1. This is a writ petition filed under Article 226 of the Constitution seeking a writ, order or direction more particularly in the nature of writ of mandamus declaring the action of Respondent No. 1 in insisting upon payment of stamp duty and registration fee on the basis of the market value as on the date of the sale deed dated 31-3-1995 instead of the actual consideration as illegal and without jurisdiction and a direction to Respondent No. 1 to register the document presented for registration and alternatively to direct Respondents No. 2 and 3 to pay the deficit stamp duty payable, if any.

2. The facts as emerging from the affidavit of the partner of the petitioner-firm are that the land bearing T.S No. 1992, Block No. 25, Ward No. 5 measuring 3311.58 Sq. Yards situated in Annapoornammapeta, Rajahmundry belonged to Endowments Department. The petitioner took the said land on lease for 35 years in the year 1958 vide registered document No. 4025/58 and then constructed a cinema theatre and he has been enjoying the same all along. While so, the Government took a policy decision to sell the endowment properties to the existing lease holders in the year 1987 and accordingly a High Power Committee to work out the modalities for the sale of those lands including the fixation of price was constituted. The said High Power Committee held a meeting on 6-5-1988 after giving notice to the petitioner-firm vide letter dated 17-2-1988 and after hearing all concerned, fixed the market value of the land at Rs. 300/- per Sq. Yard and further imposed a condition that another sum of Rs. 90/- over and above a sum of Rs. 300/- per Sq. Yard shall be paid towards solatium at 30% of the price. The petitioner accepted the offer under a letter dated 20-5-1988 and subsequently the High Power Committee again met on 14-6-1988 and confirmed the sale at that rate i.e, Rs. 390/- per Sq. Yard towards the price and solatium. After confirmation of the sale by High Power Committee notice was issued to the petitioner on 12-7-1988 for payment of the price fixed as above and accordingly four partners of the petitioner-firm paid Rs. 1,04,000/- each towards their respective contributions to Respondent No. 3 under receipts bearing No. 469 to 472 dated 15-8-1988. The total sum paid by them is Rs. 4,16,000/- being ⅓rd of the total amount payable towards price as well as the solatium. The remaining ⅔rd amount was payable on 15-4-1989 and it was also paid under receipts No. 69 to 72, dated 15-4-1989. Thus, the partners of the petitioner-firm paid a total sum of Rs. 12,91,516/- by 15-4-1989. Respondent No. 3 having received the above amount, invested it in a fixed deposit in their name and derived a sum of Rs. 6,04,677/- by way of interest by 5-1-1994. However, Respondents No. 2 and 3 have not taken any steps to execute the sale deed in favour of the partners of the petitioner-firm though the petitioner-firm pursued the matter with the above respondents. Respondent No. 3, however, obtained necessary approval from his superiors and executed a sale deed on 31-3-1995 and the same was presented for registration on 31-3-1995 before Respondent No. 1 herein. It is asserted that the entire sale transaction was conducted through Official Receiver of the Government and hence absolutely there is no possibility of suppressing a consideration. Yet, Respondent No. 1 started insisting for payment of stamp duty and registration fee as per the market value as on the date of presentation of the sale deed. According to the petitioner, Section 47-A of the Stamp Act cannot be invoked in such a case. It is also asserted that the concept of market value is alien to the stamp duty and the concept of stamp duty as introduced in this country and which is in vogue since its inception and as is recognised by the Constitution it is a tax on the instrument on the basis of its actual consideration. Therefore, the taxation on the basis of the market value of the property which forms the subject matter of the instrument amounts to a taxation on wealth and, therefore, amendment to Section 47-A and Schedule 1-A of the Indian Stamp Act introducing market value as basis by A.P.Amendment Act 17 of 1986 is illegal and contrary to law. It is once again pointed out that the total consideration was received by Respondent No. 3 by 15-4-1989 itself and a sale deed ought to have been executed immediately thereafter and in case any higher stamp duty and registration fee is payable, it is for Respondents No. 2 and 3 to pay the same as the delay, if any, was on account of them. Hence the writ petition. The petitioner also filed W.P.M.P No. 22346/1995 seeking a direction to Respondent No. 1 to register the document bearing No. 172/95 dated 31-3-1995 executed by Respondent No. 1 pending disposal of the above writ petition. After hearing both sides and on a consideration of the judgments in K. Shiva Ramaiah v. Special Deputy Collector (Urban) (1) 1989 (1) APLJ 387 and L.R Venkateswaran v. Government of Andhra Pradesh (2) 1990 (2) ALT 110 this Court directed Respondent No. 1 on 17-8-1995 to register the document in question. Accordingly the document has been registered and released to the petitioner-firm.

