TMI Blog1989 (10) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... mendment of the provisions, stamp duty is demanded on the cost of proposed construction of a flat, which is unconstitutional. The consequential circular issued by the second respondent is contrary to the provisions of the Indian Stamp Act. When the transaction pertains to a sale of an undivided share in a land with out reference to any building or structure thereon which may come into existence later on, the insistence by the registering authorities upon payment of ad valorem stamp duty at 13% in the city of Madras on the proposed construction is illegal and invalid. The amendments effected are beyond the legislative competence of the State Legislature and Item No. 44 of List III do not authorise enactment of such an amendment. No duty could ever be levied on a property which is not in existence on the date of the execution or registration of the instrument. In essence, it is a tax or duty on the potential value of capital assets, which is not within the powers of the State Legislature. In the absence of guidelines, the certificate of the Assistant Engineer, Public Works Department, which is made conclusive relating to "the cost of the proposed construction" leads to arbitrariness ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for the purpose of stamp duty. If there is no building and only vacant land is sold as an undivided share, stamp duty is demanded only on value of land. The documents are detained as per section 35 of the Indian Stamp Act and, therefore, the interim orders passed require to be vacated. An additional counter-affidavit was filed on behalf of the second respondent in W. P. No. 603 of 1989, etc., batch of cases. It is not known as to how a law officer in the office of the Inspector-General of Registration could swear to an affidavit, instead of the Inspector-General of Registration himself, which is invariably the practice, when he is impleaded as a party to a proceeding. The law officer could only advise and cannot take a decision, and for administrative decisions taken by the Inspector-General of Registration, he cannot be the deponent of an affidavit on his behalf. It is stated therein that the assent of the President of India was obtained on September 24, 1987, and, therefore, the amendments cannot be attacked on the ground of repugnancy with any Central law nor are they violative of articles 14, 19(1)(g), 21, 265 and 300A of the Constitution of India, as alleged in the affida ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of documents, by issue of encumbrance certificates even after several decades, etc., and the amount spent on the Department has a correlation with the amount collected by way of fee. As head of the Department, the impugned circular having been issued by the Inspector-General of Registration, there was no interference with the powers of the registering authorities as claimed by the petitioner, when the procedure adopted is consistent with the provisions of the Registration and Stamp Act and the Rules framed therein. Unless ownership of the building and the land are with the same person, no ownership right could be claimed only relating to building when the land belongs to another. After denying all the contentions put forth, it is prayed that the writ petitions deserve to be dismissed. Mr. Sundaravaradan, learned counsel for some of the petitioners, has put forth the following contentions : Article 5(i) of Schedule I to the Indian Stamp Act (hereinafter referred to as "the Act") lacks legislative competence ; that it is vioaltive of articles 14, 19, 21 and 300A of the Constitution ; that it would not come within entry 44 of List III of the 7th Schedule to the Constitution ; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rth, then he has to register the instrument and refer the same to the Collector for fixing the correct market value of such property and for proper duty payable thereon. The Collector has suo motu powers, within two years from the date of registration of any instrument, to reopen the matter and ascertain the correct market value and collect duty thereon. The challenged provision in article 5(i) dealing with "agreement or memorandum of an agreement" is to the following effect: "If relating to construction of a house or building including the multi-unit house or building by the vendor on land sold by such vendor and containing stipulation that such land together with such house or building or multi-unit house or building so constructed shall be held either individually or jointly by the vendee of such land, (i) When the land is situated Thirteen rupees for every Rs. 100 or part within the cities of Madras, Madurai thereof of the cost of the proposed and Coimbatore and Municipal Towns construction of house or building or of Salem and Tiruchirapalli. any flat or apartment within such multi-unit house or building, which is the subject matter of the agreement; (ii) When the land is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in law, there cannot be an agreement relating to one kind of property and a sale as regards another". "For the sale of goods", there must be an agreement between the parties for the sale of the very goods in which the property eventually passes" and that in a building contract, the agreement between the parties is that the contractor should construct a building according to the specifications contained in the agreement and, in consideration therefor, receives payment as provided therein, and, in such an agreement, there is neither a contract to sell the materials used in the construction, nor does property pass therein as movables. Learned counsel, Mr. Sundaravaradan, would also contend that the building which comes up on the land is an accretion to it, and it vests in the other party not as a result of the contracts, but as a part owner of the land. By reading the judgment in extenso, he contends that an agreement to put up a building cannot result in transfer of any interest in the superstructure yet to be erected and that when a share in the land alone is conveyed by the owner of the land, which had no doubt put up the building pursuant to the agreement by entering into diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in question is only an agreement. In Aveline Scott Ditcham v. James J. Miller, AIR 1931 PC 203, which dealt with a deed of assignment which purported to assign an estate or interest which was not in existence at the time of the instrument, it was held (at p. 206) : "But, so regarded, it was, at law, quite inoperative inasmuch as the estate or interest which it purported to assign had, at the date of the deed, no existence, and it is well-settled that, neither at law nor in equity, can the assignment of such an interest operate according to its tenor." Learned counsel submits that it is not based on the agreement that rights of parties could be worked out, but only in equity. He then relies on P. A. Munusami Reddi v. C. M. Thirunavukkarasu Mudaliar, AIR 1950 Mad 764, but it has no relevance relating to the concept of immovable property because it was a decision devoted to a case where notice had been served as required under section 112 of the Madras Act 1 of 1908. Relating to legislative competence, he refers to J. K. Jute Mills Co. Ltd. v. State of U. P., AIR 1961 SC 1534 ; [1961] 12 STC 429, which could be of no assistance for holding that the Tamil Nadu Legislature did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that, when a classification is feasible relating to houses and buildings subjected to duty, depending upon a to whether they are used for residential purposes or non-residential purposes, whether they are rented out or sold on instalment basis, etc., etc., and when the Legislature fails to so classify, then such a section is liable to be struck down ; and, for this purpose, he relies upon the decisions in Kunnathat Thathunni Moopil Nair v. State of Kerala, AIR 1961 SC 552, New Manek Chowk Spg. and Wvg. Mills Co. Ltd. v. Municipal Corporation of the City of Ahmedabad, AIR 1967 SC 1801 and State of Kerala V. Haji K. Haji K. Kutty Naha [1969] SCJ 691 ; AIR 1969 SC 378. These decisions deal with instances