Stamp duty valuation must follow the land's existing character, not its possible future residential use.

Stamp duty valuation must be determined by reference to the land's actual character on the date of execution of the sale deed, not by its possible future residential use. Where the instrument covered agricultural land, the Collector could not base market value on adjacent land that had been converted for residential purposes or on the purchaser's intended future conversion. The existing nature of the property was the relevant factor, and a hypothetical future use was not material to stamp valuation. The Collector's valuation was therefore unsustainable, and the demand for deficient stamp duty and registration charges was set aside.

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Issues: Whether the market value of the land for stamp duty purposes was required to be determined on the basis of its nature on the date of execution of the sale deed or on the basis of its possible future residential use.

Analysis: The land sold under the instrument was agricultural land on the date of execution, and the valuation for stamp purposes had to be made with reference to that existing character. The possible future conversion or intended use by the purchaser was not a relevant factor for determining market value. The demand was founded on the value of adjacent land that had been converted for residential use, which could not govern the valuation of the agricultural land covered by the deed.

Conclusion: The valuation adopted by the Collector was unsustainable, and the demand for deficient stamp duty and registration charges was liable to be set aside in favour of the petitioner.

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