Adarsh Sahkari Grih Nirman Swawlambi Society Limited Vs State of Jharkhand & Ors (Supreme Court of India)
Ease of Doing Transactions for Co-ops: SC Strikes Down Illegal Administrative Hurdle-No Extra Certificate Needed for Stamp Duty Exemption to Co-ops
SC examined the legality of Memo No. 494 dated 20.02.2009 issued by the Principal Secretary, Registration Department, Jharkhand directing all Sub-Registrars to grant exemption under Section 9A only after obtaining recommendation of the Assistant Registrar, Cooperative Society. Appellant, a registered cooperative society seeking stamp-duty-free registration of transfer of premises to its members, challenged this Memo as ultra vires, arbitrary & destructive of the self-reliant framework of cooperative societies.
SC held that once a cooperative society is registered under Section 5, the certificate of registration issued by the Registrar is conclusive proof of its existence under Section 5(7) & the State is bound by this statutory declaration. Any additional requirement to “verify” existence through the Assistant Registrar is irrelevant, superfluous, creates an unlawful hurdle & adds no value to the integrity of transactions.
SC emphasised that administrative decisions based on irrelevant considerations or unnecessary burdens violate principles of good governance, efficiency & legality. The Stamp Act grants a statutory right to co-operative societies to transfer premises to members without stamp duty, & authorities have a corresponding statutory duty to register such instruments without insisting on extraneous conditions. SC held the Memo illegal as it disrupts ease of transactions, is not supported by the Stamp Act or Registration Act & imposes a redundant requirement contrary to the legislative scheme. SC set aside the Memo & allowed the appeal, reversing the Jharkhand High Court’s refusal to interfere.
