Must a Registering Officer record reasons before referring an instrument to the Collector as undervalued under the Indian Stamp Act, 1899?

Yes. It is not permissible for the Registering Officer to undertake a roving enquiry for the purpose of ascertaining the correct market value of the property. If he is bona fide of the view that the sale consideration shown in the sale deed is not correct and the sale is undervalued, it is obligatory on the part of the Registering Authority as well as the Special Deputy Collector (Stamps) to assign some reason for arriving at such a conclusion. If the document is straightway referred to the Collector without recording any prima facie reason, the same would vitiate the entire enquiry and the ultimate decision.

Indian Stamp Act, 1899 — s.47-A — Tamil Nadu Stamp (Prevention of Undervaluation of Instruments) Rules, 1968 — rr.3, 4, 6 and 7 — "Reason to believe" — Roving enquiry — Form I and Form II — Provisional order — Indian Stamp Act, 1899 — s.47-A — "Reason to believe" — Objective satisfaction — Held: The expression "reason to believe" is not synonymous with the subjective satisfaction of the officer; the belief must be held in good faith and cannot be merely a pretence. It is open to the Court to examine whether the reasons for the belief have a rational connection or a relevant bearing to its formation. (¶21) Indian Stamp Act, 1899 — s.47-A(1) — Reference to the Collector — Recording of prima facie reason — Held further: A Registering Officer may not undertake a roving enquiry to ascertain the correct market value, but is obliged to assign some reason for concluding that an instrument is undervalued. A document referred straightway without recording any prima facie reason vitiates the entire enquiry and the ultimate decision. (¶27) Rules, 1968 — rr.4(4), 6 and 7 — Provisional order and Form II — Final order — Held further: The Collector must pass a written order provisionally determining the market value, clearly indicating the basis on which it was arrived at, communicate it in Form II and receive representations before passing the final order. Passing the final order directly is in violation of Rules 4 and 6. Appeals dismissed. (¶30, 31)

One judgment a day. That's the whole habit.

Read the full text of CHIEF REVENUE CONTROLLING OFFICER-CUM-THE-INSPECTOR GENERAL OF REGISTRATION & ORS v. P. BABU — and get the Supreme Court's output as a five-minute daily read, with plain-language headnotes and the questions each judgment settles.

Free forever plan · 30 seconds · data stays in India