wherein failure to classify would not only lead to indefiniteness, but the purpose for which the enactment is made would also be defeated. In the earliest of the decisions, it was held that inequality is writ large on the Act and is inherent in the very provisions of the taxing section. In the next decision, it was held that the flat rate method was held to result in inequalities, as there had been no classification of factories on any rational basis. In the last of the decisions, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ected the Deputy Inspector-General of Registration to carry out the functions of the Registrar which is contrary to the provisions of the Registration Act and the Rules framed thereunder. To assail this circular as illegal, he refers to the decision in Board of Revenue v. Sardarani Vidyawati [1962] Supp. 3 SCR 50 ; AIR 1962 SC 1217 in which the Supreme Court held that, when the provision of an Act is silent, the duty to act judicially may be inferred from the provisions of the statute or may be gathered from the cumulative effect of the nature of the rights affected, the manner of the disposal provided, the objective criterion to be adopted and the phraseology used and other indicia afforded by the statute. Dealing with the scope of section 56(2) of the Indian Stamp Act, it was held that the Collector was performing the duties which would be of a quasi-judicial nature. When G. O. was issued by the Government relating to allotment of marks under the Motor Vehicles Act, 1939, it was held that such a G. O. fetters the independent discretion of the quasi-judicial authority and, therefore, such G. O. cannot be taken into account. It was in B. Rajagopala Naidu v. State Transport Appellat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut, which are injected with vagueness and uncertainties in implementation, leading to a high degree of arbitrariness which would be much worse than what is presently happening in Sub-Registrar's offices when documents are presented for registration. He would submit that, even today no document gets registered by following the prescribed procedure known to law, and if the procedure now envisaged in the amending Act has to be implemented, it would lead to more corruption, because the certificate of P. W. D. Assistant Engineer having been given the status of conclusive proof, and as to what is a multi-unit house or building not having been precisely explained as now being experienced by persons like the petitioners in the hands of the registration authorities, it would only lead to unjust enrichment by persons in charge of the affairs of the Department. He then submits that construction of a building is a works contract, and that section 8 of the Transfer of Property Act cannot be relied upon while article 5(i) is invoked. This being a colourable legislation, it is liable to be struck down. He refers to certain passages extracted herein. In Sergeant on Stamp Duties (5th Edition) (pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registration has led to considerable inconvenience and monetary loss to parties. It is not open to the registering authorities to interpret the document. Impounding of document under section 33 of the Act would arise only in certain circumstances. As to how and what procedure is to be followed, sections 58 to 60 of the Registration Act state as to what a Registrar will have to do when an instrument is presented to him. The quantum of fee collected for issue of copies is challenged on the plea that anything and everything required to be done is being done by the parties without being carried out by the authorities, and hence the fee demanded is illegal. He refers to para 656 at page 435 of Vol. 44 of 4th Edition of Halsbury's Laws of England, which is as follows : "A conveyance on sale of building plot may present difficulties of assessment where a building has been erected by the time the conveyance is executed. Where the builder is the vendor but the building contract is expressed to be conditional on the completion of the purchase of the site, the consideration paid for the building (as distinct from the site) does not attract duty, even though the builder may have begun to bui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Narayanaswami, learned counsel, relies on Jugalkishore Saraf v. Raw Cotton Co Ltd., AIR 1955 SC 376 [1955] MWN 421, in which the Supreme Court, while dealing with section 8 of the Transfer of Property Act, held that it does not operate to pass any future property, for that section passes all interest which the transferor can then, i.e., at the date of the transfer, pass. If, for any reason, by any provision of law, statutory or otherwise, interest in property passes from one person to another, there is a transfer of property by operation of law. Section 2(14) has defined an "instrument" as one by which "any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded." Unless the building is in existence, an agreement of the nature contemplated under article 5(i) could not be treated as an instrument under the Act. Earlier, an agreement to transfer immovable property did not require any registration, and even now, if parties do not desire to have it registered, the transaction would not become illegal, but it cannot be enforced in a court of law unless it is registered ; and therefore, the Registrar cannot compel the parties to regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticle 5 instead of article 23. When the pith and substance is made out, it has to be either struck down as illegal, or read as part of article 23, so that the duplicity of collection of duty in two stages at the same rate, one being treated as an agreement and the other as a conveyance, could be avoided. Mr. D. Raju, learned counsel appearing for some of the petitioners, after referring to section 3 of the Act which is the charging section, submits that the statutory duty of the Registrar, on presentment of an instrument, is to register the document and thereafter send it for valuation, if he does not accept the market value. He relies upon the sections referred to by learned counsel, Mr. Vedantham Srinivasan, and contends that, when it is the Collector who will have to look into the valuation, the impugned circular cannot direct the Deputy Inspector-General of Registration to find out the market value. Section 47-A cannot apply to instruments which would come under article 5(i), because that section deals with only five types of instruments. Except when the owner of the land enters into an agreement and constructs a building on his own, and thereafter as vendor transfers intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uperstructure. In Bishan Das v. State of Punjab, AIR 1961 SC 1570, after referring to the decision reported in Narayan Das v. Jatindranath, AIR 1927 PC 135, it was held by the Supreme Court as follows (at p. 1574) "These decisions show that a person who bona fide puts up constructions on land belonging to others with their permission would not be a trespasser, nor would the buildings so constructed vest in the owner of the land by the application of the maxim quic quid plantatur solo solo credit. It is, therefore, impossible to hold that, in respect of the dharmasalas, temples and shops, the State has acquired any rights whatsoever merely by reason of their being on the land belonging to the State." A Division Bench in Katihar jute Mills Ltd. v. Calcutta Match Works (India) Ltd., AIR 1958 Patna 133, 142, held as follows : "Generally, any sale of a building without any specific reference to the land whereon it stands cannot necessarily convey the land along with it and what is provided in section 8 of the Transfer of Property Act as to easement cannot apply to the land on which the buildings stand, for there is no easement in law which gives any exclusive and unrestricted us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only a land being conveyed under an instrument, the registering authorities are bound to register the document, and if they have any doubt about the market value of the land, they can proceed under section 47A if the document is one of conveyance or of any one of the other four types mentioned