# THE SUB REGISTRAR, AMUDALAVALASA & ANR v. M/S DANKUNI STEELS LTD. & ORS

- **Citation:** [2023] 8 S.C.R. 1098
- **Court:** Supreme Court of India
- **Decided:** 2023-04-26
- **Case number:** Civil Appeal Nos.31343135 of 2023
- **Bench:** K. M. Joseph, Hrishikesh Roy
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/the-sub-registrar-amudalavalasa-anr-v-m-s-dankuni-steels-ltd-ors-37540
- **Pages:** 41

## Headnote

Stamp Act, 1899 - s.27- Andhra Pradesh Act (8 of 1988) -
Proviso to s.27 added - Andhra Pradesh (Amendment) Act, 1971 -
s.47A - Transfer of Property Act, 1882 - s.8 - 'immovable property'-
Exigibility of the plant and machinery to stamp duty under the Act -
Second respondent auction purchased the property, at a bid of
Rs.8.35 crores, consisting of land, building, civil works, plant &
machinery and other assets - On the basis of direction given in
C.A. No. 1203 of 2004 at the instance of the second respondent,
the Official Liquidator was accorded permission to execute the sale
deed in favour of the first respondent (nominee of the second
respondent) - Sale deed executed in favour of the first respondent
- Respondents 1 & 2 applied for registration of the sale deed on
the basis that the land and building had to be registered with the
value thereof being shown as Rs.1,01,05,000/ - First appellant
informed the first respondent that due to some reasons registration
was kept pending - Respondents 1 and 2 challenged the said
communication - Second appellant-District Registrar directed the
first respondent and the Official Liquidator to deposit stamp duty
besides penalty - Writ petition filed by Respondents 1 & 2, Single
Judge of High Court remitted the matter to the second appellant -
Division Bench inter alia directed the Sub-Registrar to consider the
respondents' request for registration of the lands and buildings
purchased by them and determine its value on the date of
presentation of the document for registration, collect the stamp duty
and registration fees thereupon - Held: From a reading of the Recital
Clause in conjunction with s.8, Transfer of Property Act, the
intention of the parties become self-evident that the vendor intended
to convey, all things, which inter alia stood attached to the earth -
Mere fact that there is no express reference to plant and machinery
in the Recital Clause cannot mean that the interest in the plant and
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machinery which stood attached to the land, which was scheduled,
was not conveyed to the first respondent - Sum of Rs.8.35 crores
was unambiguously indicated as the total sale consideration for
the asset sold to the first respondent, comprising of land, building,
civil works, plant and machinery and current assets, etc - However,
first respondent took out the value of the land, building and civil
works and shown it at Rs.10105000/-, indicating only the said
amount as value - This was to tide over the liability to stamp duty
for what was actually, in law, conveyed to the first respondent -
Effort of respondents 1 & 2 was to avoid payment of the stamp duty
as due in law - Division Bench erred in not noticing the true purport
of the sale deed in conjunction with s.8, 1882 Act and definition of
the word 'immovable property - The sale deed operated to convey
the rights over the plant and machinery as well, which was comprised
in the land scheduled in the sale deed - In the nature of the
transaction, and what was actually sold by the Official Liquidator,
plant and machinery, such as would answer the description of
immovable property, must also be found part of the property for the
purpose of the stamp duty and other charges as per law - First
respondent is liable in law as vendee to pay the stamp duty -
Impugned judgment set aside - Judgment of the Single Judge
restored subject to the modification that the direction to the second
appellant to give the benefit of GoMS dtd.07.02.2001 is set aside -
Second appellant will ascertain the value of plant and machinery -
It will also go into the question, whether the first respondent would
be entitled to the benefit of the exemption of stamp duty, etc., as
claimed and make available the exemption, if entitled in law -
Registration Act, 1908 - General Clauses Act, 1897.
Andhra Pradesh Amending Act (8 of 1988) - Proviso added
to s.27, Stamp Act, 1899; s.47A - Held: Proviso to s.27 does empower
the Officer to inspect the property, make local

## Text

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SUPREME COURT REPORTS
[2023] 8 S.C.R.
 [2023] 8 S.C.R. 1098
1098
THE SUB REGISTRAR, AMUDALAVALASA & ANR.
v.
M/S DANKUNI STEELS LTD. & ORS.
(Civil Appeal No(s). 3134-3135 of 2023)
 APRIL 26, 2023
[K. M. JOSEPH AND HRISHIKESH ROY, JJ.]
