Judgment:
Manmohan Sarin, J.
(1) The appellant, aggrieved by the order of the learned single Judge allowing Civil Writ Petition No 687196 and directing it reassess the duty payable on the disclosed consideration of Rs. 10,000 in the conveyance deed, has filed the present appeal. The appellant's case is that the admitted consideration in the entire transaction, is Rs. 5,61,000 on which stamp duty is liable to be paid.
(2) The facts leading to the filing of the present appeal may be noticed in brief : (i) Delhi Development Authority had granted a lease of 3.65 acres of land situated in Mayur Vihar, Phase-I, New Delhi to the respondent No. 2, Mis. Parvana Cooperative Group Housing Society Limited, for construction of flats for its members. In the event, flat No. A-37 was allotted by respondent No. 2 to two of its members, viz. P. K. Roy and Pranab K. Roy, (hereinafter referred to as the 'original allottees'). (ii) The aforesaid original allottees entered into an agreement to sell with respondent No. 1 whereby they agreed to sell and transfer all their rights in flat No. A-37 for a consideration of Rs. 5,51,000, being the amount admittedly paid by respondent No. 1 to them. The allottees had also executed a General Power of Attorney in favor of Mr. Ramesh Chandra, husband of respondent No. 1 and authorised him to execute the sale conveyance deed. as required. (in) On 20-2-1995. the attorney of the original allottees applied to the Delhi Development Authority for converting leasehold rights in respect of the land underneath the flat to freehold rights in favor of respondent No. 1. In response the Delhi Development Authority sent an unsigned and unexecuted conveyance deed in prescribed form for execution to the altorney. The Delhi Development Authority also communicated that the request for reversion of the interest in the land had been. accepted and that the unexecuted conveyance deed forms should be got stamped from the Collector of Stamps, appellan therein, (iv) The unexecuted conveyance deed was submitted to the Collector of Stamps, i.e. the appellant for adjudication of the stamp duty payable. Along with the said document, agreement to said dated 2-5-1995 in, favor of respondent No. 1 by the original allottees and the power of attorney in favor of husband of respondent No. 1 as well as letter of allotment issued by the respondent No. 2 society in favor of the original allottees were sent. (v) The appellant vide its communication dated 29-1-96 informed' the respondent No. 1 that stamp duty and transfer duty amounting to Rs. 44.884 was liable to be paid. The appellant proceeded on the basis that the property had been purchased by the respondent No. 1 from the original allottees for a consideration of Rs. 5,51.000. mentioned in the agreement to sell. Further, a General Power of Attorney had also been executed but since no said deed or conveyance deed. had been executed, no stamp duty and transfer duty had been paid till date. Appellant took the position that stamp duty and transfer duty on the consideration amount of the agreement to sell and conversion charges under Section 28(3) read with Article 23 of the Schedule 1A of Stamp Duty Act was payable. The duty was computed as under : Agreement to sell : 'Rs. 5,51,000.00 Conversion Chases as per conveyance deed sent by Dda : Rs. 10,000.00 Total : Rs. 5,61.000.00 Stamp Duty : Rs. 16.000 Stamp Duty : Rs. 16,000 Copy Charges : Rs. 4.00 Total : Rs. 44,884.00 (vi) As noticed earlier, respondent No. 1, aggrieved by the aforesaid demand had preferred Civil Writ Petition No. 687196. The learned Single Judge directed the appellant to reassess the stamp duty on the conveyance deed which disclosed a sale consideration of Rs. 10,000, although the admitted sale consideration paid by the respondent No. 1 to' the original flat owner was Rs. 5,51,000.
(3) Learned counsel for the appellant has argued before us that admittedly respondent No. 1 had purchased the flat for a disclosed consideration of Rs. 5,51,000, which sum was reflected in the agreement to sell that had been sent Along with the conveyance deed for adjudication of the stamp duty payable. It was argued that in terms of Section. 27 of the Indian Stamp Act, the consideration and all other facts and circumstances affecting the chargeability of the instrument with duty, were required to be truly and fully set forth. Reliance was also placed on Section 28(3) of the Indian Stamp Act. The section, caters to a situation where a purchaser of property having not obtained the conveyance deed contracts to sell the same to another person. In such an event, where the property is to be conveyed to the said purchaser, the conveyan.ce is charged with ad valorem duty i.e. consideration for sale by the original purchaser to the subsequent purchaser. Learned counsel also argued that in the instant case, the Delhi Development Authority should not have recognised the agreement to sell, as being barred under Section, 49 of the Stamp Act. Further, that the Delhi Development Authority was duty bound to impound the said document. The argument being that the Delhi Development Authority could not by the conveyance deed sent to' respondent No. 1 permit the conversion of leasehold rights into freehold. Learned counsel for the appellant also argued that the authorities relied on by the learned Single Judge in holding that the Collector of Stamps cannot hold a.n enquiry into the actual consideration and has to go by the disclosed consideration were not applicable. It was urged that since the agreement to sell itself disclosed the consideration, the same should have been adopted for the purpose of levy of stamp duty.
