If Development Agreement Not Duly Stamped, RERA Should Refer It To Registrar Of Stamps; Not Dismiss Application For Registration: MP High Court

The Madhya Pradesh High Court at Indore on Monday set aside an order passed by Real Estate Regulatory Authority (RERA) which dismissed an application under Section 4 of Real Estate (Regulation and Development) Act, 2016 for registration of a project for not being properly stamped

File photo
File photo

The single judge bench of Justice Vivek Rusia observed that if the RERA had come to the conclusion that the agreement in question is not duly stamped, it was incumbent upon it to refer the document to the Registrar of Stamps for impounding instead of dismissing the application for registration.

The observation was made in a petition filed by Accrual Realities, a real estate company which entered into a development agreement with the land owners for joint venture agreement named “24 Carat Extn.”

After completing all the requisite formalities, Accrual Realities had filed an application under Section 4 of Real Estate (Regulation and Development) Act, 2016 for registration of the project. RERA rejected the same vide order dated April 19, 2022 on the ground that the agreement dated February 11, 2021 was not properly stamped. According to the RERA, under Article 6(1)(d) of the Indian Stamps Act, stamp duty of Rs.22,40,333/- was liable to be paid but Accrual Realities paid the stamp duty of Rs.12,45,630 only.

Aggrieved by the impugned order passed by the RERA, the petitioners filed the petition before the High Court. The State of Madhya Pradesh and the Inspector General, Department of Stamps and Registration in their respective replies submitted that if any authority finds that the instrument produced before him is not properly stamped, then such authority can impound the same under the Indian Stamps Act.

The court set aside the impugned order dated April 19, 2022 and remitted back the matter to RERA to decide the application afresh.

“The issue of payment of stamp duty be decided after giving opportunity of hearing to the petitioners. If respondent No.3 finds that any report is required from the Registrar/Sub Registrar of Stamps, then the same shall be obtained. If any deficiency of stamp duty is found, the petitioner should be given an opportunity to deposit the deficit stamp duty. Let the entire exercise be completed within 45 days from today,” the court said.