M.Y. Eqbal, J.
1. A very important question of law having general importance falls for consideration in this writ application and with the consent of the learned Counsels for the parties who have been heard at length the writ application is disposed of at the admission stage.
2. The question falls for consideration is 'whether authorities exercising power u Section 47A of the Stamp Act (as amended by Bihar Amendment Act. 1988) read with Bihar Stamp (Prevention of Undervaluation of Instrument) Rules, 1995, can refuse to register an instrument duly presented for registration in execution of a decree of specific performance of contract of sale of immovable property passed by a Civil Court of competent jurisdiction on the ground of undervaluation of the property which is the subject matter of the decree.
3. Before answering the question it would be useful to briefly state the facts of the instant case which lie in a narrow compass.
4. In 1978 one Smt. Pratlbha Singh and her husband, Madhusudan Singh jointly proposed to sell their land measuring an area of 8 kathas at a price of Rs. 6500/- per katha. Pursuant to the said offer an agreement was executed by them in favour of the petitioners on 30-11-78 and out of the total consideration a sum of Rs. 24.000/- was paid as an advance. Accordingly, application seeking permission for transfer of the land was filed being permission case No. 827/78 and permission was accorded vide order dated 28-8-79. The petitioners accordingly said to have purchased the required stamp papers and requested the vendors to sell the land. It appears that when the vendor refused to execute sale deed a dispute arose between the petitioners and the vendors which resulted in filing of Title Suit No. 125/81 by the petitioner for specific performance of contract. The aforesaid suit was decreed by the Sub-Judge, Ranch) vide judgment and decree dated 18-10-82 with a direction to the defendants i.e. the respondents-vendors to execute sale deed within two months from the date of the judgment. In the decree the valuation of the land was shown at Rupees 52,000/-. The petitioner, thereafter, filed Execution Case No. 1/83(A) and prayed to the Execution Court to allow them to deposit the decretal amount. In the meantime, the vendors challenged the Judgment and decree by filing First Appeal No. 27/83R before this Court, in the said appeal the execution of the decree was, however, stayed by this Court, The said appeal was ultimately dismissed on 4-4-90. The vendors then filed L.P. A. No. 47/ 90(R) which too was dismissed on 17-10-90. The vendors then filed S.L.P. No. 5061/90 before the Supreme Court which was accepted for hearing and was numbered as Civil Appeal No. 3151/92. The said Civil Appeal was also ultimately dismissed on 23-11-95. The defendants/vendors then filed Civil Review No. 63/96 before the Supreme Court which was also dismissed on 7-2-96 and the judgment and decree passed by the Sub-Judge was confirmed. After disposal of the civil review by the Supreme Court, the Executing Court again proceeded with the execution of the decree and directed the petitioners vide order dated 15-2-96 to deposit the balance amount wtych was deposited on 23-3-96. The decree, however, could not be executed due to several objections filed by the vendors. When the vendors-judgment-debtors failed to execute and register the sale deed in terms of the decree, the Executing Court executed the sale deed on 23-12-98 and authorised the office clerk to present the sale deed before the Sub-Registrar for acceptance of its execution and registration. The sale deed was presented before the Sub-Registrar who, after admitting the same, issued receipt to the officer clerk. The said Sub-Registrar however, referred the matter to the Dist, Registrar i.e. respondent No. 2 under Section 47A(3) of the Stamp Act, 1899 for fixation of proper valuation and the stamp duty payable thereon. It is stated that since then this matter is pending before the respondent No. 2.
5. Petitioners' further case is that respondent No. 2 exercising power under Section 47A of the said Act, issued show cause notice dated 13-7-99 directing the petitioners to show cause as to why valuation of the property be not fixed for the purpose of payment of stamp duty. Petitioners challenged the jurisdiction of the authority and validity of notice by filing representation/ objection requesting respondent No. 2 to dispose of the matter at an early date. It is stated that the petitioners met respondent No. 2 personally at several occasions and requested for early hearing and disposal of the objection but nothing has been done.
6. Mr. A. K. Sinha, learned Sr. Counsel appearing on behalf of the petitioners assailed the show cause notice and the power of the District Registrar-cum-Deputy Commissioner to interfere with the decree in the matter of payment of stamp duty on the valuation shown in the decree. Learned Counsel submitted that respondent No. 2 has got no authority to change the valuation of the instrument which has been fixed in the year 1978 and a decree to that effect was passed and more so, the matter remained pending since 1978 due to the stay order passed by the High Court and the Supreme Court in different appeals. Learned Counsel further submitted that the executability of a valid decree of a Civil Court cannot be challenged by the authority exercising powers under the said Act.
