Horizon Bioceuticals PVT. LTD. vs. State Of Hp

Held

The Court held that a sale certificate issued to a purchaser of property sold by public auction by a civil or revenue officer is not compulsorily registrable under Section 17(1) of the Registration Act, 1908, as specifically exempted by Section 17(2)(xii). The sale certificate is merely evidence of title, and title vests upon confirmation of the sale. The Court relied on Supreme Court judgments in M/s Esjaypee Impex Private Limited and Inspector General of Registration and Another v. G. Madhurambal and Another, which affirmed that a sale certificate is not a conveyance subject to stamp duty. While the filing of a copy of the sale certificate under Section 89(4) of the Registration Act with the Sub-Registrar is sufficient, stamp duty would only be attracted if the auction purchaser uses the certificate for purposes beyond mere evidence of title, as per Articles 18 and 23 of the Stamp Act. Regarding the alternate remedy, the Court held that while ordinarily writ petitions should not be entertained when an efficacious alternate remedy exists, the High Court retains discretion under Article 226 in appropriate cases, especially when the controversy necessitates it. The Court directed the respondents to execute the supplementary sale deed in favour of the petitioner without demanding stamp duty and registration charges, and expressed hope that this would be done expeditiously within three weeks. The issue of service tax was not expressly decided but was implicitly resolved by the overall allowance of the petition.

Facts

The petitioner, Horizon Bioceuticals Private Limited, purchased plots 15, 16, and 17 in the Industrial Area, Kala Amb, District Sirmaur, Himachal Pradesh, through auction proceedings. A sale certificate was issued. However, the petitioner alleged that despite repeated representations, the District Collector-cum-Deputy Commissioner, Sirmaur, was not taking steps to register a supplementary deed. The petitioner was compelled to deposit Rs. 35,60,650/- and Rs. 5,43,150/- (service tax) as demanded by the Member Secretary, Single Window Clearance Agency, Kala Amb, for registration. The petitioner contended that as an auction purchaser, stamp duty and registration charges were not payable. The respondents, in their reply, initially stated no such amount was demanded for registration, but later communications indicated the amount was deposited, and the issue of stamp duty was under consideration. The petitioner sought quashing of the order demanding stamp duty and registration charges and a direction to register the mutation.

Key Issues

1. Whether the demand of stamp duty and registration charges for the registration of a sale certificate issued pursuant to an auction purchase is legally sustainable, particularly in light of Section 17(2)(xii) of the Registration Act, 1908? 2. Whether the High Court should entertain a writ petition under Article 226 of the Constitution of India when an alternate efficacious remedy of appeal is available? Petitioner's Arguments: The petitioner argued that as an auction purchaser, they are not liable to pay stamp duty and registration charges for the sale certificate. They relied on Section 17(2)(xii) of the Registration Act, 1908, which exempts certificates of sale from compulsory registration. They also cited judicial precedents establishing that a sale certificate is merely evidence of title and does not require registration. Furthermore, they contended that the demand for stamp duty was contrary to established legal principles and that the High Court's writ jurisdiction was appropriately invoked due to the exceptional circumstances and the respondents' failure to act. Respondents' Arguments: The respondents initially submitted that no amount was demanded for the registration of the sale certificate. However, subsequent submissions indicated that the amount deposited by the petitioner was related to stamp duty and that no deed had been presented for registration. They also referred to Section 17(2)(xii) of the Registration Act, 1908, suggesting that a sale certificate is not required to be registered. The respondents also raised the issue of the availability of an alternate efficacious remedy.