IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26th DAY OF MARCH 2019 BEFORE THE HON’BLE MR. JUSTICE ALOK ARADHE WRIT PETITION NO. 8682 OF 2014 (GM-ST/RN) BETWEEN:
SOBHA ASSETS PVT.LTD “SOBHA”, SARJAPUR MARTHAHALLI OUTER RING ROAD DEVARABISANAHALLI, BELLANDUR POST BANGALORE – 560 103.
REPRESENTED BY ITS AUTHORISED SIGNATORY MR.N.B.ASHOK KUMAR, AGE 50 YEARS.
… PETITIONER (By Mr.P.S.RAJAGOPAL SR.COUNSEL A/W SRI. MADHUKAR DESHPANDE, ADV.) AND:
1. CHIEF CONTROLLING AUTHORITY & IGR & CS, KARNATAKA 8TH FLOOR KANDAYA BHAVAN, GANDHINAGAR BENGALURU – 560 001 REPRESENTED BY ITS INSPECTOR GENERALOF REGISTRATION AND COMMISSIONER OF STAMPS.
2. DEPUTY COMMISSIONER AND DISTRICT REGISTRAR GANDHINAGAR, 2ND FLOOR, MARUTHI COMPLEX VYALIKAVAL MAIN ROAD BENGALURU – 560 003.
3. THE SECRETARY TO GOVERNMENT OF KARNATAKA REVENUE DEPARTMENT M.S.BUILDING DR.AMBEDKAR ROAD BENGALURU – 560 001.
… RESPONDENTS (By Mr. SHIVAMURTHY, HCGP FOR R-1 TO R-3) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO CALL FOR RECORDS/FILE IN CASE NO.45-A(3) BYP/1/12-13 FROM THE R-2 AND QUASH THE IMPUGNED NOTICE DATED 11.02.2013 & 03.02.2014, ISSUED BY THE R-2, PRODUCED AS ANN-C & ANN-K RESPECTIVELY, BY WRIT OF CERTIORARI OR OTHER APPROPRIATE ORDER & PROHIBIT THE R-2 FROM PROCEEDING ANY FURTHER PURSUANT TO THE IMPUGNED NOTICES BY ISSUE OF PROHIBITION AND PASS SUCH OTHER ORDER WITH COST, AND ETC.
THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER Sri.P.S.Rajagopal, learned Senior counsel along with Sri.Madhukar Deshpande, learned counsel for the petitioner.
Sri.V.Shivareddy, learned High Court Government Pleader for the respondent Nos.1 to 3.
2. The petition is admitted for hearing. With consent of the learned counsel for the parties, the same is heard finally.
3. In this petition under Articles 226 and 227 of the Constitution of India, the petitioner inter alia seeks a writ of certiorari for quashment of notices dated 11.02.2013 and 03.02.2014 issued by the respondent No.2.
4. Facts giving rise to the filing of the petition briefly stated are that the petitioner entered into an agreement with the Agriculture Produce Marketing Committee for project development and implementation which was duly approved by the Government of Karnataka for development and construction of modern agricultural market complex for fruits and vegetables at Bellary road, Bengaluru. The petitioner paid the stamp duty of `2,24,05,000/- and registration fee of `40,08,860/-. The aforesaid agreement was registered on 14.08.2012. Thereafter, the respondent No.2 issued a notice on 11.02.2013 to the petitioner that purported the exercise of powers under Section 45A(3) of the Karnataka Stamp Act, 1957 (hereinafter referred to as ‘the Stamp Act’ for short) in order to determine the market value of the property and the petitioner was asked to produce the documents within a period of 21 days. The petitioner responded to the aforesaid notice by submitting a reply dated 13.03.2013 in which it was pointed out that the notice issued by the respondent No.2 is illegal and contrary to law. Thereafter, again a notice dated 10.07.2013 was issued to the petitioner to attend the spot inspection and to produce the documents and the papers. In the aforesaid factual background, the petitioner has approached this Court.
5. Learned Senior counsel for the petitioner, while inviting the attention of this Court to Section 2(mm) of the Stamp Act, has submitted that since the document in question has been executed in favour of the petitioner by a local authority namely the Agriculture Produce Marketing Committee which is deemed to be a local body under Section 9(3) of the Karnataka Agriculture Produce Marketing Committee (Regulation and Development) Act, 1966 (hereinafter referred to as ‘the Act’ for short), the market value of the property stated in the document has to be taken as value of consideration for such a conveyance as set forth in the instrument. Therefore, the provisions of Section 45A(3) are not applicable to the fact situation of the case. It is further submitted that the impugned show cause notices are per se without jurisdiction.
6. On the other hand, learned High Court Government Pleader supported the show cause notice issued by the respondent No.2.
7. I have considered the submissions made by both the sides and have perused the record. Section 2(mm) of the Stamp Act reads as under:
“2(mm) “market value” in relation to any property, which is the subject matter of an instrument, means the price which such property would have fetched in the opinion of the Deputy Commissioner or the Appellate Authority or the Chief Controlling Revenue Authority, if sold in open market on the date of execution of such instrument or the consideration stated in the instrument, which ever is higher:
Provided that notwithstanding anything contained in this Act or in the Articles, in respect of an instrument executed by or on behalf of or in favour of the State Government or the Central Government or a local authority or other authority constituted by or under any law for the time being in force or a Body incorporate wholly owned or controlled by the Central Government or the State Government the market value of the property shall be the value of consideration for such conveyance as set forth in the instrument.”
8. From perusal of Section 2(mm) of the Stamp Act, it is evident that if a document is executed by a local authority, the market value of the property shall be the value of consideration for such conveyance as set forth in the instrument. From perusal of the document in question namely, the agreement dated 17.04.2012, it is evident that the aforesaid agreement has been executed in favour of the petitioner by the Agriculture Produce Marketing Committee. It is not in dispute that the aforesaid authority is a local body within the meaning of Section 9(3) of the Act. Therefore, the impugned show cause notices issued by the respondent No.2 dated 11.02.2013 and 03.02.2014 are per se without jurisdiction. The impugned notices cannot be sustained in the eye of law. The impugned notices are accordingly quashed. In the result, the petition is allowed.
Sd/- JUDGE RV