BHARAT PETROLEUM CORPORATION LIMITED v. THE DISTRICT REVENUE OFFICER
2026 INSC 963 · SLP (C) NO. 37096 OF 2025
Coram: Justice Dipankar Datta · Justice Sheel Nagu
Headnote
Indian Stamp Act, 1899 — s.47-A — Undervaluation of instruments — Reference to larger Bench —
Indian Stamp Act, 1899 — s.47-A — Reason to believe — No fraudulent-intent requirement —
Held: Section 47-A requires only reason to believe that the market value has not been truly set forth; it does not require proof of wilful undervaluation or fraudulent intention. Reading such a requirement into the provision amounts to judicial legislation. (¶16, 19)
Constitution of India — Art. 226 — Show cause notice — Writ maintainability —
Held further: A writ petition against a show cause notice lies only on two narrow grounds — want of jurisdiction, or mala fide exercise of jurisdiction — and not as a routine measure. The correctness of a three-Judge Bench decision was doubted and referred to a larger Bench. (¶10, 24)
In the Court's own words
Paragraph 16We have read V.N. Devadoss (supra) in between the lines. The afore-mentioned decision by a Bench of three Judges declares the law that while exercising the power under Section 47-A of the Stamp Act, there must exist material evincing lack of bona fides and a fraudulent attempt to undervalue the subject of conveyance in a bid to evade stamp duty. The basis, therefore, per the ratio of the said decision, is “wilful undervaluation with fraudulent intention to evade proper stamp duty”. However, the expressions “wilful undervaluation” and/or “fraudulent intention” is/are conspicuously absent in the plain phraseology of sub-section (1) of the said provision. On its own terms, Section 47-A does not require the registering authority to issue notice having “reason to believe” of a culpable mindset being the motive behind the transaction; it merely requires reason to believe that the market value of the property has not been truly set forth in the instrument presented before him for consideration. It is one thing to require that the authority should have relevant material preceding the formulation of reasons, followed by exercise of power under Section 47-A of the Stamp Act; and, it is totally another thing to require that, in addition to the explicitly spelt out statutory requirement, the officer must also have material demonstrating wilful or fraudulent intent to evade stamp duty. The latter proposition, if sought to be pressed as an independent ingredient for the invocation of power under the said provision, would be tantamount to judicial legislation under a provision, de hors the precincts of the plain text of the statute. The language is plain and the symmetry is straightforward, which should not be distorted in its purpose, through legal lexicalism.
Paragraph 19Furthermore, in our considered opinion, “wilful undervaluation” and/or “fraudulent intention” cannot be read as an intra-sentential component into Section 47-A of the Stamp Act for its invocation, and any distinction, if purportedly demarcated between bona fide undervaluation and wilful undervaluation, is alien to the plain phraseology of the provision as well as the spirit of the statute. The following passage from the decision in Shanti Bhushan v. State of U.P.[^14], lends credence to the afore-mentioned proposition:
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