Proceedings No. 28752/P1/2018, Stamp Duty Revision for Pending Document P.47/2018, 2019

What the proceedings decide

Proceedings No. 28752/P1/2018 dated 1 February 2019 were issued by the Inspector General of Registration and Chief Controlling Revenue Authority of the Registration Department, Chennai. They decide a revision petition concerning a sale deed presented as pending document P.47/2018 at the Ambattur Sub Registrar Office.

The deed, executed on 17 May 2018, transferred 3.99 acres from seven members to the Chennai Government Officers Cooperative Building Society. The stated consideration and document value was Rs.69,59,35,800, and no stamp duty had been paid.

Why stamp duty was initially demanded

The North Chennai District Registrar concluded that the exemption under Government Order No. 2179, Cooperation Department, dated 29 June 1966 did not apply. The reasons recorded were:

• The deed did not state that the seven sellers had continuously been members of the society for two years.
• The society had not initially produced supporting evidence of two years of membership.
• The District Registrar therefore demanded Rs.4,87,15,506 as deficit stamp duty and imposed a Rs.5,000 penalty through Order No. 5975/A1/2018 dated 25 June 2018.

Findings in the revision

The Inspector General of Registration and Chief Controlling Revenue Authority examined the petition, the District Registrar's original file, the petitioner's submissions and information supplied by the Registrar of Cooperative Societies (Housing), Chennai.

The information showed that:

• The Chennai Government Officers Cooperative Building Society was not a society formed for constructing and providing houses to members.
• All seven sellers had been members from 11 May 2018.
• They were therefore members before the deed was executed on 17 May 2018.

A Registration Department letter dated 5 May 1995 stated that the two year membership condition applies to a cooperative house building society purchasing property from a member. It also stated that this time requirement does not apply when another type of cooperative society purchases property from its member.

Result and practical effect

Proceedings No. 28752/P1/2018 found that the society was not a house building society and that the sellers were already members when the deed was executed. The stamp duty exemption was therefore allowed, the revision petition was accepted, and the North Chennai District Registrar's demand for deficit stamp duty and penalty was cancelled.

The decision directly concerns pending document P.47/2018 and the named cooperative society and sellers. It explains why the two year membership condition was not applied to this particular non-house-building cooperative society transaction.