1.

Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No.    8325           OF 2011  (Arising out of SLP (C) NO. 20964 OF 2010)

  Smt. Har Devi Asnani           …… Appellant

Versus

State of Rajasthan & Others                      …… Respondents

WITH CIVIL APPEAL No.        8326       OF 2011  (Arising out of SLP (C) NO. 17233 OF 2010)

J U D G M E N T

A. K. PATNAIK, J.

Leave granted.

2. The appellant purchased Plot No. A-7 situated in the  

Housing  Scheme  No.12,  Ajmer  Road,  Jaipur,  of  

Krishna Grah Nirman Sahakari  Samiti  Limited by  a  

registered  Sale  Deed  dated  16.05.2007  for  a  

consideration  of  Rs.18  lacs.   The  Sale  Deed  was  

executed on a stamp duty of Rs.1,17,000/-.  The Sub-

Registrar, SR IV, Jaipur, did not accept the valuation

1.

made in the Sale  Deed and appointed an Inspection  

Officer to inspect the plot purchased by the appellant  

and  determined  the  value  of  the  land  at  

Rs.2,58,44,260/-.  The Additional Collector (Stamps),  

Jaipur,  served  a  notice  under  the  Rajasthan  Stamp  

Act,  1998  (fo  short  ‘the  Act’)  to  the  appellant  on  

07.07.2008 to appear before him on 19.09.2008 and to  

show-cause  why  prosecution  against  the  appellant  

should  not  be  initiated  for  concealing  or  

misrepresenting  facts  relating  to  the  valuation  

mentioned  in  the  Sale  Deed  resulting  in  evasion  of  

stamp duty.  The appellant filed a reply stating therein  

that the plot of land purchased by her under the Sale  

Deed was allotted to her for residential purposes and  

was not meant for commercial use and that the sale  

price  was paid  entirely  by  a  cheque.   The appellant  

also  stated  in  her  reply  that  adjacent  to  the  plot  

purchased by her,  Plot  Nos.A-3 near  Scheme No.12,  

Roop Sagar, had been sold by a registered Sale Deed  

on 16.12.2006 and another Plot No.A-38, near Scheme

1.

No.12, Roop Sagar, at a price less than the price in the  

Sale  Deed  dated  16.05.2007  under  which  she  had  

purchased  Plot  No.A-7  in  Housing  Scheme  No.12.  

Along with the reply, the appellant had also furnished  

copies  of  the  two  Sale  Deeds  of  the  adjacent  Plot  

Nos.A-3 and A-38 in Scheme No.12.  In the reply, the  

appellant requested the Additional Collector (Stamps)  

to  drop  the  recovery  proceedings.   The  Additional  

Collector (Stamps) heard the appellant and in his order  

dated  20.07.2009  held  after  considering  the  Site  

Inspection Report that the determination made by the  

Sub-Registrar  at  Rs.  2,58,44,260/-  was  correct  and  

that the appellant was liable to pay deficit stamp duty  

of  Rs.15,62,880/-,  deficit  registration  charges  of  

Rs.7,000/- and penalty of Rs.120/- totalling to a sum  

of Rs.15,70,000/- and accordingly made the demand  

on the appellant and directed recovery of the same.

3. Aggrieved,  the  appellant  filed  SB  Civil  Writ  Petition  

No.12422  of  2009  before  the  Rajasthan  High  Court  

challenging  the  order  dated  20.07.2009  of  the

1.

Additional Collector (Stamps), Jaipur.  A learned Single  

Judge of the High Court, however, dismissed the Writ  

Petition  by  order  dated 21.10.2009 holding  that  the  

appellant  had  a  remedy  against  the  order  of  the  

Additional  Director  by  way  of  a  revision  before  the  

Board of Revenue and as there was an alternative and  

efficacious remedy available to the appellant, there was  

no just reason for the appellant to invoke the extra-

ordinary jurisdiction of the High Court under Articles  

226  and  227  of  the  Constitution  of  India.   The  

appellant then filed D.B. Civil Appeal (Writ) No.1261 of  

2009 before the Division Bench of the High Court, but  

by order dated 22.03.2010 the Division Bench of the  

High Court held that there was no error or illegality  

apparent on the face of the record in the order dated  

21.10.2009 passed by the  learned Single  Judge and  

that  the  appeal  was  devoid  of  any  merit  and  

accordingly  dismissed  the  appeal.   Aggrieved,  the  

appellant has filed Civil Appeal arising out of S.L.P. (C)  

No.17233 of 2010.

