D.Dis.No.37968/P1/2018, Review Petition on Cancellation of Settlement Deed
The Chief Controlling Revenue Authority and Inspector General of Registration, Chennai issued proceedings D.Dis.No.37968/P1/2018 dated 1 March 2021, allowing a review petition concerning the stamp duty classification of a deed cancelling a settlement deed. The proceedings set aside the Sub Registrar (District Registrar cadre), Anna Nagar order demanding deficit stamp duty of Rs.1,34,182 and a penalty of Rs.500. The cancellation deed was held classifiable under Article 58(b) of the Indian Stamp Act, 1899, with maximum stamp duty of Rs.80, rather than as a gift under Article 33.
What the proceedings decide
Proceedings D.Dis.No.37968/P1/2018 dated 1 March 2021 were issued by the Chief Controlling Revenue Authority and Inspector General of Registration, Chennai. They decide a review petition relating to pending document No.185/2017 at the Sub Registrar Office, Anna Nagar.
The document was titled “Deed of Cancellation of Settlement Deed”. It sought to cancel a settlement deed dated 12 April 2009, registered as document No.1250/2009 at the Sub Registrar Office, Anna Nagar.
Who is affected
The proceedings directly concern Mrs. E. Vijayalakshmi, who had executed the original settlement in favour of her son, Mr. P. Siva, and the Sub Registrar (District Registrar cadre), Anna Nagar. They are also relevant to the classification of a settlement revocation deed where the person who received the settlement signs the cancellation document.
Key findings
- Mrs. E. Vijayalakshmi executed the cancellation deed, and Mr. P. Siva also signed it.
- The registering officer treated Mr. P. Siva’s signature as causing the property to revest by way of gift under Article 33 of the Indian Stamp Act, 1899.
- On that basis, the registering officer demanded deficit stamp duty of Rs.1,34,182 and a penalty of Rs.500.
- The Chief Controlling Revenue Authority found that neither Article 58(b) of the Indian Stamp Act, 1899 nor the Registration Act prohibits the person who received the settlement from signing a deed revoking that settlement.
- Mere signature showing consent to revocation does not change the cancellation deed into a gift.
- The cancellation deed was therefore classified under Article 58(b), with maximum stamp duty of Rs.80.
Practical result
Proceedings D.Dis.No.37968/P1/2018 allowed the review petition and set aside the earlier order of the Sub Registrar (District Registrar cadre), Anna Nagar. The Sub Registrar was directed to collect any stamp duty deficiency in accordance with Article 58(b) of the Indian Stamp Act, 1899.
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Common questions
Does the beneficiary’s signature make a settlement cancellation deed a gift?
No. The Chief Controlling Revenue Authority held that the beneficiary’s mere signature showing consent to revocation does not change the nature of the deed into a gift.
What stamp duty classification was applied to the cancellation deed?
The deed was classified under Article 58(b) of the Indian Stamp Act, 1899, with maximum stamp duty of Rs.80.
What happened to the demand for Rs.1,34,182 and the Rs.500 penalty?
The Sub Registrar’s order imposing that deficit stamp duty and penalty was set aside. The Sub Registrar was directed to collect any deficiency according to Article 58(b).
Which registration document did the proceedings concern?
They concerned pending document No.185/2017 at the Sub Registrar Office, Anna Nagar, titled “Deed of Cancellation of Settlement Deed”.