Stamp Act, 1899 - s.27- Andhra Pradesh Act (8 of 1988) -
Proviso to s.27 added - Andhra Pradesh (Amendment) Act, 1971 -
s.47A - Transfer of Property Act, 1882 - s.8 - 'immovable property'-
Exigibility of the plant and machinery to stamp duty under the Act -
Second respondent auction purchased the property, at a bid of
Rs.8.35 crores, consisting of land, building, civil works, plant &
machinery and other assets - On the basis of direction given in
C.A. No. 1203 of 2004 at the instance of the second respondent,
the Official Liquidator was accorded permission to execute the sale
deed in favour of the first respondent (nominee of the second
respondent) - Sale deed executed in favour of the first respondent
- Respondents 1 & 2 applied for registration of the sale deed on
the basis that the land and building had to be registered with the
value thereof being shown as Rs.1,01,05,000/ - First appellant
informed the first respondent that due to some reasons registration
was kept pending - Respondents 1 and 2 challenged the said
communication - Second appellant-District Registrar directed the
first respondent and the Official Liquidator to deposit stamp duty
besides penalty - Writ petition filed by Respondents 1 & 2, Single
Judge of High Court remitted the matter to the second appellant -
Division Bench inter alia directed the Sub-Registrar to consider the
respondents' request for registration of the lands and buildings
purchased by them and determine its value on the date of
presentation of the document for registration, collect the stamp duty
and registration fees thereupon - Held: From a reading of the Recital
Clause in conjunction with s.8, Transfer of Property Act, the
intention of the parties become self-evident that the vendor intended
to convey, all things, which inter alia stood attached to the earth -
Mere fact that there is no express reference to plant and machinery
in the Recital Clause cannot mean that the interest in the plant and
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machinery which stood attached to the land, which was scheduled,
was not conveyed to the first respondent - Sum of Rs.8.35 crores
was unambiguously indicated as the total sale consideration for
the asset sold to the first respondent, comprising of land, building,
civil works, plant and machinery and current assets, etc - However,
first respondent took out the value of the land, building and civil
works and shown it at Rs.10105000/-, indicating only the said
amount as value - This was to tide over the liability to stamp duty
for what was actually, in law, conveyed to the first respondent -
Effort of respondents 1 & 2 was to avoid payment of the stamp duty
as due in law - Division Bench erred in not noticing the true purport
of the sale deed in conjunction with s.8, 1882 Act and definition of
the word 'immovable property - The sale deed operated to convey
the rights over the plant and machinery as well, which was comprised
in the land scheduled in the sale deed - In the nature of the
transaction, and what was actually sold by the Official Liquidator,
plant and machinery, such as would answer the description of
immovable property, must also be found part of the property for the
purpose of the stamp duty and other charges as per law - First
respondent is liable in law as vendee to pay the stamp duty -
Impugned judgment set aside - Judgment of the Single Judge
restored subject to the modification that the direction to the second
appellant to give the benefit of GoMS dtd.07.02.2001 is set aside -
Second appellant will ascertain the value of plant and machinery -
It will also go into the question, whether the first respondent would
be entitled to the benefit of the exemption of stamp duty, etc., as
claimed and make available the exemption, if entitled in law -
Registration Act, 1908 - General Clauses Act, 1897.
Andhra Pradesh Amending Act (8 of 1988) - Proviso added
to s.27, Stamp Act, 1899; s.47A - Held: Proviso to s.27 does empower
the Officer to inspect the property, make local inquiries in the facts,
call for connected records, examine them and satisfy that the
provisions of s.27 are complied with - s.27 provides that the
consideration, if any, and the other facts and circumstances,
affecting the chargeability of any instrument or the amount of duty,
must be fully and correctly set forth - Equally, s.47A, empowers the
Registering Officer to deal with undervalued instruments.
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS.
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Transfer of Property Act, 1882 - s.8 - Held: s.8 declares that
in the absence of an express or implied indication, a transfer of
property passes to the transferee all the interests, which the transferor
was capable of passing in the property and in the legal incidents
thereof - Such incidents includes, inter alia, where the property is
land, all things attached to the earth - When the property is
machinery attached to the earth, the movable parts thereof also are
comprehended in the transfer.
Disposing of the appeals, the Court
HELD: 1.1 The second respondent was, undoubtedly, the
auction purchaser. The auction sale related to the assets of the
company, which included the land, the building, the plant and
machinery and other assets. The vendee, who under the sale
deed is the first respondent, being the nominee of the second
respondent. It has 49 been recited in Clause (H) that the vendee
has paid the full consideration. More significantly, it is stated
therein also that as per the terms of the sale properties have
been sold by the vendor to the vendee on 'as is where is whatever
there is basis'. The total sale consideration, it is clear again from
the sale deed itself, is Rs.8.35 crores, for the land, building, civil
works, plant and machinery and current assets, etc. However,
what had been done is an amount of Rs.10105000/- has been taken
as the value of the land, building and civil works based on the
offer received by the Liquidator, when the assets were put up for
sale individually. It is further stated that the purchaser has agreed
to pay the stamp duty/registration fees/transfer fees as per the
value derived by the Sub-Registrar. This last statement is
traceable to order dated 15.06.2004 passed in civil Appeal 1202
of 2004 which we have referred to in paragraph 6. A copy of the
said order is enclosed with the sale deed. It is further stated that
the 46 acres and a few cents was 'now' registered in favour of the
vendee. In the Recital Clause, thereafter, what has been
purported to be done is that it is shown that the vendors have
sold, transferred, conveyed, alienated, assigned to the vendee
all the scheduled property. The matter does not end there. The
aforesaid recital is followed up with the words 'along with all the
rights, easements, interests, etc., the rights which ordinarily
passed on through such sale on and over the said land in favour
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of the vendee and to hold and enjoy the same as absolute owner.
