After Petitioner Acquired 40 Acres, Karnataka HC Quashes Stamp-Duty Assessment On 50.47 Acres For A Release Deed Covering 10.47 Acres

The petitioner and two others purchased an undivided 4/5 share in 50.47 acres in 1992.

After subsequent transactions concerning the other purchasers’ shares, the petitioner sought a release of the remaining 10.47 acres from members of the original vendors’ family.

The Sub-Registrar referred the document for adjudication, and the District Registrar, by order dated 27 June 2012, assessed stamp duty on the entire 50.47 acres and demanded an additional Rs.7,52,823.

The petitioner challenged that assessment, contending that it should apply only to the 10.47 acres covered by the release deed.

The Sub-Registrar had assessed the duty payable on that extent at Rs.1,49,160

The proceedings arose under the Karnataka Stamp Act, 1957: the Sub-Registrar referred the document under Section 33, and the Chief Revenue Controller directed adjudication under Section 45-A.

The Court applied the principle that the valuation and stamp duty assessment for a transfer document must relate to the property that is the subject matter of that document; it identified no precedent or further statutory rule in its reasoning.

The petitioner had already acquired title to 40 acres through the earlier sale, release and partition transactions.

The release deed at issue covered only the remaining 10.47 acres.

Accordingly, assessing the guidance value and stamp duty on all 50.47 acres was erroneous.

As the Sub-Registrar had already assessed the duty for the 10.47 acres at Rs.1,49,160, the Court directed payment of that amount with interest, rather than the higher amount demanded under the District Registrar’s order.

It directed the petitioner to pay Rs.1,49,160, with interest at 6% per annum from 27 August 2011 until payment, to the Senior Sub-Registrar.

Upon deposit, the release deed was to be released within four weeks, subject to there being no other legal impediment.