TaxTMI 
TaxTMI 
2006 (4) TMI 542
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....of trial, called for the guideline value from the Sub-Registrar's Office and the valuation register from the Municipality, and, on the basis of the reports of the Advocate Commissioner and the Chartered Engineer and also taking the guideline value at Rs. 250/- per square feet, fixed the fair rent at the rate of Rs. 2,642/- per month. (iv) The tenant/petitioner, challenging the said fixation of fair rent, filed R.C.A.No.136 of 1994 before the Rent Control Appellate Authority. (v) After hearing the counsel for the parties, the Rent Control Appellate Authority, by the judgment dated 30.07.1996, dismissed the appeal, confirming the findings of the Rent Controller and fixing the fair rent at Rs. 2,642/- per month. (vi) Assailing the orders of both the Rent Controller and the Rent Control Appellate Authority, this Civil Revision Petition has been filed by the petitioner/tenant before this Court." 3. The main point, that has been urged before Justice K.P. Sivasubramaniam, a learned single Judge of this Court (as he then was), by the learned counsel for the petitioner/tenant, is, that the authorities below should not have accepted the ....
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....udge went further to observe that the judgment could not have any bearing on the present case under Section 4 of the Tamil Nadu Buildings (Lease and Rent Control) Act 1960. 3. Subramani,J. in his judgment reported in 1997 (3) Law Weekly 193 (SRINIVASA GOUNDER V. K.VENKATESAN) had held that the guideline value as maintained by the Sub-Registrar's Office cannot be accepted as correct for the purpose of ascertaining the market value of the property. 4. Therefore, there are two conflicting decisions which require to be resolved. Having regard to the fact that in many Civil Revision Petitions before this Court as well as several similar proceedings before the various Authorities under the Rent Control Act, the same issue arises for consideration, it would be desirable to have the issue resolved at the earliest, by a larger Bench. Therefore, the office is directed to place the papers before My Lord the Honourable the Chief Justice for reference before a Larger Bench." That is how the matter has been referred to this Full Bench, for deciding the issue in question. 7. Let us now quote the relevant observations from the t....
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....ad an occasion to consider a similar case in the decision reported in 1996-2-L.W.637 (Rahmath Fathima, T.H.S. v. T.K.Kader Mohideen), where I held that for determination of the market value, transaction between a willing purchaser and a willing seller will have to be considered, and I also held that the value fixed by the Government for the purpose of stamp duty has no relevance. In paragraph 17 of the judgment, I have said thus :- "..The Government fixes the value only for the purpose of Stamp Duty i.e., for the purpose of its revenue. The value is fixed for the locality and not for a particular survey number. The market value for a particular survey number is the result of a bargain between the parties. That is a matter to be proved by evidence. Judicial notice cannot be taken regarding the value of the property on the basis of a value fixed by the Government." 10. Since the Appellate Authority has relied upon only the hearsay evidence of P.W.1, and that too on the basis of the information ascertained by him from the Sub-Registrar's Office where registers have been kept for the purpose of determining stamp duty, the same cannot be accepted ....
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....IR 1959 SC 429) in paragraph 9 held that the function of the Court in awarding compensation under the Act is to ascertain the market value of the land at the date of the notification under Section 4(1). The methods of valuation may be (1) opinion of experts (2) the price paid within a reasonable time in bona fide transactions of purchase of the lands acquired or the lands adjacent to the lands acquired and possessing similar advantages; and (3) a number of years purchase of the actual or immediately prospective profits of the lands acquired. Same was the view in Tribeni Devi v. Collector of Ranchi ((1972) 1 SCC 480). It was reiterated in catena of decisions, vide, Periyar and Pareekanni Rubbers Ltd. v. State of Kerala ((1991) 4 SCC 195). Therefore, it is settled law that in determining the market value, the Court has to take into account either one or the other three methods to determine market value of the lands appropriate on the facts of a given case to determine the market value. Generally, the second method of valuation is accepted as the best. The question, therefore, is whether the Basic Valuation Register would form foundation to determine the market value.... I....
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....re is no guarantee or truth or correctness of the data given in the guideline value. In Naganatham v. Revenue Divisional Officer, Adilabad (AIR 1983 A.P.155), the Andhra Pradesh High Court has held that the fixation of market value cannot be made on the basis of the value noted in the market value register maintained by the Government and the Court has to take into account the price which a selling (sic willing) purchaser is prepared to pay to a willing vendor. This view has been confirmed by the Supreme Court in the same case, which was later taken before the Supreme Court in Jawajee Naganatham v. Revenue Divisional Officer (1994 (4) S.C.C.595). In a recent case, Land Acquisition Officer v. Jasti Rohini (1995 (1) S.C.C.717), the Supreme Court has observed that valuation register on the basis of the notification under Section 47-A of the Stamp Act is for collection of Revenue and it cannot be the basis for determination of the market value of the land. In this case also, the Supreme Court has observed that the price which the willing seller expects from the willing purchaser is the market price. This Court also in Collector, Nilgiris v. M/s.Mahavir Plantations Pte.Ltd.&....
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....ernment for determination of the market value on the basis of basic valuation register were held illegal. The Collector, therefore, was obviously wrong in determining the compensation under Section 23 (1) on the basis of prevailing rates in 1992 as per basic valuation circulars." (v) In 2004 SUPREME COURT CASES (CRI) 377 (R.SAI BHARATHI v. J. JAYALALITHA AND OTHERS), the Apex Court, in paragraphs 22 and 24, held as follows : "22. The guideline value has relevance only in the context of Section 47-A of the Indian Stamp Act (as amended by T.N.Act 24 of 1967) which provides for dealing with instruments of conveyance which are undervalued. The guideline value is a rate fixed by authorities under the Stamp Act for purposes of determining the true market value of the property disclosed in an instrument requiring payment of stamp duty. Thus the guideline value fixed is not final but only a prima facie rate prevailing in an area. It is open to the registering authority as well as the person seeking registration to prove the actual market value of property. The authorities cannot regard the guideline valuation as the last word on the sub....
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....ties, on the basis of the notification issued by the Government under Section 47-A of the Indian Stamp Act. The same is meant to be a guide for collection of revenue and the stamp duty. It is mainly for collection of stamp duty for registration of an instrument. The Notification under Section 47-A, which is meant to be a guide for collection of revenue, cannot form basis for determination of the market value. The Government fixes the value, as indicated above, only for the purpose of stamp duty i.e., for the purpose of its revenue. The value is fixed for the locality and not for a particular survey number. The market value for a particular survey number is the result of a bargain between the parties. On the other hand, as pointed out by the Supreme Court, the market value is the value, as described in the sale deed. 14. The methods of valuation for ascertaining the market value, as suggested in the above decisions, are as follows : (1) Opinion of experts (2) The price paid within a reasonable time in bona fide transactions of purchase of the lands acquired or the lands adjacent to the lands acquired and possessing similar advantages. Evidence ....