1.

4. In the meanwhile, the appellant filed a separate Writ  

Petition D.B. Civil  Writ Petition No.14220 of 2009 in  

the  Rajasthan  High  Court  challenging  the  

constitutional validity of the proviso to Section 65(1) of  

the  Rajasthan Stamp Act,  1998 (for  short  ‘the  Act’),  

which provided that  no revision application shall  be  

entertained unless it is accompanied by a satisfactory  

proof of the payment of fifty percent of the recoverable  

amount.  The ground taken by the appellant in the writ  

petition  before  the  High  Court  was  that  unless  the  

appellant deposited fifty percent of the total amount of  

Rs.15,70,000/-  towards  deficit  stamp  duty,  

registration charges and penalty, the revision petition  

of  the  appellant  would  not  be  entertained  and  the  

appellant was not in a position to deposit such a huge  

amount  as  a  condition  for  filing  the  revision.   The  

appellant accordingly contended before the High Court  

that the pre-condition of payment of fifty percent of the  

recoverable amount for entertaining a revision petition  

was  arbitrary,  unreasonable  and  unconstitutional.

1.

The Division Bench of the High Court, however, held in  

its  order  dated  16.11.2009  that  the  constitutional  

validity of the proviso to Section 65 (1) of the Act had  

been examined by another Division Bench of the High  

Court  in  M/s  Choksi  Heraeus  Pvt.  Ltd.,  Udaipur  v.   

State & Ors. [AIR 2008 Rajasthan 61] and the proviso  

to  Section  65  (1)  of  the  Act  had  been  held  to  be  

constitutionally valid.  The Division Bench relying on  

the aforesaid decision in M/s Choksi Heraeus Pvt. Ltd.,   

Udaipur  v.  State  &  Ors.  (supra)  dismissed  the  Writ  

Petition by order dated 16.11.2009.  The appellant has  

filed the Civil Appeal arising out of S.L.P. (C) No.20964  

of  2010  against  the  order  dated  16.11.2009  of  the  

Division Bench in D.B. Civil Writ Petition No.14220 of  

2009.

5. For appreciating the contentions of the learned counsel  

for the parties, we must refer to Section 65 of the Act.  

Section 65 of the Act is quoted hereinbelow:

“65.  Revision  by  the  Chief  Controlling  Revenue Authority

1.

(1) Any person aggrieved by an order made  by  the  Collector  under  Chapter  IV  and  V  and under clause (a) of the first proviso to  section 29 and under section 35 of the Act,  may within 90 days from the date of order,  apply  to  the  Chief  Controlling  Revenue  Authority for revision of such order:

Provided that  no revision application shall  be entertained unless it is accompanied by a  satisfactory  proof  of  the  payment  of  fifty  percent of the recoverable amount.

(2) The Chief Controlling Revenue Authority  may  suo  moto  or  on  information  received  from the registering officer or otherwise call  for  and  examine  the  record  of  any  case  decided in proceeding held by the Collector  for  the purpose of  satisfying himself  as to  the legality or propriety of the order passed  and as to the regularity of the proceedings  and pass such order with respect thereto as it may think fit:

Provided that no such order shall be made  except  after  giving  the  person  affected  a  reasonable opportunity of being heard in the  matter.”

6. Learned  counsel  for  the  appellant  submitted  that  

although sub-section (1) of Section 65 of the Act confers a  

right on a person to file a revision against the order of the  

Collector, the proviso to Section 65(1) of the Act renders this  

right illusory by insisting that the revision application shall  

not  be  entertained  unless  it  is  accompanied  by  a

1.

satisfactory  proof  of  the  payment  of  fifty  percent  of  the  

recoverable  amount.   He  submitted  that  the  proviso  to  

Section  65(1)  of  the  Act  is  therefore  unreasonable  and  

arbitrary and violative of Article 14 of the Constitution and  

should  be  declared constitutionally  invalid.   He cited the  

decision of this Court in  Mardia Chemical  Ltd. and Others  

vs.  Union of India and Others [(2004) 4 SCC 311] in which  

the provision requiring pre-deposit of 75% of the demand  

made by the bank or the financial institution in Section 17  

of the Securitisation and Reconstruction of Financial Assets  

and Enforcement of  Security Interest Act,  2002 has been  

held  to  be  onerous  and oppressive  rendering  the  remedy  

illusory and nugatory and constitutionally invalid.