therein. Before doing so, first of all, the Registrar will have to register the document. He cannot withhold it, as presently done in innumerable cases. He also refers to the Explanation to section 17(2) of the Registration Act, and submits that, with its continued existence, section 17(1)(f) could not co-exist. In obtaining assent, whether this aspect had been placed before the President will have to be clarified by the State. Merely because an instrument of sale or mortgage and the like had been executed between the parties, it would not result in the registering authorities compelling the parties to register their documents. They take the risk of the consequences of non-registration, if circumstances arise. Otherwise, the transactions, in law, exist as between the parties. Mr. S. G. Prabakaran had claimed that discrimination is practised when an agreement relating to the same property i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o power conferred on the Registrar to examine title to or ownership of the properties, and the inspection being made to fix the value of the built-up properties is illegal, and that too by an authority who is not named in the Act. Mr. P. S. Venkatasubramanian, learned counsel for some of the petitioners, would refer to rule 19 of the rules framed under section 69 of the Registration Act, and contend that the superintending power of the Inspector-General of Registration under the said section cannot go to the extent of issuing instructions which are contrary to the provisions of the Act and the Rules. He further submits that the Sub-Registrar is not subordinate to the Inspector-General of Registration, and only the Inspector is subordinate to him. His further submission is that, until April 24, 1968, under the Stamp Act as it then stood, the Registrar can only look into the consideration as stated in the document. It was by amending the Tamil Nadu Act 24 of 1967 that the concept of market value was inducted under section. 47A and that could be done only in respect of the five categories of instruments mentioned therein. As to what is the subject matter, it is for the party to deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SC 724, 731, in which, dealing with the enactment of an Ordinance, it was held: "It is a settled rule of constitutional law that the question whether statute is constitutional or not is always a question of power of the Legislature concerned, dependent upon the subject-matter of the statute, the manner in which it is accomplished and the mode of enacting it". Courts would not enquire into the propriety of the exercise of the legislative power or the motives behind the enactment or whether it had applied its mind to the provisions of a statute before passing it, and, therefore, the propriety, expediency and necessity of a legislative act are for the determination of the legislative authority. Regarding competency to enact these amendments, he refers to the following entries : "Entry 91 of List I.-Rates of stamp duty in respect of bills of exchange, cheques, promissory notes, bills of lading, letters of credit, policies of insurance, transfer of shares, debentures, proxies and receipts. Entry 63 of List II. -Rates of stamp duty in respect of documents other than those specified in the provisions of List I with regard to rates of stamp duty. Entry 44 of List III. -Stamp duti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld not tax, and if it decided to impose tax on certain articles it thought necessary, that was question of policy into which courts cannot enter and, in such circumstances, per se there is no discrimination. Unless it be shown that the tax incidence has resulted in an unreasonable restriction on the right to carry on trade, it cannot be held as violative of articles 14 and 19(1)(f) of the Constitution. As to how a taxing statute should be looked into, in Ganga Sugar Corporation Ltd. v. State of U. P. [1980] 45 STC 36, 49 ; AIR 1980 SC 286, 296, it was observed as follows : "Even so, taxing statutes have enjoyed more judicial indulgence. This court has uniformly held that classification for taxation and the application of article 14, in that context, must be viewed liberally not meticulously." Khyerbari Tea Co. Ltd. v. State of Assam, AIR 1964 SC 925, holds (headnote) : "It is, of course, true that the validity of tax laws can be questioned in the light of the provisions of articles 14, 19 and 301, if the said tax directly and immediately imposes a restriction on the freedom of trade ; but the power conferred on the court to strike down a taxing statute, if it contravenes the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or is then capable of passing in the property including things attached to earth, i.e., building. Section 3(26) of the General Clauses Act defines "immovable property" as including things attached to the earth. Therefore, unless a legal right in the land and building is conveyed in favour of the person putting up the building, no building could be transferred without rights in the land when the building would be imbedded in the earth and becomes an immovable property which is claimable by an agreement-holder. In support of this plea, he would first refer to the decision in Leon Gon Kyu v. Moung Maung Gyi, AIR 1933 Rang 24, wherein, after referring to section 8 of the Transfer of Property Act, the learned judge held that unless a different intention is expressed or necessarily implied, the presumption is that, when a land is transferred by a deed of gift, the building situated thereon also stood transferred. A learned judge of the Bombay High Court in N. C. Macleod v. Vithal Singh [1904] ILR 30 Bom 250 took the view that when the Transfer of Property Act makes no distinction between freehold and leasehold property for the purposes of the rule of law embodied in sections 8 and 70 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arily implied in the document." It was then held that the two parts of the agreement cannot be treated as dealt with together, because the intention was to sell the fixtures as movables. Relying on these decisions, he submits that any building over the land could only belong to the owner of the land. He also refers to certain provisions in the Tamil Nadu Town and Country Planning Act, 1971, and the forms prescribed therein which are to the effect that the owner of the property will have to make an application for grant of permission to put up buildings and the like. Then, dealing with the grievance that sale deeds which would not come under article 5(i) are kept back without registration for months together, he points out that the concept of market value was introduced under section 47A by the State to be assessed by the Collector, and guideline values having been fixed for each area, the registering authorities have the jurisdiction to find out whether the entire property involved in the instrument had been properly valued or not; and even if, for any reason, it be held that section 47A cannot be invoked under section 27, facts affecting duty have to be set forth in the instrume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e submits that any construction to be put on these provisions should not render the provisions void, even assuming that any other construction is possible, because unless the construction which is put forth by the law-maker is bound to lead to absurdities, the law as made has to be upheld. As for the contention that the fee claimed for issue of copies is not commensurate to services rendered, the facts and figures supplied in the supplemental affidavit go to show that it is well within the permissible limits as held in Municipal Corporation of Delhi v. Mohd. Yasin [1983] 142 ITR 737 ; AIR 1983 SC 617 and Sreenivasa General Traders v. State of Andhra Pradesh, AIR 1983 SC 1246. In replying to these arguments, each one of the counsel had put forth further submissions to contend that, if the amended provisions are to continue to remain in the statute book, it Will lead only to arbitrariness and a sea of uncertainty, as held in K. A. Abbas v. Union of India, AIR 1971 SC 481, in implementing those provisions. In an ununderstandable manner, the provisions having been