7. On the other hand, Mr. A. Sahay, learned Govt. Advocate referred Rule 20 of the Bihar Stamp (Prevention of Undervaluation of Instrument) Rules and submitted that the respondent No. 2 has all the power to fix the valuation of deed presented before the Sub-Registrar. According to the learned Counsel the petitioners are bound to pay the stamp duty on the basis of the market value of the land which is the subject matter of the sale deed.
8. Mr. V.P. Singh, learned counsel Intervened in the matter on behalf of the vendors-respondents, Smt. Prattbha Singh and her husband, Madhusudan Singh and prayed for adding the vendores-intervenors (judgment debtors) as party-respondents in this writ petition on the ground mentioned therein.
9. Before appreciating the rival contentions of the parties, It would be useful first to refer the relevant provisions of the Act and the Rules.
10. Section 47A of the Stamp Act was inserted by Bihar Act, 15 of 1988 of the Indian Stamp (Amendment) Act, 1988. The said provisions reads as under :
'47A. Instrument of conveyance :--(1) where the registering officer appointed under the Indian Registration Act, 1908 (XVI of 1908) while registering any instrument of conveyance, exchange, gift, partition or settlement, has reason to believe that the market value of the property which is the subject matter of such instrument has not been rightly set forth in the instrument he may, after registration of such instrument refer the matter to the collector for determination of the market value of such property and the proper duty payable thereon.
(2) On receipt of a reference under Sub-section (1), the collector shall, after giving one month's time to the parties for making their representation and after holding an enquiry determine the market value of the property which is the subject matter of such instrument and the duty as aforesaid. The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty:
Provided that no such person shall be required to pay any amount to make up the difference if the difference between the consideration of the market value as set forth in the instrument and the market value determined by the Collector does not exceed 10 per cent of the market value so determined.
(3) The Collector may suo motu within two years from the date of registration of such instrument not already referred to him under Sub-section (1), call for and examine the Instrument for the purpose of satisfying himself as to the correctness of the market value of the property which is the subject matter of such instrument and the duty payable thereon and if after such examination he has reason to believe that the market value of such property, has not been rightly set forth in the instrument, he may determine the market value of such property and the duty as aforesaid in accordance with the procedure provided for in Sub-section (2). The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty:
Provided that nothing in this sub-section shall apply to any instrument registered before the date of commencement of the Indian Stamp (Bihar Amendment) Ordinance, 1986.
(4) Any person aggrieved by an order of the Collector under Sub-section (2) or Sub-section (3) may appeal to the Commissioner concerned of the adminstrative division, such appeal shall be preferred within sixty days of order and shall be heard and disposed of by the Commissioner.
(5) For the purpose of this Act, market value of any property shall be estimated to be the price which in the opinion of the Collector or the appellate authority, as the case may be, such property would have fetched or would fetch, if sold, in the open market on the date of execution of the in-
strument of conveyance, exchange, gift, partition or settlement.'
11. As noticed above, Section 47A was inserted vide Bihar Amendment Act of 1988. Again some minor amendments were made under Section 47A of the Act by Indian Stamp (Bihar amendment) Act 1991. In Sub-section (1) of Section 47A after the word 'that the market value of the property which is the subject matter of such instrument has not been rightly set forth in the instrument', the words 'or, which is less than the value calculated in terms of the rules framed in this Act,' has been inserted.
12. From bare perusal of the provisions of Section 47A of the Act, it is manifest that these provisions empower the registering authority while registering any instrument of conveyance to refer the matter to the Collector for determination of market value of the property and the proper duty payable on the instrument, if the registering authority has reason to believe that market value of the property which is the subject matter of such instrument has not been rightly set forth in the instrument. Sub-section (2) of Section 47A of the Act empowers the Collector to hold an inquiry after giving one month's notice to the parties and determine the market value of the property which is the subject matter of such instrument. On such determination the difference if any in the amount of duty shall be payable by the person liable to pay the duty. Sub-section (3) empowers the Collector to proceed suo motu within two years from the date of registration of such instrument not already referred to him under Sub-section (1). The Collector may call for and examine the instrument for the purpose of satisfying himself as to the correctness of the market value of the property which is the subject matter of such instrument. Any order passed by the Collector determining the market valuation and asking the person for payment of difference amount is made appealable under Sub-section (4) of the said Act.
