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IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL No. 8325 OF 2011
(Arising out of SLP (C) NO. 20964 OF 2010)
Smt. Har Devi Asnani ...... Appellant
Versus
State of Rajasthan & Others ...... Respondents
WITH
CIVIL APPEAL No. 8326 OF 2011
(Arising out of SLP (C) NO. 17233 OF 2010)
J U D G M E N T
A. K. PATNAIK, J.
Leave granted.
2. The appellant purchased Plot No. A-7 situated in the
Housing Scheme No.12, Ajmer Road, Jaipur, of
Krishna Grah Nirman Sahakari Samiti Limited by a
registered Sale Deed dated 16.05.2007 for a
consideration of Rs.18 lacs. The Sale Deed was
executed on a stamp duty of Rs.1,17,000/-. The Sub-
Registrar, SR IV, Jaipur, did not accept the valuation
made in the Sale Deed and appointed an Inspection
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Officer to inspect the plot purchased by the appellant
and determined the value of the land at
Rs.2,58,44,260/-. The Additional Collector (Stamps),
Jaipur, served a notice under the Rajasthan Stamp
Act, 1998 (for short `the Act') to the appellant on
07.07.2008 to appear before him on 19.09.2008 and to
show-cause why prosecution against the appellant
should not be initiated for concealing or
misrepresenting facts relating to the valuation
mentioned in the Sale Deed resulting in evasion of
stamp duty. The appellant filed a reply stating therein
that the plot of land purchased by her under the Sale
Deed was allotted to her for residential purposes and
was not meant for commercial use and that the sale
price was paid entirely by a cheque. The appellant
also stated in her reply that adjacent to the plot
purchased by her, Plot Nos.A-3 near Scheme No.12,
Roop Sagar, had been sold by a registered Sale Deed
on 16.12.2006 and another Plot No.A-38, near Scheme
No.12, Roop Sagar, at a price less than the price in the
Sale Deed dated 16.05.2007 under which she had
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purchased Plot No.A-7 in Housing Scheme No.12.
Along with the reply, the appellant had also furnished
copies of the two Sale Deeds of the adjacent Plot
Nos.A-3 and A-38 in Scheme No.12. In the reply, the
appellant requested the Additional Collector (Stamps)
to drop the recovery proceedings. The Additional
Collector (Stamps) heard the appellant and in his order
dated 20.07.2009 held after considering the Site
Inspection Report that the determination made by the
Sub-Registrar at Rs. 2,58,44,260/- was correct and
that the appellant was liable to pay deficit stamp duty
of Rs.15,62,880/-, deficit registration charges of
Rs.7,000/- and penalty of Rs.120/- totalling to a sum
of Rs.15,70,000/- and accordingly made the demand
on the appellant and directed recovery of the same.
3. Aggrieved, the appellant filed SB Civil Writ Petition
No.12422 of 2009 before the Rajasthan High Court
challenging the order dated 20.07.2009 of the
Additional Collector (Stamps), Jaipur. A learned Single
Judge of the High Court, however, dismissed the Writ
Petition by order dated 21.10.2009 holding that the
4
appellant had a remedy against the order of the
Additional Director by way of a revision before the
Board of Revenue and as there was an alternative and
efficacious remedy available to the appellant, there was
no just reason for the appellant to invoke the extra-
ordinary jurisdiction of the High Court under Articles
226 and 227 of the Constitution of India. The
appellant then filed D.B. Civil Appeal (Writ) No.1261 of
2009 before the Division Bench of the High Court, but
by order dated 22.03.2010 the Division Bench of the
High Court held that there was no error or illegality
apparent on the face of the record in the order dated
21.10.2009 passed by the learned Single Judge and
that the appeal was devoid of any merit and
accordingly dismissed the appeal. Aggrieved, the
appellant has filed Civil Appeal arising out of S.L.P. (C)
No.17233 of 2010.
4. In the meanwhile, the appellant filed a separate Writ
Petition D.B. Civil Writ Petition No.14220 of 2009 in
the Rajasthan High Court challenging the
constitutional validity of the proviso to Section 65(1) of
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the Rajasthan Stamp Act, 1998 (for short `the Act'),
which provided that no revision application shall be
entertained unless it is accompanied by a satisfactory
proof of the payment of fifty percent of the recoverable
amount. The ground taken by the appellant in the writ
petition before the High Court was that unless the
appellant deposited fifty percent of the total amount of
Rs.15,70,000/- towards deficit stamp duty,
registration charges and penalty, the revision petition
of the appellant would not be entertained and the
appellant was not in a position to deposit such a huge
amount as a condition for filing the revision. The
appellant accordingly contended before the High Court
that the pre-condition of payment of fifty percent of the
recoverable amount for entertaining a revision petition
was arbitrary, unreasonable and unconstitutional.