7. Learned  counsel  for  the  appellant  submitted  that  

assuming  that  the  proviso  to  Section  65(1)  of  the  Act  is  

constitutionally  valid  where  the  valuation  adopted by  the  

Additional  Collector  or  Collector  and  the  consequent  

demand  of  additional  stamp  duty  are  unreasonable  and  

exorbitant, the alternative remedy of revision after deposit of  

50%  of  the  exorbitant  demand  is  not  efficacious,  and

1.

affected party should be able to move the High Court under  

Article  226  of  the  Constitution.   In  support  of  this  

submission,  he  cited  the  decision  of  this  Court  in  

Government of Andhra Pradesh and Others vs. P. Laxmi Devi  

[(2008) 4 SCC 720]

8. Learned  counsel  for  the  respondents,  on  the  other  

hand,  submitted  that  a  revision  or  an  appeal  is  a  right  

conferred by the statute and the legislature while conferring  

this  statutory  right  can  lay  down  conditions  subject  to  

which the appeal or revision can be entertained and that  

there is nothing unreasonable or arbitrary in the proviso to  

Section  65(1)  of  the  Act  requiring  deposit  of  50% of  the  

recoverable  amount  before  the  revision  application  is  

entertained.  He argued that the proviso to Section 65(1) of  

the  Act  is  in  no  way  illusory  and  is  only  a  provision  to  

ensure that the stamp duty demanded is recovered in time  

and is not held up because of the pendency of the revision.  

In  support  of  his  submission,  learned  counsel  for  the  

respondent  relied  on  the  decisions  of  this  Court  in  The  

Anant Mills Co. Ltd. vs. State of Gujarat and others [(1975) 2

1.

SCC 175]; Seth Nand Lal and Another vs. State of Haryana  

and Others [1980 (supp) SCC 575]; Vijay Prakash D. Mehta  

and Another vs.  Collector  of  Customs (Preventive),  Bombay  

[(1988) 4 SCC 402] and Gujarat Agro Industries Co. Ltd. vs.  

Municipal Corporation of the City of Ahmedabad and Others  

[(1999) 4 SCC 468].

9. Learned  counsel  for  the  respondents  submitted that  

the  decision  of  this  Court  in  Mardia  Chemical  Ltd.  and   

Others vs.  Union of India and Others (supra) declaring the  

provision  of  Section  17  of  the  Securitisation  and  

Reconstruction  of  Financial  Assets  and  Enforcement  of  

Security Interest Act, 2002, requiring deposit of 75% of the  

demand as  constitutionally  invalid  does  not  apply  to  the  

facts  of  the  present  case.   He  submitted  that  in  Mardia  

Chemical Ltd. and Others (supra) this Court clearly held that  

the amount of deposit of 75% of the demand is at the initial  

proceedings itself when the bank or the financial institution  

makes its demand on the borrower and the requirement of  

deposit of such a heavy amount on the basis of one-sided  

claim of the bank or the financial institution at this stage,

1.

before the start of the adjudication of the dispute, cannot be  

said to be a reasonable condition.  He submitted that in the  

instant case, the first adjudicatory authority is the Collector  

and only after the Collector determines the amount of stamp  

duty payable on the documents,  the affected party has a  

right of revision under Section 65(1) of the Act.  He further  

submitted  that  the  requirement  of  50%  of  the  amount  

determined  by  the  Collector  at  the  stage  of  filing  of  the  

revision is therefore not a requirement at the initial stage  

but a requirement at the revisional stage and the decision of  

this Court in Mardia Chemical Ltd. and Others vs. Union of   

India and Others (supra) is distinguishable from the facts of  

the present case.

10. We  need  not  refer  to  all  the  decisions  cited  by  the  

learned  counsel  for  the  parties  because  we  find  that  in  

Government of Andhra Pradesh and Others vs. P. Laxmi Devi  

(supra)  this  Court  has  examined  a  similar  provision  of  

Section  47-A  of  the  Stamp Act,  1899,  introduced  by  the  

Indian Stamp Act (A.P. Amendment Act 8 of 1998).  Sub-

section (1) of Section 47-A, introduced by Andhra Pradesh

1.