In the Schedule, no doubt, what is mentioned is 46 acres and a
little over 71 cents. We have already referred to the conduct of
the first and second respondents, which commended itself to the
learned Single Judge as conveying the impression that they wanted
to repair and maintain the plant and machinery. Furthermore, they
have also sought the benefit of the exemption provided under
GoMS 103 dated 07.02.2001, which Government Order purported
to provide for certain concessions in the form of exemption from
stamp duty and registration fee in favour of industrial units. We
are in agreement with the view taken by the learned Single Judge
that the unit was purported to be operated as a going concern
and apparently the first respondent did not intend to dispose of
the plant and machinery as scrap. Bearing in mind this context,
we proceed to examine the exigibility of the plant and machinery
to stamp duty under the Act. [Para 34][1133-C-H; 1134-A-C]
1.2 It is, no doubt, true that what is purported to be
conveyed, going by the Recital Clause, is, at first blush, the land
as comprised in the Schedule, viz., 46 and odd acres. What is
conveyed is immovable property. Immovable property has been
defined in the General Clauses Act, 1897 as 'including land,
benefits to arrive out of land and things attached to the earth or
permanently fastened to anything attached to the earth'. When it
comes to the definition of 'immovable property' in the Transfer
of Property Act, it has been defined as 'not including standing
timber, growing crops or grass'. In the Registration Act, 1908,
immovable property includes, apart from land and buildings, things
attached to the earth or permanently fastened to anything which
is attached to the earth but not including standing timber, growing
crops or grass. Most importantly, we cannot also be oblivious
that Section 8 of the Transfer of Property Act declares that in the
absence of an express or implied indication, a transfer of property
passes to the transferee all the interests, which the transferor
was capable of passing in the property and in the legal incidents
thereof. Such incidents includes, inter alia, where the property is
land, all things attached to the earth. When the property is
machinery attached to the earth, the movable parts thereof also
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS.
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SUPREME COURT REPORTS
[2023] 8 S.C.R.
are comprehended in the transfer. In the Recital Clause, a proper
reading of the same would tend to indicate that what is conveyed
is rights over the scheduled property, which, no doubt, is the
land, as described in the Schedule but it includes all the rights,
easements, interests, etc., i.e., the rights which ordinarily passed
on such sale over the land. It is from a reading the said recital in
conjunction with Section 8 of the Transfer of Property Act that
the intention of the parties become self-evident that the vendor
intended to convey, all things, which inter alia stood attached to
the earth. The mere fact that there is no express reference to
plant and machinery in the Recital Clause cannot mean that the
interest in the plant and machinery which stood attached to the
land, which was scheduled, was not conveyed to the first
respondent. The value of, what was actually purchased, has been
expressly set out in the Preamble to the sale deed. The value
has been reflected as Rs.8.35 crores. The sum of Rs.8.35 crores
had been, in unambiguous terms, indicated as the total sale
consideration for the asset sold to the first respondent,
comprising of land, building, civil works, plant and machinery and
current assets, etc. The first respondent has taken out the value
of the land, building and civil works, and shown it at Rs.10105000/
-, and then indicating only the said amount as value. This is
apparently to tide over the liability to stamp duty for what was
actually, in law, conveyed to the first respondent. The Division
Bench appears to have proceeded on the basis that the first
appellant could not force Respondents 1 and 2 to pay stamp duty
on the value of the plant and machinery, when they do not seek
its registration. As respondents 1 and 2 had given up their claim
for exemption based on the Government Order, the Division
Bench accepted the same. The Division Bench overlooked the
nature of the transaction, the effect of the auction sale, the
property sold and their value, and the fact that the Company Judge
had by order dated 15.06.2004 left it open to the authority to
determine the liability. The Division Bench did not consider the
preambular part. It also failed to bear in mind the power available
with the authorities. [Paras 36, 37][1134-F-H; 1134-A-G]
1.3 The effort of respondents 1 and 2 was to avoid payment
of the stamp duty as due in law. The Division Bench erred in not
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noticing the true purport of the sale deed in conjunction with
Section 8 of the Transfer of Property Act and the definition of the
word 'immovable property'. Viewed in the context of Duncans
Industries Limited and Member, Board of Revenue, as also the other
attendant facts, including the contents of the Preambular portion,
as also the conduct of the Respondents 1 and 2, it would be clear
that the sale deed operated to convey the rights over the plant
and machinery as well, which was comprised in the land scheduled
in the sale deed. As far as the plant and machinery is concerned,
it must, however, be only such plant and machinery, which was
permanently embedded to the earth and answering the description
of the immovable property as defined. It would appear that such
an inquiry was not done to ascertain the same by the appellants.
[Para 38][1136-A-C]
Duncans Industries Limited v. State of Uttar Pradesh
and others (2000) 1 SCC 633; Member, Board of
Revenue v. Arthur Paul Benthall AIR 1956 SC 35 :
[1955] SCR 842 - referred to.
