Stamp Duty To Be Paid On Value Of Sale Deed If Executed In Furtherance Of Decree Under Specific Relief Act: Karnataka High Court

The Karnataka High Court has held that the sale deed executed in furtherance of a decree for Specific Performance, after contesting, the stamp duty liable to be paid would not be as per the valuation of the property on the date on which the document was presented for registration and but would be on the agreement value.Justice Suraj Govindaraj said “ I am of the considered opinion that merely because Sri.Khader Mohiddin came forward to execute a sale date in favour of the petitioners would not require the petitioner to make payment of the stamp duty and registration fee as per the market value on the date of presentation of the said sale date. The benefit which would be available as regards sale deed executed and registered in the course of Execution Proceedings would equally apply to a sale date voluntarily executed by judgment debtor in favour of the decree holder.” Case Background: Munikrishnappa, husband of petitioner No.1 and father of petitioners No.2 and 3 had entered into an agreement of sale with one Khader Mohiddin on 3.4.1994 for purchase of land for total sale consideration of Rs.4 lakhs and as on the date of the agreement had paid a sum of Rs.3,50,000 and the balance amount of Rs.50,000 was payable at the time of execution of the absolute sale deed. Mohiddin not having performed his part of the contract, Munikrishnappa had filed a suit for specific performance. The suit came to be decreed on 12.09.2005 which was challenged by Mohiddin, which was dismissed on 01.08.2007. Thereafter, Mohiddin came forward to execute the absolute sale deed in favour of the petitioners, which was presented for registration before respondent No.3-Senior Sub-registrar, Vartur by making payment of the stamp duty and registration fee on the value mentioned in the agreement of sale.However, the senior Sub-registrar did not register the sale deed on the ground that the valuation for the purpose of payment of stamp duty is not proper. The valuation had to be done as per the current market value as on the date of the presentation of the sale deed. Later the District Commissioner and District Registrar passed an order determining the stamp value at 8.48% to be Rs 26,16,080, and registration fee was determined to be Rs 3,08,500, totalling Rs. 29,24,580/- which the petitioners were called upon to make payment. The petitioners argued that the sale consideration continues to be Rs.4 lakhs, which has been accepted by the Senior Civil Judge, Bangalore Rural District. The valuation sought to be made by the Sub-register as on the date of presentation of the document is completely illegal and non-est. The Sub-register ought to have taken into consideration that a sale deed was required to be executed on the very same sale consideration that was agreed in the year and therefore taking the present value of the land would not arise. The respondents contended that the sale deed has not been executed through the process of the Court but has been executed between two parties voluntarily and willingly. Insofar as such sales are concerned, the value of the property as on the date on which the sale deed has been executed is required to be taken into consideration for the purpose of determining the stamp duty and registration fee. Findings: The bench noted that though the suit was filed in the year 1995 the same came to be decreed on 12.09.2005 and there is no particular observation made in the said decree requiring the purchaser to make payment of any enhanced value in respect of the property. Stating that from the year 1995 till the year 2007, it is on account of Khader Mohiddin's defaults that the sale deed could not be executed in favor of the petitioners. If at all such a sale deed had been executed earlier the petitioners would have made payment of the stamp duty as on the date of execution of sale deed. Noting that after dismissing of the appeal if the petitioner had filed Execution Proceedings and in the Execution Proceedings sale deed was executed in favor of the petitioners, again the petitioners would not be required to make payment of stamp duty and market registration fee on the market value of the property as on the date of presentation of the sale deed. The court said “The distinction sought to be made out by the respondent is without a difference in as much as by virtue of execution of sale deed, what is sought to be done is to give effect to the decree dated 12.09.2005 in OS No.759 of 1995 and RFA No.1721 of 2005.” Following which it held, “Whether a sale deed has been executed in favor of the petitioners in the Execution Proceedings or voluntarily, the net result being to give effect to the decree dated 12.09.2005 in OS No.759 of 1995, I am of the considered opinion that this distinction without difference cannot enure to the benefit of the State.” Allowing the petition, the court directed the respondents are directed to register the sale deed presented by the petitioner with reference to the value of the property as...

Stamp Duty To Be Paid On Value Of Sale Deed If Executed In Furtherance Of Decree Under Specific Relief Act: Karnataka High Court

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