drafted and passed by the Legislature, retention of these sections in the statute book would only lead to disorderly impl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustice to come to that conclusion, but their Lordships hold that nothing can justify it except necessity, or the absolute intractability of the language used." "Legislation by reference: Legislation by reference is usually the outcome, not of negligence, ignorance, or incapacity in the draftsman, but of the foibles of Parliament, and is excused on the ground that it lessens political difficulties and simplifies the process of getting Bills through committee by lessening the area for amendment." After referring to the "theory of impracticability", he points out that the learned Advocate-General was not correct in claiming that only the owner of the land could apply for building permission because, in every Form, it is stated that it could be done by the owner of the land or the applicant. His more substantial contention is in referring to section 49 of the Tamil Nadu Act (35 of 1972), which nowhere refers to the owner of the land making the application, and it states that "any person" can make an application to the appropriate planning authority and ask for permission to carry out development on any land or building. After referring to the decision in Board of Revenue v. N. Na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to initiate action under section 64. In respect of agreements, section 47A cannot be invoked. In rule 3(3) particulars to be furnished are with reference to any information appearing on the subject, and to examine any records kept with any public officer or authority, and hence he cannot make a roving inquiry to go behind the document and find out whether there are any other documents in existence between the parties or not. Section 17(1)(f) cannot co-exist with section 17(2)(b) read with its explanation, and, therefore, incongruity sets in, and hence indefiniteness and misconception of law are made out. In enacting an amendment, the Legislature cannot make a law without being conscious of what it had already enacted and bring into existence contradictory provisions which lead to uncertainties in the implementation of the provisions of the enactment. As for the circular issued, the Inspector-General of Registration has to confine himself only to the Registration Act, and he cannot issue any instruction relating to what should or should not be done under the provisions of the Indian Stamp Act, because it is for the Chief Controlling Revenue Authority under the Act to issue appropria ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R 1985 SC 1394, where the assent had been obtained for a specific purpose, whereas the legislation goes beyond the expressed purpose. It was pointed out therein that an assent under article 254 is not a matter of idle formality and that the President has to be apprised of the reason as to why his assent was sought and if there is any special reason for doing so, it must be stated. The series of decisions relied upon by the learned Advocate-General above referred to pertain to articles 14 and 19 and go to show that it is open to the State to classify groups and categories for the purposes of transactions and so long as they were put in a particular group or category, and equally or uniformly treated, no invalidity arises. In matters of taxation, the court has to permit greater latitude to the discretion of the Legislature, as held in Ganga Sugar Corporation Ltd. v. State of U. P., AIR 1980 SC 286. As to what articles or groups or categories of persons are to be taxed, it is policy decision as held in Gopal Narain v. State of U. P., AIR 1964 SC 370 and Steelworth Ltd. v. State of Assam [1962] Supp. 2 SCR 589. The Legislature having the exclusive power to make laws relating to subje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the court, by taking an overall picture, held that the impugned provisions of the Kerala Act II of 1959 were not unreasonable and, therefore, not liable to be struck down. Reliance is also placed on Kunnathat Thathunni Moopil Nair v. State of Kerala, AIR 1961 SC 552, which held that the taxing statute is not wholly immune from attack on the ground of violation of article 14. It was pointed out thereunder that the courts are not concerned with the policy underlining the taxation statute, and if a reasonable classification is adopted by the Legislature, of persons or properties and group them into different categories and subject them to different rates of taxation, such classification would not be open to attack on the ground that the burden results in many unequal incidences of tax. Different kinds of properties may be subjected to different rates, but so long as there is a rational basis, article 14 would not be invoked. Yet another decision on the same line relied upon by them is Khyerbari Tea Co. Ltd. v. State of Assam, AIR 1964 SC 925, wherein it was reiterated that a taxation law can be questioned as violative of articles 14, 19 and 301, and that the courts would act with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated by section 7 and, therefore, it was held that failure to classify in a matter of such a nature offends article 14. The next decision is New Manek Chowk Spg. and Wvg. Mills Co. Ltd. v. Municipal Corporation of the City of Ahmedabad, AIR 1967 SC 1801, in which, in respect of rule 9(b) framed under the Bombay Provincial Municipal Corporations Act, 1949 a flat rate method according to the floor area was applied in fixing the annual value of textile factories for property-tax and it was held that, applied indiscriminately, it was sure to give rise to inequalities in the absence of a rational classification on factories. The last of the decisions is State of Kerala v. Haji K. Haji K. Kutty Naha, AIR 1969 SC 378, wherein it was pointed out that, in enacting the Kerala Buildings Tax Act, 1961, no attempt at any rational classification was made by the Legislature because, in imposing the tax, the nature of construction, the purpose for which it is used, its situation, its capacity for profitable user and other relevant circumstances, which have a bearing on matters 81 taxation, have not been taken into account, and only the floor area of the building having been adopted as the basis, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R 1961 SC 1047, holds the following view (headnote of STC) : "In interpreting a taxing statute, equitable considerations are entirely out of place. Nor can taxing statutes be interpreted on any presumptions or assumptions. The court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed ; it cannot imply anything which is not expressed ; it cannot import provisions in the statute so as to supply any assumed deficiency." Steelworth Ltd. v. State of Assam [1962] Suppl. 2 SCR 589 holds that, when the object of the Amendment Act was to raise revenue and when it is for the Legislature to decide as to what articles it should not tax, and if it had taken a decision to impose tax on certain articles it thought necessary, it being a policy decision, the plea of discrimination would not arise in such instance. Gopal Narain v. State of U. P., AIR 1964 SC 370 ; [1964] 4 SCR 869 also reiterates that it is riot for the court to enter into the domain of speculation with a view to cover up an obvious deficiency in a legislation, unless the intention is clearly discernible on a fair reading of the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elpful to the State as would be pointed out later on. Hence, the impugned article will have to be read without adding any words other than what are found therein. Hence, on this point, by relying on preponderance of authorities of the Supreme Court above referred to, it is held that the impugned article will have to be read by ascribing to the words used therein the ordinary meaning, because circumstances do not warrant implanting any words to make out the real intention of the law-maker. The third point is whether a building is an immovable property or movable property. Mr. Vedantham Srinivasan, learned counsel, submits that since the State claims that an agreement to construct a building