While answering a reference by two judges’ bench regarding the scope of Section 47A of the Indian Stamp Act (as applicable to West Bengal) (“the Act”), the Supreme Court observed that a Registering authority cannot sit in appeal over the decision of the Court permitting Sale at a particular price. The Apex Court further observed that the public auction carried out through the court process/receiver is the most transparent manner of obtaining the correct market value of the property.
The Calcutta High Court had held that Section 47A of the Act read with Rule 3 of the West Bengal Stamp (Prevention of Undervaluation of Instruments) Rules, 2001 is not applicable to an instrument executed by a Receiver pursuant to an order of sale passed by a civil court, after publication in newspapers.
The High Court observed that the sale conducted by the Court through its officers qualifies to be an open market subject to the condition that there was wide publicity of the proposed sale along with the publication of advertisement in at least one newspaper having wide circulation in the applicable city/town/ district, and the purchaser of the property must not be connected to the authority or the officer of the authority conducting the sale.
However, while considering the appeal by the jurisdictional Sub-Registrar, the Division bench of the High Court doubted the decision of the single bench which held that a Registering authority cannot be compelled to follow the value fixed by the Court for purposes of suit valuation. Answering the reference, the full bench of the Supreme Court observed that the public auction carried out through court process/ receiver is the most transparent; any interference by Registering Authority on the aspect of the price of the transaction would be unjustified; and that the independent determination by a Registering Office would apply only to private sale transaction but not a Court sale