1.4 The proviso to Section 27 of the Act, added by the
Andhra Pradesh Amending Act (8 of 1988), does empower the
Officer to inspect the property, make local inquiries in the facts,
call for connected records, examine them and satisfy that the
provisions of Section 27 are complied with. Section 27,
undoubtedly, provides that the consideration, if any, and the other
facts and circumstances, affecting the chargeability of any
instrument or the amount of duty, must be fully and correctly set
forth. Equally, Section 47A of the Andhra Pradesh Amending Act
(8 of 1988), empowers the Registering Officer to deal with
undervalued instruments. [Para 39][1136-D-E]
1.5 In the nature of the transaction, and what was actually
sold by the Official Liquidator, plant and machinery, such as would
answer the description of immovable property, must also be found
part of the property for the purpose of the stamp duty and other
charges as per law. [Para 40][1136-H; 1137-A]
1.6 There are two aspects, which remain. Firstly, on account
of the default of the appellants to effect service on the second
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS.
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[2023] 8 S.C.R.
respondent, the SLP stood dismissed. We, however, notice that,
at the request of the second respondent, the Company Court
ordered that the sale deed be executed in favour of its nominee,
viz., the first respondent. The first respondent, accordingly,
became the vendee under the sale deed. It is the first respondent,
which is liable in law as vendee to pay the stamp duty. Therefore,
we would think that the absence of the second respondent, may
not affect passing of an order as against the first respondent,
which, as the vendee, is the entity liable to bear the liability
towards stamp duty. Another aspect is that the matter may have
to go back to consider the actual plant and machinery as would
answer the description of immovable property as correctly
pointed out by the learned Amicus. The passage of time may have
its bearing. But it may have to be carried out. As noticed by us,
the appellants had also appealed against the Judgment of the
learned Single Judge. The Single Judge, it must be remembered,
while upholding the Order of the second appellant (District
Registrar) in regard to the value of the plant and machinery, had
directed deducting the value of the current assets and also directed
making available benefits of GoMS 103 dated 07.02.2001.
Apparently, Respondents 1 and 2 in the Appeal gave up their
claim to the exemption on the basis that they succeeded in having
the sale deed registered without having to include the value of
plant and machinery before the Division Bench. The stand of the
appellants would appear to be that GoMS 103 dated 07.02.2001
applied to new industrial units other than those listed as ineligible
under GoMS 9 dated 05.01.2001. It appears to be their case that
the subject industry is a mini steel industry and mini steel industry
plants were not eligible and the item appears as Item 56 in
Annexure 1 to GoMS 9 dated 05.01.2001. Since, the respondents
gave up their claim for exemption, the case of the appellants was
not gone into by the Division Bench. The second appellant can
look into this aspect as well. [Paras 41, 42][1137-B-G]
1.7 The Appeal filed against Writ Appeal No. 1873 of 2005
is allowed. The Appeal filed against the Judgment in Writ Appeal
No. 2457 of 2005 is partly allowed. The impugned Judgment is
set aside and the Judgment of the learned Single Judge is restored
subject to the modification that the direction to the second
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appellant to give the benefit of GoMS 103 dated 07.02.2001 is
set aside. The second appellant will ascertain the value of plant
and machinery on the basis of it answering the description of the
immovable property as understood in law. The second appellant
will also go into the question, whether the first respondent would
be entitled to the benefit of the exemption of stamp duty, etc., as
claimed while taking a decision and make available the exemption,
if entitled in law. The second respondent cannot be made liable
under this judgment. [Para 43][1137-H; 1138-A-C]
Himalaya Space House Company Limited v. Chief
Controlling Revenue Authority (1972) 1 SCC 726 :
[1972] 3 SCR 332; Chief Controlling Revenue Authority
v. Coastal Gujarat Power Ltd. and others (2015) 10
SCC 700 : [2015] 9 SCR 36 - referred to.
Case Law Reference
[1955] SCR 842
referred to
Para 19
[1972] 3 SCR 332
referred to
Para 20
[2015] 9 SCR 36
referred to
Para 20
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.31343135 of 2023.
From the Judgment and Order dated 18.07.2017 of the High Court
of Judicature at Hyderabad for the State of Telangana and the State of
Andhra Pradesh in WA Nos.1873 and 2457 of 2005.
Mahfooz A. Nazki, Polanki Gowtham, Shaik Mohamad Haneef,
T. Vijaya Bhaskar Reddy, K. V. Girish Chowdary, Rajeswari Mukherjee,
G. N. Reddy, Advs. for the Appellants.
Gopal Jha, Adv. for the Respondents.
The Judgment of the Court was delivered by
K. M. JOSEPH, J.
1. Delay condoned. Leave granted.
2. By order dated 13.06.2002, the High Court of Andhra Pradesh
ordered M/s. Midwest Iron & Steel company Ltd. (which is Respondent
No.3 in the appeals) to be wound up. Though pursuant to order dated
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS.
