SUREKHA Vs. COMMISSIONER AND SECRETARY TO THE GOVERNMENT

JUDGEMENT

(1.) HEARD Mr.C.Ramakrishna, the learned counsel for Mr.K.Viswanath, appearing for the petitioner and Mr.V.Manoharan, the learned Government Advocate, appearing for the respondents.

(2.) THE petitioner has preferred the present writ petition praying for a writ of Certiorarified Mandamus, invoking Article 226 of the Constitution of India, seeking to quash the notice, dated 18.8.1997, issued by the third respondent in Ref.No.I No.20/B1/97, calling upon the petitioner to pay a penalty of 10 times the deficit stamp duty, under Section 40(1)(b) of THE Indian Stamp Act, 1899, as amended by THE Tamil Nadu Amendment Act 24 of 1975, (hereinafter referred to as 'the Act') and to direct the third respondent to register the sale deed presented, on 29.3.1996 and to return the same after the completion of the necessary formalities.

(3.) IT has been further stated that Section 40 of the Act would not be applicable to the present case. Clause 2 of Section 47-A of the Act specifies that the market value of the property and the duty payable thereon ought to be determined only after the parties concerned are given a reasonable opportunity of being heard and after holding an enquiry in such manner as may be prescribed by the rules made under the Act. After such determination, the persons concerned would be given an opportunity to pay the difference in the amount of duty liable to be paid, prescribing a specific period for the payment of the amount. Any person aggrieved by such an order may appeal to such authority as may be prescribed for the hearing of such appeal. By issuing the impugned proceedings, under Section 40(1)(b) of the Act, the third respondent has circumvented the procedures established by law. Thus, the petitioner has been adversely affected due to the irreparable monetary loss and mental agony caused to him. The third respondent has fixed the penalty amount without hearing the petitioner and without giving proper reasons for fixing the amount liable to be paid by the petitioner. When there are no guidelines prescribed for the third respondent to follow, while exercising the discretionary powers vested in him, to decide the penalty payable under Section 40 (1)(b) of the Act, such a provision cannot be valid as it is arbitrary and ultra vires the constitution of India, being contrary to the principles enshrined in Article 14 of the Indian Constitution. Without following the principles of natural justice, the third respondent had concluded that the petitioner had under valued the instrument and had paid the deficit stamp duty with the malafide intention of gaining unlawfully.