is taxable and registrable, it relates to a building yet to come into existence or may be one which had partly come into existence and hence it is an agreement relating to movable property. His contention is that, when materials are piled up for construction of buildings to come up pursuant to the agreement, they are only movables. To strengthen this plea, he refers to Thangammal v. Murugmmal, AIR 1970 Mad 325, where the learned judge, in dealing with the Presidency Small Cause Courts Act, 1882 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... superstructure is erected over the land belonging to person, then, in the eye of law, the owner of land becomes the owner of the superstructure. The petitioners' counsel contend that the maxim relied upon by the learned Advocate-General is one of antiquity and obsolete in law and has no application in India and that ownership in land could be with one person and that the superstructure could be owned by another, provided there is a legal relationship between them. It may originate by granting him a permission, which, in law, means licence, or may be the resultant effect of a long lease granted by the owner for putting up the superstructure, etc. Learned Advocate-General relies upon very old decisions of the English courts as in Annada Mohan Roy v. Gour Mohan Mullick, AIR 1923 PC 189, Aveline Scott Ditcham v. James J. Miller, AIR 1931 PC 203, but no attempt is made to refer to any decision of the English courts, on this side of the century. No decision of the latter half of this century had been produced to show that such a maxim any longer survives in England. When statutory provisions have been made relating to rights over properties, goods and the like in this country, and when p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no rule of law that whatever is affixed or built on the soil becomes a part of it, and is subjected to the same rights of property as the soil itself ......" In the previous three paragraphs, a reference was made to the aforesaid English maxim and it was stated that there was a concession by counsel that this maxim has at the most only a limited application in India. It is this concession found therein that the learned Advocate-General relied upon to claim that once such a maxim is applicable and specific provisions having been made in sections 63A and 108(h) and section 8 of the Transfer of Property Act relating to passing of ownership in properties erected on somebody else's land under certain circumstances like mortgages and leases, wherever a building is put up on land belonging to another pursuant to an application made to the concerned authority under the Tamil Nadu Country and Town Planning Act, claiming to be the owner, whatever be the terms agreed to between the parties, irrespective of those terms, in law, the owner of the land becomes the "owner of the building". The paragraph above extracted clearly shows that such a maxim was not recognised by the Privy Counci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ... a person who bona fide puts up constructions on land belonging to others with their permission would not be a trespasser, nor would the buildings so constructed vest in the owner of the land.. . " He would respectfully submit that sections 63A, 108(h) and 8 of the Transfer of Property Act had not been placed before the court to show that the principle behind this maxim could be invoked because it has been statutorily recognised with particular reference to mortgages and leases. Section 63A deals with improvements on mortgaged property by the mortgagee, and in the absence of a contract to the contrary, upon redemption, except as to what are provided in sub-section (2), other improvements belong to the mortgagor. Section 108(h) states that the lessee may, even after the determination of lease, remove when he is in possession of the property leased to him, but not afterwards, things which he has attached to the earth. Hence, when he fails to remove, before the termination of the lease, any superstructure, the owner of the land becomes the owner of the superstructure. This also is subject to contract or local usage to the contrary. By relying upon these decisions and the two sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under a defective title improving an immovable property in good faith, and, when dispossessed, he would be entitled to the value of the improvements made by him. Rather, the Transfer of Property Act proceeds on the basis that, in law, ownership of a building is different from ownership of the land, and that land and building could be owned by different persons in the eye of law. Therefore, reliance placed on sections 8, 63A and 108(h) does not, in any manner, advance the propositions put forth by the learned AdvocateGeneral. Rather, the advocates appearing for the petitioners have relied on the decisions under mentioned to show that this obsolete maxim has no application in India. Mr. Mohan Parasaran, learned counsel would, straightaway refer to a Division Bench decision of this court in Venkatasubbiah Chetty v. Thirupurasundari, AIR 1965 Mad 185, wherein, after referring to section 63 of the Transfer of Property Act, it was held categorically (at p. 186) : "There is no substance in this contention. This maxim-whatever is affixed to the soil belongs to the soil-is a rule of considerable antiquity and has been held to be inapplicable in this country...." "In India the view ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 45 Patna 400 ; ILR 24 Patna 268 held that, in the absence of any reservation found in the document on partition, as the mortgagors were allotted the land on which the house then stood, the security or mortgage created would include both the house and the land. This decision also thus recognises that the parties even to a mortgage transaction could differently deal with rights in the land separately from the rights over the superstructure, if their intention is made clear in the instrument. Relying on this decision, the petitioners succeed in showing that, even in the case of a mortgage or a lease or any transaction relating to transfer of interest in property, it is open to the parties to convey only such of those rights or interests which they choose to transfer and that, when an owner of land only intends to transfer his rights therein, either as a whole or in part, he cannot be compelled to part with his rights in the superstructure, if any, if he intends to deal with it separately. They also succeed in their contention that, ownership in land and ownership in superstructure could be with different persons provided there is a legal relationship existing between them as parties t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fer. In Mott Ram v. Khyali Ram, AIR 1967 All 484, it was held that a transfer could be only of a specific property which is in existence, but agreement to transfer can be of future property and equally, there could be an agreement to assign interest in future. Division Bench of this court, in dealing with a transaction in Mm trade and with reference to section 2(17) of the Stamp Act in Chief Controlling Revenue Authority v. Sudarsanam Picture, ILR (1968) 1 Mad 660, 669; AIR 1968 Mad 319, 322 [FB], held that if article 40(a) and (b) are to apply, then the mortgage must be over a right or in respect of a specified property which is then in existence, and that a purported transfer of property not in existence at the time of the contract can only operate as contract put forth in future. It was then observed as follows (p. 322) : "As will be seen presently, it is settled law that while a transfer of property may take place not only in the present, but also in the future, the property must be in existence at the time of the transfer, for an instrument to be a deed of transfer ... The conveyance may be in present or in future, but the conveyance should be of property in existence. A pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oranea exposition is a well-settled principle or doctrine, which applies only to the construction of ambiguous language in old statutes, and it is not applicable to modern statutes. Reference was made therein to Maxwell 