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22.09.2003, efforts were made to sell the property of respondent no.3 in
three lots, finally, based on an auction for a consolidated sale, the second
respondent herein, namely, M/s. SMC Marketing Private Ltd. who figured
as the highest bidder, became the successful auction purchaser. It bid
for the property which consisted of land, building, civil works, plant &
machinery and current assets, etc. The amount for which the second
respondent was declared the highest bidder was Rs.8.35 crores. On the
basis of a direction given in C.A. No. 1203 of 2004 at the instance of the
second respondent, the Official Liquidator was accorded permission by
the learned Company Judge to execute the sale deed in favour of the
first respondent in the appeals, viz, M/s. Dankuni Steel Ltd. A sale deed
came to be executed by the Official Liquidator in favour of the first
respondent dated 5th August, 2004. In the sale deed in the preambular
portion we may notice the following statements:
"D. WHEREAS the Official Liquidator has put the properties of
the Company for sale in terms of orders of the Hon'ble High
Court and whereas the Hon'ble High Court of Andhra Pradesh,
Hyderabad by an order dated 04-02-2004 made in C.A.No.736/
2003 in R.C.C.No. 10/2001 (copy enclosed) was pleased to
confirm the sale of the assets pf the Company such as land, building,
plant and machinery and other assets in favour of Messrs SMC
Marketing Pvt. Ltd., having its office at Room No.617, 6th floor,
P 41, Princep Street, Kolkatta - 700 072, represented by its
authorized representative Sri Amar Chand. Choudhary for a total
sale consideration of Rs.8.35 crores.
E. WHEREAS the Hon'ble High Court of Andhra Pradesh,
Hyderabad passed by an order dated 15-06-2004 made in C.A.No.
1202/2004 was pleased to direct the Official Liquidator to execute
necessary conveyance deeds for the land sold in auction in favour
of the vendee here in who is the nominee of the said highest
bidder Messrs SMC Marketing Pvt. Ltd. A copy of which is
enclosed herewith."
3. Clause H of the preamble, reads as follows:-
"H. WHEREAS the Vendee has paid the full consideration to the
vendor within the time stipulated by the Hon'ble High Court of
Andhra Pradesh, Hyderabad and as per the terms and conditions
of the sale, properties have been sold by the Vendor to the Vendee
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on 'as is where is whatever there is basis'. Vendor hereby admits
and acknowledges that he has received the full consideration from
the Vendee and there is no balance payable by him. Further the
Vendor has already given possession of the Schedule property to
the Yendee under due acknowledgement.The Vendor hereby
conveys, transfers and assigns all the rights, title interest together
with all the liberties, advantages, held and enjoyed by Messrs
Midwest Iron & Steel Co. Ltd., to theVendee, who shall hereinafter
enjoy the same with full and absolute rights without any disputeor
objection from any source as owner.
AND WHEREAS the total sale consideration is Rs.8.35 crores
for the entire assets of the company comprising of land, building,
Civil works, plant & machinery and current assets, etc"
An amount of Rs.1,01,05,000/- is taken as the value of the land,
building and civil works basing on the offer received by the official
liquidator when the assets were put for sale individually and the
purchaser has agreed to pay the stamp duty / registration fees /
transfer feesas per the-value derived by the sub registrar.
WHEREAS the land to an extent of Acres 46.7167 cents situated
in Dusi Village as per detailsgiven below is now registered in favour
of the VENDEE through this document, hereinafterreferred to as
the 'SCHEDULED PROPERTY' for brevity, which is fully
described in theschedule of property and clearly delineated in red
colour in the plan annexedhereto.
4. Next, the recital clause (1) reads as follows:
"NOW THE VENDOR HEREBY ASSURES AND
COVENANTS THE VENDEE AS UNDER:
In consideration of the said amount paid by the Vendee, the Vendors
here.by scll, transfer, convey, alienate, assign unto and to the use
of the Vendee absolutely and forever all that the scheduled property
along with all the rights, easements, interests etc., the rights which
ordinarily pass on through such sale on and over the said land in
favour of the Vendee to hold and to enjoy the same as absolute
owner."
5. Next, we must notice the schedule of the property which inter
alia reads as follows:
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS. [K. M. JOSEPH, J.]
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SUPREME COURT REPORTS
[2023] 8 S.C.R.
"All that piece and parcel of the property admeasuring acres of
46.7167 cents situated at Dusi Village, Srikakulam District, within
the limits of Sub-Registrar, Amudalavalasa, belonging to M/s.
Midwest Iron & Steel Co. Ltd. in the above R.S. Numbers sold
by the Vendor to Vendee is bounded by..." The boundaries are
hereafter set out.
6. Since the sale deed in favour of the nominee, namely, the first
respondent came to be executed pursuant to order of the Company Judge
dated 15.06.2004 made in C.A. No.1202 of 2004 as stated in Clause E
(supra), we may notice the prayers and relevant part of the order. They
read as under:
"Application under Section of the Companies Act, 1956 R/W Rule
9 of the Companies (Court) Rule, 1959, praying that this High
Court may be pleased to direct the Official Liquidator to execute
the sale deed in respect of the land and building and civil works
belonging to the company in liquidation fora consideration of Rs.
