the parties who present the documents. At the same time, the learned Judge observed that at the most, it can be treated as a guideline, a relevant material, by the registering officers . The learned Judge also held that S. 47-A is meant to meet cases of undervaluation and as pointed out by the Division Bench of the Madras High Court in State of Tamil Nadu v. Chandrasekharan, , normally, the consideration stated as the market value in a given instrument brought for registration should be taken to be correct unless circumstances exist which suggest fraudulent evasion. In other words, according to the learned Judge, it is not enough to show that the consideration stated in the instrument of sale is less than the prevailing market value but it must be further shown that it is a case of under-valuation. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion Bench of this Court and the writ appeal filed by the State is pending. Having regard to these considerations, I would prefer to decide the issue posed for my decision independent of the said judgment, without basically differing from the principles laid down in the judgment. 8. It must be noted that the foundation for exercise of jurisdiction under S. 47-A of the Act is that the registering officer should have 'reason to believe' that the market value of the property has not been truly set forth in the instrument presented for registralion. He will then refer the matter to the Collector for determination of market value and proper duty payable. The crucial expression is 'reason to believe' -- which is a well known legal expression used to limit or subdue the otherwise vast and extensive power or discretion confided to a statutory authority. It may perhaps be relevant to refer to a few decisions of the Supreme Court which have considered the import of this expression. 9. In Berium Chemicals v. Company Law Board, it was observed that the words 'reason to believe'do not lead to the construction that the process of entertaining 'reason to believe&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escapement of the income of the assessee..... It is no doubt true that the Court cannot go into the sufficiency or adequacy of the material and substitute its own opinion for that of the I.-T.O..... At the same time, we have to bear in mind that it is not any and every material, howsoever vague and indefinite of distant, remote and far-fetched which would warrant the formation of the belief relating to escapement of the income of the assessee from assessment. The learned Judge then stressed that the words of Statute are 'reason to believe' and not 'reason to suspect.' 10. Going by the principles enunciated above, whether we call the process of formation of belief as subjective or 'not altogether subjective' as observed by the Supreme Court in Lakhmani's case, the objective element has been brought to bear upon this process by employing the word 'reason'. Existence of a reason and its relevancy and nexus to the formation of belief are the fundamental postulates for the exercise of power such as the one contained in S. 47-A of the Stamp Act. It connotes that there must be material before the concerned authority to form the requisite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rules are not relevant for our purpose, 12. Sub-rule (3) of Rule 3 is complementary to S. 47-A and is meant to be a step-in-aid for reaching the satisfaction whether the market value or consideration has been correctly furnished in the instrument. It provides for an enquiry to be made for this purpose. The registering officer is expressly empowered to call for any relevant information from the parties and he can also call for and examine any records kept with a public officer. Of course, such enquiry is, in the very nature of things, a summary enquiry. But the enquiry facilitates the Registering Officer to form the belief or to reach the satisfaction on the crucial question whether the value or consideration of the property sought to be registered has been correctly stated. Whenever the Registering Officer entertains a doubt about the correctness of the value or consideration stated in the document, it is incumbent on the part of the registering authority to make an enquiry either by examining the parties or by gathering information from other sources including the official or public record. Of course, if any material is gathered from official records or otherwise, it has to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the purpose which the sub-rule is intended to achieve, the scheme of Rules 3,4 and 5 and the undesirable consequences that might follow by holding that the enquiry is not obligatory in case of a dispute, I am inclined to think that the expression 'may' occurring in sub-rule (3) of R. 3 confers on the Registering Officer a I power coupled with the duty. If it is construed as merely an enabling provision as contended by the learned Government Pleader, it is left to the sweet will and pleasure of the Registering Officer whether to conduct an enquiry or not. Moreover, such an interpretation will stultify the objective of the rule as noticed earlier. Accepting the argument of the learned Government Pleader would mean that wherever there is a basic value register, the question of holding an enquiry under R. 3 will not arise and in a case of variation between the value noted in the register and the sale deed, the Registering Officer will have no option but to refer the document to the Collector under S.47-A. But that will be ignoring the purpose and scheme of the Rules and amounts to placing the basic value register on a higher pedestal than what it deserves. I therefore, r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... troversy on the true nature of the land notwithstanding what has been mentioned in the basic value register. In such a situation, it is incumbent on the part of the registering authority to form a belief as envisaged by S.47-A of the Stamp Act only after holding an enquiry in whatever form it may be, under sub-rule (3) of R. 3. As this has not been done and the documents have been straightway referred to' the Collector, I declare the impugned action of the 1st respondent as illegal and contrary to law. Of course, I am not expressing any view on the merits of the petitioners' contention that the land in question shall be treated as agricultural land only and evaluated on that basis. It is for the Registering Officer to form the requisite opinion or belief after holding an enquiry in which the petitioners shall be given an opportunity to put forward their case. If after such enquiry the Registering Officer forms the reasonable belief that the consideration amount stated in the document is prima facie not in conformity with the market value of the land, then only a reference under S. 47-A can be made to the Collector. 15. The rough and ready working principle indicated by J ..... X X X X Extracts X X X X X X X X Extracts X X X X
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