Stamp duty

chandra1 (Querist) 01 October 2009 This query is : Resolved
clarification
Facts
1-That a property was allotted by Development authority to "A" on the installment basis, for the sale consideration Rs.4Lacs .But due to default on behalf of the allot tee, in making installment payment. The sale consideration was shown in the deed Rs.9 Lacs at the time of execution of the sale deed. Now the actual sale consideration Rs.4 Lacs + 5 Lacs as the interest there on. The stamp duty has been paid accordingly.
2- Thereafter few days "A" resold the property to “B”for the Sale consideration Rs. 4lacs. The proper stamp duty was paid on the sale deed of “B” and the market value of the property comes to Rs.6 Lacs . The sale deed of “B”has got registered in the appropriate office. After some days The sale deed of “B” was referred to the collector under 47A of the Indian Stamp Act, 1899 .
2- The Sale deed of “B” was referred by the registering authority merely on the ground ,
that the sale consideration was shown Rs. 4Lacs in place of Rs 9Lacs as shown in ealier sale deed of "A" [actual sale consideration of the Property Rs.4 Lacs + interest Rs. 5Lacs]. In his reference it was not clarified, that the earlier sale deed of “A” was executed by the Development authority . It is also pertinent to mention here that the Stamp Duty on the Instrument is being charged on the Sale Consideration Shown By Development Authority. Meaning there by Market value does not effective in the sale deed those are being executed by Authority.
3- The deficiency of Stamp duty was evaluated on the sale consideration of Rs. 5 lacs. And it was further submitted The Sale consideration in sale deed of “B” could not be lowered than 9 Lacs.

4. The sale deed which are executed between private person, the stamp duty is being paid on the market value or consideration and in both which is higher. And on the execution of the sale deed of “B” the stamp duty was paid on market value as per Circle rate issued under relevant rules. The market value was higher than the consideration and the stamp duty was being paid on the market value.
5- In this way the Sale deed of “B” was not under valued in any legal aspect. Now as we know that the chargeability of the stamp duty impose on the “instrument” on the basis of the facts, which is being set forth in the instrument.
4- The object of the section 47 A is only to neutralize the effect, the under valuation of the property with a view to realize proper stamp duty. It is not meant to be applied in a matter of fact fashion in haphazard way.

Now question are:-
a) Whether the reference made by the registering authority is valid and how?
b) the deficiency of stamp duty shall be realized from the sale deed of “B” on the basis of the consideration made in Sale deed of “A”.
d)chargeability of the stamp duty cab be impose on the basis of the facts of other instrument of the prpoerty.
c) If any citation is available. kindly send us. Thanks.

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Raj Kumar Makkad (Expert) 02 October 2009
The sale price fixed by the collector for the particular area shall prevail and you cannot be forced to treat the value of sale consideration as Rs. 9 lakh or more. Prevailing market rates can be maximum consideration. so reference is illegal and no deficiency at par with the rates of a can be charged. There are numerous citations on this point.