40,13,000/- in favour of the Applicant's nominees-M/s. Dankun·1
Steels Lim.1ted.
b) Direct the Official Liquidator to execute a sale certificate in
favour of the Applicant's nominees. M/s. Dankuni Steels Limited,
in respect of the plant and machinery fora consideration Rs. 751.27
Lakhs and in respect of the current assets and furniture and
fixtures in the sum of Rs. 43,60,000/-.
c) Direct the Official Liquidator to obtain all the original documents
of title deposited by company in liquidation with financial institutions
viz., ICICI Bank Limited, IDBI, Canara Bank, United Western
bank Limited, IFCI, IIBI and State Bank of India, and deliver the
same to the Applicant's nominees, M/s. Dankuni Steels Limited.
This Application coming on for orders upon readingthe Judge's
Summons and the affidavit dated: 23-4-2004 and filed by Mr. Amar
Chand Choudary, authorized Representative of the Application in
support of this Application and upon hearing the arguments of Mr.
Anil Kumar counsel for The Official Liquidator and of Mr. S.
Ravi, Advocate for the applicant and of Mr. M. Anil Kumar,
Counsel for the Official Liquidator on behalf of the respondent"
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" ...The learned counsel also placed before me Form No.32 issued
by the Office of Registrar of Companies, Calcutta, showing that
Sri Amit Ganguly, S/o late B.N.Ganguly, who is the Director of
applicant company in M/s.Dankuni Steels Limited. A certificate
issued by the Director of the applicant company placed before
the Court would show that the applicant company holds 9,000
(Nine thousand only) shares of Rs.10/- each of M/ s. Dankuni
Steels Limited. ..."
"... Insofar as the relationship between the applicant company
and M/ s. Dankuni Steels Limited, this Court is satisfied that the
applicant is justified in taking sale deed in favour of M/s. Dankuni
Steels Limited. Insofar as the relief in the application to direct the
Official Liquidator to execute the sale deed in favour of M/s
Dunkuni Steels Limited for a consideration of Rs.40, 13,000/-
(Rupees forty lakh and thirteen thousand only) is confirmed in the
auction conducted by this Court, as the land, building and machinery
of the company in liquidation was sold to the applicant company
at a price of Rs.8,35,00,000/- (Rupees eight crore thirty five lakh
only), it would be better if the issue as to the value of the property
in respect of which a conveyance deed has to be executed is
decided by the Registration Authorities. It is needless to observe
that at the time of completion of this exercise, Official Liquidator
will hand over all the original documents in respect of the property.
The application is, accordingly, ordered."
(emphasis supplied)
7. It is thereafter that as already noticed that the sale deed came
to be executed on 05.08.2004. Respondents 1 and 2, it would appear
claimed benefit of GOMS No.103 dated 07.02.2001. The said GOMS
read as under inter alia:
 "GOVERNMENT OF ANDHRA PRADESH
ABSTRACT
Indian Stamp Act, 1899 - 50°/o Exemption frompayment of Stamp
Duty and Registration Fee on theinstruments of leases, leasecum-sales and salesexecuted in favour of Industrial Units in the
State forthe purposes of selling up or expansion ordevelopment of
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS. [K. M. JOSEPH, J.]
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SUPREME COURT REPORTS
[2023] 8 S.C.R.
Industries - Orders - Issued.
REVENUE (REGISTRATION.II) DEPARTMENT
G.0.Ms.No.103
Dated :07 .02.2001
Read the following:-
1. Letter from the Chairman and Managing D1rector, A.P.I.I.C.
No.SIPC/APIIC/M(Pig)/97, dt.11.5.2000.
2. From the Commissioner and Inspector General of Registration
and Stamps Letter No.Sl/10783/2000, dt.28.9.2000 and even
No.,dt.17.11.2000.
3. G.O.Ms.No.9, Industries & Commerce
Department, dt.5.1.2001.
ORDER:-
In pursuance of the decisions of the SIPD,orders were issued in
G.O.Ms.No.9, Industries &Commerce Department, dt.5.1.2001,
enunciating aNew Industrial Policy for 2000-2005. Among
variousother decisions, exemption of 50% Stamp Duty,Registration
Fee and Transfer Duty was allowed onlands meant for Industrial
use. Exemption of StampDuty and Registration Fee 'for loan
agreements, creditdeeds, mortgages and hypothecation deeds
executedby the Industries in favour of banks or financialinstitutions
has also been included in the Policy. NewIndustrial Units ether
than listed as 'ineligible' in theGovernment order cited third above,
would beeligible for the concession in stamp duty andregistration
fees as notified below.
Basing on the above decision, the followingNotifications will be
published in the next issue of theAndhra Pradesh Gazette:-
NOTIFICATION - I
In exercise of the powers conferred by clause(a) of sub-section -
(1) of section 9 of the IndianStamp Act, 1899 (Central Act II of
1899), theGovernment of Andhra Pradesh hereby reduces thestamp
duty by 50 percent on the instruments ofleases, lease-cum-sales
and sales executed in favour of Industrial units and also remits
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Stamp Duty in fullon laan agreements, credit deeds, mortgages
andhypothecation deeds executed by such Industrialunits in favour
of banks or financial institutions forthe purposes of setting up or
expansion ordevelopment of Industries.
