Elipe Dharma Rao, J.
1. This writ appeal has been filed challenging the order passed by the learned single Judge of this Court, dated 28.7.2005 made in W.P. No. 4802 of 2000.
2. The appellant herein is a Government of India Enterprise, falling under the Ministry of Petroleum and Natural Gas and engaged in refining, marketing, distribution or petroleum products through various outlets throughout the breadth and length of the country. The case of the appellant/petitioner is that their predecessors-in-interest viz. Caltex (India) Limited, had taken on lease a vacant land measuring 9600 sq.ft. in Old Door No. 31/4, A.L. Plant Road, Guindy, Chennai-32 from one Mr. M.L. Loganatha Mudaliar on 1.5.1957 for a period of five years on a monthly rental of Rs. 100/- and the said document was registered on 23.5.1957. The said document contains a clause for renewal for further three terms of five years each and before expiry of the first lease period itself, the said Loganatha Mudaliar sold the property to 'Elite Opticals' in and by a sale deed dated 17.3.1962. Subsequently, the said Caltex (India) Limited, entered into a lease agreement with Elite Opticals Industries for a period of five years, commencing from 1.5.1962 with two renewal options of five years each. The Central Government, by an Ordinance called the Caltex (Acquisition of Shares of Caltex Oil Refining (India) Limited and of the Undertakings in India of Caltex (India) Limited Ordinance, 1976, has acquired the right, title and interest of Caltex (India) Limited in relation to its undertakings in India and acquired all the shares of Caltex Oil Refining (India) Limited and thus the Caltex Oil Refining (India) Limited became a Government Company within the meaning of Section 617 of the Companies Act, 1956 and all other legal formalities were also completed and thus the petitioner/appellant company was born from the said amalgamation.
3. It is also stated by the appellant that after the expiry of the lease period, the landlord had filed C.S. No. 490 of 1992 before this Court, seeking eviction of the Corporation, wherein the petitioner/appellant had filed Application No. 2492 of 1983, invoking the provisions of Section 9 of the Madras City Tenants Protection Act, for purchase of the land in question and by an order dated 16.2.1993, this Court has held that the petitioner/appellant is entitled to the benefits of the said Act and thus is entitled to purchase the suit land, for which the value had to be fixed in accordance with the Act. Thereafter, one Mr. T. Kandaswamy, Advocate, was appointed as the Advocate-Commissioner to determine the minimum of extent of land that is necessary for the convenient use and also to fix the land value, taking into consideration the very market value of three years, preceding the date of the order and accordingly, the Advocate-Commissioner has fixed the total value of the land at Rs. 22,45,000/- and this Court, after considering the report and the objections of the landlord/Elite Opticals, who claimed higher amount, by an elaborate order dated 17.2.1993, fixed the market value of the land in accordance with the provisions of Section 9(1) of the Tamil Nadu City Tenants Protection Act at Rs. 26,85,000/-. Accordingly, the payment was made by the petitioner/appellant and thereafter, the said Elite Opticals had sought for directions from this Court to the Registering Officer to register the Sale Deed, without requiring the petitioner/appellant to furnish a certificate under Section 269-UL of the Income-tax Act.
4. In the case on hand, the dispute started when the document was presented on 28.12.1996 for registration and when the Registering Authority has referred the same under Section 47-A of the Stamp Act, stating that the value of the property was under-valued in the document. This action of the Registering Authority was challenged by the appellant by filing the writ petition praying to issue a Writ of Mandamus, to direct the second respondent to forthwith release the original sale deed, bearing Document. No. 916 of 1996, on the ground that when once the Court has fixed the value of de property, under the provisions of Section 9 of the Tamil Nadu City Tenants Protection Act and when the ingredients of Section 47-A of the Stamp Act, as amended by the Tamil Nadu, are not satisfied, the respondents are fault in referring the document.
5. The learned single Judge has disposed of the said writ petition, with the following directions:
(i) the petitioner shall give an undertaking before the second respondent that they would pay the deficit stamp duty, if ultimately it is held that they are liable for such payment, and the same shall be recorded in the sale deed;
(ii) the petitioner shall furnish a bank guarantee for the deficit stamp duty, which shall be subject to the proceedings under Section 47A of the Indian Stamp Act;
(iii) the petitioners shall give an undertaking that they would not alienate or encumber the property in question till the payment of additional stamp duty, if any, and
(iv) on compliance of the conditions (i) to (iii), referred to above, the respondents are directed to return the original document with an endorsement that the matter in issue is pending before the third respondent herein under Section 47A of the Indian Stamp Act.