Act  8  of  1998  in  the  Indian  Stamp  Act,  is  extracted  

hereinbelow:

“47-A. Instruments of conveyance, etc. how to  be dealt with-(1) Where the registering officer  appointed under the Registration Act, 1908,  while  registering  any  instrument  of  conveyance,  exchange,  gift,  partition,  settlement,  release,  agreement  relating  to  construction,  development  or  sale  of  any  immovable  property  or  power  of  attorney  given  for  sale,  development  of  immovable  property,  has  reason  to  believe  that  the  market  value  of  the  property  which  is  the  subject-matter  of  such  instrument  has  not  been truly set forth in the instrument, or that  the  value  arrived  at  by  him  as  per  the  guidelines prepared or caused to be prepared  by the Government  from time to time has not  been  adopted  by  the  parties,  he  may  keep  pending  such  instrument  and  refer  the  matter  to the  Collector  for  determination of  the  market  value  of  the  property  and  the  proper duty payable thereon.

Provided that no reference shall be made by  the  registering  officer  unless  an  amount  equal  to  fifty  per  cent  of  the  deficit  duty  arrived at by him is deposited by the party  concerned.”

Under  sub-section  (1)  of  Section  47-A  quoted  above,  a  

reference can be made to the Collector for determination of  

the market value of property and the proper duty payable  

thereon where the registering officer has reason to believe

1.

that the market value of the property which is the subject-

matter of the instrument has not been truly set forth in the  

instrument, or that the value arrived at by him as per the  

guidelines  prepared  or  caused  to  be  prepared  by  the  

Government  from time to time has not been adopted by the  

parties.   The  proviso  of  sub-section  (1)  of  Section  47-A,  

however, states that no such reference shall be made by the  

registering officer unless an amount equal to fifty per cent of  

the deficit duty arrived at by him is deposited by the party  

concerned.  This proviso of sub-section (1) of Section 47-A  

was challenged before the Andhra Pradesh High Court by P.  

Laxmi Devi and the Andhra Pradesh High Court held that  

this proviso was arbitrary and violative of Article 14 of the  

Constitution and was unconstitutional.  The Government of  

Andhra Pradesh, however, filed an appeal by special leave  

before  this  Court  against  the  judgment  of  the  Andhra  

Pradesh High Court and this Court held in para 18 at page  

735 of [(2008) 4 SCC 720] that there was no violation of  

Articles 14, 19 or any other provision of the Constitution by  

the enactment of Section 47-A as amended by the Andhra

1.

Pradesh Amendment Act 8 of 1998 and that the amendment  

was only for plugging the loopholes and for quick realisation  

of the stamp duty and was within the power of the State  

Legislature  vide Entry 63 of List-II  read with Entry 44 of  

List-III of the Seventh Schedule to the Constitution.  While  

coming to the aforesaid conclusions, this Court has relied  

on  The Anant Mills Co. Ltd. vs.  State of Gujarat and others  

(supra), Vijay Prakash D. Mehta and Another vs. Collector of   

Customs  (Preventive),  Bombay (supra)  and  Gujarat  Agro  

Industries Co. Ltd. vs.  Municipal  Corporation of the City  of   

Ahmedabad  and  Others (supra)  in  which  this  Court  has  

taken a consistent view that the right of appeal or right of  

revision is not an absolute right and it is a statutory right  

which can be circumscribed by the conditions in the grant  

made by the statute.  Following this consistent view of this  

Court, we hold that the proviso to Section 65(1) of the Act,  

requiring deposit of 50% of the demand before a revision is  

entertained against the demand is only a condition for the  

grant of the right of revision and the proviso does not render

1.

the  right  of  revision  illusory  and is  within  the  legislative  

power of the State legislature.

11.  We also  find  that  in  the  impugned order  the  High  

Court has relied on an earlier Division Bench judgment of  

the High Court in M/s Choksi Heraeus Pvt. Ltd., Udaipur v.   