NOTIFICATION - II
In exercise of the pówers conferred under Section 78 of the
Registration Act, 1908 (Central ActXVI of 1908), the Governor
of Andhra Pradesh herebymakes the following amendment to the
"Table ofFees" - issued in G.O. MS. N0.1637,
RevenueDepartment, dated the 3rd September, 1958 andpublished
at pages 2250 to 2253 of Part I of theAndhraPradesh
Gazette,Dated:ll.09.1993 issubsequently amended from time to
time.
AMENDMENT
In the said "Table of Fees" in article l(a), afterclause "K
(XCXXIV)", the following clause shall beadded, namely :-
"K (XCXXV): The Registration Fee leviable underthis Article on
the instructions of leases, leasecumsalesand sales executed in
favour of industrialunits shall be reduced by 50 percent and
noregistration fee shall be leviable on loan agreements,credit deeds,
mortgages and hypothecation deedsexecuted by such industrial
units in favour of banksor financial institutions for the purposes of
setting upor expansion or development of industries".
(BY ORDER AND IN THE NAME OF THE
GOVERNOR OF ANDHRA PRADESH)
K.C.MISRA PRINCIPAL
SECRETARY TO GOVERNMENT"
8. It would appear that the respondents 1 and 2 applied for
registration of the sale deed according to the appellants on the basis that
the land and building had to be registered with the value thereof being
shown as Rs.1,01,05,000/-. The Sub-Registrar, namely, the first appellant
by communication dated 12.08.2004 informed the first respondent that
the registration was kept pending for the following reasons:
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS. [K. M. JOSEPH, J.]
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SUPREME COURT REPORTS
[2023] 8 S.C.R.
(1)
The chargeable value as per the contents of the documents
was assessed to be Rs.8.35 crores whereas respondents 1
and 2 had stated that only the land and buildings were being
transferred for Rs.1,01,05,000/-.
(2)
Since 50% exemption was being claimed, the G.O. had to
be verified thoroughly.
(3)
The land in some of the Survey Nos. were found to be
Government land.
9. The respondents 1 and 2 feeling aggrieved filed Writ Petition
No.16104 of 2001 challenging the said communication. The District
Registrar, Srikakulam, [the second appellant before us] directed the first
respondent and the Official Liquidator to deposit Rs.8629025/- as stamp
duty besides penalty of Rs.1000/. It is challenging the said communication
that Respondents 1 and 2 filed Writ Petition No. 19900 of 2004. Both the
Writ Petitions came to be heard together and disposed by a learned
Single Judge by the Judgment dated 12.07.2005. The learned Single Judge
found inter alia as follows:
"5. Though the Company Court initially directed · auction of the
assets of the Company in three lots, having felt that the bids
received for the lots are inadequate, the learned Judge directed
sale of all the three lots i.e. (i) Land, Buildings and Civil Works;
(ii) Plant and Machinery; and cJii) Current Assets and Swaraj
Mazda vehicle, as one lot only. Therefore, the fact that the
Company Court originally directed sale of the assets of the
Company in three lots has no relevance for deciding these petitions
because second petitioner, admitted1y, purchased the assets of
the company as one lot only, in the open auction held by the
Company Court, but not as three different lots .
6. It is no doubt true, as per the proviso to Sectiön 47A(6) of the,
Stamp Act, instruments executed by or on behalf .of the Central
Government or the State Government or any authority or body
incorporated by or under any law for the time being in force and
wholly owned by Central/State Government, the market value of
the property shall be the value shown in such instrument. This
provision, far from helping the petitioners, would go against their
contention that sale deed can be executed for Lot l only, inasmuch
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as assets of the company were advertised for sale in three lots,
because all the three assets of the company were purchased by
the second petitioner only as one lot, but not in three different lots,
and since there is nothing in the sale deed in question to show the
exact value of the Land, Building and Civil works. The file produced
by the official liquidator shows that there was correspondence
between him and the petitioners with regard to the contents etc.
of the sale deed to be executed by him i.e. official liquidator. Here,
I am constrained to observe that the official liquidator does not
seem to have acted fairly while executing the sale deed in question,
and seems to have made an attempt to favour the petitioners by
suppressing certain fact: and incorporating the undermentioned
highlighted portion in page 3 of the sale deed in question reading -
"AND WHEREAS the total sale consideration is Rs.8.35 crores
for the entire assets of the company comprising of land, building,
Civil works, plant & machinery and current assets, etc., An amount
of Rs.1,01,05,000/- is taken as the value of the land, building and
civil works basing on the offer received by the official liquidator
when the assets were put for sale individually and the purchaser
has agreed to pay the stamp duty/registration fees/transfer fees
as per the value derived by the sub registrar." obviously that
statement, mentioning the value of the building etc. as
Rs.1,01,05,000/- is made on the basis of the offers received by
him (official liquidator) on 04-12-2003 whereat M/s.Bhagya Nagar
Metals Ltd., offered Rs"101.05 lakhs for Lot No.1 and Rs.301.00
lakhs for Lot No.2, and M/s.MahavirGhantakaram Enterprises
offered Rs.29.50 lakhs for Lot No.3. So, it is clear that the total
value of the offers for the three lotreceived by the official liquidator,
on 04-12-2003, was Rs.431.55 lakhs. But, on 30-12-2003, M/
s.ConcastIspat Ltd., which (as per the letter dated 13-08-2004 of
the Genera! Manager, District Industries Centre, Srikakulam,
addressed to the fourth respondent, relied on by the petitioners,
produced as a material document along with the petition) seems
to be a group company of the petitioners, gave a consolidated
offer for Rs.576.00 lakhs for the three lots put together, and the
bid ultimately was knocked down in favour of the second petitioner
for Rs.835.00 lakhs, for all the three lots put together, in the court
auction held on 04-02-2004. Thus, official liquidator knows, and if
THE SUB REGISTRAR, AMUDALAVALASA & ANR. v. M/S
DANKUNI STEELS LTD. & ORS. [K. M. JOSEPH, J.]