3. Respondent No. 1 filed W.V.M.P No. 2429/1995 seeking to vacate the interim order dated 17-8-1995. The Joint Sub-Registrar-1 of Rajahmundry filed his affidavit in support of the above petition. It is stated that a High Power Committee appointed by Government of Andhra Pradesh has fixed the price of Rs. 300/- per Sq. Yard and another sum of Rs. 90/- per Sq. Yard as solatium, but the High Power Committee while fixing the above value has neither consulted the concerned Sub-Registrar nor followed the general principles for fixation of value and the above Committee did not take into consideration the potentiality of the land viz., commercial importance of the site. It is further stated that as per the amendment introduced in the year 1986 adding Section 47-A of the Stamp Act by G.O.Ms No. 1031, Revenue-II, dated 31-7-1995 the Sub-Registrar was authorised to keep the document pending without registration when the Registering Officer has reason to believe that the market value is not truly and correctly set forth in the instrument and he may refer the matter to the Collector for determination of the correct market value. The intendment of the above amendment is to check the under-valuation to plug the loop-holes in the State revenues. The petitioner's contention attributing the delay in execution of sale deed as a lapse on the part of the Respondents No. 2 and 3 is denied. It is asserted that Section 29 of the Stamp Act enjoins that the stamp duty is to be borne by the grantee in the absence of an agreement to the contrary. As regards the alternative remedy it is stated that Section 47-A of the Stamp Act provides for alternative remedy and it is for the Collector to give an opportunity to the parties and held an elaborate enquiry as prescribed by the rules and determine the market value and the aggrieved parties may seek recourse to civil Courts. Since the petitioner has directly rushed to this Court without adopting the above alternative remedy, this writ petition is liable to be dismissed.

4. Having regard to the above averments, the short question that arises for consideration is whether the document No. 172/95, dated 31-3-1995 is chargeable with stamp duty on the real consideration fixed by the High Power Committee or the market value as on the date of execution of sale deed.

5. Sri M.V Durga Prasad, the learned Counsel for the petitioner vehemently contended that the consideration in this case was fixed by High Power Committee appointed by the State Government taking into consideration the market value as well as the potentiality of the land and apart from fixing the market value at Rs. 300/- per square yard a further sum of Rs. 90/- towards solatium at 30% of the above price has been fixed and the offer was communicated to the petitioner under letter dated 20-5-1988 and the same was accepted by him. The petitioner was also made to pay the consideration in two instalments namely ⅓rd of the total amount in the first instance and the ⅔rd in the next instalment and the same has been invested in a fixed deposit by the third respondent and a sum of Rs. 6,04,677-00 has been earned by way of interest. He has thus demonstrated that the petitioner was not at all at fault for the delay in execution of the sale deed, in question. According to Sri Durga Prasad, the learned Counsel for the petitioner Section 47-A of the Stamp Act is not intended to be applied to the transactions of this nature and therefore the impugned proceedings are illegal and opposed to the rule of law. He further contended that Section 47-A of Stamp Act is applicable only to a case of under-valuation and by any stretch of imagination this case cannot be called a case of under-valuation. He also argued that basic value register does not have statutory sanction and it is fit to be ignored as held in Ponnavolu Sasidar v. Sub-Registrar, Hayatnagar (3) AIR 1992 AP 198. Thus he urged that the proceedings initiated by the Sub-Registrar, the first Respondent, which are impugned herein may be quashed.