13th edition, page 259. Hence, in ascertaining the intention of the legislature as to what kind or kinds of agreements it had chosen to subject to payment of duty under article 5(i), the plain meaning of the words used will have to be applied and more so, as earlier held, the Stamp Act being a taxing statute, strict interpretation is inescapable. One more point remains to be considered before resorting to construing the impugned provision. It is the contention of learned counsel, Mr. Sundaravaradan, that it is a works contract which had been subjected to duty, and, in the context of the two pronouncements of the Supreme Court, it is an indivisible transaction, and hence, it cannot be subject to any taxing measure, i.e., either to sales tax or stamp duty or registration charges, and the like. Though he had put forth extensive arguments and repeated this contention more than once, this is a point advanced on the premise that the impugned article deals with transfer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merate, that is the entire building that is actually constructed. It was also observed therein as follows (at p. 400) : "Even after the decision of this court in State of Madras v. Gannon Dunkerley and Co. (Madras) Ltd. [1958] 9 STC 353 ; [1959] SCR 379, it was quite possible that where a contract entered into in connection with the construction of a building consisted of two parts, namely, one part relating to the sale of materials used in the construction of the building by the contractor to the person who had assigned the contract and another part dealing with the supply of labour and services, sales tax was leviable on the goods which were agreed to be sold under the first part. But sales tax could not be levied when the contract in question was a single and indivisible works contract." This observation was made in view of what had been held in State of Madras v. Gannon Dunkerley and Co. (Madras) Ltd. [1958] 9 STC 353, 387 ; AIR 1958 SC 560, para 48 of AIR 1958 SC 560, which is extracted hereunder : "To avoid misconception, it must be stated that the above conclusion has reference to works contracts which are entire and indivisible, as the contracts of the respondents hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 3 of the Act. Hence, this point is decided against the petitioners. One other point put forth by the petitioners is that, article 5(i) deals with transfer of interest in immovable property and, therefore, it should be read as part of article 23, because in the objects and reasons, the loopholes which were intended to be plugged were with reference to the conveyance of ownership of apartments by promoters to respective owners by treating it as an agreement. It is claimed by them that, in pith and substance, what is intended under the article is to convey the rights in immovable property, and that it had been wrongly included by the Legislature in article 5, instead of making it a part of article 23 which alone deals with conveyance. Misplacing could not take away the intendment of the article, and when the resultant effect is a double levy of duty, one under article 5(i) and again under article 23, it is illegal and oppressive. In the Objects and Reasons, the relevant portion is as follows : "The conveyance of the ground with a joint ownership, for all apartment owners, is registered and stamp duty paid accordingly. But the conveyance of ownership of each such apartment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought forth in relation to this Act, the use of this word could not have been casually done by the Government in moving the Legislature for amending the provisions. The emphasis laid by the petitioners on the proposition that the Objects and Reasons would be relevant for construing sections in an enactment cannot be countenanced because it has been repeatedly held that they cannot bring out the real intendment of the words used in the enactment. It must be remembered that, whatever might have been the object of the Government in placing a proposed amendment before the Legislature, it ultimately decides on how to make the law, and the Act passed could be far different from what the Government had thought of in introducing the Bill. During the course of the discussion of the Bill in the Legislature, decisions may be taken to radically change a Bill or to effect marginal changes which are necessary consequent to the discussions held in the Legislature. What may ultimately emerge as an Act could be far different from what is spelt out in the objects and reasons. That is why it has been held that the words used in a particular section of an Act, will have to be understood by ascribin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permissible, as pleaded by learned Advocate-General, to read these words as "on land to be sold". It is when an owner of land either sells the whole of it or part of it, and thereafter enters into an agreement relating to construction of a building of the nature described therein with a stipulation that such land sold together with the building is to be held by the other party to the agreement, that article 5(i) would become applicable. The words "together with such house" are referable to the building which the vendor of the land agrees under the agreement to construct on "such land", which he had already sold to the agreement-holder which may be either part or a share in it or the whole of it. As for the words "so constructed shall be held", even though learned Advocate-General here again would attempt to read it as "to be so constructed", on what has been pointed out above relating to interpretation, it is not permissible to read it so, because that would destroy the real intendment of this Act. They only mean that the owner of the land who agrees to put up the building, on so constructing it as per the agreement, would then allow the agreement-holder to hold it. As for the wor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ol over the entire land till the building is constructed. Thereafter, he enters into agreements with different parties and executes sale deeds, only confined to the respective shares in the land belonging to him. As far as the building is concerned, he assumes the role of a contractor to construct the building on funds supplied by the vendees who had since become part owners of the proportionate share of the land. Having lost his right over that share in the land by the effected sale confined to land alone, it is only under the agreement that he secures the right to be in possession till the building is completed. As soon as the building is "so constructed", he agrees to deliver possession either individually or jointly to the vendees of the land. He may happen to hold one of the flats/apartments or choose to invest his funds in some portion of the building and retain it as its owner. In so far as the superstructure is concerned, vendees contribute their funds to the erstwhile owner of the land who had assumed the role of a "building contractor" and carries out work, like what is called a "works contract". It is such a building contract, when entered into, which invites the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rried out, the Legislature in its wisdom may restrict the scope of the enactment only to some aspects. Hence, even though there may be and in fact there are several kinds of instruments entered into by promoters in putting up multi-storeyed buildings, the Legislature, by this amendment, had confined the regulatory measure only to such of those instances where the owner of the land becomes the building contractor. He may get it accomplished by engaging other agencies to put up the building ; but, under the agreement, he assumes the responsibility for the construction of a flat or an apartment in the building. He may put up the construction by the contribution of funds by the vendees, in which event, he would not become the owner of that portion of the superstructure, but, if he erects any portion of the building out of his own funds or by securing loans from anybody else, the building being an immovable property and interest in that portion having been acquired by him, on the day when he sells a