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SUPREME COURT REPORTS
[2023] 8 S.C.R.
he were to say that he does not know, should be imputed with
knowledge that this offer dated 04-12-2003 for the Land, Buildings
and Civil works for Rs.101.05 lakhs does not truly and correctly
represent the value of the Land, Buildings and Civil works. In
fact, in his letter bearing No.OL/AP/RCC.10/ 2001/AR/2004 dated
04-02-2004 addressed to the second petitioner, official liquidator
stated:
"With reference to the open auction held on4-2-2004 before the
Hon'ble High Court ofAndhra Pradesh, Hyderabad in the matter
ofsale of entire assets of the subject company I am to inform you
that the Hon'ble High Court vide their order dt.4-2-2004 made in
C.A.No. 736/2003 accepted your offer for the purchase of entire
assets of the company as one Lot i.e., Land & Buildings & Civil
Works, Plant and Machinery and Current Assets, Furniture
&Fixtures including Swaraj Mazda Vehicle lying at Dusi Village,
Srikakulam District for a total sale consideration· of Rs.8,35,00,000/
-. The Hon'ble High Court was pleased to grant three months
from the date of confirmation i.e., 4-2-2004 for making balance
sale consideration of Rs.6.28Crores as follows:
Yet, the official liquidator, for reasons known to him only, mentioned
the non-existing 'offer value' of Rs.101.05 lakhs as the value of
the Land, Buildings and Civil works, in the sale deed.
10. The Court further notes as follows:
"8. In R.C.C.No.10/2001/ AR/2004 dated 05-8-2004sent by him,
in reply to the memo impugned inW.P.No.16104 of 2004 issued
by the thirdrespondent, official liquidator stated as
follows."Inpursuance of the orders of the Hon'bleHigh Court of
Andhra Pradesh, Hyderabad in thereference cited, I have executed
a sale deeddated 05-08-2004, in favour of M/s.DankuniSteels
Limited, Kolkatta transferring the assetsof the company M/
s.Midwest Iron and Steel Limited, Dusi Village, Srikakulam District
whichis in liquidation for Rs.1,01,05,000/- and signedall the
connected statements of the saiddocument.
11. The learned single Judge thereafter referred to order passed
in C.A. No.1202 of 2004. Thereafter, the single Judge found that there
would be no doubt that respondents 1 and 2 M/s. Concast Ispat Limited
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were group companies. Another aspect noted by the learned Single Judge
was the conduct of the second respondent filing Civil Appeal No. 823 of
2004 seeking permission of the Court to get the plant and machinery
repaired and overhauled on the basis that it intended to revive the unit
and run it. An Order, it was noted, was passed thereon on 06.04.2004
allowing the second respondent to carry out repair and overhaul operations
inter alia subject to certain conditions. Next, the learned Single Judge
noted the letter dated 13.08.2004 by the General Manager of the District
Industries Centre to the second appellant. It reads:
"the Commissioner of Industries, Andhra Pradesh, Hyderabad
informed that M/s.Concast Ferro Inc, Dusi Village, Amadalavalasa
Mandal, Srikakulam District who have obtained IEM No. 2284/
SIA/IMO/2004 dt.25.06.2004 for establishing unit for the line of
activity (1) Pig Iron (2) Granualated slag and (3) Coke Fines by
acquiring the sick unit through official liquidator,High Court of
Andhra Pradesh as a new Entrepreneur is entitled for availing
50% Exemption Duty exclusive under NIP 2000-2005 scheme.
Therefore I request you kindly allow 50% stamp duty,
Registration fee and transfer for loan agreements, credit deeds,
mortgages and hypothecation deeds executed by the Industrial
Unit in favour of banks or financial institutionson lands meant for
industrial units after fulfillingthe formalities in terms of
G.O.Ms.No.103Revenue (Registration) Department dated
07.02.2001."
12. The learned Single Judge found that Respondents 1 and 2
were using the plant and machinery for their business and had no intention
to remove and sell them as scrap or otherwise. It is further found that if
respondents 1 and 2 were to contend that M/s. Concast Ferro Alloys
which was obviously a mistake for M/s.