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HC-KAR NC: 2025:KHC:29120 WP No. 635 of 2015
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ WRIT PETITION NO. 635 OF 2015 (GM-ST/RN) BETWEEN:
M/S DMR ENTERPRISES GOKALDAS CHAMBERS, 222/14, 3RD FLOOR, 5TH MAIN, SADASHIVNAGAR, BELLARY ROAD, BANGALORE-560 080. REPRESENTED BY ITS PARTNER MR.RAJENDRA J HINDUJA …PETITIONER (BY SRIYUTHS CHAYANK, MNK AND BADRI VISHAL, ADVOCATES) AND:
STATE OF KARNATAKA REPRESENTED BY PRINCIPAL SECRETARY, DEPARTMENT OF REVENUE AMBEDKAR VEEDHI, VIKASA SOUDHA, BANGALORE-560 001.
CHIEF CONTROLLING REVENUE AUTHORITY INSPECTOR GENERAL OF STAMPS AND REGISTRATION, GOVERNMENT OF KARNATAKA, NO.720, 1ST FLOOR, KANDAYA BHAVANA K.G. ROAD, BANGALORE-560 009.
DISTRICT REGISTRATION OFFICER OF STAMPS NO.44A, DEEWAN'S ROAD, LAKSHMIPURAM, NEAR DOUBLE WATER TANK, M.G.ROAD, MYSORE DISTRICT, MYSORE-560 005
Digitally signed by SUMA Location: HIGH COURT OF KARNATAKA
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HC-KAR NC: 2025:KHC:29120 WP No. 635 of 2015
THE SUB-REGISTRAR MYSORE NORTH CIRCLE, NO.2/4, PRABHUDEVA TALKIES ROAD, AGRAHARA FORT MOHALLA MYSORE-560 004. …RESPONDENTS (BY SRI. M. SRINIVAS KUMAR, HIGH COURT GOVERNMENT PLEADER FOR RESPONDENTS)
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER PASSED BY THE 2ND RESPONDENT DATED 20.09.2014 IN CASE NO.S.A.P.2/2014-15 AT ANNEXURE-K.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE R. NATARAJ
ORAL ORDER
The petitioner has challenged the order bearing No.S.A.P 2/2014-15 dated 20.09.2014 passed by the respondent No.2 in exercise of the power under Section 53A of the Karnataka Stamp Act, 1957.
It appears that a sale agreement dated 25.09.2006 was entered into between Sri H.N. Shivananjaiah and Smt.
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Nutan Prabhakar Shetty and Sri K. Subramanya Rai agreeing to convey certain extents of the land bearing Sy. Nos.25/1 and 25/2 of Nadanahalli, Kasaba Hobli, Mysore Taluk, for a total sale consideration of Rs.5,55,39,000/-. The purchasers/agreement holders had paid advance of Rs.30,00,000/- to the vendor through cheque bearing No.796133 dated 28.08.2006 drawn on Vijaya Bank, Sayyaji Rao Road Branch, Mysore; Rs.20,00,000/- through cheque bearing No.22863 dated 28.08.2006 drawn on ING Vysya Bank, Jayalakshmipuram Branch, Mysore. As per the terms of the agreement, agreement holders were required to pay additional advance of Rs.75,00,000/- on or before 25.10.2006 i.e. within 30 days from the date of the agreement and further, a sum of Rs.4,30,39,000/- at the time of registration of the sale deed. It is stated in the petition that the agreement holders had paid a sum of Rs.1,25,00,000/- as advance to the vendor and had agreed to pay the balance consideration within a period of six months. The petitioner herein was interested in the above said land and therefore, he met the agreement holders, namely, Smt.Nutan Prabhakar Shetty and Sri K. Subramanya Rai and negotiated with them to make over their rights under the
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agreement of sale dated 25.09.2006. Consequent thereto, the agreement holders agreed to nominate the petitioner in their place and accordingly, they handed over the agreement of sale dated 25.09.2006 to the petitioner. The petitioner on 07.02.2007 entered into an agreement with the agreement holders reducing the terms and conditions of nomination. Consequent thereto, a sale deed was executed by Sri H.N. Shivananjaiah in favour of the petitioner on 08.02.2007. The petitioner was served with notice dated 16.02.2013 followed by another notice dated 25.03.2013 issued by the respondent No.3 under Section 46A of the Karnataka Stamp Act, 1957 (for short, 'the Act, 1957') to show cause as to why a sum of Rs.4,25,99,574/- should not be treated as the excess sale consideration paid and therefore, called upon the petitioner to make good the stamp duty and registration. Thereafter, the petitioner entered appearance through counsel in the proceedings before the respondent No.3 and filed objections to the said notices. The respondent No.3 after considering the contentions of the petitioner herein, dropped the proceedings in terms of the order dated 21.11.2013. Long thereafter, i.e., on 26.07.2014, the petitioner received another notice from the
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HC-KAR NC: 2025:KHC:29120 WP No. 635 of 2015
respondent No.2 under Section 53A of the Act, 1957. The petitioner filed his objections on 27.08.2014. The representative of the petitioner appeared before the respondent No.2 on 02.09.2014 and furnished some documents. Respondent No.2, allegedly, without providing an opportunity of being heard to the representative of the petitioner, passed an order dated 20.09.2014 setting aside the order dated 21.01.2013 passed by the respondent No.3 and directed the petitioner to deposit Rs.69,42,932/- being the deficit stamp duty and Rs.8,19,230/- being the deficit registration fee in the office of the respondent No.4 herein within the time stipulated therein.
Being aggrieved by the said order, the petitioner is before this Court.