share of his interest in the land, the superstructure also belongs to him and, therefore, if he chooses to convey only an interest in the land, his rights in the superstructure would not get ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orm containing particulars accompanied by such documents as may be prescribed. Ownership in a particular property, whether movable or immovable, is dependent upon the facts and circumstances of each case. As an applicant for grant of permission, he may be held liable for contraventions. This Act nowhere deals with ownership rights relating to buildings or lands. It does not control ownership rights. The object of the Act is "to provide for planning the development and use of rural and urban lands in the State of Tamil Nadu and for purposes connected therewith". Hence, as found in the Transfer of Property Act parties to a transaction of transfer of immovable property could always enter into any kind of legal relationship in the manner in which they choose to do. It is entirely left to the discretion of the owner of the land to part with his rights in the land either in favour of one or many. He may permit another person to put up the superstructure on his land, at his own cost. He may lease out the land for 100 years or more and permit the lessee to put up the superstructure at his own cost. Subject to these rights, he may convey interest in the land to another person. Equally, pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on-testamentary instruments which purport or operate to create, declare, whether present or future, any right, title, whether vested or contingent, in immovable property is registrable. Therefore, to claim that what is to come into existence in the future cannot be the subject matter of an agreement and that too a works contract is not acceptable. Article 5(i) deals with a building contract, and it is in relation to a land which is situate on the date of the agreement in the concerned district and, therefore, when the building to come up is an immovable property which would be embedded in the land situate within that district, there was no illegality in incorporating the amended provision, as part of section 17(1). What is then contended is that when section 17(2)(v) read with the Explanation deals with an agreement to sell and does not require registration by introducing section 17(1)(f), an incongruity had set in. This argument could be entertained, only if article 5(i) agreement is to be construed as an agreement to sell. Once it is held that it is a building contract, neither section 17(2)(v) nor the Explanation to it would have any relevance. Hence, no invalidity is perceivabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w which have been made supplemental to the Registration Act. It is certainly not within the domain of the Sub-Registrar to decide whether the document satisfies the requirements of a particular law or whether the recitals are proper or whether any other parties are interested in the transaction, etc. If all the executants of a deed admit execution before the Registrar, then he has no right to go behind the recitals found in the deed. If the document is not properly stamped, he could only forward the document to the Collector after impounding the same. All SubRegistrars having been notified as Collectors as defined under section 2(9) of the Stamp Act, after carrying out registration, for deficit stamp duty, if any, under the Stamp Act action could be taken for recovery of the deficit stamp duty. Therefore, the directive in the circular to stop the registration is opposed to the provisions of the Registration Act. This court in Venkataswami Aiya, In re, AIR 1953 Mad 941, 942 ; [1953] 1 MLJ 658, has held: " .... although the Registrar before whom a document is presented for registration cannot embark on an independent enquiry regarding the value of the property, yet he has power und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Income-tax Act, would fetter the judicial discretion of those functionaries in administering the Act. The concerned circular therein was declared as not binding upon the concerned quasi judicial functionaries. Mr. Venkatasubramaniam, learned counsel, had claimed that it is not for the Inspector-General of Registration to deal with matters arising out of the Stamp Act, and it is only the Chief Controlling Authority under the Stamp Act who could deal with the requirements of deficit stamp, if any, and that such an authority functions as a quasijudicial authority. It was held in Board of Revenue v. Sardarni Vidyawati, AIR 1962 SC 1217 ; [1962] Suppl. 3 SCR 50, that, when the Collector gets doubt in his mind regarding the construction of an instrument and as to what provisions of the Act are applicable, he refers the matter to the Chief Controlling Authority who has to decide the matter judicially and would thus be a quasi-judicial authority. Another oft-quoted decision is B. Rajagopala Naidu v. State Transport Appellate Tribunal, AIR 1964 SC 1573, which dealt with the same G. O. as considered in Natesan Transport (P.) Ltd. v. Tanjore Motor Traders (P.) Ltd., AIR 1965 Mad 473, and w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot. Chief Controlling Revenue Authority, Board of Revenue v. Dr. Manjunatha Rai [1976] 2 MLJ 279; AIR 1977 Mad 10 [SB], held that revenue authorities cannot ignore the terms of the document presented before them and choose to base their decision in terms of some other collateral instrument. Chief Controlling Revenue Authority, Board of Revenue v. Dr. K. Manjunatha Rai [1976] 2 MLJ 279 ; AIR 1977 Mad 10, is again an apposite decision on the point taken, and it was held thereunder that the name the parties give to an instrument would not be decisive or even indicative of the true nature of the instrument for the purposes of stamp duty, but that would not mean that the Registering Authority is empowered to go behind the recitals in the terms of the document before it and hold that the object of the transaction was something different from what the document discloses and, therefore, the document should be deemed to be that which it is not. The Supreme Court, in Madras Refineries Ltd. v. Chief Controlling Revenue Authority, Board of Revenue, AIR 1977 SC 500; 90 LW 85 (Journal Section) relied upon the decision in Limmer Asphalte Paving Co. Ltd. v. IRC [1872] LR 7 Exchq 211, 214, wherein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ersons who have executed the document and, on going through the document, find out under what description in Schedule I it could be classified, and what proper stamp duty is payable thereon. As far as valuation is concerned, if it is a document which comes under section 47A and if he finds that the market value has not been properly set forth in the instrument, his first duty is to register the instrument and then refer such a document to the Collector for determining the correct market value and recover the proper duty payable thereon. In respect of any other instrument listed in Schedule 1, section 47A procedure cannot be followed. It is no doubt obligatory on the part of the parties to the instrument to disclose fully and truly the consideration and the market value of the instrument relating to its chargeability and, in the event of any contravention, the course open is to prosecute the person under section 64 of the Act. For instruments not covered by section 47A, this is the available recourse. None of the sections ever confer upon him any authority to go behind the terms of the document and find out as to what are the other transactions which have been entered into between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctor for determination of the market value of share of land and no other. The decision in Venkataswami Aiya, In re [1953] 1 MLJ 658 ; AIR 1953 Mad 941, above referred to, would have no application, wherever section 47A applies. Section 47A deals with instruments, conveyance, exchange, gift, release of benami right or settlement. If an instrument of any one of these descriptions as found in Schedule I is produced for registration, and if the Registering Authority considers that the property chargeable to stamp duty had