The Division Bench of the High Court, however, held in
its order dated 16.11.2009 that the constitutional
validity of the proviso to Section 65 (1) of the Act had
been examined by another Division Bench of the High
Court in M/s Choksi Heraeus Pvt. Ltd., Udaipur v.
6
State & Ors. [AIR 2008 Rajasthan 61] and the proviso
to Section 65 (1) of the Act had been held to be
constitutionally valid. The Division Bench relying on
the aforesaid decision in M/s Choksi Heraeus Pvt. Ltd.,
Udaipur v. State & Ors. (supra) dismissed the Writ
Petition by order dated 16.11.2009. The appellant has
filed the Civil Appeal arising out of S.L.P. (C) No.20964
of 2010 against the order dated 16.11.2009 of the
Division Bench in D.B. Civil Writ Petition No.14220 of
2009.
5. For appreciating the contentions of the learned counsel
for the parties, we must refer to Section 65 of the Act.
Section 65 of the Act is quoted hereinbelow:
"65. Revision by the Chief Controlling
Revenue Authority
(1) Any person aggrieved by an order made
by the Collector under Chapter IV and V
and under clause (a) of the first proviso to
section 29 and under section 35 of the Act,
may within 90 days from the date of order,
apply to the Chief Controlling Revenue
Authority for revision of such order:
Provided that no revision application shall
be entertained unless it is accompanied by a
satisfactory proof of the payment of fifty
percent of the recoverable amount.
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(2) The Chief Controlling Revenue Authority
may suo moto or on information received
from the registering officer or otherwise call
for and examine the record of any case
decided in proceeding held by the Collector
for the purpose of satisfying himself as to
the legality or propriety of the order passed
and as to the regularity of the proceedings
and pass such order with respect
thereto as it may think fit:
Provided that no such order shall be made
except after giving the person affected a
reasonable opportunity of being heard in the
matter."
6. Learned counsel for the appellant submitted that
although sub-section (1) of Section 65 of the Act confers a
right on a person to file a revision against the order of the
Collector, the proviso to Section 65(1) of the Act renders this
right illusory by insisting that the revision application shall
not be entertained unless it is accompanied by a
satisfactory proof of the payment of fifty percent of the
recoverable amount. He submitted that the proviso to
Section 65(1) of the Act is therefore unreasonable and
arbitrary and violative of Article 14 of the Constitution and
should be declared constitutionally invalid. He cited the
decision of this Court in Mardia Chemical Ltd. and Others
vs. Union of India and Others [(2004) 4 SCC 311] in which
8
the provision requiring pre-deposit of 75% of the demand
made by the bank or the financial institution in Section 17
of the Securitisation and Reconstruction of Financial Assets
and Enforcement of Security Interest Act, 2002 has been
held to be onerous and oppressive rendering the remedy
illusory and nugatory and constitutionally invalid.
7. Learned counsel for the appellant submitted that
assuming that the proviso to Section 65(1) of the Act is
constitutionally valid where the valuation adopted by the
Additional Collector or Collector and the consequent
demand of additional stamp duty are unreasonable and
exorbitant, the alternative remedy of revision after deposit of
50% of the exorbitant demand is not efficacious, and
affected party should be able to move the High Court under
Article 226 of the Constitution. In support of this
submission, he cited the decision of this Court in
Government of Andhra Pradesh and Others vs. P. Laxmi Devi
[(2008) 4 SCC 720]
8. Learned counsel for the respondents, on the other
hand, submitted that a revision or an appeal is a right
conferred by the statute and the legislature while conferring
9
this statutory right can lay down conditions subject to
which the appeal or revision can be entertained and that
there is nothing unreasonable or arbitrary in the proviso to
Section 65(1) of the Act requiring deposit of 50% of the
recoverable amount before the revision application is
entertained. He argued that the proviso to Section 65(1) of
the Act is in no way illusory and is only a provision to
ensure that the stamp duty demanded is recovered in time
and is not held up because of the pendency of the revision.
In support of his submission, learned counsel for the
respondent relied on the decisions of this Court in The
Anant Mills Co. Ltd. vs. State of Gujarat and others [(1975) 2
SCC 175]; Seth Nand Lal and Another vs. State of Haryana
and Others [1980 (supp) SCC 575]; Vijay Prakash D. Mehta
and Another vs. Collector of Customs (Preventive), Bombay
[(1988) 4 SCC 402] and Gujarat Agro Industries Co. Ltd. vs.