6. Aggrieved by the above said directions of the learned single Judge, this writ appeal has been filed by the appellant.
7. The specific argument advanced on the part of the learned Counsel for the appellant is that only when the Registering Officer has 'reason to believe that the market value of the property has not been truly set forth in the instrument', he may, after registering such instrument, refer the same to the Collector for determination of the market value and since in the case on hand, the sale consideration has been fixed by the Court, exercising its statutory powers under Section 9 of the Tamil Nadu City Tenants Protection Act, there is no question of undervaluing the property and the reference under Section 47-A is unwarranted.
8. The question that falls for consideration in this matter is whether the Registering Authority is right in referring the document under Section 47-A of the Stamp Act, when, admittedly, the sale consideration was fixed by the Court, while exercising the powers under Section 9 of the Chennai City Tenants Protection Act?
9. For better appreciation of the case, we shall now extract hereunder Section 47-A of the Stamp Act, as amended by Tamil Nadu:
47-A Instruments of conveyance, etc.. undervalued, how to be dealt with-
If the Registering Officer, appointed under the Indian Registration Act, 1908, while registering any instrument of conveyance, exchange, gift, release of benami right or settlement has reason to believe that the market-value of the property, which is the subject-matter of conveyance, exchange, gift, release of benami right or settlement has not been truly set forth in the instrument, he may, after registering such instrument, refer the same 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 the parties reasonable opportunity of being heard and after holding an enquiry in such manner as may be prescribed by rules made under this Act, determine the market-value of the property, which is the subject-matter of conveyance, exchange, gift, release of benami right or settlement 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.
(3) The Collector may, suo molu, within two years from the date of registration of any instrument of conveyance, exchange, gift, release of benami right or settlement, 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 conveyance, exchange, gift, release of benami right or settlement, and the duty payable thereon and if, after such examination, he has reasons to believe that the market-value of such property has not been truly 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 (Madras Amendment) Act, 1967.
(4)(a) Any person, aggrieved by an order of the Collector under Sub-section (2) or Sub-section (3), may appeal to the appellate authority specified in Sub-section (5).
(b) All such appeals shall be preferred within such time, and shall be heard and disposed of in such manner, as may be prescribed by rules made under this Act.
(5) The appellate authority shall be,-
(i) in the city of Madras, the Madras City Civil Court; and
(ii) elsewhere-
(a) the Subordinate Judge, or if there are more than one Subordinate Judges, the Principal Subordinate Judge, having jurisdiction over the area in which the property concerned is situated; or
(b) if there is no such Subordinate Judge, the District Judge, having jurisdiction over the area aforesaid.
10. On a perusal of the provisions of Section 47-A of the Stamp Act, as amended by the Tamil Nadu, 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. The object of the provision is only to neutralise the effect of under-valuation of property with a view to evading payment of stamp duty. The condition precedent for making a reference is, there must be reason for the Registering Authority to believe that the market value of the property has not been truly set forth in the document presented for registration and hence it must follow that the reasons must be recorded, however short it may be. It is the duty of the Registering Authority to record reasons for his belief that true market value has not been set out in the document, complete the registration and thereafter refer the matter to the Collector for determination of the market value of the property and the proper duty payable thereon. It is essential to point out that before registration, the Registering Authority has to record that he has reasons to believe that the value of the property has not been duly set forth in the instrument. Only after recording such reasons, the Registering Authority has to complete registration of the instrument in question and thereafter alone, he could refer the same to the Collector under Sub-section (1) of Section 47A of the Indian Stamp Act. In the case on hand, all these procedures have been duly followed by the Registering Authority in referring the document under Section 47-A of the Stamp Act.
11. The specific argument of the learned Counsel for the appellant is that when, admittedly, the price was fixed by the Court, there is no reason for the Registering Authority to suspect the value mentioned in the sale deed and since there is no fraudulent evasion of payment of stamp duty, the reference under Section 47-A of the Stamp Act, is untenable. The learned Counsel for the petitioner would rely on a judgment of a Division Bench of this Court in S.P. Padmavathi v. State of Tamil Nadu and Ors. AIR 1997 Mad 296, wherein it has been 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....
