Case Note & Summary
The appeal arose from a dispute concerning recovery of deficient stamp duty and registration fee on a sale deed executed in favour of M/s Mahajan Sabha, Gurdaspur, a society registered under the Societies Registration Act. The State of Punjab and its revenue authorities were appellants before the Supreme Court. The sale deed No.3033 was executed for a consideration of Rs.2,50,000 in respect of a building situated in Gurdaspur. No stamp duty was affixed on the sale deed and no registration charges were paid. When the auditing authority pointed out the omission, the Sub-Registrar made a reference to the District Collector under Section 47-A(1) of the Indian Stamp (Punjab Amendment) Act, 1982 for collection of stamp duty of Rs.32,350 and registration fee of Rs.1,000. The Collector issued notice to the respondent society under Sections 47-A(2) and (3). The respondent filed objections on 9 October 1989 contending that since the document was registered two years prior to the notice, the Collector had no power to take action. The Collector rejected the contention and passed orders demanding the duty. The respondent then approached the High Court by way of a writ petition, which granted liberty to file an appeal before the District Judge. The Additional District Judge, Gurdaspur, in C.A. No.11/19 of 1991 by order dated 21 March 1991 held that once the Sub-Registrar had registered the document, he became functus officio and therefore had no power to make a reference to the Collector. The State's revision against that order was dismissed by the High Court on 10 August 1994 in C.R. No.2836/94. The State then filed a special leave petition before the Supreme Court. The only question before the Supreme Court was whether the limitation of two years prescribed in sub-section (3) of Section 47-A of the Act was attracted to the Collector's action initiated on a reference from the Registering Authority under sub-section (1). The respondent contended that the Collector could act under sub-section (2) only if the action was initiated within two years from the date of registration, and since the notice was sent after two years, the Collector lacked jurisdiction. The State, in effect, argued that the two-year limitation under sub-section (3) was confined to suo motu action by the Collector or reference from the Inspector General of Registration or the Registrar of a district, not to references by the Sub-Registrar. The Supreme Court examined the scheme of Section 47-A. It noted that sub-section (1) empowers the Registering Authority, i.e., the Sub-Registrar, to refer a case to the Collector for determination of value and proper stamp duty after registering an instrument. Sub-section (2) then provides for the Collector to give opportunity and determine the deficient duty upon receipt of such reference. Sub-section (3) prescribes a two-year limitation for the Collector to act suo motu or on reference from the Inspector General or the Registrar. The Court held that the limitation of two years under sub-section (3) applies only to those two situations, not to a reference made by the primary Registering Authority under sub-section (1). On a conjoint reading of all three sub-sections, the Collector's action taken under sub-sections (2) and (3) on a reference under sub-section (1) is not controlled by the two-year limitation. Consequently, the Supreme Court allowed the appeal, set aside the orders of the High Court and the Additional District Judge, and confirmed the order of the Collector. The parties were directed to bear their own costs. The Court held that the action initiated by the Collector was not barred by limitation and that the deficient stamp duty and registration fee were recoverable.
Headnote
A) Stamp Duty - Limitation for Collector's Action - Application of Two-Year Limitation Under Section 47-A(3) - Indian Stamp (Punjab Amendment) Act, 1982, Section 47-A - Sale deed executed in favour of respondent society without payment of stamp duty and registration fee; Sub-Registrar made reference to Collector under Section 47-A(1); Collector issued notice under Sections 47-A(2) and (3) but respondent contended action barred by two-year limitation from date of registration. The Supreme Court held that the two-year limitation in sub-section (3) applies only to suo motu action by Collector or reference from Inspector General of Registration or Registrar of a district, not to references by Registering Authority under sub-section (1). On conjoint reading of sub-sections (1), (2) and (3), Collector's action on such reference is not controlled by that limitation. Held that action initiated by the Collector was not barred by limitation, and deficient stamp duty and registration fee were recoverable. (Paras 1-4)
Issue of Consideration
Whether the limitation of two years prescribed in sub-section (3) of Section 47-A of the Indian Stamp (Punjab Amendment) Act, 1982 applies to action initiated by the Collector on a reference from the Registering Authority under sub-section (1) of Section 47-A.
Final Decision
Appeal allowed; orders of High Court and Additional District Judge set aside; order of Collector confirmed; parties to bear their own costs.
Law Points
- Two-year limitation under Section 47-A(3) of Indian Stamp (Punjab Amendment) Act
- 1982 applies only to suo motu action by Collector or reference from Inspector General of Registration or Registrar of a district
- it does not apply to reference by Registering Authority under Section 47-A(1)
- Collector's action on such reference not barred by limitation
- deficient stamp duty and registration fee recoverable.