Municipal Corporation of the City of Ahmedabad and Others
[(1999) 4 SCC 468].
9. Learned counsel for the respondents submitted that
the decision of this Court in Mardia Chemical Ltd. and
Others vs. Union of India and Others (supra) declaring the
10
provision of Section 17 of the Securitisation and
Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002, requiring deposit of 75% of the
demand as constitutionally invalid does not apply to the
facts of the present case. He submitted that in Mardia
Chemical Ltd. and Others (supra) this Court clearly held that
the amount of deposit of 75% of the demand is at the initial
proceedings itself when the bank or the financial institution
makes its demand on the borrower and the requirement of
deposit of such a heavy amount on the basis of one-sided
claim of the bank or the financial institution at this stage,
before the start of the adjudication of the dispute, cannot be
said to be a reasonable condition. He submitted that in the
instant case, the first adjudicatory authority is the Collector
and only after the Collector determines the amount of stamp
duty payable on the documents, the affected party has a
right of revision under Section 65(1) of the Act. He further
submitted that the requirement of 50% of the amount
determined by the Collector at the stage of filing of the
revision is therefore not a requirement at the initial stage
but a requirement at the revisional stage and the decision of
11
this Court in Mardia Chemical Ltd. and Others vs. Union of
India and Others (supra) is distinguishable from the facts of
the present case.
10. We need not refer to all the decisions cited by the
learned counsel for the parties because we find that in
Government of Andhra Pradesh and Others vs. P. Laxmi Devi
(supra) this Court has examined a similar provision of
Section 47-A of the Stamp Act, 1899, introduced by the
Indian Stamp Act (A.P. Amendment Act 8 of 1998). Sub-
section (1) of Section 47-A, introduced by Andhra Pradesh
Act 8 of 1998 in the Indian Stamp Act, is extracted
hereinbelow:
"47-A. Instruments of conveyance, etc. how to
be dealt with-(1) Where the registering officer
appointed under the Registration Act, 1908,
while registering any instrument of
conveyance, exchange, gift, partition,
settlement, release, agreement relating to
construction, development or sale of any
immovable property or power of attorney
given for sale, development of immovable
property, has 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, or that
the value arrived at by him as per the
guidelines prepared or caused to be prepared
by the Government from time to time has not
been adopted by the parties, he may keep
pending such instrument and refer the
12
matter to the Collector for determination of
the market value of the property and the
proper duty payable thereon.
Provided that no reference shall be made by
the registering officer unless an amount
equal to fifty per cent of the deficit duty
arrived at by him is deposited by the party
concerned."
Under sub-section (1) of Section 47-A quoted above, a
reference can be made to the Collector for determination of
the market value of property and the proper duty payable
thereon where the registering officer has reason to believe
that the market value of the property which is the subject-
matter of the instrument has not been truly set forth in the
instrument, or that the value arrived at by him as per the
guidelines prepared or caused to be prepared by the
Government from time to time has not been adopted by the
parties. The proviso of sub-section (1) of Section 47-A,
however, states that no such reference shall be made by the
registering officer unless an amount equal to fifty per cent of
the deficit duty arrived at by him is deposited by the party
concerned. This proviso of sub-section (1) of Section 47-A
was challenged before the Andhra Pradesh High Court by P.
Laxmi Devi and the Andhra Pradesh High Court held that
13
this proviso was arbitrary and violative of Article 14 of the
Constitution and was unconstitutional. The Government of
Andhra Pradesh, however, filed an appeal by special leave
before this Court against the judgment of the Andhra
Pradesh High Court and this Court held in para 18 at page
735 of [(2008) 4 SCC 720] that there was no violation of
Articles 14, 19 or any other provision of the Constitution by
the enactment of Section 47-A as amended by the Andhra
Pradesh Amendment Act 8 of 1998 and that the amendment
was only for plugging the loopholes and for quick realisation
of the stamp duty and was within the power of the State
Legislature vide Entry 63 of List-II read with Entry 44 of
List-III of the Seventh Schedule to the Constitution. While
coming to the aforesaid conclusions, this Court has relied
on The Anant Mills Co. Ltd. vs. State of Gujarat and others
(supra), Vijay Prakash D. Mehta and Another vs. Collector of
Customs (Preventive), Bombay (supra) and Gujarat Agro
Industries Co. Ltd. vs. Municipal Corporation of the City of
Ahmedabad and Others (supra) in which this Court has
taken a consistent view that the right of appeal or right of
revision is not an absolute right and it is a statutory right
14
which can be circumscribed by the conditions in the grant
made by the statute. Following this consistent view of this
Court, we hold that the proviso to Section 65(1) of the Act,
requiring deposit of 50% of the demand before a revision is
entertained against the demand is only a condition for the
grant of the right of revision and the proviso does not render
the right of revision illusory and is within the legislative
power of the State legislature.