not been properly valued, his first duty which is a statutory duty is to register the instrument and refer it to the Collector for determining the market value of that property which is sought to be conveyed. If the correct market value of that property is not set forth in the document as required under section 27, apart from the payment of the deficit stamp duty, which will be determined by the Collector under section 47A(2), the parties to the instrument could be prosecuted under section 64 of the Act. It is interesting to note that even a person engaged in the preparation of an instrument is liable to be prosecuted under section 64(f) of the Act. It is only in resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocuments relating to "conveyance" which would come under article 23 of Schedule I to the Act, and in respect of them, as stated earlier, in view of section 47A, what the Inspector-General of Registration had directed is opposed to the provisions of the Act. He has not understood the difference between articles 5(i) and 23, i.e., an agreement to construct a building is different from a conveyance of land. He had not issued this circular relating to agreements under article 5(i) which is impugned in this writ petition, though it is referred to therein inappropriately. Therefore, the impugned circular is struck down as invalid and inoperative. Learned counsel for all the petitioners had made a grievance that for months together, the documents presented for registration had not been registered. Undoubtedly, what the concerned registering authorities had done is consequent to the misguided approach made by the Inspector General of Registration. Hence, if the concerned registering authority believes suo motu or on calling for certain particulars and "prima facie" arrives at the conclusion that the correct market value is not reflected relating to the share of the land sold under the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lead to arbitrary functioning by different Registering authorities in the implementation of the impugned provisions. Vagueness is writ large in the explanation about multi-unit house or building and, therefore, article 5(i) has to be struck down as a whole. Article 5(i) states that the construction to be put up by the owner of the land, who had sold his share, can be a house or a building which will include the multi-unit house or building. Therefore, if any superstructure is to be erected under the works contract entered into between the parties, it would fall within the scope of this article. The expression "multi-unit house or building" having acquired a commercial meaning in relation to multi-storeyed constructions coming up in these days at the instance of promoters, they are also included as part of article 5(i). Hence, even if less than five floors are constructed, such a building contract would come within the scope of article 5(i). Therefore, the plea about vagueness or arbitrariness, and that what is explained as multi-unit house or building cannot be understood by parties, cannot be entertained. Mr. Sundaravaradan, learned counsel, would state that these provisions l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngineer is to be held as conclusive proof, it is left to the law-maker to decide as to what could be conclusive proof under certain circumstances. Section 4 of the Evidence Act deals with conclusive proof, and to avoid delay in registration and to prevent harassment of parties, when the Legislature's intent is to make a certification issued by the named authority based on sound principles of calculation as conclusive proof, such a provision cannot be struck down. The likelihood of abuses being committed cannot be a ground to strike down the said provision of law. Of course, a safeguard invariably made is to provide for an appellate forum, but failure to provide an appellate forum in a statute cannot be a ground to strike down a provision which makes certification of an authority conclusive to subserve certain purposes under the Act. The object being for an early determination of the cost of construction covered by the agreement and to avoid protracted litigation on this aspect, the certificate of the assistant engineer is made conclusive proof by the Legislature. Mr. K. G. Vasudevan, learned counsel, points out that agreements entered into prior to January 1, 1988, cannot be subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would suffer the disability as known to law. No provision is made either in the Stamp Act or in the Registration Act to compel parties to an instrument to register it. Mr. Radhakrishnan, learned counsel, has produced a specimen form adopted by his clients which gives three schedules. The first schedule describes the entire extent of the land owned by the owner of the land, the second one deals with the share therein which he has conveyed under the deed and the third one bears the caption that the superstructure existing thereon is not being conveyed. He points out that the superstructure had come up by the investments made by the vendee of the land, and the vendor of the land having not acquired any ownership rights in the superstructure, the parties clearly state that they do not intend to treat it as part of the sale transaction. In spite of it, such documents are also detained without registering them. If the market value relating to land is not correctly given, he submits that the procedure under section 47A could be followed, so that parties could get the documents registered on time. Ms submissions are in accord with the existing provisions of the Act and hence refusal to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the services rendered and the charges levied, and the amount collected is deposited to the credit of the consolidated fund. Registration of documents is done to help the public in assuring their genuineness and authenticity with reference to a point of time and to discover the documents existing relating to properties which they deal with, and, therefore, the nominal 1 % charge based on sale consideration of the document is quite reasonable. Though the required particulars were not incorporated as part of the counter-affidavit, learned Advocate-General had placed before the court a statement of receipts and expenditure of the Registration Department which shows that receipts for 1987-88 were Rs. 19.23 crores and, for 1988-89, receipts were Rs. 22.8 crores and expenditure was Rs. 11.43 crores and Rs. 10.34 crores respectively. In Municipal Corporation of Delhi v. Mohd. Yasin [1983] 142 ITR 737 (SC), after referring to the earlier decisions in Shri Swamiji of Shri Admar Mutt v. Commissioner, Hindu Religious and Charitable Endowments Department, AIR 1980 SC 1, and Southern Pharmaceuticals and Chemicals, Trichur v. State of Kerala, AIR 1981 SC 1863, it was held that the primary objec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tments. 7. When a sale deed conveying only a share in the land is produced and the Registering authority has reason to believe that its market value furnished is not Correct, he has no jurisdiction or authority to hold an enquiry and decide as to what is the stamp duty payable thereon. Rule 3(3) only enables him to arrive at a "prima facie" assessment as to whether the market value furnished in the sale deed could be relied upon to proceed with the registration. If he opines that the market value is not correct, the statutory duty cast upon him is to register and send it to the Collector to follow the procedure under section 47A. 8. Except the Collector, no authority of the Registration Department in any other capacity could fix the market value and decide upon the proper stamp duty payable in respect of any instrument covered by section 47A. 9. The impugned circular of the second respondent dated December 9, 1988, is declared illegal and invalid. 10. Levy of registration fee at 1% is valid. 11. Article 5 (i) could be applied only in respect of an agreement to construct a building or part of building entered into between a vendor of the land, who had already sold a portio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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