13. For giving effect to the provision of Section 47A of the said Act the State government framed a rule namely, the Bihar Stamps (Prevention of undervaluation of Instrument) Rules, 1995 (hereinafter referred to as the Rules). Rule 4 of the said Rule provides that the District Collector within the area of his district shall determine the minimum value of the land/property for different categories on the basis of instrument relating to conveyance of highest value. Rule 5 provides for the fixation of the minimum valuation and manner of preparation of guideline register. Rule 6 prescribes the procedure for the fixation of estimated minimum value and Rule 7 empowers the Collector to send the list of minimum value to the registering officer in respect of different areas of land/ property.
14. Form reading of the amended provisions of the Act and the Rules made thereunder, it is clear that the object of the provision is only to neutralise the effect of undervaluation of property with a view to evading payment of stamp duty. The exercise of power under the amended provision is with reference to particular land covered by the instrument brought for registration. When the Collector has reason to believe that the instrument is under-valued he should get it verified as to whether market value was truly reflected in the instrument for the purpose of stamp duty and the Collector on reference could determine the same on the basis of prevailing market value. In other words, power under Section 47A of the Act can only be exercised when the registering officer has reason to believe that market value of the property, which is the subject matter of conveyance, has not been rightly set forth with a view to fraudulently evade payment of proper stamp duty. The expression used in Section 47A is 'rightly' and not properly or correctly. In other words, if prima facie it appears that valuation put in the instrument has been rightly set forth then the authority under the Act has no jurisdiction to determine the valuation.
15. Similar provision has been inserted in the Stamp Act by other States. Section 47A has been inserted in the Stamp Act by Tamil Nadu Amendment Act 24 of 1967. The said amended provision came for consideration before a Division Bench of Madras High Court in the case of 'S. P. Padmavathi v. State of Tamil Nadu, AIR 1997 Madras 296. The question falls for consideration before their lordship was as to whether in case of deed of conveyance presented for registration pursuant to the decree for specific performance passed in the suit, it is open to the registering authority to direct payment of stamp duty on the market value of the property. Answering the question their lordship held that :
'Power under Section 47A of the Act can only be exercised when the Registering Officer has reason to believe that the market value of the property, which is the subject of conveyance, has not been truly set forth, with a view to fraudulently evade payment of proper stamp duty. Mere lapse of time between the date of agreement and the execution or the document will not be the determining factor that the document is undervalued and such circumstance by itself is not sufficient to invoke the power under Section 47A of the Act, unless there is lack of bona fides and fraudulent attempt on the part of the parties to the document to undervalue the subject of transfer with a view to evade payment of proper stamp duty ...'
16. Their lordship further held that
: 'In the case of instrument of conveyance executed pursuant to the decree for specific performance passed by the Civil Court, in which there is no allegation of deliberate under-valuation of lack of bona fides in valuing the subject of transfer with a view to evade payment of proper stamp duty, the mere fact that there is a time gap between the agreement of sale and the execution of the document by itself is not sufficient for the Registering Officer to Invoke his power under Section 47A of the Stamp Act, unless there are reasons to believe that there is an attempt on the part of the parties to the instrument to undervalue with a view to evade payment of proper stamp duty.'
17. Similarly, the State of Madhya Pradesh also inserted Section 47A in the Stamp Act by Indian Stamp (Madhya Pradesh 2nd amendment) Act, 1975. A question of law arose as to whether the said amendment will have retrospective operation was referred for consideration before the special Bench of the Madhya Pradesh High Court. The special Bench of the Madhya Pradesh High Court answered the reference in the case of 'Sitaram. v. State, AIR 1980 Madh. Pard. 4. Answering the reference their lordship held that the amended provision of the Act shall not have retrospective operation.
18. It is well known cardinal principle of law that every statute which takes away or impairs vested rights acquired under the existing laws, or creates a new obligation or imposes a new duty in respect of past transaction must be presumed to be intended not to have retorospective effect. Applying the said priciple, I am of the view that when the court execute a sale deed on the basis of a decree passed in a suit for specific performance and plaintiff was not responsible for the prolonged litigation, then the value on the date of agreement alone is relevant for stamp duty and not the value on the date of execution of the sale-deed by the Court.