11. We also find that in the impugned order the High
Court has relied on an earlier Division Bench judgment of
the High Court in M/s Choksi Heraeus Pvt. Ltd., Udaipur v.
State & Ors. (supra) for rejecting the challenge to the proviso
to Section 65(1) of the Act. We have perused the decision of
the Division Bench of the High Court in M/s Choksi
Heraeus Pvt. Ltd., Udaipur v. State & Ors. (supra) and we
find that the Division Bench has rightly taken the view that
the decision of this Court in the case of Mardia Chemical
Ltd. and Others vs. Union of India and Others (supra) is not
applicable to the challenge to the proviso to Section 65(1) of
the Act inasmuch as the provision of sub-section (2) of
Section 17 of the Securitisation and Reconstruction of
15
Financial Assets and Enforcement of Security Interest Act,
2002, requiring deposit of 75% of the demand related to
deposit at the stage of first adjudication of the demand and
was therefore held to be onerous and oppressive, whereas
the proviso to Section 65(1) of the Act in the present case
requiring deposit of 50% of the demand is at the stage of
revision against the order of first adjudication made by the
Collector and cannot by the same reasoning held to be
onerous and oppressive. In our considered opinion,
therefore, the proviso to Section 65(1) of the Act is
constitutionally valid and we are therefore not inclined to
interfere with the order dated 16.11.2009 in D.B.CWP
No.14220 of 2009. The Civil Appeal arising out of S.L.P. (C)
No.20964 of 2010 is therefore dismissed.
12. We are, however, inclined to interfere with the order
dated 21.10.2009 of the learned Single Judge of the High
Court in SB Civil Writ Petition No.1244 of 2009 as well as
the order dated 22.03.2010 of the Division Bench of the
High Court in D.B. Civil Appeal (Writ) No.1261 of 2009. The
learned Single Judge of the High Court and the Division
Bench of the High Court have taken a view that as the
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appellant has a right of revision under Section 65(1) of the
Act, the writ petition of the appellant challenging the
determination of the value of the land at Rs.2,58,44,260/-
and the demand of additional stamp duty and registration
charges and penalty totaling to Rs.15,70,000/- could not be
entertained under Article 226 of the Constitution. The
learned Single Judge of the High Court and the Division
Bench of the High Court have not considered whether the
determination of market value and the demand of deficit
stamp duty were exorbitant so as to make the remedy by
way of revision requiring deposit of 50% of the demand
before the revision is entertained ineffective. In Government
of Andhra Pradesh and Others vs. P. Laxmi Devi (supra) this
Court, while upholding the proviso to sub-section (1) of
Section 47-A of the Indian Stamp Act introduced by Andhra
Pradesh Amendment Act 8 of 1998, observed:
"29. In our opinion in this situation it is
always open to a party to file a writ petition
challenging the exorbitant demand made by
the registering officer under the proviso to
Section 47-A alleging that the determination
made is arbitrary and/or based on
extraneous considerations, and in that case
it is always open to the High Court, if it is
satisfied that the allegation is correct, to set
aside such exorbitant demand under the
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proviso to Section 47-A of the Stamp Act by
declaring the demand arbitrary. It is well
settled that arbitrariness violates Articles 14
of the Constitution vide Maneka Gandhi vs.
Union of India [(1978) 1 SCC 248]. Hence,
the party is not remediless in this
situation."
13. In our view, therefore, the learned Single Judge should
have examined the facts of the present case to find out
whether the determination of the value of the property
purchased by the appellant and the demand of additional
stamp duty made by the appellant by the Additional
Collector were exorbitant so as to call for interference under
Article 226 of the Constitution.
14. We, therefore, allow the appeal arising out of S.L.P. (C)
No.17233 of 2010, set aside the order passed by the learned
Single Judge of the High Court in SB Civil Writ Petition
No.1244 of 2009 and the order passed by the Division
Bench of the High Court in D.B. Civil Appeal (Writ) No.1261
of 2009 and remand the writ petition back to the High Court
for fresh consideration in accordance with law. No costs.
.............................J.
(R. V. Raveendran)
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.............................J.
(A. K. Patnaik)
New Delhi,September 27, 2011.
Discussion
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