Simplified Explanation of the Judgment
The Patna High Court, in a recent decision, has ruled in favor of a petitioner who was wrongly penalized for deficit stamp duty after purchasing a piece of land classified as agricultural. The issue arose when the local registration office, after registering the sale deed and accepting all dues, later reclassified the land as “developing land” and imposed additional stamp duty and penalties.
The petitioner had legally purchased a parcel of land and had it registered on 9 March 2017. At the time of registration, the land was recorded as “Dhanhar” (agricultural land), and the appropriate stamp duty and registration charges were paid accordingly. However, a year later, on 2 April 2018, the District Sub-Registrar referred the matter to the Assistant Inspector General of Registration (Respondent No. 3), who issued an order on 17 April 2018 demanding an additional Rs. 1,37,148 — which included Rs. 1,24,680 in deficit stamp duty and Rs. 12,468 as penalty.
The petitioner challenged this decision, arguing that the referral was legally invalid since it occurred after the sale deed was registered. As per Section 47A(1) of the Indian Stamp Act, 1899 (as amended in Bihar), such a referral regarding the property’s classification or undervaluation can only be made before registration. The law allows post-registration referrals only under specific circumstances and usually by the Collector suo motu within two years.
The petitioner also relied on two judgments by the Patna High Court, The State of Bihar v. Smt. Tetra Devi, 2018 (3) PLJR 136, and Shahnaz Begam v. State of Bihar, 2018 (2) PLJR 293, which confirmed that such post-registration reclassifications by Sub-Registrars without proper authority are unlawful.
The High Court, agreeing with the petitioner, quashed the order dated 17 April 2018, terming it illegal, arbitrary, and beyond the powers conferred under the law. It directed that any amount already deposited by the petitioner in compliance with the impugned order must be refunded within eight weeks.
Significance or Implication of the Judgment
This judgment holds significant implications for property buyers and the registration authorities in Bihar. It reaffirms the principle that the assessment of stamp duty must occur at the time of registration and cannot be revised later based on subsequent site inspections or assumptions.
For the general public, it provides legal clarity and protection from arbitrary financial demands long after property transactions are concluded. For registration officials, it underlines the importance of adhering strictly to statutory procedures under the Indian Stamp Act.
Legal Issue(s) Decided and the Court’s Decision
- Whether a Sub-Registrar can refer a registered sale deed for reassessment of stamp duty under Section 47A(1) of the Indian Stamp Act, 1899?
- Decision: No. The Sub-Registrar has no authority to refer the document after registration. The Court held the referral and consequent penalty as illegal.
- Can the Collector act on such a post-registration referral under Section 47A?
- Decision: No, unless acting suo motu within two years, and only if the document wasn’t already referred under Section 47A(1).
Judgments Referred by Parties
- The State of Bihar and Others v. Smt. Tetra Devi, 2018 (3) PLJR 136
- Shahnaz Begam v. State of Bihar, 2018 (2) PLJR 293
Judgments Relied Upon or Cited by Court
- The State of Bihar and Others v. Smt. Tetra Devi, 2018 (3) PLJR 136
- Shahnaz Begam v. State of Bihar, 2018 (2) PLJR 293
Case Title
Abhay Kumar Singh v. The State of Bihar & Others
Case Number
Civil Writ Jurisdiction Case No.13172 of 2018
Citation(s)– 2025 (1) PLJR 69
Coram and Names of Judges
Hon’ble Mr. Justice Mohit Kumar Shah
Names of Advocates and who they appeared for
- Mr. Gopal Krishna, Advocate for the Petitioner
- Mr. P.N. Shahi, AAG-6, and Mr. Manish Kumar, AC to AAG-6 for the Respondents
Link to Judgment
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