12. There is no dispute with regard to this part of the above proposition of law, arrived at by the Division Bench of this Court. In the case on hand, the Court has passed the order in the petition filed under Section 9 of the Chennai City Tenants' Protection Act, 1921 on 17-2-1994, fixing the market value of the land at Rs. 26,85,000/-. But, the document has been executed and presented for registration only on 28-12-1996 i.e. well after 34 months, during which, it is the common knowledge of everybody that there was price sore in the market value of the properties. It is because of this reason, the Registering Authority has held the document as 'under-valued' as on the date of executing the sale deed and referred the document under Section 47-A of the Stamp Act.
13. It has been vehemently argued on the part of the appellant that since the price of the land was fixed by the Court, there was no fraudulent evasion of stamp duty and that only the value of the land as on the date of agreement or the order of the Court should be taken into consideration while registering the deed. In support of his arguments, the learned Counsel for the appellant would rely on the following judgments:
1. S.P. Padmavathi v. State of Tamil Nadu and Ors. AIR 1997 Mad 296,
2. G.B. Adhilakshmi Ammal v. The Special Deputy Collector (Stamps) 2002 (3) CTC 490,
3. Sub-Registrar, Adyar, Chennai v. Canara Bank, Saidapet Branch and Ors. (2006) 3 MLJ 425, and
4. Devi Narayanan Housing Development Private Limited v. Inspector General of Registration : (2007)5MLJ1337 .
14. In the first judgment cited, reported in AIR 1997 Mad 296, a Division Bench of this Court has held:.Mere lapse of time between the date of agreement and the execution of 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 47-A 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.
15. In the second judgment cited above reported in 2002 (3) CTC 490. a learned single Judge of this Court, in a matter wherein the Court has fixed the sale price in a petition filed under Section 9 of the City Tenants Protection Act and the Sub-Registrar passed the order directing tenant to pay difference in Stamp Duty on ground that market value of lands was more, has held that 'sale consideration had been fixed on basis of order of Court exercising statutory power and there is no allegation by Sub-Registrar that tenant and landlord have colluded' and therefore the order of the Special Deputy Collector (Stamp) demanding difference in Stamp Duty Was set aside.
16. In the third judgment cited above reported in 2006 (3) MLJ 425, a learned single Judge of this Court has held that 'mere time gap between sale and execution of document is not sufficient to the Registering Officer to invoke his power under Section 47-A'.
17. In the fourth judgment cited above reported in : (2007)5MLJ1337 , a learned single Judge of this Court has held:
When a property is purchased in a Court auction, the value fixed thereon should be the value truly fixed based on material consideration. If any value other than the value fixed by the Court is taken into consideration, then, it tantamounts to exceeding the jurisdiction made under the law. The authorities concerned cannot sit on appeal over the Court's decision unless an appeal is preferred from such an order. Therefore, the value of the property in question for the purpose of determining the stamp duty to be paid by the purchaser is the value fixed in the Court auction purchase which is arrived at after an offer and acceptance and the amount offered during the auction and accepted by the Court would represent the real market value of the property. In the instant case, the authority concerned has exceeded his jurisdiction by going beyond the value fixed by the Court.
In the instant case, the value indicated by the petitioner is the value fixed by the Court and therefore, the same has to be taken into account and accordingly, the petitioner has to pay the stamp duty only on the basis of the value fixed by the Court in the Court auction.
In view of this settled proposition that the value fixed by the Court has to be taken by the respondent, the impugned order, which is made contrary to the above said proposition cannot be sustained and the same is liable to be set aside.
18. There is no dispute that in the case on hand, the value of the property was fixed by the Court, in a proceeding initiated under Section 9 of the Chennai City Tenants Protection Act. But, when the Court, in a proceeding under Section 9 of the Chennai City Tenants Protection Act, after scrupulously following the requisites mandated thereunder has fixed the market value as on that date i.e. on 17.2.1994, the appellant has slept over the matter, without any rhyme or reason and has coolely presented the document for registration after a lapse of 34 months, by which time, the market value of the property has soared to a high level. When, for this purpose, the document was referred under Section 47-A of the Stamps Act by the Registering Authority, it was challenged by the appellant/petitioner on the ground that the value was arrived at by a Court of law, in a proceeding initiated by them under Section 9 of the Chennai City Tenants Protection Act. The market value was arrived at by the Court in the said proceeding on 17.2.1994, whereas the document was executed and presented for registration on 29.12.1996. In such a factual situation and when there is increase in the market value of the property, it cannot be said that the Registering Authority is at fault in insisting the appellant/purchaser to pay the difference of amount.
