Fair value of land is be considered as on date of execution of document

State of Kerala Vs Sunitha Paul (Kerala High Court)

Conclusion: Where the document was executed by the parties prior to the revision of the fair value, the valuation need only be done in accordance with the fair value existing as on the date of execution of the document and the stamp duty for the purpose of registration need be calculated accordingly.

Held: The subject issue relates to the fixation of the fair value of land by the Statutory authority under Section 28A of the Kerala Stamp Act, 1959 (‘the Act, 1959’ for short), the attendant rules, and the consequences arising from the order passed by the Government and the Revenue Divisional Officer. According to the appellant-State, the judgment of the Single Judge was erroneous, since the Single Judge had not appreciated the provisions of Section 28A of the Kerala Stamp Act and the Rules framed thereunder in its correct perspective and therefore, the State Government was put to innumerable financial difficulties. Single Judge erred in holding that the fixation of the land value on 06.11.2014 was based on the current market value of the land. However, Single Judge had not taken into account the subtle distinction between the provisions of Section 28A, and the power enjoyed by the State Government to enhance the land value of the properties as a whole within the State of Kerala. It submitted that the Single Judge was carried away by the land value fixed by the Revenue Divisional Officer to the property of assessee and without properly appreciating the law held that the land value fixed by the said authority could not increase all on a sudden and that too within a week. Assessee submitted that the property was transacted by and between the assessee and the owner of the property and the transaction was complete when the consideration was passed on, therefore, Single Judge was right in directing the Sub Registrar to register the documents submitted by assessee based on the fair value fixed as per Ext.P13 gazette notification dated 16.11.2014. It was held that the State Government, as per Ext.P14 gazette publication dated 14.11.2014, in exercise of the powers conferred under sub-Section (1B) of Section 28A of the Act, 1959 increased the existing fair value of the land in Kerala fixed as per sub-Section (1) of Section 28A by 50%, which was declared to have come into force on the 17^th day of November, 2014. However, State Government was of the opinion that the market value of land has increased considerably , however, the fair value of the land was not revised in tune with the increase in the market value. Therefore, on a harmonious reading of sub-Section of Section 28A and the provisions of Rules, 1995, it was vivid and clear that a review after the publication of the notification under sub-Section (1B) was maintainable before the District Collector only to review the order passed in appeal under sub-Section (4).  District Collector did not have power to review the order of the State Government published as per Ext.P14 gazette notification, because there was no order passed in any appeal against the assessee to be aggrieved as provided under sub-Section (5) of Section 28A of Act, 1959. The distinction by and between the powers conferred on the Revenue Divisional Officer under the provisions of Sections 28A (i) and 28(1A), the powers conferred on the Government under Section 28A (1B), and the powers enjoyed by the District Collector to entertain an appeal and review were not properly brought to the notice of the Single Judge, which persuaded the Single Judge to arrive at a finding that the fair value fixed by the Revenue Divisional Officer as per Ext.P12 order dated 06.11.2014 and published in the gazette dated 16.11.2014 had only a difference of a week with the fair value fixed by the Government as per Ext. P14, and therefore the fair value so fixed by the Government could not be sustained. However, the fair value of the land was fixed in the year 2010 and the second revision was done by the Government as per Ext.P14 gazette notification dated 16.11.2014. Therefore, in effect, the value of the land had to be compared with the value of the year 2010. Moreover, the learned single Judge had not found fault with the manner in which the decision was taken by the District Collector in the impugned order though contentions were raised against the same in the writ petition. Moreover, a transaction by and between private persons with respect to a property would  not stand in the way of the State Government fixing the fair value of the land, and merely because the financial transaction had taken place earlier, by and between the parties, that would not disable the registering authority from insisting for payment of stamp duty in accordance with law, for registration of documents. It was true, as provided under section 47 of ‘The Indian Registration Act, 1908’, if the document was executed by the parties prior to the revision of the fair value, the valuation need only be done in accordance with the fair value existing as on the date of execution of the document and the stamp duty for the purpose of registration need be calculated accordingly. Thus, appellants were entitled to take appropriate action in accordance with law to realise the extra stamp duty in accordance with law.

FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT

This writ appeal is filed by the respondents in the writ petition, who are State of Kerala and its officials challenging the judgment of the learned single Judge in W.P.(C) No. 2384 of 2016 dated 20.01.2016.

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