State & Ors. (supra) for rejecting the challenge to the proviso  

to Section 65(1) of the Act.  We have perused the decision of  

the  Division  Bench  of  the  High  Court  in  M/s  Choksi  

Heraeus Pvt.  Ltd.,  Udaipur v. State  & Ors.  (supra) and we  

find that the Division Bench has rightly taken the view that  

the decision of this Court in the case of  Mardia Chemical   

Ltd. and Others vs. Union of India and Others (supra) is not  

applicable to the challenge to the proviso to Section 65(1) of  

the  Act  inasmuch  as  the  provision  of  sub-section  (2)  of  

Section  17  of  the  Securitisation  and  Reconstruction  of  

Financial Assets and Enforcement of Security Interest Act,  

2002,  requiring  deposit  of  75% of  the  demand related to  

deposit at the stage of first adjudication of the demand and  

was therefore held to be onerous and oppressive, whereas  

the proviso to Section 65(1) of the Act in the present case

1.

requiring deposit of 50% of the demand is at the stage of  

revision against the order of first adjudication made by the  

Collector  and  cannot  by  the  same  reasoning  held  to  be  

onerous  and  oppressive.   In  our  considered  opinion,  

therefore,  the  proviso  to  Section  65(1)  of  the  Act  is  

constitutionally  valid and we are therefore not inclined to  

interfere  with  the  order  dated  16.11.2009  in  D.B.CWP  

No.14220 of 2009.  The Civil Appeal arising out of S.L.P. (C)  

No.20964 of 2010 is therefore dismissed.

12. We are, however, inclined to interfere with the order  

dated 21.10.2009 of the learned Single Judge of the High  

Court in SB Civil Writ Petition No.12442 of 2009 as well as  

the  order  dated  22.03.2010 of  the  Division Bench of  the  

High Court in D.B. Civil Appeal (Writ) No.1261 of 2009.  The  

learned Single  Judge of  the  High Court  and the  Division  

Bench of  the  High  Court  have  taken  a  view that  as  the  

appellant has a right of revision under Section 65(1) of the  

Act,  the  writ  petition  of  the  appellant  challenging  the  

determination of the value of the land at Rs.2,58,44,260/-  

and the demand of additional stamp duty and registration

1.

charges and penalty totaling to Rs.15,70,000/- could not be  

entertained   under  Article  226  of  the  Constitution.   The  

learned Single  Judge of  the  High Court  and the  Division  

Bench of the High Court have not considered whether the  

determination  of  market  value  and the  demand of  deficit  

stamp duty were exorbitant so as to make the remedy by  

way  of  revision  requiring  deposit  of  50%  of  the  demand  

before the revision is entertained ineffective.  In Government  

of Andhra Pradesh and Others vs. P. Laxmi Devi (supra) this  

Court,  while  upholding  the  proviso  to  sub-section  (1)  of  

Section 47-A of the Indian Stamp Act introduced by Andhra  

Pradesh Amendment Act 8 of 1998, observed:  

“29.  In  our  opinion  in  this  situation  it  is  always open to a party to file a writ petition  challenging the exorbitant demand made by  the registering officer under the proviso to  Section 47-A alleging that the determination  made  is  arbitrary  and/or  based  on  extraneous considerations, and in that case  it is always open to the High Court, if it is  satisfied that the allegation is correct, to set  aside  such  exorbitant  demand  under  the  proviso to Section 47-A of the Stamp Act by  declaring the demand arbitrary.  It is  well  settled that arbitrariness violates Articles 14  of the Constitution vide Maneka Gandhi vs.  Union of India [(1978) 1 SCC 248].  Hence,

1.

the  party  is  not  remediless  in  this  situation.”

13. In our view, therefore, the learned Single Judge should  

have  examined  the  facts  of  the  present  case  to  find  out  

whether  the  determination  of  the  value  of  the  property  

purchased by the appellant and the demand of additional  

stamp  duty  made  by  the  appellant  by  the  Additional  

Collector were exorbitant so as to call for interference under  

Article 226 of the Constitution.  

14. We, therefore, allow the appeal arising out of S.L.P. (C)  

No.17233 of 2010, set aside the order passed by the learned  

Single  Judge  of  the  High Court  in  SB Civil  Writ  Petition  

No.12442  of  2009  and  the  order  passed  by  the  Division  

Bench of the High Court in D.B. Civil Appeal (Writ) No.1261  

of 2009 and remand the writ petition back to the High Court  

for fresh consideration in accordance with law.  No costs.

.……………………….J.                                                             (R. V. Raveendran)

………………………..J.                                                             (A. K. Patnaik) New Delhi,

1.

September 27, 2011.