19. As stated above, power under Section 47A of the Act can be exercised when the Registering Officer has reasons to believe that the market value of the property, which is the subject matter of conveyance, has not been rightly set forth with a view to fraudulently evade payment of the proper stamp duty. Mere lapse of time between the date of agreement and the execution of document will not be the determining factor that the document is under valued and such circumstances be itself is not sufficient to invoke the power under Section 47A of the Act unless there is lack of bona fide and fraudulent attempt on the part of the parties to the document to undervalue the subject of transfer with a view to evade payment of proper stamp duty.
20. Coming back to the instant case the agreement was entered into by and between the parties much before a decade i.e. in 1978 when Section 47A was inserted by Bihar Amendment Act, 1988. In the said agreement the consideration for the sale of the propety was fixed at Rs.6500/- per katha (total price of Rs.52,000/-), The suit for specific performance was filed in 1981 and the same was decreed in 1982 directing the vendors to execute sale-deed within two months from the date of the judgment. The plaintiff immediately filed Execution Case No. 1/83. Even after the decree the vendor did not come forward to execute the sale-deed rather challenged the decree by filing first appeal which remain pending and ultimately dismissed in 1990. Not only that the vendors again filed Letters Patent Appeal which too was dismissed and then Special Leave Petition before the Supreme Court which was converted into Civil Appeal in 1992, the Supreme Court ultimately dismissed the Civil Appeal in 1995. Litigation did not come to an end rather prolonged at the instance of the vendors who filed Civil Review before the Supreme Court and the same was dismissed in 1996. Even thereafter the vendors did not come forward to execute the sale-deed and ultimately the Court was compelled to register the sale-deed in favour of the petitioners. From these factual position it cannot be said that the consideration amount shown in the sale-deed was not rightly put forth and the same is not the true consideration. Moreover, once the consideration paid by the petitioners cannot be attacked on any ground, the question of demanding stamp duty on the basis of the market value prevailing on the date of execution of sale-deed does not arise.
21. A Division Bench of Madras High Court in the case of 'State v. T.N. Chandrasekharan' AIR 1974 Madras-117 while dealing with similar provision observed as under (Para 5) :
'We are inclined to think that the object of the Amending Act being to avoid large scale evasion of stamp duty, it is not meant to be applied in a matter of fact fashion and in a haphazard way. Market value itself, as we already mentioned, is a changing factor and will depend on various circumstances and matters relevant to the consideration. No exactitude is in the nature of things possible. In working the Act, great caution should be taken in order that it may not work as an engine of opression. Having regard to the object of the Act, we are inclined to think normally the consideration stated as the market value in a given instrument brought for registration should be taken to be correct unless circumstances exist which suggest fraudulent evasion.'
22. Having regard to the entire facts and circumstances of the case and the law discussed herein above, I have come to the following conclusions :
(1) Section 47A of the Act, as amended by Bihar Amendment Act, 1988 shall have no application in respect of a document presented for registration pursuant to a decree for specific performance of an agreement executed prior to coming into force of the amended provision of Act.
(2) Power under Section 47A of the Act can be exercised when the Registering authority has reasons to believe that the valuation of the property which is the subject matter of conveyance has not rightly been set forth with a view to fraudulently evade payment of proper stamp duty. Mere lapse of time between the date of agreement and execution of document will not be the determining factor that the document is undervalued and such circumstances may not itself be sufficient to invoke power under Section 47A of the Said Act.
(3) The Registering authority is empowered under Section 47A of the Act to hold an inquiry to satisfy himself whether value of the property has been rightly shown in the document, but in the instant case as the agreement entered into between the parties is much before the amending Act came into existence and having regard to the fact that the parties have been litigating for about 20 years, the Registering authority has no jurisdiction to initiate inquiry under the said provision of the Act and the Rules made thereunder.
23. Accordingly, this writ application is allowed and the impugned notice and the proceeding Initiated by the respondents arc quashed. It is held that the Registering authority shall register the document on payment of stamp duty on the valuation mentioned in the said instrument and shall not demand payment of additional stamp duty.
24. Before parting with the judgment. I must discuss here the submission made by Mr. V.P. Singh, who has appeared on behalf of the intervenors by filing intervention petition. The main ground for intervening in the writ application is that the vendors filed objection in the executing Court and against the order of the executing Court rejecting their objection, they have filed Misc. Appeal No. 1/99(R) and Civil Revision No. 2/99(R) in which execution of the decree has been stayed. In view of the submissions made by the learned counsels, let it be clarified that the executing Court shall not proceed with the execution case till further order is passed by this Court in the aforementioned appeal and revision said to have been pending.