Property valued less than circle rate prescribed can be registered #indianlaws

Delhi High Court has clarified that the parties presenting instruments/transfer document of basements of residential properties for registration, if of a consideration lower than the consideration/ valuation in accordance with the circle rates, shall upon their instruments/transfer documents after registration, under Section 47-A being referred to the Collector, be entitled to satisfy the Collector of the consideration/valuation of the subject basement in residential properties being lower than the consideration applicable to instruments/transfer documents of other floors in the same property and the Collector shall proceed to determine the same u/ss 47 A and 27 of the Stamp Act

In a petition before the Delhi High Court a declaration was sought:

That the policy/ practice of construing the basements of residential properties at par with the other floors for the purpose of evaluating the applicable stamp duty, is violative of Articles 14 and 19 of the Constitution of India

High Court stated that notwithstanding anything contained in any order/circular including those impugned in the instant petitions, in the event of the consideration mentioned in the instrument/transfer document presented for registration being less than the valuation as per the prescribed circle rates, the Registrar /Sub Registrar entrusted with the responsibility of registration of the documents, shall,

  1. Notify the parties presenting the instrument/document for registration that the consideration set forth in the instrument and the stamp duty computed on the basis thereof is less than the valuation as per the circle rates;
  2. Give them an opportunity to amend the document/instrument, to bring the valuation thereof for the purpose of payment of stamp duty, in consonance with the circle rates and make up deficiency in stamp duty;
  3. If parties do not amend/revise the valuation and do not pay the deficient stamp duty/transfer duty in terms of the circle rates, follow the procedure as prescribed in Section 47-A supra i.e. register the document/instrument (instead of returning the same to the parties) with endorsement of registration and forward the same to the Collector of Stamps for determination of value or consideration as the case may be and the proper duty payable thereon; and
  4. The Collector thereafter shall proceed in accordance with law including Section 27 of the Stamp Act. 

It was further clarified that the parties presenting instruments/transfer document of basements of residential properties for registration, if of a consideration lower than the consideration/ valuation in accordance with the circle rates, shall upon their instruments/transfer documents after registration, under Section 47-A being referred to the Collector, be entitled to satisfy the Collector of the consideration/valuation of the subject basement in residential properties being lower than the consideration applicable to instruments/transfer documents of other floors in the same property and the Collector shall proceed to determine the same. 

[Manu Narang & Anr. vs. The Lt. Governor, NCT of Delhi & Ors.]

(Delhi HC, 23.12.2015)

W.P.(C) No.5975/2013