6. Sri Madanmohan Rao, the Government Pleader for Revenue appearing for the first Respondent on the other hand contended that a bare reading of the definition of “Chargeability” occurring in Section 2(6) together with Section 3 of the Stamp Act would leave no doubt that it is the date of execution of the document that is material for “Chargeability” and accordingly the market value prevailing as on the date of registration must be determined by the Collector under Section 47-A of the Stamp Act and therefore the petitioner cannot have any grievance against the action initiated by the Sub-Registrar. He pointed out that the Sub-Registrar has followed the procedure laid down in sub-section (1) and kept the document pending with a view to refer the matter to the Collector for the determination of the market value, but the petitioner filed this writ petition and obtained a direction to register the document. Though the document in this case has been registered, it was done so as per the directions of this Court and hence it is open for this Court to dispose of the writ petition and direct the first Respondent to refer the matter to the Collector for determination of the market value and thereafter the parties will have to seek recourse to the procedure laid down in sub-section (5) of the Stamp Act. He relied on a decision in M. Anasuyamma v. Choppelia Lakshmamma (4) AIR 1992 AP 183 and in Vidyanagar Housing Co-operative Society, Hyderabad v. State of Andhra Pradesh (5) AIR 1995 AP 223.

7. Sri R. Sreeramulu, the learned Counsel for the second and third Respondents argued that there is an alternative remedy for the petitioner and the same has not been exhausted and hence this writ petition is liable to be dismissed in limini. According to him the alternative remedy is provided in Section 47-A of the Stamp Act itself.

8. I applied my anxious consideration to all the contentions of both the learned Counsel. The factual background is not at all in dispute. The land in question is an Endowment property and it has been under occupation of the petitioner-firm since a long time and in view of the long-standing possession, a policy of decision was taken by the State Government to convey the endowment property to the persons in occupation of such lands, and for that purpose a High Power Committee was constituted to fix the consideration. In this case the High Power Committee fixed the price at Rs. 300/- per square yard and also solatium at the rate of 30% thereon which came to Rs. 90/- per square yard. An offer was made to the petitioner whether he would pay the consideration and take sale deed in his favour. Accordingly the offer was accepted by the petitioner-firm and ⅓rd of the total consideration was paid in one instalment and the remaining ⅔rd was also paid subsequently. The High Power Committee confirmed the sale transaction in favour of the petitioner. The Respondents 2 and 3 had to take necessary approval from the State Government and that had taken a couple of years and ultimately the sale deeds came to be executed on 31-3-1995 and presented for registration on the same day. Thereupon the first Respondent Sub-Registrar, Rajahmundiy insisted upon the stamp duty and registration fee as per the market value as on the date of the presentation of the sale deed and not on the consideration fixed by the High Power Committee. In these circumstances the petitioner had to knock at the door of this Court. It is noteworthy that the entire amount of consideration being a sum of Rs. 12,91,516-00 was paid by the petitioner's firm by 15-4-1989 and it was invested in a fixed deposit in the name of third Respondent and interest of Rs. 6,04,677-00 was earned by 5-1-1994.

9. It is firstly contended by Sri M.V Durga Prasad, the learned Counsel for the petitioner that Section 47-A of the Stamp Act is applicable to a case of under valuation and to check cases of evasion of stamp duty. He laid stress on the following words occurring in sub-section (1) thereof “…….. reason to believe that the market value of the property which is the subject matter of such instrument has not been truly set forth in the instrument …….”. He asserted that the market value of the property was fixed by High Power Committee constituted by the Government and hence there can be no doubt that the same has been truly setforth in the instrument. It is no doubt true that the consideration in this case was fixed by High Power Committee constituted by the Government and undoubtedly that amount has been truly setforth in the Government, but the respondent's case is that the above value was fixed long back and it does not represent the market value prevailing as on the date of execution or presentation of the sale deed. Ordinarily it is the date of execution of the sale deed that is relevant for reckoning the market value for the charge ability of the instrument. But there are cases and cases where the above general rule appears to have been departed, from.

10. In K. Sivaramaiah… v. Special Deputy Collector, Urban Cuddapah…. (1 supra) the property was purchased at a public auction held by the Managing trustee of a temple on 16-10-1981 for a total consideration of Rs. 36,200/- and after confirmation of sale was accorded by the Commissioner of Endowments, the instrument of conveyance was registered on 2-9-1983. The Sub-Registrar made a representation to the Collector on the ground that the market value of the property is under-valued in the instrument and proceedings under Section 47-A of the Stamp Act were initiated and the Collector determined the market value of the property at Rs. 1,66,980/-. The auction purchaser preferred an appeal to the Subordinate Judge under sub-section (5) but he could not get any relief and then he filed revision before this Court. In the said decision it is held:

“In the instant case there could be no question of under-valuation of the property as the property was sold in public auction in favour of the appellant. The expression in Section 27-A used as “truly” and not “properly” or “correctly”. The consideration the appellant parted with for purchase of property, it is not denied, was truly setforth in the instrument. It therefore follows that the reference made by the Sub-Registrar, is bad”.

