Exemption From Stamp Duty Granted Under Tamil Nadu Cooperative Societies Act Not Applicable To Multi-State Cooperative Societies: Madras High Court

The Madras High Court recently observed that the exemption from payment of stamp duty granted by the government under the Tamil Nadu Cooperative Societies Act is not applicable to societies registered under the Multi State Cooperative Societies Act 2002. Justice SM Subramaniam observed that Tamil Nadu Cooperative Societies Act is a State enactment whereas the Multi State Cooperative Societies Act is a central enactment. "The cooperative societies registered under the provisions of the Tamil Nadu Cooperative Societies Act alone are entitled to avail the benefit of stamp duty exemption and registration fees which was granted by invoking the powers under Section 51 of the Tamil Nadu Cooperative Societies Act. Consequently, the Multi-State Cooperative Societies Act, 2002 are not entitled to get the benefit of the exemption from payment of stamp duty and registration fees and if at all, such exemption is to be granted it must be granted by the Government of India." In the present case, the petitioner was registered under the Multi-State Cooperative Societies Act 2002. They were enjoying the benefit of a Government Order issued in 1966 whereby the State had exempted societies from payment of stamp duty. In 2009, through a letter, the Commercial Taxes and Registration Department clarified that cooperative societies registered under the Multi-State Cooperative Societies Act, 2002, are also deemed to be cooperative society under the Tamil Nadu Cooperative Societies Act. However, later in 2013, through another Government Order, the department stated that stamp duty exemption would no longer be applicable to the cooperative societies registered under the Multi-State Cooperative Societies Act. The same was challenged by the petitioner society. The court noted that as per definition, only a cooperative society registered under the State enactment is considered a “registered society” within the meaning of the Act. "Let us now consider the provisions of the Multi-State Cooperative Societies Act, 2002. Section 3 provides definitions, section 3(B) defines “multi state cooperative society” means a society registered or deemed to be registered under this Act and includes a national cooperative society and a federal cooperative. Therefore, a cooperative society registered under the Multi State Cooperative Societies Act 2002 is a multi-state cooperative society within the provisions of the Act and thus, the said multi state cooperative societies cannot be construed as a cooperative society or deemed to be a cooperative society under the provisions of the Tamil Nadu Cooperative Societies Act, 1983," said the court.The court said the exemption granted by the State government by invoking powers under Section 51 of the state enactment cannot extend to a society registered under the central enactment. "Thus, the Government letter, first issued in letter no.18639/J1/08-5, dated 09.04.2009, is in violation of the provisions of the Tamil Nadu Cooperative Societies Act since there cannot be any deemed registration of a central cooperative society as state cooperative society, since the registrations are independent and separate under both the central and state acts. That exactly is the reason why the government issued further clarification through impugned order in letter dated 21.10.2013 stating that the exemption from payment of stamp duty granted under Section 51 of the Tamil Nadu Cooperative Societies Act is not applicable to the cooperative societies registered under the Multi-State Cooperative Societies Act, 2002," said the court. Thus, finding the GO to be in consonance with the provisions of the Act, the court dismissed the plea as the petitioner society was not entitled to any relief. Case Title: The Royal Lands and Nest Cooperative Housing Society Ltd v. The Government of Tamil Nadu and another Citation: 2023 Livelaw (Mad) 99Click here to read/download the judgment

Exemption From Stamp Duty Granted Under Tamil Nadu Cooperative Societies Act Not Applicable To Multi-State Cooperative Societies: Madras High Court

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Exemption From Stamp Duty Granted Under Tamil Nadu Cooperative Societies Act Not Applicable To Multi-State Cooperative Societies: Madras High Court

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