(4) Learned counsel for the appellant further argued that if such transactions were permitted. It would result in large scale evasion of stamp duty. The purchasers of Dda flats would rest content with getting a conveyance from the Dda by payment of conversion charges for land alone and be substituted as the allottees, without obtaining or registering a conveyance deed from original allottees for the fiat and thereby avoid payment of stamp duly on the sale consideration.
(5) Learned counsel for the appellant has placed reliance on the observations made by the Apex Court in the case S. P. Goyal Vs . Collector of Stamps : AIR1996SC839 to the effect that Registration Act and Stamp Act are meant primarily to augment the state revenue by prescribing the stamp duty on various categories of instruments or documents. There can be no dispute with regard to the objective of the said legislation. However, the same would not advance the case of the appellant or enable the determination of the stamp duty on consideration other than that disclosed in the document itself.
(6) We have given due consideration to the submissions made. The short question before us is whether stamp duty on the conveyance deed sent for adjudication is to be paid on the disclosed consideration of Rs. 10,000 or on the amount of consideration that may have been mentioned in another document, viz. the agreement to sell A perusal of the conveyance deed shows that it purports to grant the 'reversionary interest of the Vendor', viz. the original allottees in the land underneath the flat allotted leased in favor of the purchaser, viz. respondent No. 1 for a consideration of Rs. 10,000. The transfer is limited to the above extent. It does not mention the super structure of the flat. It is not in dispute that the consideration for conversion of the reversionary interest in the land underneath is on the rates prescribed by the DDA. The Collector of Stamp,s is not required to hold an independent inquiry into the market value of the property conveyed or the consideration for conveying the same for determining the duty chargeable. He has to go by the consideration mentioned in the document fur calculating the stamp duty payable which, in the instant case, is governed by Article 23 of the: Schedule to the Stamp Act. This is now well established and reference in this connection may be made to the following cases : 1. The Chief Controlling Revenue Authority. (2) Board of Revenue, Madras Vs . K. S. Dwarkanathan : AIR1980Mad171 . 2. Shri Krishan Jindal Vs . Registrar (3) (Deputy Commissioner) District Patiala and Others . 3. Ramchandra Vishwanath Ghaisas and others (4) Vs . The State of Maharashtra : AIR1981Bom164 . 4. Himalaya House Co., Ltd., Vs . The Chief (5) Controlling Revenue Authority and another : [1972]3SCR332 .
(7) As regards the submission of the learned counsel for the appellant that the learned Single Judge had erred in observing that no agreement to sell had been executed between them, it is noticed in the earlier part of the judgment that the learned Single Judge had taken note of the sum of Rs. 5,51,000 which had been paid as sale consideration for the flat. The erroneous observation regarding non-execution of the agreement to sell would not make any material difference as there was no conveyance deed executed with consideration of Rs. 5,51,000 which was the subject matter of adjudication before the Collector of Stamps. The question to be considered is whether the terms of the agreement to sell by which the respondent No. 1 purchased the flat have been incorporated in the conversance deed or not It is clear from a perusal of the conveyance deed for the reversionary of interest in the land that it does not incorporate any term of the agreement to sell. In the absence of any terms of the agreement to sell being incorporated in the conveyance deed, the stamp duty that is chargeable and payable would be on the basis of the consideration as disclosed in the conveyance deed, which is confined to the value of reversionary interest in the land underneath the flat.
(8) As regards the submission of the learned counsel for the appellant that acceptance of this transaction would result in mass scale evasion of stamp duty. it would be for the State Legislature and the statutory authorities to make or seek appropriate amendments in the statute, rules and regulations to make such a transaction exigible to stamp duty on the actual consideration that may be paid.
(9) Be that as it may, as per the existing statutory provisions, the conveyance deed to be executed by the Dda for grant of reversionary interest would be exigible; to stamp duty on the disclosed consideration of Rs. 10,000 only.
(10) The appeal has no merit and is dismissed.