11. Another case which can be said to be a deviation from the general rule is in between L.R Venkateswaran v. Government of Andhra Pradesh (2 supra). In that case the petitioner was allotted a residential house L.I.G 176.C in Sanjeeva Reddy Nagar, Hyderabad by A.P Housing Board and lease-cum-agreement was executed on 10-5-1979. All the instalments fixed by the Board had been paid by the petitioner by 1986 and he therefore represented to the Housing Board to determine the final value of the house and receive the balance if any due. Its final cost was calculated at the rate of Rs. 31,155/- and the petitioner sought for registration of the house in his name on that valuation by paying requisite stamp duty on 27-10-1986 before the Joint Sub-Registrar who called upon the petitioner to deposit the stamp duty of Rs. 8,741-50 on the ground that the valuation of the house was fixed at Rs. 95,378-02. The petitioner paid that amount on 3-12-1987 and took registered instrument in his favour. Thereafter the Joint Sub-Registrar referred the matter to the Collector under Section 47-A of the Stamp Act for determination of the market value. During the pendency of those proceedings the Government issued G.O.Ms No. 522, Revenue dated 20-7-1988 reducing the stamp duty payable by the allottees of the A.P Housing Board. The petitioner represented to the Government seeking refund of the excess amount paid by him but the same was rejected by the Government and thereupon he filed writ petition in this Court.

12. In the judgment cited supra (2), wherein Justice M.N Rao considered the exceptional facts and circumstances of the case and held:—

“The notification issued in G.O.Ms No. 522, Revenue is the result of the decision taken by the Government on the representation of the Housing Board after consulting the Inspector-General of Stamps and Registration. Paragraph 4 of the G.O says that the Government had decided to:

“collect stamp duty and registration fee from the allottees of the houses constructed by the A.P Housing Board only on the final sale price fixed by it at the time of registering the transfer of title in favour of the allottees.”

This beneficial measure is applicable to all cases where there has been no escalation in the sale price fixed by the Housing Board; whatever is the amount fixed by the Housing Board at the time of registration of the house, the stamp duty has to be collected only on that amount but not on the basis of the market value. The intention of the Government is very clear that in every case where registration is sought by an allottee, the stamp duty has to be collected only on the basis of the sale price fixed by the Housing Board…….”

13. Thus it is noteworthy that chargeability of an instrument as on the date of its execution is not a rule of thumb. The first Respondent represents the Registration Department while the Respondents No. 2 and 3 represent Endowments Department of the State Government. The High Power Committee in this case was constituted by the State Government and the consideration in this case at Rs. 390/- per Sq. Yard came to be offered by the State Government and the same was merely accepted by the petitioner and that culminated into a full-fledged sale. As already indicated above, the petitioner has performed his part of the contract and what remained was the formality of execution of conveyance. Undoubtedly the delay in executing the document was on account of the red-tapism prevailing in the Government machinery and there does not appear to be any default on the part of the petitioner for the above delay. The Endowments Department accepted the consideration and thought it fit to invest in a fixed deposit so as to earn interest of more than six lakhs. While so another Department of the State Government namely, Registration Department wants to contend that the market value has not been truly setforth in the document. On a thorough consideration of the provisions of the Stamp Act and also the case law on the subject and having regard to the peculiar circumstances of this case I hold that the ratio in the judgment cited supra (1) is applicable to this case. That apart, the principles of equity also demand that the petitioner should not be mulcted with additional stamp duty having recourse to Section 47-A of the Stamp Act. It may be remembered that Section 47-A of the Stamp Act can be pressed into service only in a case of suppression of real consideration or under valuation but not to a case of genuine transaction of sale by one Department of the State Government and that too the consideration having been fixed by the State Government. Having regard to all the above circumstances, I am satisfied that this can be treated as an exception to the general rule that the date of execution of the instrument is the criteria for chargeability.

14. For all the reasons given above, this writ petition is merited and the same is fit to be allowed. The writ petition is accordingly allowed and the proceedings initiated by the first Respondent under Section 47-A of the Stamp Act are set aside. The parties will bear their own costs.