19. At this juncture, we feel it appropriate to quote a judgment of the Honourable Apex Court in State of Rajasthan and Ors. v. Khandaka Jain Jewellers : AIR2008SC509 , wherein the Hon'ble Apex Court has categorically held as follows:
10. It may be mentioned that there is a difference between an agreement to sell and a sale. Stamp duty on a sale has to be assessed on the market value of the property at the time of the sale, and not at the time of the prior agreement to sell, nor at the time of filing of the Suit. This is evident from Section 17 of the Act. It is true that as per Section 3, the instrument is to be registered on the basis of the valuation disclosed therein. But Section 47-A of the Rajasthan (Amendment) Stamp Duty Act contemplates that in case it is found that properties are under valued then it is open for the Collector (Stamps) to assess the correct market value. Therefore, in the present case, when the Registering Authority found that valuation of the property was not correct as mentioned in the instrument, it sent the document to the Collector for ascertaining the correct market value of the property. The expression 'execution' read with Section 17 leaves no manner of doubt that the current valuation is to be seen when the instrument is sought to be registered. The Stamp Act is in the nature of a taxing statute, and a taxing statute is not dependant on any contingency. Since the word 'execution' read with Section 17 clearly says that the instrument has to be seen at the time when it is sought to be registered and in that if it is found that the instrument has been undervalued then it is open for the Registering Authority to enquire into its correct market value. The learned single Judge as well as the Division Bench in the present case had taken into consideration that the agreement to sell was entered into but it was not executed. Therefore, the incumbent had to file a Suit for seeking a decree for execution of the agreement and that took a long time. Therefore, the Courts below concluded that the valuation which was in the instrument should be taken into account. In our opinion this is not a correct approach. Even the valuation at the time of the decree is also not relevant. What is relevant in fact is the actual valuation of the property at the time of the sale. The crucial expression used in Section 17 is 'at the time of execution'. Therefore, the market value of the instrument has to be seen at the time of the execution of the sale deed, and not at the time when agreement to sale was entered into. An agreement to sell is not a sale. An agreement to sell becomes a sale after both the parties signed the sale deed. A taxing statute is not contingent on the inconvenience of the parties. It is needless to emphasize that a taxing statute has to be construed strictly and considerations of hardship or equity have no role to play in its construction....
(Emphasis supplied)
19A. This judgment of the Honourable Apex Court has settled the position that even the valuation at the time of the decree is not relevant and what is relevant is the actual valuation of the property at the time of the sale and therefore, the judgments cited by the learned Counsel for the appellants cannot be made applicable.
20. Therefore, we have no hesitation to hold that the Registering Authority has done nothing wrong in referring the document in question under Section 47-A of the Stamp Act, even though the sale value was fixed by the Court in a proceeding under Section 9 of the Chennai City Tenants Protection Act, after complying with all the mandatory requirements thereunder, since, there was a long gap from the date of passing of the order by the Court and the date of execution and presentation of the document for registration, during which time, the market value has reached new peaks. Having thus slept over the matter, unreasonably and without any rhyme or reason and inviting an unpleasant situation, the appellant cannot be permitted to raise objection against the statutory action initiated by the Registering Authority.
21. In the counter affidavit filed, the third respondent has satisfactorily explained the reason for not passing any order in the reference under Section 47-A of the Stamp Act. In such circumstances, we are unable to appreciate the contentions raised on the part of the appellants. Therefore, it follows that the present appeal deserves only dismissal.
22. The officers at the helm of affairs of the appellant Corporation at the relevant time must be held responsible for their lethargic attitude, resulting in the present unpleasant situation to the Corporation and sleeping over the matter, in spite of the order of the Court, permitting them to purchase the property for a sum of Rs. 26,85,000/- and their lethargy in discharging their official duties, in getting the sale deed executed in favour of the appellant Corporation immediately after the permission was granted by the Court, has thrown the Corporation to a situation of shelling out more amount towards the Stamp Duty, besides legal expenses and further delay in registration of the document. Therefore, the appellant Corporation is directed to initiate necessary disciplinary proceedings against the officers concerned who were at the helm of affairs of the appellant Corporation at the relevant time and who left the matter without pursuing it, from the date of the order of the Court i.e. from 17.2.1994, resulting in extra financial burden on the appellant Corporation, a Government of India Enterprise, towards Stamp Duty, in view of the escalation in land prices, and other incidental charges like the legal expenses, thus putting a dent to the public money, and report compliance to this Court within eight weeks from the date of receipt of a copy of this order.
23. With such direction to the appellant Corporation, this writ appeal is dismissed. No costs.