The respondents - State have filed statement of objections inter alia contending that the respondent No.2 before passing the impugned order had considered the objections filed by the petitioner herein and the representative of the petitioner herein, who appeared in person in the
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proceedings, was afforded sufficient opportunity to put forth his case. Hence, they sought for dismissal of the petition.
Learned counsel for the petitioner urged two contentions in support of the writ petition, namely, (i) the proceedings under Section 53A of the Act, 1957 was not based on the subjective satisfaction of the respondent No.2 but was based on the report of the Accountant General’s office. He submits that while exercising power under Section 53A of the Act, 1957, the revisional authority is bound to check the records, be satisfied that the order passed is in accordance with law and that it affects the interest of the revenue and thereafter, take steps in accordance with Section 53A of the Act, 1957. He contends that a perusal of the notice issued by respondent No.2 dated 26.07.2014 would show that suo motu proceedings was based on the report of the Accountant General. Therefore, he contends that the entire proceedings is not at the instance of respondent No.2, but is at the instance of an outside agency and therefore, exercise of power under Section 53A of the Act, 1957 is improper and illegal. In support of this contention, he has relied upon the judgment of a coordinate Bench of this Court in W.P. No.48165/2011 c/w W.P.
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HC-KAR NC: 2025:KHC:29120 WP No. 635 of 2015
No.48133/2011 (disposed off on 25.01.2025); (ii) that respondent No.2 did not provide enough opportunity of addressing him on the contentions urged by the petitioner herein, in the statement of objections. In support of this, he has placed reliance upon the order sheet of the proceedings held by the respondent No.2 and contends that the case was taken up before the respondent No.2 on 02.09.2014 on which date itself, the respondent No.2 reserved the case for orders and then pronounced the order on 20.09.2014. He, therefore, contends that the impugned order passed by the respondent No.2 is in violation of the principles of natural justice and the same is liable to be set aside.
The learned High Court Government Pleader, on the other hand, contended that the respondent No.3 had dropped the proceedings under Section 46A of the Act, 1957 unmindful of the fact that the petitioner had not justified by acceptable evidence that it was not liable to pay the deficit stamp duty and the deficit registration fee. He contends that this was noticed by the office of the Accountant General and the same was reported to the Inspector General of Registration and Commissioner of Stamps. He, therefore, contends that the
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respondent No.2 on receipt of information has initiated suo motu proceedings within the time prescribed under Section 53A of the Act, 1957. He contends that respondent No.2 after considering the objections of the petitioner herein, had passed the impugned order which is just and proper and does not call for any interference. In so far as the contention of the petitioner that the opportunity of personal hearing was not provided to it, the learned High Court Government Pleader adverted to the order sheet of the proceedings maintained by the respondent No.2 and contended that the representative of the petitioner submitted before the respondent No.2 that he had nothing more to submit. Therefore, he contends that respondent No.2 was justified in proceeding to pass the impugned order. Statement of Objections is filed by the respondents.
I have considered the submissions of the learned counsel for the petitioner and the learned High Court Government Pleader for the respondents.
It appears from the records placed along with the writ petition that the petitioner was the assignee of certain
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rights under an agreement of sale dated 25.09.2006 entered into between Sri H.N. Shivananjaiah and Smt. Nutan Prabhakar Shetty and Sri K. Subramanya Rai for a consideration of Rs.5,55,39,000/-. The sale deed dated 08.02.2007 executed in favour of the petitioner pursuant to the agreement of sale dated 25.09.2006 contemplated that agreement holders had agreed to purchase the schedule 'B' property stated therein for a total sale consideration of Rs.5,55,39,000/-. However, the agreement holders who had assigned their interest in favour of the petitioner had addressed a letter to the Deputy Commissioner of Income Tax, Central Wing, Mysuru, that the consideration paid by the petitioner in respect of the property purchased by him was Rs.13,74,61,260/- as against Rs.5,55,39,000/- mentioned in the sale deed. The Accountant General on coming to know of this submitted a report to the Inspector General of Registration and Commissioner of Stamps that the stamp duty collected from the petitioner was on the basis that the sale consideration was Rs.5,55,39,000/- as against a sum of Rs.13,74,61,260/- that was actually paid. The assignment agreement dated 07.02.2007 entered into between Sri K.Subramanya Rai and Smt. Nutan Prabhakar Shetty and
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HC-KAR NC: 2025:KHC:29120 WP No. 635 of 2015
the petitioner could not have come to the notice of respondent No.3 or respondent No.2 and thus, it could be treated as information to the respondent No.2 to exercise power under Section 53A of the Act, 1957. The respondent No.2 was therefore in a way justified in initiating action under Section 53A of the Act, 1957. However, the respondent No.2 must have provided adequate opportunity to the petitioner herein to establish that the exercise of power under Section 53A of the Act, 1957 by the respondent No.2 was not warranted. A perusal of the order sheet maintained by the respondent No.2 shows that the same was done hurriedly without proper application of mind to the objections raised by the petitioner herein in the statement of objections. In that view of the matter, the impugned order passed by the respondent No.2 deserves to be set at naught.
Accordingly, the Writ Petition is allowed. The impugned order bearing No.S.A.P 2/2014-15 dated 20.09.2014 passed by the respondent No.2 is set aside and the matter is remitted back to the respondent No.2 for reconsideration in accordance with law. Any observations made herein are only for the limited purpose of disposal of this petition but the respondent No.2
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shall consider the matter in accordance with law and dispose of the same at the earliest. In order to expedite the consideration of the proceedings, the petitioner is directed to appear before the respondent No.2 on 18.08.2025 at 3 p.m.
Sd/- (R. NATARAJ) JUDGE
SMA List No.: 1 Sl No.: 26