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January 2015

Stamp valuation – Market value – Property purchased in Company Court auction – Sale deed executed in their favour by official liquidator – Registration authorities cannot question the sale deed on ground of undervaluation. Stamp Act, 1899, section 47-A.

By Dr . K. Shivaram Senior Advocate; Ajay R. Singh Advocate
Reading Time 2 mins
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The Inspector General of Registration, Chennai and Ors vs. K.P. Kadar Hussain. AIR 2014 Madras 230.

The Respondents purchased the property in an auction, which was held by this Court, after paper publication on 08-03-2012. The said sale was confirmed by this Court and the Court directed the Official Liquidator to execute a sale deed in favour of the Respondents after receiving entire sale consideration.

The Respondents contended that it was not open to the appellants to take a stand that since the guideline value of the properties were increased only in the month of April 2012 and therefore, the Respondents are liable to pay the amount on that basis.

The Respondents vehemently submitted that the law is a well settled in regard to the purchase of property in a Court Auction and the authorities cannot refer the document demanding higher stamp duty unless a fraudulent attempt on the part of parties to document to evade payment of stamp duty is manifest.

When the Respondents had purchased the properties in question by way of sale deeds executed by the official liquidator for the sale value mentioned in the sale deeds, the said value cannot be questioned by appellants at a later point of time merely on the premise that the sale value mentioned in the sale deeds purchased by the respondents cannot be termed as `market value’.

The court observed that section 47A has no application whatsoever, in sofar as the respondents, purchasers of properties in company court auction because of the prime reason that there is no room for entertaining any doubt that there was any under valuation in regard to the sale deeds executed by the official liquidator.

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